Latest Formula Donation from AG James’ Settlement with Baby Formula Supplier Paragon for Price Gouging During 2022 Shortage AG James Has Secured More Than $700,000 Worth of Baby Formula Donations from Price Gouging SettlementsNew York Attorney General Letitia James secured the donation of over $13,500 worth of baby formula from baby formula supplier Paragon USA & Co., LLC (Paragon) for Brooklyn families. The donation is the result of the Office of the Attorney General’s (OAG) investigation into Paragon for price gouging during the nationwide baby formula shortage in 2022. As part of a settlement with OAG, Paragon has paid a $10,000 penalty and delivered an additional $35,000 in free baby formula that OAG has distributed to New Yorkers in need. Today’s donation is the fourth and final delivery of baby formula from Paragon and will be distributed by Mixteca, a community organization primarily serving Latino communities in Brooklyn.
“Companies should never be able to raise prices and squeeze extra profits from struggling New Yorkers during a crisis,” said Attorney General James. “At a time when families were desperately searching for baby formula, Paragon raised its prices to unconscionable levels. As a result of my office’s investigation, we have secured another delivery of free baby formula to Brooklyn families in need. I will continue to go after any company for price gouging New Yorkers.”
“At Mixteca, we are deeply grateful for this generous donation of baby formula,” said Mixteca Executive Director Lorena Kourousias. “This support ensures that families in our community have access to essential nutrition for their little ones during a time of great need. Thank you, Attorney General James, for standing with our immigrant and Indigenous families and helping us care for the youngest members of our community with dignity and love.”
In 2022, Abbott Laboratories closed one of its baby formula manufacturing plants and recalled formula produced there, creating significant hardship for families throughout New York and the nation as formula supplies dwindled and prices rose. Abbott produces over 40 percent of the infant formula sold in the United States, and the plant it closed was responsible for approximately one fifth of total U.S. production.
New York’s price gouging laws prohibit vendors from unconscionably increasing prices on goods that are vital to consumers’ health, safety, or welfare during market disruptions such as the 2022 formula shortage. In May 2022, Attorney General James issued warnings to more than 30 retailers across the state to stop overcharging for baby formula after consumers reported unreasonably high prices.
The OAG’s investigation found that Paragon, which supplies formula to retailers in New York, generated tens of thousands of dollars in additional revenue by raising prices more than 20 percent after Abbott announced its recall. The price hikes affected thousands of units of canned or bottled formula sold primarily in New York City.
As a result of a settlement with OAG, Paragon must pay penalties and make formula donations with a combined value of $45,000. This includes a $10,000 penalty to the state that Paragon has already paid and an additional $35,000 that has been paid in the form of donated formula. Today’s donation is the fourth and final donation secured by Attorney General James as part of the settlement with Paragon. In February, Attorney General James secured the donation of over $1,500 worth of baby formula to families in Westchester, and in March, over $6,300 worth of baby formula to families in Brooklyn. Earlier in May, Attorney General James secured the donation of over $13,500 worth of formula in Rochester.
New York Attorney General Letitia James secured the donation of over $13,500 worth of baby formula from baby formula supplier Paragon USA & Co., LLC (Paragon) for Brooklyn families. The donation is the result of the Office of the Attorney General’s (OAG) investigation into Paragon for price gouging during the nationwide baby formula shortage in 2022. As part of a settlement with OAG, Paragon has paid a $10,000 penalty and delivered an additional $35,000 in free baby formula that OAG has distributed to New Yorkers in need. Today’s donation is the fourth and final delivery of baby formula from Paragon and will be distributed by Mixteca, a community organization primarily serving Latino communities in Brooklyn.
“Companies should never be able to raise prices and squeeze extra profits from struggling New Yorkers during a crisis,” said Attorney General James. “At a time when families were desperately searching for baby formula, Paragon raised its prices to unconscionable levels. As a result of my office’s investigation, we have secured another delivery of free baby formula to Brooklyn families in need. I will continue to go after any company for price gouging New Yorkers.”
“At Mixteca, we are deeply grateful for this generous donation of baby formula,” said Mixteca Executive Director Lorena Kourousias. “This support ensures that families in our community have access to essential nutrition for their little ones during a time of great need. Thank you, Attorney General James, for standing with our immigrant and Indigenous families and helping us care for the youngest members of our community with dignity and love.”
In 2022, Abbott Laboratories closed one of its baby formula manufacturing plants and recalled formula produced there, creating significant hardship for families throughout New York and the nation as formula supplies dwindled and prices rose. Abbott produces over 40 percent of the infant formula sold in the United States, and the plant it closed was responsible for approximately one fifth of total U.S. production.
New York’s price gouging laws prohibit vendors from unconscionably increasing prices on goods that are vital to consumers’ health, safety, or welfare during market disruptions such as the 2022 formula shortage. In May 2022, Attorney General James issued warnings to more than 30 retailers across the state to stop overcharging for baby formula after consumers reported unreasonably high prices.
The OAG’s investigation found that Paragon, which supplies formula to retailers in New York, generated tens of thousands of dollars in additional revenue by raising prices more than 20 percent after Abbott announced its recall. The price hikes affected thousands of units of canned or bottled formula sold primarily in New York City.
As a result of a settlement with OAG, Paragon must pay penalties and make formula donations with a combined value of $45,000. This includes a $10,000 penalty to the state that Paragon has already paid and an additional $35,000 that has been paid in the form of donated formula. Today’s donation is the fourth and final donation secured by Attorney General James as part of the settlement with Paragon. In February, Attorney General James secured the donation of over $1,500 worth of baby formula to families in Westchester, and in March, over $6,300 worth of baby formula to families in Brooklyn. Earlier in May, Attorney General James secured the donation of over $13,500 worth of formula in Rochester.
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