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Healthcare Organizations and Local Governments Should Seek Reimbursement from PPE Scammers

In the wake of the novel Coronavirus outbreak (COVID-19), hospitals and various other healthcare organizations right down to states and municipalities are scrambling to maintain sufficient inventory of Personal Protective Equipment (PPE) for their professionals, first responders, and patients alike. They are in dire need of PPE including but not limited to masks, gloves, isolation gowns, lab coats, face shields, shoe covers, surgical gowns, and coveralls. Professionals in the hardest hit areas are being told to reuse equipment, increasing the risk of cross-contamination between patients, each other, and the public.  Unfortunately, unscrupulous pandemic profiteers are exploiting the health emergency and attempting to profit through various scams such as price-gouging, fake offers, counterfeiting, and other unfair and deceptive trade practices.  Your organization may have a legal claim for economic damages.

Since the inception of COVID-19, state attorneys general throughout the country have been flooded with complaints of price gouging and profiteering on PPE, and have been responding to protect consumers from this predatory behavior.  For example, on March 20, 2020, Massachusetts Attorney General Maura Healy filed an amendment to the Massachusetts price gouging law in order to provide broad and sweeping protections for businesses or other entities seeking to purchase any goods or services, like PPE, that are necessary for the health, safety, or welfare of the public. 

Despite the on-going efforts, such complaints do not necessarily lead to reimbursement of economic damages, in part, because state law may not allow for private lawsuits against the profiteer.  Florida’s price gouging law, for example, does not allow for private lawsuits to enforce the law.  Contrast that with California Penal Code which broadly allows for private lawsuits if the cost of goods was raised more than 10% during a declared emergency.  Further, California’s law expressly covers medical supplies like PPE and even prescription and non-prescription drugs.  Depending on your state, price gouging laws may work to allow your business to enforce the law in a private lawsuit in order to recover your money.  Notwithstanding the foregoing, even if your state’s price gouging law does not allow a private lawsuit, there may be additional laws or regulations available that could help your organization to recover vital funding during this critical time. 

More important, healthcare organizations such as hospitals and surgical centers as well as states and municipalities must be cautioned when purchasing PPE.  If your organization purchased PPE at a grossly marked-up price or suspect counterfeit PPE, you should carefully investigate the products and the underlying purchase agreements/orders, and consult with industry experts to procure reimbursement for monies paid to the pandemic profiteers. 

How Frier Levitt Can Help

If you and/or your organization purchased PPE at a grossly marked-up price but are hesitant to retain legal counsel due to the uncertainty of the COVID-19 crisis, contact Frier Levitt today to learn the different ways in which we may be able to protect your rights.  We may be willing to review your contracts and present viable options at no cost.  For more information on alternative fee arrangements, contact Frier Levitt to speak with an attorney.