Press Release
California Governor Signs AB 325 to Stop Algorithmic Price Collusion
10. 07. 2025
The legislation updates consumer protections to prohibit digital price fixing
SACRAMENTO – Gov. Newsom yesterday evening signed AB 325 (Aguiar-Curry) legislation that strengthens consumer protections by prohibiting the use of algorithms and digital tools to artificially inflate prices on essential goods and services.
California families face soaring costs for essential goods and services, from rent and prescription drugs to groceries and restaurant meals. California grocery prices are 27% higher than four years ago. The state’s rents have grown 38% from January 2020 to June 2025, with the median rent 32-33% higher than the national median. While people may blame this solely on market forces, investigations reveal an additional culprit: corporations using technology to coordinate price increases, artificially driving costs even higher.
“Governor Newsom’s signature on this legislation sends a message to corporations who are using digital tools to rip off customers: what you are doing is illegal,” said Teri Olle, Director of Economic Security Project California. “California families are already being hammered at every turn – from groceries to rent; from hotel prices to french fries. The last thing they can afford is companies colluding behind their computers to jack up prices and pad their pockets with huge profits. Just because this collusion is conducted with technology rather than a handshake deal in a smoke-filled backroom doesn’t make it fair – or legal. California is setting the standard for ensuring corporations can’t use algorithms to rip off consumers.”
Examples of algorithmic-fueled collusion hurting consumers include:
- Housing: RealPage’s software allegedly cost renters an additional $3.8 billion in 2023 alone by helping landlords coordinate rent increases
- Food: The four largest potato product manufacturers (controlling 90+% of the market) all feed their data into the same third-party software, called PotatoTrack, causing french fry prices to jump
- Meat: Companies allegedly share secret pricing data through the platform Agri Stats, affecting 90% of chicken, turkey, and pork processing and resulting in price increases
The new law clarifies that digital tools cannot be used to circumvent established antitrust law, which exists to protect fair markets.
Economic Security Project’s affiliate Economic Security California Action was proud to co-sponsor this bill with Assemblymember Aguiar-Curry.