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Legal concerns for businesses following a natural disaster

Certain things could lead to a business considering deviating significantly from its standard operations and practices. One is a natural disaster striking in the area the business operates in, like the recent flooding here in Louisiana. The reason for this is that such disasters can create challenges and circumstances for a business that may make doing things the way they normally would impracticable or impossible.

When considering how to act in response to the effects of flooding or some other natural disaster striking in their area, it can be important for Louisiana businesses to not ignore legal issues.

Many legal issues could potentially arise for a business in relation to actions it took in the wake of a natural disaster. For one, such actions could sometimes lead to disputes with a customer or another business over whether any contracts were breached by the action. So, when deciding what steps to take following a disaster, one of the things that a business may want to keep in mind is the impacts the actions it is considering could have in regards to the contracts it has formed.

Another legal issue that disasters can raise is that disasters can trigger some special rules regarding business practices. It is important for companies to make sure they don’t inadvertently violate these rules in their disaster-related actions.

Here in Louisiana, one of these special rules is the price gouging law. Under this law, when a disaster leads to a state of emergency being declared, businesses are generally prohibited from charging, in the emergency area, prices for goods/services that exceed the ordinary pricing. There are some exceptions to this prohibition on price-raising. A business could face various penalties if it is found to have violated the price gouging law.

So, when a Louisiana business is thinking about making any pricing changes in the wake of a disaster, it can be important for it to be aware of the price gouging law and what kinds of conduct would be violations of it.

Experienced business attorneys can advise businesses on special legal issues that have arisen for them in connection to a disaster or other major disruptive event that occurred in their operating area.

Source: KATC, “Price Gouging is illegal,” Aug. 29, 2016

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