•  Summary 
  •  
  •  Actions 
  •  
  •  Committee Votes 
  •  
  •  Floor Votes 
  •  
  •  Memo 
  •  
  •  Text 
  •  
  •  LFIN 
  •  
  •  Chamber Video/Transcript 

A09785 Summary:

BILL NOA09785
 
SAME ASNo Same As
 
SPONSORTitone
 
COSPNSRSeawright
 
MLTSPNSR
 
Amd 349, 349-c, 350-d & 350-e, add 349-f, Gen Bus L
 
Relates to consumer protection from deceptive acts and practices; increases damages and directs consumers on bringing an action for such deceptive acts and practices.
Go to top    

A09785 Actions:

BILL NOA09785
 
02/07/2018referred to consumer affairs and protection
03/06/2018reported referred to codes
04/17/2018reported
04/19/2018advanced to third reading cal.764
Go to top

A09785 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A9785
 
SPONSOR: Titone
  TITLE OF BILL: An act to amend the general business law, in relation to consumer protection from unfair or deceptive acts or practices   PURPOSE: The purpose of this bill is to enhance the effectiveness of New York's Consumer Protection Law and deter the use of unfair or deceptive acts or practices.   SUMMARY OF SPECIFIC PROVISIONS: This bill amends various sections of Article 22-A of the General Busi- ness Law, which provides consumer protections for deceptive acts or practices, as follows: Section one of the bill would amend section 349 of the General business law by making changes to subdivisions (a) and (h) and adding a new subdivision (i). -Subdivision (a) of section 349-of the General Business Law, which currently declares "deceptive acts or practices" unlawful, would be amended to add that unfair acts or practices are also unlawful. -Subdivision (h) of section 349 of the General Business Law would be amended to increase the minimum award an injured party may recover in a private action arising from a violation of the section from $50 to $500, increase the cap on treble damages the court may award for intentional or willful violations of this section from $1,000 to $10,000, grant the court discretion to award punitive damages of up to three times the amount of the actual damages, and mandate that a prevailing plaintiff in such an action shall be awarded reasonable attorney's fees and costs. -The new subdivision (i) of section 349 of the General Business Law would lay out the factors the court shall consider in determining wheth- er an act or practice is unfair, including whether the defendant knew or should have known he or she was (1) taking advantage of the consumer's inability to understand an agreement; or (2) charged the consumer a price that, at the time the transaction took place, grossly exceeded that of similar, readily available property or services. Section two of the bill amends section 349-c of the General Business Law to increase the maximum civil penalty imposed for acts prohibited under sections 349, 349-f, 350-c, and 350-c of the General Business Law perpe- trated against people 65 years of age or older. Section three of the bill amends the General Business Law by adding a new section 349-f that would allow for class action suits to be brought when appropriate for violations of Article 22-A of the General Business Law that entitle an individual consumer to bring a civil action. Section four of the bill amends section 350-d of the General Business Law to increase the maximum civil penalty for violations of Article 22-A of the General Business Law, Section five of the bill would amend section 350-e of the General busi- ness law by making changes to subdivisions (3) and adding a new subdivi- sion (4). -Subdivision 3 of section 350-e of the General Business Law would be amended to mandate that a prevailing plaintiff in an action brought by a consumer for a violation of section 350 or 350-a of the General Business Law shall be awarded reasonable attorney's fees and costs. -The new subdivision (4) of section 350-e of the General Business Law would establish additional civil liability for any intentional violation of an injunction prohibiting unfair or deceptive acts practices issued pursuant to this section. Further, upon petition by the Attorney Gener- al, the court may order the canceling of any certificates filed under the provisions of section 310 of the General Business Law for habitual violation of injunctions issued pursuant to Article 22-A of the General Business Law. Section six of the bill sets forth the effective date.   JUSTIFICATION: New York's landmark prohibition against deceptive acts or practices was enacted in 1970. In 1980, the statute was significantly improved when a provision granting aggrieved consumers a right of action. Since that time, however, New York's law has not kept pace with other state consum- er protection statutes. The effectiveness of New York's statute is hampered by the fact that it does not allow private individuals to bring an action for unfair prac- tices and by outdated caps on civil liabilities and damage awards for violations. Individual consumers and consumer attorneys are often disinclined to bring an action against a violator for $50, or up to $1,000 for knowing or willful violations, due to the imbalance between the amount that may be recovered and the costs of litigation, and, as such, violators are not brought to justice and consumers are left unprotected. This bill would bring New York's consumer protection statute in line with more protective statutes in other states by enhancing remedies and civil penalties. These improvements would serve to provide a significant deterrent to unscrupulous businesses that seek to treat consumers unfairly or deceptively and ensure that consumers who are victimized are able to obtain justice and be made whole.   FISCAL IMPACT ON THE STATE: It is anticipated that the increased civil penalties imposed on viola- tors would result in an increase in revenue for the State.   FISCAL IMPACT ON LOCALITIES: None.   IMPACT ON THE REGULATION OF BUSINESSES AND INDIVIDUALS: The bill would prohibit businesses from engaging in unfair acts or prac- tices. The bill also increases the amount a consumer may be awarded in a private action brought against a business for a violation of section 349 of the General Business Law and allows for consumers to bring class action suits for violations of Article 22-A of the General Business Law.   IMPACT ON FINES, IMPRISONMENT, FORFEITURE OF RIGHTS, OR OTHER PENAL SANCTIONS: The bill would increase the maximum civil penalties for prohibited acts under Article 22-A of the General Business Law from $5,000 to $10,000. Additionally, the bill would increase the maximum civil penalties for certain prohibited acts under Article 22-A of the General Business Law perpetrated against consumers 65 years of age or older from $10,000 to $20,000. Lastly, the bill would impose civil liability not to exceed $5,000 on any business that intentionally violates any injunction prohibiting unfair acts or practices. Where such conduct is of a contin- uing nature, each day of such conduct is separate violation. In the case of businesses that habitually violate such injunctions, the Attorney General may petition the court to order the cancelation of various certificates required filed under section 130 of the General Business Law.   LEGISLATIVE HISTORY: 2017: A08169(Kavanagh)- Enacting Clause Stricken in Rules 2016: A01161(Dinowitz)- On the Floor 2015: A01161(Dinowitz)- On the Floor 2014: A00312A(Dinowitz)- On the Floor 2013: A00312(Dinowitz)- Codes 2012: A08381(Dinowitz)- Codes 2011: A08381(Dinowitz)- Consumer Affairs and Protection 2010: A10306(Pheffer)-Codes   EFFECTIVE DATE: This act shall take effect on the ninetieth day after it shall have become a law.
Go to top

A09785 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          9785
 
                   IN ASSEMBLY
 
                                    February 7, 2018
                                       ___________
 
        Introduced by M. of A. TITONE -- read once and referred to the Committee
          on Consumer Affairs and Protection
 
        AN  ACT  to  amend  the  general  business  law, in relation to consumer
          protection from unfair or deceptive acts or practices
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Subdivisions  (a)  and  (h) of section 349 of the general
     2  business law, subdivision (a) as added by chapter 43 of the laws of 1970
     3  and subdivision (h) as amended by chapter 157 of the laws of  1984,  are
     4  amended and a new subdivision (i) is added to read as follows:
     5    (a)  [Deceptive]  Unfair or deceptive acts or practices in the conduct
     6  of any business, trade or commerce or in the furnishing of  any  service
     7  in this state are hereby declared unlawful.
     8    (h)  (1)  In  addition  to the right of action granted to the attorney
     9  general pursuant to this section, any person who  has  been  injured  by
    10  reason  of  any violation of this section may bring an action in his own
    11  name to enjoin such unlawful act or practice, an action to  recover  his
    12  actual damages or [fifty] five hundred dollars, whichever is greater, or
    13  both such actions.  The court may, in its discretion, increase the award
    14  of  damages to an amount not to exceed three times the actual damages up
    15  to [one] ten thousand dollars, if the court finds the defendant willful-
    16  ly or knowingly violated this section. The court may also award punitive
    17  damages in an amount not to exceed three times the  actual  damages  and
    18  provide any equitable relief the court considers necessary or proper.
    19    (2)  The  court [may] shall award reasonable attorney's fees and costs
    20  to a prevailing plaintiff.
    21    (i) In determining whether an act or practice  is  unfair,  the  court
    22  shall  consider  circumstances of which the defendant knew or reasonably
    23  should have known, including, but not limited to the following:
    24    (1) that the defendant took advantage of the inability of the consumer
    25  to reasonably protect the consumer's interests because of the consumer's
    26  physical infirmity, illiteracy or inability to understand  the  language
    27  of an agreement;
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD00081-03-7

        A. 9785                             2
 
     1    (2)  that  at  the time the consumer transaction was entered into, the
     2  price grossly exceeded the price at which similar property  or  services
     3  were readily obtainable in similar transactions by similar consumers;
     4    §  2.  Paragraph  (a) of subdivision 2 of section 349-c of the general
     5  business law, as added by chapter 687 of  the  laws  of  1996  and  such
     6  section  as renumbered by chapter 189 of the laws of 1999, is amended to
     7  read as follows:
     8    (a) In addition to any  liability  for  damages  or  a  civil  penalty
     9  imposed  pursuant  to  sections  three hundred forty-nine, three hundred
    10  forty-nine-f, three hundred fifty-c and three hundred  fifty-d  of  this
    11  [chapter]  article, regarding deceptive practices and false advertising,
    12  and subdivision twelve of section  sixty-three  of  the  executive  law,
    13  regarding  proceedings  by  the  attorney  general  for equitable relief
    14  against fraudulent or illegal consumer fraud, a  person  or  entity  who
    15  engages  in  any conduct prohibited by said provisions of law, and whose
    16  conduct is perpetrated against one  or  more  elderly  persons,  may  be
    17  liable  for an additional civil penalty not to exceed [ten] twenty thou-
    18  sand dollars, if the factors in paragraph (b) of  this  subdivision  are
    19  present.
    20    § 3. The general business law is amended by adding a new section 349-f
    21  to read as follows:
    22    § 349-f. Civil action.  Any consumer entitled to bring an action under
    23  this  article  may, if the unlawful act or practice has caused damage to
    24  other consumers similarly situated, bring an action on behalf of himself
    25  or herself and such other consumers to recover damages or  obtain  other
    26  relief as provided for in this article.
    27    Any  action  brought  under this subdivision shall comply with article
    28  nine of the civil practice law and rules.
    29    § 4. Section 350-d of the general business law, as amended by  chapter
    30  208 of the laws of 2007, is amended to read as follows:
    31    §  350-d.  Civil penalty. Any person, firm, corporation or association
    32  or agent or employee thereof who engages in any of the acts or practices
    33  stated in this article to be unlawful shall be liable to a civil penalty
    34  of not more than [five] ten thousand dollars for each  violation,  which
    35  shall  accrue  to  the state of New York and may be recovered in a civil
    36  action brought by the attorney general. In any such action it shall be a
    37  complete defense that the advertisement is subject to and complies  with
    38  the  rules  and  regulations  of,  and  the statutes administered by the
    39  Federal Trade Commission or any official department,  division,  commis-
    40  sion or agency of the state of New York.
    41    §  5.  Subdivision  3 of section 350-e of the general business law, as
    42  amended by chapter 328 of the laws of 2007, is amended and a new  subdi-
    43  vision 4 is added to read as follows:
    44    3.  Any  person  who  has  been  injured by reason of any violation of
    45  section three hundred fifty or three hundred fifty-a of this article may
    46  bring an action in his or her own name to enjoin such  unlawful  act  or
    47  practice, an action to recover his or her actual damages or five hundred
    48  dollars,  whichever  is greater, or both such actions. The court may, in
    49  its discretion, increase the award of damages to an amount not to exceed
    50  three times the actual damages, up to ten thousand dollars, if the court
    51  finds that the defendant willfully or knowingly violated  this  section.
    52  The  court  [may]  shall award reasonable attorney's fees and costs to a
    53  prevailing plaintiff.
    54    4. (a) In addition to any other applicable  penalty,  any  person  who
    55  intentionally  violates  any  injunction prohibiting unfair or deceptive
    56  acts or practices issued pursuant to this article shall be liable for  a

        A. 9785                             3
 
     1  civil  penalty  not  to exceed five thousand dollars for each violation.
     2  Where the conduct constituting a violation is of  a  continuing  nature,
     3  each day of that conduct is a separate and distinct violation. In deter-
     4  mining  the  amount  of  the civil penalty, the court shall consider all
     5  relevant circumstances, including, but not limited to, the extent of the
     6  harm caused by the conduct constituting  a  violation,  the  nature  and
     7  persistence  of  that conduct, the length of time over which the conduct
     8  occurred, the assets, liabilities,  and  net  worth  of  the  defendant,
     9  whether  corporate or individual, and any corrective action taken by the
    10  defendant.
    11    (b) Upon petition by the attorney general, the court may for  habitual
    12  violation  of  injunctions  issued  pursuant  to  this article order the
    13  canceling of any certificate filed under and by virtue of the provisions
    14  of section one hundred thirty of this chapter.
    15    § 6. This act shall take effect on the ninetieth day  after  it  shall
    16  have become a law.
Go to top