Wisconsin’s Department of Agriculture, Trade and Consumer Protection says it is seeing a surge of price gouging complaints during the COVID-19 pandemic, and it has taken action against two local businesses suspected of unfairly raising prices.
Janesville industrial supplier Grainger and an Ace Hardware store in Delavan were among 16 businesses the state consumer protection agency says it mailed “cease-and-desist” letters as of March 24 over suspected price gouging, according to documents obtained by The Gazette.
Grainger’s online sales division received a cease-and-desist letter over complaints Grainger was unlawfully raising prices on surgical masks, according to state documents.
The Ace Hardware at 840 Geneva St., Delavan, was notified it was suspected of price gouging on Clorox bleach and toilet paper, according to the documents.
Other retailers are suspected of gouging on products including milk, rice, pinto beans, bottled water, hand cleaner and disinfectant spray, according to the documents.
A Grainger spokesman told The Gazette his company is reviewing the situation.
The owner of the Delavan hardware store said the business received no feedback from a state inspector and has gotten no cease-and-desist letter.
Ti Gauger, a DATCP spokeswoman, said that as of Tuesday morning the state had received about 212 complaints of price gouging. That’s up from about 120 complaints as of late last week.
Gauger said the 212 complaints came after a March 12 executive order from Gov. Tony Evers that declared a public health emergency in Wisconsin. The state is in an “ongoing process” of investigating price checks on complaints it has received, and some of those complaints have resulted in cease-and-desist letters, she said.
In an email Tuesday, Grainger spokesman Anthony Macrito told The Gazette the complaint appears to be linked to a type of surgical mask Grainger got from a source in India at a much higher cost than usual—in large part because of global shortages of personal protective equipment.
“The ‘piece price cost’ of those masks is significantly higher than our cost from other mask manufacturers that have run out of inventory,” Macrito wrote. “We are reviewing this item to make sure it was appropriately priced and will provide a comprehensive response” to the state.
Macrito wrote that Grainger “remains committed to being a good corporate citizen as it seeks to maintain cost and quality standards” during the COVID-19 crisis.
Delavan Ace Hardware owner Mark Tomchek said as of Tuesday afternoon he had not received a cease-and-desist notice related to price gouging, and he wasn’t sure which items his store sells might have sparked complaints.
Tomchek said an inspector from the state Bureau of Weights and Measures visited his store March 23 to check on price gouging complaints. He said the inspector gave no feedback during the inspection and at the time did not supply paperwork documenting it.
He indicated his store had been selling individual rolls of paper products earlier this month, but he said the store has discontinued that practice.
Tomchek said based on social media posts he has seen, one complaint might have focused on a bleach product his store sells. He said it is a concentrated product designed for industrial use and normally is marked at a higher sale price than standard laundry bleach.
In documents made available to The Gazette, the state did not give details of the complaints or copies of cease-and-desist letters sent to Grainger and Ace.
The Gazette has requested those documents in an open records request.
Gauger said the state’s law on price gouging is intended to protect consumers, particularly now, when they’re most vulnerable to intermittent product shortages linked to the pandemic.
She said cease-and-desist letters are part of a larger process for price-gouging complaints. Businesses and corporations suspected of price gouging have the right to understand and discuss with the state complaints lodged against them.
Some complaints, Gauger said, might be exempted if retailers can give reasonable evidence that higher pricing reflects an increase in cost to have products supplied to stores.