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| New York Accuses Egg Producer of Price Gouging in Pandemic | New York Accuses Egg Producer of Price Gouging in Pandemic |
| (32 minutes later) | |
| One of the nation’s largest egg producers has been accused by New York authorities of raking in $4 million in illegal revenue by gouging customers with exorbitantly high prices when the state was grappling with rising coronavirus cases. | One of the nation’s largest egg producers has been accused by New York authorities of raking in $4 million in illegal revenue by gouging customers with exorbitantly high prices when the state was grappling with rising coronavirus cases. |
| A lawsuit filed on Tuesday by Attorney General Letitia James of New York contends that the producer, Hillandale Farms, at times quadrupled the price of eggs to cash in on a surge in demand in March and April. | A lawsuit filed on Tuesday by Attorney General Letitia James of New York contends that the producer, Hillandale Farms, at times quadrupled the price of eggs to cash in on a surge in demand in March and April. |
| In particular, Hillandale targeted distributors in New York City, as well as the military installations at West Point, Fort Hamilton and Fort Drum, according to the lawsuit. | In particular, Hillandale targeted distributors in New York City, as well as the military installations at West Point, Fort Hamilton and Fort Drum, according to the lawsuit. |
| The company was not raising prices to offset increased costs, the suit says, but “simply to line its own pockets and profit off New Yorkers during a time of crisis.” | The company was not raising prices to offset increased costs, the suit says, but “simply to line its own pockets and profit off New Yorkers during a time of crisis.” |
| Officials at Hillandale were not immediately available to comment. They told the attorney general’s office that the company’s customers, which include supermarket chains, had agreed to its pricing practices. | Officials at Hillandale were not immediately available to comment. They told the attorney general’s office that the company’s customers, which include supermarket chains, had agreed to its pricing practices. |
| According to the lawsuit, the attorney general’s office received hundreds of complaints from consumers angered by the sudden price increases. | According to the lawsuit, the attorney general’s office received hundreds of complaints from consumers angered by the sudden price increases. |
| “This location serves low-income families who, due to the current pandemic emergency, have most likely lost what little income they have,” wrote one complainant. “Disgraceful!” | “This location serves low-income families who, due to the current pandemic emergency, have most likely lost what little income they have,” wrote one complainant. “Disgraceful!” |
| The lawsuit is one of several accusing major egg producers of illegally taking advantage of heightened demand at a time when restaurants were shuttered and many Americans were forced to rely more heavily on home cooking. | The lawsuit is one of several accusing major egg producers of illegally taking advantage of heightened demand at a time when restaurants were shuttered and many Americans were forced to rely more heavily on home cooking. |
| In April, Texas’ attorney general accused the nation’s largest egg producer, Cal-Maine Foods, of hiking egg prices by 300 percent. Another price-gouging lawsuit, in California, named several major supermarket chains including Whole Foods and Costco. | In April, Texas’ attorney general accused the nation’s largest egg producer, Cal-Maine Foods, of hiking egg prices by 300 percent. Another price-gouging lawsuit, in California, named several major supermarket chains including Whole Foods and Costco. |
| The New York suit names Hillandale Farms Corporation, which is headquartered in Kent, Ohio, as well as five other companies that use the Hillandale name. | The New York suit names Hillandale Farms Corporation, which is headquartered in Kent, Ohio, as well as five other companies that use the Hillandale name. |
| Hillandale is often ranked among the top five egg producers in the United States. It sells to several supermarket chains with stores in New York, including Stop & Shop, Western Beef, BJ’s Wholesale Club and Associated Supermarkets. | Hillandale is often ranked among the top five egg producers in the United States. It sells to several supermarket chains with stores in New York, including Stop & Shop, Western Beef, BJ’s Wholesale Club and Associated Supermarkets. |
| Between January and early March, Hillandale sold eggs to Western Beef at prices ranging from 59 cents to $1.10 a dozen. Then on March 15, two days after President Trump declared a national emergency in response to the coronavirus, the lawsuit says Hillandale increased its price to $1.49. | Between January and early March, Hillandale sold eggs to Western Beef at prices ranging from 59 cents to $1.10 a dozen. Then on March 15, two days after President Trump declared a national emergency in response to the coronavirus, the lawsuit says Hillandale increased its price to $1.49. |
| The company continued to raise its wholesale prices as the pandemic grew in ferocity, to a peak of $2.93 a dozen by the end of March. The prices charged to Western Beef didn’t return to normal levels until early May, according to the lawsuit. | The company continued to raise its wholesale prices as the pandemic grew in ferocity, to a peak of $2.93 a dozen by the end of March. The prices charged to Western Beef didn’t return to normal levels until early May, according to the lawsuit. |
| Other stores saw similar increases. At Stop & Shop, the price Hillandale charged jumped from as low as 85 cents a dozen in January to $3.15 by early April. | |
| The lawsuit contends that Hillandale raised prices using a “feedback loop” system in which it coordinated with a market research company, Urner Barry, to justify the price gouging. | The lawsuit contends that Hillandale raised prices using a “feedback loop” system in which it coordinated with a market research company, Urner Barry, to justify the price gouging. |
| The authorities say the feedback loop worked like this: Hillandale and other egg producers told Urner Barry their assessment of egg prices; Urner Barry used these assessments to create “indexed” prices that it sent to the producers; finally, the egg producers sold eggs at the price set by Urner Barry, citing the index as their method for setting a “fair” price. | The authorities say the feedback loop worked like this: Hillandale and other egg producers told Urner Barry their assessment of egg prices; Urner Barry used these assessments to create “indexed” prices that it sent to the producers; finally, the egg producers sold eggs at the price set by Urner Barry, citing the index as their method for setting a “fair” price. |
| Urner Barry has denied wrongdoing, saying that the increase in prices simply reflected the rise in demand. | Urner Barry has denied wrongdoing, saying that the increase in prices simply reflected the rise in demand. |
| During the period covered by the lawsuit, Hillandale took in about $8 million in revenue in New York, about $4 million of it from price gouging, according to the lawsuit. | During the period covered by the lawsuit, Hillandale took in about $8 million in revenue in New York, about $4 million of it from price gouging, according to the lawsuit. |
| While the price differences may seem nominal, they could have a significant effect on customers on tight budgets. For a family using a dozen eggs a week, the monthly cost could have risen to $13 from about $5.40. | While the price differences may seem nominal, they could have a significant effect on customers on tight budgets. For a family using a dozen eggs a week, the monthly cost could have risen to $13 from about $5.40. |
| One complainant, who shopped at a Fine Fare store in the Lower East Side of Manhattan, told the New York attorney general that the prices were “sad and disrespectful.” | One complainant, who shopped at a Fine Fare store in the Lower East Side of Manhattan, told the New York attorney general that the prices were “sad and disrespectful.” |
| “I’ve been living in the community for 65 years,” the person wrote. “The prices are ridiculous.” | “I’ve been living in the community for 65 years,” the person wrote. “The prices are ridiculous.” |