Sherrill Targets AI Surveillance Pricing in New Jersey

Governor Mikie Sherrill brought her fight against AI-driven pricing manipulation to a Rochelle Park pharmacy Wednesday, joining state legislators to warn New Jersey residents about a practice that could soon cost them more at the register without their knowledge.

The event came one day after Sherrill condemned what she calls “for profit surveillance by Big Tech” during her budget address to the Legislature. The governor and her allies want New Jersey to get ahead of this technology before it takes hold across the state’s pharmacies, supermarkets, and retail stores.

The practice at issue is called surveillance pricing. Retailers using AI algorithms can track customer behavior, purchasing history, browsing habits, and even the time of day a purchase is made to set individualized prices. The result is a system where two people buying the same product at the same store might pay very different amounts, with neither one knowing why.

Sherrill was joined at the Rochelle Park pharmacy by state Sen. Joe Lagana, state Sen. Joe Cryan, and Assemblyman Chigozie Onyema. Lagana, whose district covers the township, was direct in his assessment. “It’s just not right,” he said.

The governor called the technology “frightening,” and the assembled lawmakers agreed that the potential for abuse has no clear ceiling.

The examples raised at Wednesday’s event were jarring in their specificity. An AI system could flag a customer buying a prescription drug at 9 p.m. and raise the price on the assumption that a late-night purchase signals desperation. Supermarkets could use the same logic to charge more during peak shopping hours, when most working families are actually in the store. Perhaps most unsettling, retailers could track what products a customer researches on their phone and then charge that customer a premium when they show up to buy the item in person or online, treating their interest as a signal to extract more money.

This is not a theoretical threat. The Federal Trade Commission released a report in 2024 documenting how major retailers had begun experimenting with the practice. New Jersey, with its dense population, massive retail sector, and significant pharmaceutical industry presence, has particular exposure.

Lagana acknowledged the challenge facing lawmakers. “A lot of times the government has to catch up with technology,” he said. That gap between innovation and regulation is exactly the space these bills are meant to close.

Two pieces of legislation are now moving in Trenton. Onyema is sponsoring an Assembly bill that would ban the use of electronic shelf labels and surveillance-based pricing specifically for food items. The Senate bill, backed by Lagana and Cryan, takes a broader approach. It would classify surveillance pricing as consumer fraud, exposing violators to fines starting at $10,000 for a first offense.

Sherrill framed the effort as more than consumer protection. She said New Jersey has the opportunity to lead the country on this issue, setting a standard that other states could follow. That kind of positioning fits her administration’s broader pitch that the state can be a model for tech accountability at a moment when federal regulators have retreated from aggressive enforcement.

Whether the Legislature moves quickly enough to match the governor’s urgency is a separate question. Bergen County lawmakers showing up to a township pharmacy is good politics, but these bills still need to clear committees, survive industry lobbying, and reach Sherrill’s desk for a signature.

What Wednesday’s event did accomplish was putting retailers and tech companies on notice that Trenton is watching. For New Jersey consumers who have grown accustomed to feeling nickeled and dimed at every transaction, the idea that an AI might now be profiling their shopping patterns to squeeze out every last dollar carries a particular sting.

Sherrill wants to make that practice illegal. The lawmakers standing beside her in Rochelle Park say they have the votes to help her do it. Now they have to prove it.