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Ohio AG Settles N95 Mask Price-Gouging Lawsuit (Update)

Update, April 23, 2020: Ohio’s Mario Salwan has reached an “amicable agreement” with the Ohio Attorney General’s Office to resolve a matter that began as a price-gouging lawsuit. Law&Crime obtained a statement from Salwan and copy of the judgment, which notably includes no admission of liability.

The full statement from Salwan, which included an apology:

Yesterday, I reached an amicable agreement with the Ohio Attorney General’s office resolving the Ohio
Attorney General’s complaint, which incorrectly alleged that I amassed a large quantity of N-95 masks at
the start of the coronavirus pandemic to sell them online at an excessive price.

I continue to maintain that there was no factual or legal basis for this complaint. However, I wanted to
do the right thing right away, to put an end to this matter and to get masks into the hands of health care
workers. So I have chosen to take the following actions:

• Issue a full refund to everyone who bought the subject N-95 masks. Everyone receiving refunds
may keep the masks I sent them.
• Transfer 570 of the remaining N-95 masks I originally purchased for my construction business to
the state for distribution to Ohio health care workers.
• Remit a one-time $1,500 payment to the state for its investigation.
• Retain only 80 N-95 masks for my worker’s safety for use on job sites.

Yesterday’s agreement, as approved by the Attorney General’s office, expressly states that there is no
admission of liability. My company uses N-95 masks as basic personal protection for workers when
working with construction dust from concrete sanding. The masks are used on nearly all jobs. My
company originally purchased 2,800 N-95 masks in March 2019, well before the discovery of the
coronavirus and used most of those masks on job sites over the past year.

Once business slowed due to the coronavirus, I tried to get the masks I had purchased over a year ago
into the hands of people who wanted them at a price that the market determined – and nothing more. I
offered N-95 masks for sale to willing buyers to help keep my business afloat. I am sorry I did this. My
intent was not to hurt anyone.

I applaud Governor DeWine and Dr. Amy Acton for their work to stop the spread of coronavirus and I am glad to help the Governor and Dr. Acton’s efforts in my contribution of the masks through the resolution of this matter.

And above all, I salute healthcare workers on the front lines who risk their lives to help patients suffering from COVID-19.

A copy of the judgment:

Mario Salwan settlement by Law&Crime on Scribd

The Republican Attorney General of Ohio filed a price gouging lawsuit on Monday against defendants he referred to as “another name for [a] donkey” or a jackass, perhaps to their chagrin. AG Dave Yost alleged in the lawsuit that Chagrin Falls resident Mario F. Salwan and John Does 1-100 sought to take advantage of the coronavirus pandemic by up-charging for N95 masks on eBay under the username “Donkey476.”

According to the complaint, the defendants “acquired in excess of one thousand two hundred (1,200) N95 Masks” as the public began to panic, “exacerbat[ing] the growing shortage of N95 Masks available in the marketplace for purchase by Ohio citizens with health concerns, and by Ohio health care workers.”

The State of Ohio alleges that the accused increased prices on N95 masks by “an average of 1,700%.”

Beginning on March 28, 2020, Defendants made sales on the e-Bay platform to fifteen (15) different purchasers of packages of ten (10) N95 Masks each at prices ranging from $360.00 to $375.00, for an average price of $363.43 per package, or $36.34 per mask. The highest price charged by Defendants was $375.00 for a package of ten (10) masks, or $37.50 per mask. Defendants charged this peak price to two (2) purchasers, one of whom is a resident of Cleveland, Ohio, who made the purchase on March 31, 2020.

Prior to the declaration of a State of Emergency in Ohio related to the COVID-19 pandemic, the retail market price of N95 Masks was typically $1.75 to $2.35 per mask, for an average retail price of $2.05 per mask. Defendants increased the prices of the hoarded N95 Masks over pre-emergency retail market prices by an average of 1,700%.

The tweet below contains an image of the 3M masks and the price.

Yost said in a Tuesday press release accompanying the lawsuit that another word for donkey came to mind.

“There’s another word for donkey that immediately comes to mind when thinking about these folks,” he said. “We will continue to take action against anyone else in this state price gouging during this pandemic.”

The lawsuit alleges that Salwan et al. committed “an unreasonable and unlawful restraint of trade in violation of the Valentine Act”; engaged in unfair and deceptive acts and practices; committed unconscionable acts and practices; became a public nuisance; and illegally profiteered.

The state seeks a judgment that the defendants violated the law in numerous ways, a temporary restraining order, a permanent injunction requiring the accused to “forfeit all N95 Masks currently in their possession to the State for distribution to healthcare workers and/or first responders in the State of Ohio in exchange for just compensation at a
fair market rate to be determined by this Court,” and to make the defendants forfeit unlawful profits.

But wait—there’s more. The state is asking that the court to “assess […] a civil penalty in the amount of Twenty-Five Thousand Dollars ($25,000.00) for each separate and appropriate violation described herein pursuant to R.C. 1345.07(D).”

Law&Crime obtained a statement from Mario Salwan through his legal counsel. Salwan said his construction business bought more than 2,000 N-95 masks more than a year ago and never intended to sell them, but did sell masks to keep his business afloat when it fell on hard times during the pandemic.

He said that he never intended to hurt anyone, that he is sorry, and that he wants to make this right by donating the remaining masks to Ohio healthcare facilities in need.

The full statement:

On Monday, the Ohio Attorney General filed a complaint against me alleging that at the onset of the coronavirus pandemic, I amassed a large quantity of N-95 masks and then tried to sell them online at an exorbitant price. Contrary to the allegations of the complaint, I did not purchase a single N-95 mask at all during this pandemic, and I want to set the record straight.

I own a construction business and my employees use N-95 masks as basic personal protection when working with construction dust from concrete sanding. The masks are used on nearly all jobs. In March of 2019, well before the discovery of the coronavirus, my company purchased 2,800 N-95 masks, at a bulk purchase discount, for use on construction sites and used most of them for that purpose over the past year.

When the coronavirus “stay at home” orders were put in place, my construction business suffered, as did many small businesses in the United States. I realized my business would not need the same quantity of masks as before the pandemic, so to help keep the business afloat and generate an income, I offered one box of 10 N-95 masks for auction on eBay to determine the current market pricing. The box sold for $370.50 and I then offered more of the masks for sale, pre-packaged in their original boxes of 10 masks per box, for up to $375 per box over the following few days.

I did not buy the masks with the intention of selling them at all. No one had heard of the coronavirus when I bought them over a year ago. Once business slowed due to the coronavirus, I tried to get the masks I had purchased over a year ago into the hands of people who wanted them at a price that the market determined – and nothing more. My purchase of masks over a year ago did not contribute to the shortage of masks during this pandemic or limit the supply to health professionals, and my intent was not to hurt anyone.

I want to make this right and the best way I can think to do that is, subject to the Ohio Attorney General’s approval, donating the hundreds of masks I have remaining to our local healthcare facilities in northeast Ohio. Their employees are risking their lives every day to care for those suffering from COVID-19 and should have access to more personal protective equipment. In addition, for the past seven years my business has supported The Race benefitting University Hospitals and I plan to continue to donate money to organizations that support our local hospital systems, which are the best in the world.

I’m sorry I did this. This whole matter has caused my employees and family to fear for their safety. I will do better. I know my actions angered many, but I humbly ask the people I upset to please refrain from threatening my employees and family. I hope that we all can live peacefully together moving forward through these unprecedented times.

Editor’s note: a statement from Mario Salwan was added on April 15.

[Image via Al Bello/Getty Images]

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Matt Naham is managing editor of Law&Crime. He formerly worked as news editor and weekend editor at Rare.