The Utah Division of Consumer Protection has dismissed a citation it brought forward last month against a Nevada-based company it alleged price gouged two Utah law enforcement agencies that bought personal protective equipment during the coronavirus outbreak.
SwabTek, which sells test kits to help law enforcement officers identify narcotics and explosives, said Friday that the complaint was dropped after the company provided additional information to division investigators and agreed to comply with state law.
“We are grateful for the opportunity to work with the division to provide the documentation and information it needed to understand that we acted in good faith to meet the needs of the purchasing agencies quickly and with a commitment to a fair price," Bob Betros, CEO of SwabTek, said in a news release. "We had no hesitation providing the division our assurance of voluntary compliance, and will make any needed changes to our operations to ensure we meet all the requirements of Utah law.”
A spokesman with the Utah Department of Commerce confirmed that the two parties had reached the agreement but declined to comment further.
The division cited SwabTek last month for five instances of price gouging after the company sold South Jordan City face masks for a cost more than $2,000 greater than allowed under the state’s price gouging statute and provided the Box Elder County Sheriff’s Office masks, disposable medical gowns and face masks for $2,200 extra.
The test kit provider had not sold masks, gloves or gowns in the time before the emergency, so the citation compared the cost of obtaining the products with the price at which they were sold and found that the prices were more than 30% higher than it paid to obtain the products, which violated the statute.
Betros, however, said at the time that the citation was a “technicality," since the company had returned any excess in charges to both customers in the form of store credits after taking an accounting of its actual costs to supply the personal protective equipment.
“If we were going to be gouging," he said in an interview with The Salt Lake Tribune, “we wouldn’t be gouging policemen.”
The Division of Consumer Protection has received hundreds of complaints in the past few weeks alleging higher-than-normal prices for everything from medical goods and grocery staples to gaming systems and bottled water.
The SwabTek citation was one of four the division has filed during the coronavirus emergency.
The first was against an Ogden resident who allegedly sold N95 masks at a price of $20 each and has refused to cooperate with investigators. The state has also filed citations against a hardware company in Riverton that they say charged excessive prices for toilet paper and against a car dealer in Draper who allegedly sold masks and mask filters at high prices. The latter charged Utah customers more than $23,000 more than would be allowed under state law for those goods, that citation alleges.
Those cases remain ongoing.
Utah’s price gouging law applies only in an emergency and only to goods or services that are deemed “necessary for consumption or use as a direct result of events giving rise to a state of emergency.” The statute doesn’t define what’s “necessary,” however, leaving that up to a judge to decide.
Each violation of the statute carries a maximum potential fine of up to $1,000.