Metro IAF Calls on State Attorneys General to end Price Gouging of 3M Face Masks

MEMORANDUM - URGENT (UPDATED)

TO: State Attorneys General
FROM: Metro IAF and its affiliates
RE: Price gouging by 3M distributors on 3M’s N95 masks
DATE: April 1, 2020

Metro IAF, part of the Industrial Areas Foundation network of citizens’ organizations, seeks help from state attorneys general to end price gouging by 3M distributors on the company’s N95 masks.  The extortionate prices (more the 10 times normal prices) and payment terms (e.g. 100% prepayment) being demanded by some of these distributors during a public health emergency are endangering lives by impeding the ability of healthcare providers to get these masks to frontline workers.  Price gouging is also depleting the healthcare budgets of state and local governments and healthcare providers at a time when every resource is needed for the fight against the COVID-19 pandemic.

The Washington Post has documented this price gouging.  Metro IAF’s partner organizations have seen it first hand -- with some distributors offering masks for more than $10 each that major hospitals purchased for 58 cents before this crisis began.

Metro IAF and many others have urged 3M CEO Mike Roman to take aggressive action to curb price gouging.  In a statement released March 31, 3M announced that it “will not tolerate” price gouging and is “committed to doing all that we can to combat” it.  The statement provides some helpful information, but does not address Metro IAF’s request for 3M to set standards of conduct across its distributor chain.  Metro IAF emailed a follow-up letter to Mr. Roman on March 31 clarifying the proactive steps needed by 3M to help healthcare buyers of 3M’s N95 masks ensure adequate supply during this crisis.

3M will only act responsibly if there is considerable public pressure -- including pressure from AGs.  Mr. Roman has thus far placed the burden of ending distributor profiteering primarily on law enforcement and buyers, asking the public to report price gouging to a company hotline.  This is no substitute for the proactive steps Metro IAF proposes.

Would you be willing to communicate with 3M leadership within the next 48 hours to urge 3M to take responsibility for its distributor network?  This communication could clarify whether your state has an anti-price-gouging law and whether that law has been activated by state or national emergency declarations.    

Would you be willing to help form an ad hoc consortium of AGs by the end of this week to develop a joint strategy to compel 3M to act?

Please contact us to discuss your leadership in this effort.