SACRAMENTO – On June 18, 2020, the California Department of Justice announced misdemeanor price gouging charges against Katrin Golian, doing business as RxAll Pharmacy, an independently-owned business located in Los Angeles.
"The California Department of Justice received information of possible price gouging during a state of emergency, which special agents investigated and found to be true," said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. "Special agents work to protect Californians from harm, be it physical or financial."
On March 4, 2020, Governor Gavin Newsom declared a state of emergency in response to the COVID-19 pandemic, which triggered price gouging prohibitions statewide. On April 4, the Governor issued Executive Order N-44-20, which prohibits businesses that did not sell certain emergency-related items prior to the emergency declaration from charging a price for the items that is greater than 50 percent more than the seller's cost of purchase.
The California Department of Justice complaint alleges that Golian, a licensed pharmacist, knowingly sold KN95 masks at prices exceeding the 50 percent mark-up permitted under the executive order. This is the first time that charges have been filed under Governor Newsom's executive order on price gouging.
"The rules against price gouging are simple and direct. Katrin Golian knew the rules and willingly chose to sell masks at elevated prices that violate our state's price gouging prohibition. Now she faces prosecution," said Attorney General Becerra. "The Department of Justice relies on all Californians to be vigilant in detecting price gouging. If you see something suspicious, or if you are a victim of price gouging, file a complaint with our office at oag.ca.gov/report. The more you report, the more we can stop this abuse."
Following a consumer complaint against RxAll Pharmacy, an investigation conducted by the California Department of Justice revealed that Golian had been purchasing individual masks for $5 each and selling them at $10 each – 100 percent more than her cost for the masks – despite the Governor's executive order. After being warned by special agents that the price of the masks violated the Governor's executive order, Golian acknowledged the warning and agreed to reduce the price on masks. Several days later, California Department of Justice special agents returned to RxAll Pharmacy and found that Golian was still selling masks at the same price she had previously been told violated the order. Golian sold undercover agents two masks at the unlawful price of $10 each.
Under California law it is unlawful to refuse or willfully neglect to obey any lawful order issued under the Emergency Services Act. Violation of this section is punishable as a misdemeanor, including imprisonment in county jail for not more than six months and/or a fine of not more than $1,000. This offense has a one-year statute of limitations.
A copy of the complaint is available here.