BAILEY, BIAGGI, GIANARIS, GOUNARDES, HOYLMAN, JACKSON, KAVANAGH, KRUEGER, LIU, MAY, MONTGOMERY,
MYRIE, PARKER, RAMOS, RIVERA, SALAZAR, SANDERS, SEPULVEDA, SKOUFIS, THOMAS
 
MLTSPNSR
 
Amd §349, Gen Bus L
 
Relates to standing for persons affected by prohibited or unlawful business practices and expands prohibited acts to include unfair, deceptive or abusive acts.
STATE OF NEW YORK
________________________________________________________________________
2407--C
Cal. No. 1093
2019-2020 Regular Sessions
IN SENATE
January 24, 2019
___________
Introduced by Sens. COMRIE, BAILEY, BIAGGI, GIANARIS, HOYLMAN, JACKSON,
KAVANAGH, KRUEGER, LIU, MONTGOMERY, MYRIE, PARKER, RAMOS, RIVERA,
SALAZAR, SEPULVEDA, SKOUFIS, THOMAS -- read twice and ordered printed,
and when printed to be committed to the Committee on Consumer
Protection -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee -- committee discharged,
bill amended, ordered reprinted as amended and recommitted to said
committee -- reported favorably from said committee, ordered to first
and second report, ordered to a third reading, amended and ordered
reprinted, retaining its place in the order of third reading
AN ACT to amend the general business law, in relation to standing for
persons affected by prohibited or unlawful business practices
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 349 of the general business law, as added by chap-
2 ter 43 of the laws of 1970, subdivision (h) as amended by chapter 157 of
3 the laws of 1984, and subdivision (j) as added by section 6 of part HH
4 of chapter 55 of the laws of 2014, is amended to read as follows:
5 § 349. [Deceptive acts] Prohibited acts and practices unlawful. (a)
6 [Deceptive] This section prohibits any unfair, deceptive or abusive acts
7 or practices in the conduct of any business, trade or commerce or in the
8 furnishing of any service [in this state are hereby declared unlawful].
9 (1) For the purposes of this section, an act or practice is unfair
10 when:
11 (i) it causes or is likely to cause substantial injury, the injury is
12 not reasonably avoidable, and the injury is not outweighed by counter-
13 vailing benefits; or
14 (ii) it takes unreasonable advantage of the inability of a person to
15 protect his or her interests because of the person's infirmity, illiter-
16 acy or inability to understand the language of an agreement.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02255-08-9
S. 2407--C 2
1 (2) For the purposes of this section, an act or practice is deceptive
2 when the act or practice misleads or is likely to mislead a person and
3 the person's interpretation is reasonable under the circumstances.
4 (3) For the purposes of this section, an act or practice is abusive
5 when:
6 (i) it materially interferes with the ability of a person to under-
7 stand a term or condition of a product or service; or
8 (ii) takes unreasonable advantage of:
9 (A) a person's lack of understanding of the material risks, costs, or
10 conditions of the product or service;
11 (B) a person's inability to protect his or her interests in selecting
12 or using a product or service; or
13 (C) a person's reasonable reliance on a person covered by this section
14 to act in his or her interests.
15 (b) Whenever the attorney general shall believe from evidence satis-
16 factory to him or her that any person, firm, corporation or association
17 or agent or employee thereof has engaged in or is about to engage in any
18 of the acts or practices stated to be unfair, unlawful, deceptive or
19 abusive, he or she may bring an action in the name and on behalf of the
20 people of the state of New York to enjoin such unlawful acts or prac-
21 tices and to obtain restitution of any moneys or property obtained
22 directly or indirectly by any such unlawful acts or practices. In such
23 action preliminary relief may be granted under article sixty-three of
24 the civil practice law and rules. Such actions may be brought regard-
25 less of whether or not the underlying violation is directed at individ-
26 uals or businesses, is consumer-oriented, or involves the offering of
27 goods, services, or property for personal, family or household purposes.
28 (c) Before any violation of this section is sought to be enjoined, the
29 attorney general shall be required to give the person against whom such
30 proceeding is contemplated notice by certified mail and an opportunity
31 to show in writing within five business days after receipt of notice why
32 proceedings should not be instituted against him or her, unless the
33 attorney general shall find, in any case in which he or she seeks
34 preliminary relief, that to give such notice and opportunity is not in
35 the public interest.
36 (d) In any such action it shall be a complete defense that the act or
37 practice is, or if in interstate commerce would be, subject to and
38 complies with the rules and regulations of, and the statutes adminis-
39 tered by, the federal trade commission or any official department, divi-
40 sion, commission or agency of the United States as such rules, regu-
41 lations or statutes are interpreted by the federal trade commission or
42 such department, division, commission or agency or the federal courts.
43 (e) Nothing in this section shall apply to any television or radio
44 broadcasting station or to any publisher or printer of a newspaper,
45 magazine or other form of printed advertising, who broadcasts,
46 publishes, or prints the advertisement.
47 (f) In connection with any proposed proceeding under this section, the
48 attorney general is authorized to take proof and make a determination of
49 the relevant facts, and to issue subpoenas in accordance with the civil
50 practice law and rules.
51 (g) This section shall apply to all [deceptive] prohibited acts [or]
52 and practices [declared to be unlawful], whether or not subject to any
53 other law of this state, and shall not supersede, amend or repeal any
54 other law of this state under which the attorney general is authorized
55 to take any action or conduct any inquiry.
S. 2407--C 3
1 (h) (1) In addition to the right of action granted to the attorney
2 general pursuant to this section, any person who has been injured by
3 reason of any violation of this section may bring an action in his or
4 her own name to enjoin such unlawful act or practice, an action to
5 recover his or her actual damages [or fifty] and statutory damages of
6 one thousand dollars, [whichever is greater,] or both such actions. Such
7 actions may be brought regardless of whether or not the underlying
8 violation is consumer-oriented or has a public impact. The court may, in
9 its discretion, increase the award of damages [to an amount not to
10 exceed three times the actual damages up to one thousand dollars,] if
11 the court finds the defendant willfully or knowingly violated this
12 section. The court [may] shall award reasonable attorney's fees and
13 costs to a prevailing plaintiff.
14 [(j)] (i) For purposes of this section, a "person" is defined as an
15 individual, firm, corporation, partnership, cooperative, association,
16 coalition or any other organization's legal entity, or group of individ-
17 uals however organized;
18 (ii) For purposes of this section "non-profit organization" is defined
19 as an organization that is (1) not an individual; and (2) is neither
20 organized nor operating in whole, or in significant part, for profit;
21 (iii) Given the remedial nature of this section, standing to bring an
22 action under this section, including but not limited to organizational
23 standing and third-party standing, shall be liberally construed and
24 shall be available to the fullest extent otherwise permitted by law.
25 (2) Any individual or non-profit organization entitled to bring an
26 action under this article may, if the prohibited act or practice has
27 caused damage to others similarly situated, bring an action on behalf of
28 himself or herself and such others to recover actual, statutory and/or
29 punitive damages or obtain other relief as provided for in this article.
30 Statutory damages under this section will be limited to (i) such amount
31 for each named plaintiff as could be recovered under paragraph one of
32 this subdivision; and (ii) such amount as the court may allow for all
33 other class members without regard to a minimum individual recovery, not
34 to exceed the lesser of one million dollars or two per centum of the net
35 worth of the business. Thus, any action brought under this subdivision
36 shall comply with article nine of the civil practice law and rules.
37 (3) A non-profit organization may bring an action under this section,
38 on behalf of itself or any of its members, or on behalf of those members
39 of the general public who have been injured by reason of any violation
40 of this section, including a violation involving goods or services that
41 the non-profit organization purchased or received in order to test or
42 evaluate qualities pertaining to use for personal, household, or family
43 purposes. A non-profit organization may seek the same remedies and
44 damages that a person may seek under paragraph one of this subdivision.
45 (4) Before any violation of this section is sought to be enjoined, the
46 person bringing the action shall be required to give the person against
47 whom such action is contemplated notice by certified mail, to the place
48 where the transaction occurred or to the principal place of business
49 within the state of the person against whom such action is contemplated,
50 and an opportunity to show in writing within ten business days after
51 mailing of notice why proceedings should not be instituted against him
52 or her, unless, in any case in which the person seeks preliminary
53 relief, the giving of such notice and opportunity would cause immediate
54 and irreparable injury, loss or damages.
55 (i) Notwithstanding any law to the contrary, all monies recovered or
56 obtained under this article by a state agency or state official or
S. 2407--C 4
1 employee acting in their official capacity shall be subject to subdivi-
2 sion eleven of section four of the state finance law.
3 § 2. This act shall take effect on the sixtieth day after it shall
4 have become a law.