Bill Text: NY A00679 | 2019-2020 | General Assembly | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relates to standing for persons affected by prohibited or unlawful business practices and expands prohibited acts to include unfair, deceptive or abusive acts.

Spectrum: Strong Partisan Bill (Democrat 42-4)

Status: (Introduced - Dead) 2020-01-08 - referred to codes [A00679 Detail]

Download: New_York-2019-A00679-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         679--A

                               2019-2020 Regular Sessions

                   IN ASSEMBLY

                                       (Prefiled)

                                     January 9, 2019
                                       ___________

        Introduced  by  M.  of  A.  NIOU, STECK, BARRON, KIM, DINOWITZ, EPSTEIN,
          FRONTUS, RICHARDSON, D'URSO, FALL, REYES, SIMOTAS  --  Multi-Sponsored
          by  --  M.  of A. SAYEGH -- read once and referred to the Committee on
          Consumer Affairs and Protection -- committee discharged, bill amended,
          ordered reprinted as amended and recommitted to said committee

        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.
    17    (2)  For the purposes of this section, an act or practice is deceptive
    18  when the act or practice misleads or is likely to mislead a  person  and
    19  the person's interpretation is reasonable under the circumstances.
    20    (3)  For  the  purposes of this section, an act or practice is abusive
    21  when:

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD02255-03-9
        A. 679--A                           2

     1    (i) it materially interferes with the ability of a  person  to  under-
     2  stand a term or condition of a consumer financial product or service; or
     3    (ii) takes unreasonable advantage of:
     4    (A)  a person's lack of understanding of the material risks, costs, or
     5  conditions of the product or service;
     6    (B) a person's inability to protect his or her interests in  selecting
     7  or using a consumer financial product or service; or
     8    (C) a person's reasonable reliance on a person covered by this section
     9  to act in his or her interests.
    10    (b)  Whenever  the attorney general shall believe from evidence satis-
    11  factory to him or her that any person, firm, corporation or  association
    12  or agent or employee thereof has engaged in or is about to engage in any
    13  of  the  acts  or  practices stated to be unfair, unlawful, deceptive or
    14  abusive, he or she may bring an action in the name and on behalf of  the
    15  people  of  the  state of New York to enjoin such unlawful acts or prac-
    16  tices and to obtain restitution  of  any  moneys  or  property  obtained
    17  directly  or  indirectly by any such unlawful acts or practices. In such
    18  action preliminary relief may be granted under  article  sixty-three  of
    19  the civil practice law and rules.
    20    (c) Before any violation of this section is sought to be enjoined, the
    21  attorney  general shall be required to give the person against whom such
    22  proceeding is contemplated notice by certified mail and  an  opportunity
    23  to show in writing within five business days after receipt of notice why
    24  proceedings  should  not  be  instituted  against him or her, unless the
    25  attorney general shall find, in any  case  in  which  he  or  she  seeks
    26  preliminary  relief,  that to give such notice and opportunity is not in
    27  the public interest.
    28    (d) In any such action it shall be a complete defense that the act  or
    29  practice  is,  or  if  in  interstate  commerce would be, subject to and
    30  complies with the rules and regulations of, and  the  statutes  adminis-
    31  tered by, the federal trade commission or any official department, divi-
    32  sion,  commission  or  agency  of the United States as such rules, regu-
    33  lations or statutes are interpreted by the federal trade  commission  or
    34  such department, division, commission or agency or the federal courts.
    35    (e)  Nothing  in  this  section shall apply to any television or radio
    36  broadcasting station or to any publisher  or  printer  of  a  newspaper,
    37  magazine   or   other  form  of  printed  advertising,  who  broadcasts,
    38  publishes, or prints the advertisement.
    39    (f) In connection with any proposed proceeding under this section, the
    40  attorney general is authorized to take proof and make a determination of
    41  the relevant facts, and to issue subpoenas in accordance with the  civil
    42  practice law and rules.
    43    (g)  This  section shall apply to all [deceptive] prohibited acts [or]
    44  and practices [declared to be unlawful], whether or not subject  to  any
    45  other  law  of  this state, and shall not supersede, amend or repeal any
    46  other law of this state under which the attorney general  is  authorized
    47  to take any action or conduct any inquiry.
    48    (h)  (1)  In  addition  to the right of action granted to the attorney
    49  general pursuant to this section, any person who  has  been  injured  by
    50  reason  of  any  violation of this section may bring an action in his or
    51  her own name to enjoin such unlawful  act  or  practice,  an  action  to
    52  recover  his  or  her actual damages [or fifty] and statutory damages of
    53  two thousand dollars, [whichever is greater,] or both such actions. Such
    54  actions may be brought regardless  of  whether  or  not  the  underlying
    55  violation is consumer-oriented or has a public impact. The court may, in
    56  its  discretion,  increase  the  award  of  damages [to an amount not to
        A. 679--A                           3

     1  exceed three times the actual damages up to one  thousand  dollars,]  if
     2  the  court  finds  the  defendant  willfully  or knowingly violated this
     3  section. The court [may] shall  award  reasonable  attorney's  fees  and
     4  costs to a prevailing plaintiff.
     5    [(j)]  (i)  For  purposes of this section, a "person" is defined as an
     6  individual, firm, corporation,  partnership,  cooperative,  association,
     7  coalition or any other organization's legal entity, or group of individ-
     8  uals however organized;
     9    (ii)  Given  the remedial nature of this section, standing to bring an
    10  action under this section, including but not limited  to  organizational
    11  standing  and  third-party  standing,  shall  be liberally construed and
    12  shall be available to the fullest extent otherwise permitted by law.
    13    (2) Any person entitled to bring an action under this article may,  if
    14  the  prohibited  act  or  practice has caused damage to others similarly
    15  situated, bring an action on behalf  of  himself  or  herself  and  such
    16  others  to  recover  actual, statutory and/or punitive damages or obtain
    17  other relief as provided for in this article. Thus, any  action  brought
    18  under this subdivision shall comply with article nine of the civil prac-
    19  tice law and rules.
    20    (3)  An organization may bring an action under this section, on behalf
    21  of itself or any of its members, or on behalf of those  members  of  the
    22  general  public who have been injured by reason of any violation of this
    23  section, including a violation involving  goods  or  services  that  the
    24  organization  purchased  or received in order to test or evaluate quali-
    25  ties pertaining to use for personal, household, or family purposes.   An
    26  organization  may  seek  the same remedies and damages that a person may
    27  seek under paragraph one of this subdivision.
    28    (i) Notwithstanding any law to the contrary, all monies  recovered  or
    29  obtained  under  this  article  by  a  state agency or state official or
    30  employee acting in their official capacity shall be subject to  subdivi-
    31  sion eleven of section four of the state finance law.
    32    §  2.  Section  389-c of the general business law, as added by chapter
    33  309 of the laws of 1996, is amended to read as follows:
    34    § 389-c. Special application of section three  hundred  forty-nine  of
    35  this  chapter.  In addition to the power set forth in subdivision (b) of
    36  section three hundred forty-nine of this chapter, the  attorney  general
    37  shall  have the power to assess a fine of up to one thousand dollars for
    38  each violation of this article[; and the defense under  subdivision  (d)
    39  of  section three hundred forty-nine of this chapter shall not be avail-
    40  able in connection with any violation of this article].
    41    § 3. This act shall take effect on the sixtieth  day  after  it  shall
    42  have become a law.