NEW YORK – New York Attorney General Letitia James secured the donation of $6,300 worth of baby formula to families in Brooklyn from baby formula supplier Paragon USA & Co. LLC (Paragon). The donation is the result of an investigation conducted by the Office of the Attorney General (OAG) into Paragon for price gouging during the national shortage of baby formula in 2022. As a result of a settlement with OAG, Paragon has paid a $10,000 penalty and must pay an additional $35,000 in donated baby formula or cash. The donation will be distributed to families in need across Brooklyn by the Women’s Empowerment Coalition of New York City and Mixteca, community organizations primarily serving Muslim and Latino communities in New York City.
“Taking advantage of a crisis to squeeze extra profits from families who are struggling to feed their children is not only heartless, it’s illegal,” said Attorney General James. “During a massive shortage of baby formula in 2022, suppliers like Paragon raised their prices while New York families scrambled to find affordable baby formula. My office took action, and we are delivering free formula to families in need. I will continue to go after any business that price gouges during an emergency.”
“Empowering survivors of domestic violence and supporting low-income families is not just an act of charity—it is a fundamental step toward building a just and compassionate society,” said Somia Elrowmeim, CEO and Founder of the Women’s Empowerment Coalition of New York City. “At the Women’s Empowerment Coalition of NYC, we stand with low-income families and survivors of domestic violence, ensuring they have access to essential resources such as food, clothing, and baby necessities. Every act of support helps rebuild lives, restore dignity, and create new opportunities. We extend our deepest gratitude to the New York State Office of the Attorney General for their generous donation of baby formula, a vital resource for many families struggling to afford it. Together, we bring hope, strength, and a future where no one is left behind.”
“We are grateful for this vital donation of baby formula at a time when many families are still feeling the pressures of inflation,” said Lorena Kourousias, Mixteca's Executive Director. “This donation will directly support immigrant families in Brooklyn who continue to face economic hardship and barriers to essential resources. We thank Attorney General Letitia James for standing up against price gouging practices that have real negative impacts on families. With this donation, we can help ensure that no child in our community goes without basic nourishment.”
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 can be paid in the form of donated formula or cash that must be delivered by June 10, 2025.
“In a moment when New York families are struggling to make ends meet, it's frankly infuriating that a company would take advantage of a crisis to rip off new parents,” said Senator Andrew Gounardes. “Let this be a message to all unscrupulous companies: New York won't let you get away with price gouging. It's a particularly fitting form of justice that the fine levied on Paragon is going to fund baby formula for families in Brooklyn. Thanks to Attorney General James and her team for their important work.”
“New York will always take a hard line against companies who seek to profit from disruptions in the marketplace,” said Senator Zellnor Myrie. “In 2022 I proudly authored a law to stiffen penalties for consumer frauds and price gouging in relation to market abnormalities. I’m grateful to our Attorney General for securing this settlement and to Mixteca and the Women's Empowerment Coalition for ensuring families in Brooklyn get the baby formula they need.”
“Every family deserves access to the essentials they need to care for their children, and no one should have to struggle because of corporate greed,” said Assemblymember Marcela Mitaynes. “I am grateful to Attorney General James for taking action against price gouging and for delivering much-needed baby formula to families in our community. Organizations like Mixteca and the Women’s Empowerment Coalition are doing critical work to support our neighbors, and I will continue to stand with them in the fight for economic justice and dignity for all.”
“Emergencies should never be exploited for corporate profit, especially at the expense of vulnerable families,” said New York City Councilmember Shahana Hanif. “I’m grateful for Attorney General James’ thorough investigation into Paragon’s illegal price gouging of baby formula during the COVID-19 pandemic, which has led to significant settlements and donations to support families in need, including those in my district. I’m hopeful this sends a strong message to other companies: New York will not tolerate corporations exploiting crises for their own benefit.”
Attorney General James is a leader in the fight to protect New York consumers and guard against price gouging. Attorney General James secured the donation of over $344,000 worth of baby formula to families in the Bronx in March 2025 and 3,300 cans of baby formula worth approximately $140,000 to families in Rochester in December 2024 as part of a $750,000 settlement with formula suppliers Marine Park and Formula Depot. In October 2024, Attorney General James led a multistate coalition urging Congressional leaders to support a national ban on price gouging. In March and April 2024, Attorney General James distributed over 9,500 cans of baby formula in Buffalo and New York City from a settlement with Walgreens for price gouging during the formula shortage. In May 2023, Attorney General James secured a $100,000 settlement with Quality King Distributors, Inc. due to unconscionable price increases for Lysol products during the early days of the COVID-19 pandemic. In April 2021, Attorney General James delivered 1.2 million eggs to food pantries throughout the state which were secured as part of an agreement with the nation’s largest egg producers for price gouging in the early months of the pandemic.
New Yorkers should report potential concerns about price gouging to the OAG by filing a complaint online or calling 800-771-7755.
This matter was handled by Assistant Attorney General Benjamin C. Fishman, under the supervision of Bureau Chief Jane M. Azia and Deputy Bureau Chief Laura J. Levine, all of the Consumer Frauds and Protection Bureau. Former Data Scientist Jasmine McAllister also assisted in this matter, under the supervision of Director of Research and Analytics Victoria Khan, Deputy Director Gautam Sisodia, and former Director Megan Thorsfeldt. The Consumer Frauds and Protection Bureau is a part of the Division for Economic Justice, which is led by Chief Deputy Attorney General Chris D’Angelo and is overseen by First Deputy Attorney General Jennifer Levy.