New York Attorney General Letitia James has once again held Paragon USA & Co., LLC accountable for price gouging, requiring the company to provide over $13,500 worth of baby formula to families in Rochester. The settlement follows an investigation by the OAG into the company during the 2022 national baby formula shortage, and includes a $10,000 penalty along with an additional $35,000 in baby formula or its equivalent in cash. The Office of the Attorney General was quoted saying on their website, "Paragon took advantage of New York families, illegally raising the price on formula to squeeze extra profits."
Community organization Foodlink, operating in the Greater Rochester and Finger Lakes regions, has been tasked to quickly start distributing the much-needed baby formula. Julia Tedesco, President & CEO of Foodlink, expressed her thanks to Attorney General James: "Our partners have highlighted a growing need for baby products and other essential items, especially as grocery prices remain historically high. This generous contribution will greatly benefit our members and their clients who are in urgent need of formula," in a statement obtained by the Office of the Attorney General.
The nationwide shortage was significantly worsened when Abbott Laboratories, responsible for over 40% of the country's baby formula, closed one of its major manufacturing plants and issued a recall. Attorney General James took action back in May 2022 after reports of price gouging surfaced, warning numerous retailers across New York State against continuing such practices. As per the settlement terms announced today, Paragon has been made to forthrightly address these issues, donating substantial amounts of formula or paying penalties.
This recent donation is part of a broader effort by Attorney General James to clamp down on companies exploiting emergencies for profit. As per statement obtained by the Attorney General's Office, Senator Jeremy Cooney lauded the timely intervention: "When businesses illegally jack up prices for goods like baby formula, they must be held accountable. I applaud Attorney General James for once again protecting consumers and ensuring Rochester families get the relief they deserve."
In total, settlements negotiated by Attorney General James have led to donations of over $21,400 worth of baby formula to date. Her office continues to encourage New Yorkers to report any suspected price gouging by filing a complaint online or by calling their hotline. The latest settlement with Paragon ensures that by June 10, the agreed upon $45,000 in penalties will have been met, offering some relief to consumers during difficult economic times.
The successful investigation and ongoing action against corporate greed highlight the OAG's commitment to consumer protection, with Assistant Attorney General Benjamin C. Fishman and others playing key roles in handling this particular matter.
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