On June 4, 2026, the New York legislature passed the One Fair Price Act, which, if signed into law by Governor Kathy Hochul, would prohibit businesses from using surveillance pricing: a growing practice in which companies use consumers’ personal data—such as their browsing history, inferred income or size of household, and location data—to algorithmically set targeted prices. The same day, Connecticut Governor Ned Lamont signed a bill into law prohibiting “retail seller[s] and third-party delivery service[s] doing business in the state” from “engag[ing] in surveillance pricing.”[1]
Maryland imposed a similar ban on April 28, 2026, prohibiting food retailers and third-party delivery service providers from “engaging in the practice of dynamic pricing or using consumer personal data to set a price for consumer goods or services . . . . regardless of whether the seller collected or purchased the personal data.”[2] California is not far behind with its own legislation; AB 2564 passed the California Assembly on May 27, 2026, and is currently pending in the state Senate. And several other states are considering similar legislation.[3]
All of these state law prohibitions come at the same time democratic lawmakers have called on the Federal Trade Commission to “pursue rulemaking and enforcement actions to address exploitative surveillance and dynamic pricing practices” to help “bring down food and farm input prices . . . .”[4] State attorneys general have also announced “investigative sweep[s]” into surveillance pricing and businesses using such technologies.[5]
These actions signal a potential next stage in algorithmic pricing scrutiny and enforcement. Up to now, algorithmic pricing cases and enforcement actions have generally focused on alleged algorithmic collusion,[6] but these new laws and calls for enforcement underscore that unilateral conduct can also be a basis for liability. For instance, Maryland’s law explicitly prohibits food retailers and third-party delivery service providers from using their own data to dynamically set higher prices.[7] New York similarly prohibits the use of an algorithm that sets prices in whole or in part based on “personal data”—broadly defined as “any data that identifies or could reasonably be linked . . . with a specific customer or device.”[8] In other words, these laws can be violated even if the provider does not access or exchange information with a competitor.
Given the rapidly-developing landscape of state law restrictions on surveillance pricing, and the potential for enforcement actions, sellers should:
- Monitor legislative developments, especially if operating in food and beverage, retail, and adjacent industries. To date, the surveillance pricing legislation that has passed has focused primarily on the food and beverage and retail sectors, as well as adjacent businesses, like food delivery services. Lawmakers and enforcers have signaled that that trend will continue. Maryland Governor Wes Moore underscored that surveillance pricing legislation should protect consumers who are “already stretched by the rising cost of groceries, housing and everyday necessities” and New York Attorney General, Letitia James, lauded the protections the One Fair Price Act will provide to “shoppers.”[9] Given the heightened scrutiny on these industries, stakeholders should pay particularly close attention to developments.
- Take inventory of their pricing practices, and determine if—and how—personal data (e.g., browsing history, geolocation, inferred demographic information) are used to set prices.
- Take steps to address and mitigate exposure. Proposed and passed surveillance pricing laws vary significantly state-by-state in terms of (1) what industries/sellers the laws apply to, (2) exemptions from the laws, and (3) how surveillance or dynamic pricing and personal data are defined. Businesses with interstate operations in particular should consider multi-state exposure, compliance obligations and whether those obligations require a change in operations, and other risk mitigation strategies.
- Review loyalty and discount programs. In line with the above, most state laws—proposed and enacted—have carve-outs for discount programs, so long as discounts are made available to any qualifying consumer. Businesses should ensure that their loyalty and discount programs conform to any applicable exemptions.
FOOTNOTES
[1] Sam Silverstein, Connecticut becomes 2nd state to regulate dynamic pricing, Grocery Dive (June 8, 2026), https://www.grocerydive.com/news/connecticut-new-york-dynamic-pricing-bills-grocery-retail/822187/#:~:text=Connecticut%20Gov.%20Ned%20Lamont%20last,to%20customize%20prices%20for%20shoppers; Conn. H.B. 5563 Sec. 11(c)(1), 2026 Leg. Sess. (enacted), https://legiscan.com/CT/text/HB05563/2026.
[2] Katherine Tschopp, Maryland Becomes First State to Ban 'Surveillance Pricing' on Some Food Products, MultiState (Apr. 30, 2026), https://www.multistate.us/insider/2026/4/30/maryland-becomes-first-state-to-ban-surveillance-pricing-on-some-food-products’; Protection from Predatory Pricing Act, Md. H.B. 895, 2026 Reg. Sess. (enacted), https://mgaleg.maryland.gov/2026RS/bills/hb/hb0895E.pdf.
[3] Martha C. White, States Rush to Ban AI-Generated ‘Surveillance Pricing’ That Uses Shoppers’ Personal Data, Money.com (May 14, 2026 8:30 AM EDT), https://money.com/surveillance-pricing-grocery-laws/?xid=moneyrss.
[4] Letter from Senator Elizabeth Warren et al. to Acting Assistant Attorney General Omeed Assefi & FTC Chair Andrew Ferguson (Apr. 13, 2026), https://www.warren.senate.gov/imo/media/doc/letter_from_warren_schumer_dems_to_the_department_of_justice_and_federal_trade_commission_on_price_fixing_in_food_supply_chain.pdf.
[5] E.g., Press Release, On Data Privacy Day, Attorney General Bonta Focuses on Surveillance Pricing, Compliance with California Consumer Privacy Act, California Office of the Attorney General (Jan. 27, 2026), https://oag.ca.gov/news/press-releases/data-privacy-day-attorney-general-bonta-focuses-surveillance-pricing-compliance.
[6] Ann O. Brien & T.J. Benedict, Collusion by Code: DOJ Forecasts Criminal Scrutiny of Algorithmic Pricing Tools, Sheppard Antitrust Law Blog (May 20, 2026), https://www.sheppard.com/insights/blogs/collusion-by-code-doj-forecasts-criminal-scrutiny-of-algorithmic-pricing-tools; Ann O’Brien, Leo D. Caseria, & T.J. Benedict, California Passes Broad Limits on “Common Pricing Algorithms” (Oct. 14, 2025), https://www.sheppard.com/insights/blogs/california-passes-broad-limits-on-common-pricing-algorithms.
[7] Md. H.B. 895 § 13-321(a).III & (b).II.1.
[8] One Fair Price Act, N.Y. S.B. S.8623B, 2025-2026 Reg. Sess., https://legislation.nysenate.gov/pdf/bills/2025/S8623A.
[9] Jule Pattison-Gordon, Why Maryland Took Aim at Surveillance Pricing in Grocery Stores, Governing (June 1, 2026), https://www.governing.com/policy/why-maryland-took-aim-at-surveillance-pricing-in-grocery-stores; Press Release, Attorney General James Applauds Passage of Legislation to Protect New Yorkers from Predatory Pricing Schemes, New York State Attorney General (June 5, 2026), https://ag.ny.gov/press-release/2026/attorney-general-james-applauds-passage-legislation-protect-new-yorkers.