Volunteers from Foodlink distribute baby formula to Rochester families affected by the shortage.
The New York State Attorney General Letitia James announced that over $13,500 in baby formula will be delivered to families in Rochester through Foodlink, following a settlement with Paragon USA & Co. The company raised prices illegally during last year’s shortage. This initiative aims to support families who struggled during the crisis and reflects New York’s strict laws against price gouging during emergencies.
Rochester – The New York State Attorney General Letitia James announced that over $13,500 worth of baby formula will be shipped to families in Rochester through a partnership with Foodlink, a community-based organization. This initiative comes as part of a legal settlement with Paragon USA & Co., which was found to have illegally increased baby formula prices during the national shortage that occurred in 2022.
During the shortage, which was exacerbated by Abbott Laboratories’ closure of a manufacturing plant responsible for producing one-fifth of the nation’s baby formula, Paragon raised its formula prices by more than 20%. These actions constituted price gouging, taking advantage of vulnerable families during a critical time. Following an investigation, Paragon has agreed to pay a $10,000 penalty to the state as part of the settlement.
In addition to the monetary penalty, Paragon is required to donate a total of $35,000 worth of baby formula or cash to assist families by June 10, 2025. This specific shipment to Rochester is part of the broader efforts made by the Attorney General’s office to ensure that impacted families receive essential supplies amidst the ongoing challenges caused by price hikes in the baby formula market.
The Attorney General emphasized the importance of taking action against businesses that exploit families, especially during emergencies. Price gouging violates New York’s laws, which are designed to protect essential goods from unconscionable price increases in times of crisis. This initiative is not isolated to Rochester; it follows similar efforts in Westchester and Brooklyn, where the Attorney General’s office has secured baby formula donations for families in need.
Market analysts note that the closure of Abbott Laboratories’ plant in early 2022 led to significant shortages and consequently steep price increases for baby formula. In May 2022, as prices soared, the Attorney General warned over 30 retailers against engaging in price gouging. Paragon, as a key supplier of baby formula to various retailers in New York, generated substantial profits as a result of its price increases during this difficult period for families seeking essential infant nutrition.
The distribution of the baby formula shipment to Rochester families is expected to provide much-needed relief for those who faced hardships during the national shortage. Many families reported struggles to find affordable baby formula, with numerous stores experiencing empty shelves or inflated prices. This initiative reflects an ongoing commitment to supporting communities and ensuring access to vital resources.
New York State has strict laws against price gouging, particularly for essential goods during emergencies. These laws are meant to discourage opportunistic behavior among businesses that might seek to exploit consumers facing urgent needs. The enforcement of these laws, as demonstrated through the settlement with Paragon, aims to foster fair pricing and protect vulnerable families from financial exploitation.
This recent action taken by the Attorney General’s office underscores a continuous effort to hold businesses accountable and ensure that families in New York are supported during times of crisis. As Rochester prepares to receive this shipment of baby formula, the importance of fair trading practices and accessible essential goods remains clear for the state and its residents.
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