Jerry Kopel

Is price gouging prohibited in Colorado?

The subject comes up when motorists fill their gas tanks. Colorado is one of 30 states without a price gouging law.  

If the hike and drop in gas prices isn't gouging, it still may be a violation of Colorado's Consumer Protection Act (also known as the Deceptive Trade Practice Act.) U.S. Rep. Dianna DeGette and I both believe that law protects Colorado individuals and businesses alike against an artificial increase in gas prices. Here are my thoughts on why the Colorado Consumer Protection Act may be the solution.  

It doesn't define "consumer", but it does define "person". The definition of "person"includes not only individuals but every type of possible business including any "legal or commercial entity."   Among the many violations persons are protected against is CRS 6-1-105 (1) (l):  

"A person engages in a deceptive trade practice when, in the course of such person's business, vocation, or occupation, such person ....makes false or misleading statements of fact concerning the price of goods, services, or property..." (There is a second part not involved in our issue.)    

Just as Enron artificially hiked prices of electricity for users in California, gas wholesalers or corporations producing gas may or may not have artificially raised prices. You don't know the answer without a grand jury investigation.   Look at the damages section CRS 6-1-113:  

"The provisions of this articles shall be available in a civil action for any claim against any person who  has engaged in OR CAUSED ANOTHER TO ENGAGE IN any deceptive trade practice listed in this article. An action under this section shall be available to any PERSON who...."  

There are several ways to be eligible to be a plaintiff. One is if you are "an actual or potential consumer." Another is if the event occurs "in the course of the person's business or occupation..."   If an undefined "consumer" can file a lawsuit, so can the attorney general or district attorney under 6-1-107 to 6-1-111. And any business has standing to file a lawsuit as a "person" in a state court but not use the attorney general or district  attorney for enforcement action.  

At the least, on behalf of non-business individual transactions, law enforcement should be able to proceed now. And a new statute dealing with protecting Colorado consumers and businesses from price gouging would be a worthwhile addition to Colorado's laws.  

Since the Consumer Protection Act covers '' persons" and has been tested in the courts, I believe a complete definition of price gouging, whether gas or any other substance would  suffice as an addition to the Consumer Protection Act.  

(Jerry Kopel served 22 years in the Colorado House)