Subject: Re: Price Gouging
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked]
Date: Sun, 26 Nov 2000 11:30:00 -0800 (PST)

Great job.  I'll grab you and Susan Mon. AM to discuss this and her 
thoughts.  DF 

Kathy Ringblom
11/21/2000 04:55 PM
To: Drew Fossum/ET&S/Enron@ENRON
cc: Susan Scott/ET&S/Enron@ENRON 

Subject: Price Gouging

Drew, I will try to summarize the research I did today on the referenced 
subject.  The bottom line is that I did not find any California statutes that 
appeare to be applicable to what we're doing.  I looked at California's 
General Business Regulations, Unfair Trade Practices statute, the Public 
Utilities Code, an ALR annotation that discussed cases in which courts have 
reviewed acts or practices prohibited by state deceptive trade practice and 
consumer protection statutes, and I searched case law and statutes using 
terms such as gouging, unconscionable, pricing practices, etc.  The 
California Unfair Practices Act is "... not a price-fixing statute, but seeks 
to regulate conduct of those engaged in business in order to eliminate such 
unfair practices as price discrimination indulged in for purpose of injuring 
competitors or destroying competition.  It does not make every difference in 
price unlawful, but only those differences that cannot be justified after 
proper allowance has been made for differences in grade, quality, quantity or 
cost of transportation."   It appears that the statutes and cases that are 
anywhere close to what we're looking for deal with protection of the ultimate 
consumer and not sophisticated energy companies.  

I did find a price gouging statute in New York that states that its purpose 
is to prohibit conduct that could occur during periods of abnormal disruption 
of the market caused by strikes, power failures, severe shortages or other 
extraordinary adverse circumstances when parties have taken unfair advangage 
of consumers by charging grossly excessive prices for essential goods and 
services.  I reviewed two cases, People v. Two Wheel Corp. and State of New 
York v. Strong Oil Company, that deal with a company that sold portable 
electric generators at unconscionably excessive prices during a power failure 
caused by a hurricane and a company that sold home heating fuel at an 
unconscionably excessive price during a period of abnormal disruption of the 
market, respectively.  (The Strong Oil case discussed Federal pre-emption of 
state law due to the Federal Emergency Petroleum Allocation Act.)  I will put 
copies of these cases as well as some of the other documents mentioned above 
in your in-box in case you want to review them.  

I looked briefly at Texas law but didn't see anything.  I obviously didn't 
get every state covered.  If you want me to look further, please let me 
know.