Houston auctioneer sued for alleged price gouging of 750,000 face masks

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A Texas-based auctioneer is being sued by the state for alleged price gouging in the sale of 750,000 high-quality face masks and other desperately-needed supplies amid a nationwide shortage in hospitals across the country as medical professionals continue to battle the coronavirus.

A lawsuit filed Thursday by the Texas Attorney General's Office said Auctions Unlimited in Houston had bids on N95 face masks going for up to $80 for a pack of 16. Amazon sold a set of 100 for $4.21 in January.

"Auctions Unlimited owner Tim Worstell admitted to receiving warnings from both local police and the Texas Attorney General; however, he moved forward with the exorbitantly priced auctions," Texas Attorney General Ken Paxton said in a statement.

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The lawsuit said Worstell was taking advantage of the pandemic by offering necessities such as hand sanitizer, face masks and cleaning supplies at "exorbitant prices" after Gov. Greg Abbott declared a state of disaster earlier this month.

The auction listed the items as necessary to combat the spread of the virus, the lawsuit said. The sale was halted before the masks could be sold.

The event brought in $154,000 and netted Worstell $40,000 personally, according to the lawsuit. He denies any wrongdoing.

“It is literally impossible to price gouge using the auction method when ALL bids start at $1,” he said in a statement to The Associated Press. “The bidders, not Auctions Unlimited, decide the price. We did not, or attempt (to), collect a single penny from the auction as alleged. In fact we stated in the auction that no sales would be final until approved by the attorney general's office."

Reports of price gouging have surged in the weeks since the coronavirus began spreading across the U.S. President Trump signed an executive order last week making similar schemes and the hoarding of much-needed supplies a crime.

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Paxton is seeking an injunction against the auctions and civil penalties of up to $10,000 per violation. Worstell said the halting of the auction has left him with no choice but to keep the unsold masks in a warehouse.

“Even though the price would go up every week that went by, we need to get rid of them, so that people that need them get them,” he said.

The Associated Press contributed to this report.