Bill Text: NY A06655 | 2019-2020 | General Assembly | Amended


Bill Title: Requires registration of new automotive broker businesses; enacts various provisions relating to conduct of such businesses; defines certain deceptive practices; establishes rights of action and penalties.

Spectrum: Moderate Partisan Bill (Democrat 51-14)

Status: (Introduced) 2019-06-15 - print number 6655d [A06655 Detail]

Download: New_York-2019-A06655-Amended.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                         6655--D

                               2019-2020 Regular Sessions

                   IN ASSEMBLY

                                     March 14, 2019
                                       ___________

        Introduced  by  M.  of  A.  CARROLL,  ABBATE,  STIRPE, REYES, DenDEKKER,
          TAYLOR,  CYMBROWITZ,  DICKENS,  M. G. MILLER,   D'URSO,   ENGLEBRIGHT,
          D. ROSENTHAL,  GALEF,  GOTTFRIED,  RAMOS,  DeSTEFANO,  MIKULIN, SMITH,
          SAYEGH, WILLIAMS, COOK, ABINANTI, McDONOUGH, QUART,  SEAWRIGHT,  LiPE-
          TRI,  REILLY,  B. MILLER,  ROZIC,  PALUMBO,  EPSTEIN, FERNANDEZ, RYAN,
          STECK, CRUZ, PHEFFER AMATO,  PICHARDO,  RAIA,  RA,  BENEDETTO,  BYRNE,
          JACOBSON,  BUCHWALD,  HYNDMAN,  PERRY, THIELE, SOLAGES, LAVINE, STERN,
          GARBARINO, GRIFFIN -- Multi-Sponsored  by  --  M.  of  A.  DE LA ROSA,
          FITZPATRICK,  HEVESI, LAWRENCE, SIMON -- 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 -- again  reported  from  said  committee  with  amendments,
          ordered  reprinted  as  amended  and  recommitted to said committee --
          committee discharged, bill amended, ordered reprinted as  amended  and
          recommitted  to  said  committee -- again reported from said committee
          with amendments, ordered reprinted as amended and recommitted to  said
          committee

        AN  ACT  to  amend  the vehicle and traffic law and the general business
          law, in relation to designating new automotive broker businesses

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1. Paragraph a of subdivision 1 of section 415 of the vehicle
     2  and traffic law, as amended by chapter 554  of  the  laws  of  2015,  is
     3  amended and a new paragraph n is added to read as follows:
     4    a.  "Dealer" means a person engaged in the business of buying, selling
     5  or dealing in motor vehicles, motorcycles or trailers, other than mobile
     6  homes or manufactured homes, at retail or  wholesale;  except,  however,
     7  trailers  with  an  unladen weight of less than one thousand pounds. For
     8  the purposes of this section, a "mobile  home"  or  "manufactured  home"
     9  means  a  mobile  home  or  manufactured  home as defined in section one
    10  hundred twenty-two-c of this chapter. Any person who  sells,  or  offers

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD08916-15-9

        A. 6655--D                          2

     1  for sale or lease more than five motor vehicles, motorcycles or trailers
     2  in  any calendar year or who displays or permits the display of three or
     3  more motor vehicles, motorcycles or trailers for sale at any one time or
     4  within  any  one calendar month upon premises owned or controlled by him
     5  or her, if such vehicles were purchased, acquired or otherwise  obtained
     6  by  such person for the purpose of resale, will be regarded as a dealer.
     7  For the purposes of this section,  "offers  for  sale  or  lease"  shall
     8  include,  but  not be limited to, the act of drawing the public's atten-
     9  tion to, or the presentation or display of any motor vehicle,  including
    10  the  posting  of  images  of any such vehicle, together with an offer to
    11  provide, the provision of, or a  representation  that  such  person  may
    12  provide a service of arranging, assisting, facilitating or effecting the
    13  lease  of such new motor vehicle, except this meaning shall not apply to
    14  any activity of a cooperative or other advertising program  or  fund  as
    15  described  in  any franchise, as such term is defined by subdivision six
    16  of section four hundred sixty-two of this  title.  Except  as  otherwise
    17  provided  in subdivisions three, five, six-b, and seven of this section,
    18  the term "dealer" shall include a "new motor vehicle dealer" as  defined
    19  by  paragraph  f of this subdivision and a "qualified dealer" as defined
    20  in paragraph g of this subdivision.
    21    n. "New automobile broker business" shall have the same meaning as set
    22  forth in subdivision four of section seven  hundred  thirty-six  of  the
    23  general business law.
    24    §  2. Section 736 of the general business law is amended by adding two
    25  new subdivisions 4 and 5 to read as follows:
    26    4. "New automobile broker business" means any person who, for  a  fee,
    27  commission  or  other valuable consideration, regardless of whether such
    28  fee, commission or consideration is paid directly by a consumer,  offers
    29  to provide, provides or represents that he or she will provide a service
    30  of  purchasing,  arranging,  assisting,  facilitating  or  effecting the
    31  purchase or lease of a previously unregistered automobile; through a new
    32  motor vehicle dealer, as agent, broker, or intermediary for a  consumer.
    33  "New  automobile broker business" does not include any person registered
    34  as a new vehicle dealer for the new automobile brand or brands for which
    35  such services are provided, pursuant to article sixteen of  the  vehicle
    36  and  traffic  law nor any bona fide employee of such a registered dealer
    37  while acting for such dealer, nor any motor vehicle franchisor, manufac-
    38  turer or distributor for the new automobile brand or  brands  for  which
    39  such services are provided.
    40    5.  Notwithstanding  any  other subdivision of this section, the terms
    41  "automobile broker business" and "new automobile broker business"  shall
    42  not include any entity that provides a service of purchasing, arranging,
    43  assisting,  facilitating, or effecting the purchase or lease of a previ-
    44  ously unregistered automobile as an agent, broker, or intermediary for a
    45  consumer, if that entity facilitates the purchase  or  lease  of  a  new
    46  motor  vehicle  in  this  state  from a new motor vehicle dealer only by
    47  means of an online new automobile referral service. For the purposes  of
    48  this  subdivision,  "online  new  automobile  referral service" means an
    49  organization, including, but  not  limited  to  a  corporation,  limited
    50  liability  company,  partnership,  sole proprietor, or any other entity,
    51  that:
    52    (a) operates an interactive website and/or smartphone application that
    53  facilitates the provision of services or consummation of transactions by
    54  marketplace entities and persons seeking such services  or  transactions
    55  on  a  digital platform specifically designed and built for online motor
    56  vehicle lease transactions;

        A. 6655--D                          3

     1    (b) lists motor vehicles provided by multiple new motor vehicle  deal-
     2  ers in this state;
     3    (c)  provides  services, or the transactions facilitated thereby, on a
     4  multi-state basis pursuant to written contracts with new  motor  vehicle
     5  dealers  which  establish  a  predetermined price for the services to be
     6  rendered; and
     7    (d) involves no in-person meeting as between a prospective  lessee  or
     8  purchaser and the operator of such interactive website and/or smartphone
     9  application.
    10    § 3. Subdivision 3-a and paragraph b-3 of subdivision 5 of section 415
    11  of  the  vehicle and traffic law, as added by chapter 477 of the laws of
    12  2017, are amended to read as follows:
    13    3-a. Automobile  broker  business  [registration]  or  new  automobile
    14  broker  business.    a.  No person shall engage in the automobile broker
    15  business, the new automobile broker business or represent  or  advertise
    16  that  he or she is engaged or intends to engage in the automobile broker
    17  business or new automobile broker business in this state,  unless  there
    18  shall have been issued to him or her a certificate of registration as an
    19  automobile  broker  business  or  new automobile broker business, as the
    20  case may be, by the commissioner  under  this  section  pursuant  to  an
    21  application  for  registration submitted pursuant to subdivision five of
    22  this section.
    23    b. The commissioner shall not issue any  certificate  of  registration
    24  authorized  by  this  subdivision to any dealer, franchisee, franchisor,
    25  manufacturer, distributor, distributor branch or factory branch, as such
    26  terms are defined in section four hundred sixty-two of this title, or to
    27  any subsidiary, affiliate or controlled entity thereof.
    28    c. As a condition of any certificate of registration  issued  pursuant
    29  to  this  subdivision,  a new automobile broker business shall have, and
    30  continuously maintain, a place of business in this state  for  which  it
    31  shall  keep and maintain evidence that all necessary approvals, licenses
    32  and/or permits have been obtained from all  local  governing  bodies  to
    33  operate such place of business with customer or client traffic.
    34    d.  Every  registered  new  automobile  broker  shall  prominently and
    35  conspicuously post, in such a manner that it is likely to be  noticeable
    36  to  anyone  entering  its premises, its official business certificate of
    37  registration and a sign, which sign shall clearly state:
    38    "(Name of registered new automobile broker) is not  a  franchised  new
    39  motor  vehicle  dealership.  We  are  not  authorized  or  approved by a
    40  manufacturer or distributor to sell a motor vehicle or perform recall or
    41  original factory warranty work. If you order a search for  a  new  motor
    42  vehicle  from  this  broker,  we must make a bona fide effort to solicit
    43  bids from at least three unaffiliated new motor vehicle  dealers  for  a
    44  new motor vehicle on your behalf, including from your local dealer."
    45    e.  A  new  automobile  broker  business  shall  not provide, offer to
    46  provide, or represent that he or she will provide a service of  purchas-
    47  ing,  arranging,  assisting,  facilitating  or effecting the purchase or
    48  lease of a previously unregistered automobile with a dealer  located  in
    49  any  other  state  unless  such  state affords lawful means for the same
    50  business activity, such standards and  requirements  are  equivalent  to
    51  those contained in this article and article thirty-five-B of the general
    52  business  law, the new automobile broker business is registered, permit-
    53  ted or licensed to perform such business activity in  such  other  state
    54  and  is otherwise in good standing with each governmental agency of such
    55  other state responsible  for  regulating  such  business  activity.  The
    56  commissioner  of  motor  vehicles  shall  be  empowered to determine the

        A. 6655--D                          4

     1  substantial equivalence of such  other  state  laws  pertaining  to  the
     2  registration, permitting or licensure of such businesses.
     3    f.  Nothing in this subdivision shall be construed to prohibit a fran-
     4  chisor, manufacturer, or distributor from sponsoring activities intended
     5  to generate leads toward the sale or lease of a new motor vehicle  by  a
     6  franchisee.
     7    b-3.  In  the case of an application for registration as an automobile
     8  broker business or new automobile broker business, the name and  address
     9  of  the surety company which will issue the bond required by subdivision
    10  one of section seven hundred forty-a of the general business law  and  a
    11  statement  indicating any interest in the applicant's business entity by
    12  a person or entity described in paragraph  (f)  of  subdivision  one  or
    13  paragraph  f  of subdivision seven of this section. If the bond is to be
    14  issued by an authorized agent of the  surety  company  licensed  by  the
    15  state,  then  the name and address of that agent may be provided in lieu
    16  of the information concerning the surety company.
    17    § 4. Subdivision 1 of section 736-a of the general  business  law,  as
    18  added  by chapter 477 of the laws of 2017, is amended and a new subdivi-
    19  sion 3 is added to read as follows:
    20    1. (a) No person shall engage in  business  as  an  automobile  broker
    21  business  or  as  a  new  automobile  broker business, as such terms are
    22  defined in section seven hundred thirty-six  of  this  article,  without
    23  first having been issued a certificate of registration for an automobile
    24  broker  business or new automobile broker business pursuant to paragraph
    25  c of subdivision seven of section four hundred fifteen  of  the  vehicle
    26  and  traffic  law.  A  certificate  of registration for a new automobile
    27  broker business is valid for a period of two years.
    28    (b) No new  automobile  broker  business  shall  represent  or  accept
    29  payment from, either directly or indirectly, a franchisee, dealer, fran-
    30  chisor,  manufacturer  and/or  distributor, as such terms are defined in
    31  sections four hundred fifteen and four hundred sixty-two of the  vehicle
    32  and traffic law.
    33    (c) No new automobile broker business shall provide, offer to provide,
    34  or  represent  that  he  or  she  will  provide a service of purchasing,
    35  arranging, assisting, facilitating or effecting the purchase or lease of
    36  a previously unregistered automobile with a dealer located in any  other
    37  state  unless  such  state  affords  lawful  means for the same business
    38  activity, such standards and requirements set forth in the laws of  such
    39  other  state  are equivalent to those contained in this article, the new
    40  automobile broker business has been registered, permitted or licensed to
    41  perform such business activity in such other state and is  otherwise  in
    42  good standing with each agency of such other state responsible for regu-
    43  lating  such business activity. The commissioner of motor vehicles shall
    44  be empowered to determine the  substantial  equivalence  of  such  other
    45  state  laws  pertaining  to  the  regulation  of such business activity,
    46  including consumer protections in any such law.
    47    3. The commissioner of motor vehicles shall make necessary  rules  and
    48  regulations  as  may  be  appropriate  for the proper enforcement of the
    49  provisions of this section.
    50    § 5. The general business law is amended by adding a new section 741-c
    51  to read as follows:
    52    § 741-c. Prohibitions related to private information. No person regis-
    53  tered under this article shall request, receive, accept,  handle,  store
    54  or  transmit  the  private information, as such term is defined in para-
    55  graph (b) of subdivision one of section eight hundred ninety-nine-aa  of
    56  this chapter, of any consumer.

        A. 6655--D                          5

     1    §  6. Section 737 of the general business law, as added by chapter 616
     2  of the laws of 1988, is amended to read as follows:
     3    §  737.  Advance fees prohibited. No automobile broker business or new
     4  automobile broker business shall solicit,  receive  or  collect  from  a
     5  consumer  any fee, or commission, in advance of the performance of those
     6  services specified in the contract as required by section seven  hundred
     7  thirty-eight of this article.
     8    §  7.  The  opening  paragraph  of subdivision 1 of section 738 of the
     9  general business law, as amended by chapter 28 of the laws of  2018,  is
    10  amended to read as follows:
    11    Every  contract  between a consumer and an automobile broker business,
    12  which for the purposes of this  section  shall  include  new  automobile
    13  broker  businesses,  for the purchase of an automobile shall be in writ-
    14  ing, shall be dated, shall contain the street address of the  automobile
    15  broker business and the consumer and shall be signed by the consumer and
    16  by  the automobile broker business. Every contract shall comply with the
    17  requirements set forth in this section and contain the following:
    18    § 8. Section 740 of the general business law, as added by chapter  616
    19  of the laws of 1988, is amended to read as follows:
    20    §  740.  Escrow  required  for  advance payments. All monies paid by a
    21  consumer to an automobile broker business or  a  new  automobile  broker
    22  business  in connection with a transaction covered by this article shall
    23  be trust funds in the possession of such automobile broker  business  or
    24  new  automobile broker business and shall be deposited by it within five
    25  days after receipt thereof, in an  account  in  a  banking  organization
    26  within  the  state.  The  automobile  broker  business or new automobile
    27  broker business shall thereupon notify in writing the  consumer,  giving
    28  the name and address of the banking organization and the amount deposit-
    29  ed.  The  monies  shall  be  held  on deposit until fully applied to the
    30  contract price at the time the automobile is delivered to the  consumer,
    31  unless sooner repaid in accordance with the provisions of this article.
    32    §  9.  Section  740-a of the general business law, as added by chapter
    33  579 of the laws of 2011 and subdivision 1 as amended by chapter  477  of
    34  the laws of 2017, is amended to read as follows:
    35    § 740-a. Automobile broker business and new automobile broker business
    36  surety  bond.  1. Automobile broker businesses shall obtain and continue
    37  in effect a surety bond in an amount of  one  hundred  thousand  dollars
    38  executed  by  a  surety  company  authorized to transact business in the
    39  state by the department of  financial  services  of  the  state  or  its
    40  successor.    New automobile broker businesses shall obtain and continue
    41  in effect a surety bond in an  amount  of  two  hundred  fifty  thousand
    42  dollars  executed by a surety company authorized to transact business in
    43  the state by the department of financial services of the  state  or  its
    44  successor.  The  bonds  shall be approved as to form by the secretary of
    45  state and shall be conditioned on the automobile broker business' or new
    46  automobile broker business' payment of all valid bank drafts,  including
    47  checks,  drawn for the purchase of motor vehicles and safekeeping of all
    48  customer deposits related to the sale of a  motor  vehicle  between  the
    49  time  of receipt of such customer deposit and the transfer of good title
    50  to the vehicle to the customer.
    51    2. Recovery against a bond may be made  by  a  person,  including  the
    52  state,  who obtains a judgment against the automobile broker business or
    53  new automobile broker business for an act or omission on which the  bond
    54  is  conditioned  if  the act or omission occurred during the term of the
    55  bond. The total liability imposed on the surety under this  section  for
    56  all  breaches of the bond condition is limited to the face amount of the

        A. 6655--D                          6

     1  bond. Such liability may include, but is not limited to, the  amount  of
     2  the  valid bank drafts, including checks, drawn by the automobile broker
     3  business or new automobile broker business for  the  purchase  of  motor
     4  vehicles.  In  no  event  shall the surety on a bond be liable for total
     5  claims in excess of the bond amount, regardless of the number or  nature
     6  of claims made against the bond or the number of years the bond remained
     7  in force.
     8    3.  Any  surety  issuing  a bond pursuant to this subdivision shall be
     9  required to provide sixty days' notice to the secretary of  state  prior
    10  to the effective date of cancellation of the bond.
    11    § 10. Section 741 of the general business law, as added by chapter 616
    12  of the laws of 1988, is amended to read as follows:
    13    §  741. Deceptive acts and frauds prohibited. 1. It is hereby declared
    14  to be a deceptive trade practice and unlawful for an  automobile  broker
    15  business  or  new automobile broker business to misrepresent directly or
    16  indirectly in its advertising, promotional  materials,  sales  presenta-
    17  tion, or in any manner:
    18    [1.] (a) The nature of the services to be performed and in the case of
    19  a  new  automobile broker that a third party will be paying for any such
    20  services;
    21    [2.] (b) The time within which the services will be performed;
    22    [3.] (c) The cost of the services to be performed; [and
    23    4.] (d) The ability of the automobile broker business or  new  automo-
    24  bile broker business to perform the services; and
    25    (e) That the automobile broker business or new automobile broker busi-
    26  ness  is affiliated with any automobile manufacturer and/or distributor,
    27  including the use of any trademarks or copyrighted material without  the
    28  express, written consent of the owner of such material.
    29    2. It shall be a fraudulent business practice for an automobile broker
    30  business  or  new  automobile broker business to refuse to disclose to a
    31  motor vehicle dealer or new motor vehicle dealer the registration number
    32  provided by the department of motor vehicles pursuant  to  section  four
    33  hundred  fifteen  of  the vehicle and traffic law. Furthermore, it shall
    34  also be a fraudulent business practice for an automobile broker business
    35  or new automobile broker business to make  any  misrepresentation  to  a
    36  motor vehicle dealer or new motor vehicle dealer regarding the eligibil-
    37  ity  of  any  consumer  for  any  discounts,  reductions  or any benefit
    38  programs regarding the sale or lease of a motor vehicle.
    39    3. It shall be a fraudulent business practice  for  a  new  automobile
    40  broker business to fail to make a bona fide attempt to obtain a quote or
    41  offer  from  at least three unaffiliated dealers on behalf of a prospec-
    42  tive buyer or lessee for a vehicle  meeting  the  prospective  buyer  or
    43  lessee's  specifications, including the new motor vehicle dealer located
    44  in closest proximity  to  the  address  of  such  prospective  buyer  or
    45  lessee's  home  or,  in the case of any entity, its place of doing busi-
    46  ness.
    47    4. It shall be a fraudulent business practice  for  a  new  automobile
    48  broker  business to fail to act for the benefit of the prospective buyer
    49  or lessee, including by failing to make reasonable efforts to obtain the
    50  lowest possible price, down  payment,  number  of  payments,  amount  of
    51  payments,  finance charges, annual percentage rate and/or fees for a new
    52  motor vehicle that meets the specifications of such prospective buyer or
    53  lessee.
    54    § 11. Section 741-a of the general business law, as amended by chapter
    55  477 of the laws of 2017, is amended to read as follows:

        A. 6655--D                          7

     1    § 741-a. Advertising. Automobile broker businesses and new  automobile
     2  broker businesses shall clearly and conspicuously disclose the following
     3  in all advertisements in any medium, and in any print advertisement such
     4  disclosures  shall  not appear in any footnotes and shall be situated in
     5  the top half of any such advertisement in an easily readable typeface:
     6    (a) That the automobile broker business or new automobile broker busi-
     7  ness  is  not  a registered new motor vehicle dealer but is a registered
     8  automobile broker business or new automobile broker business as  defined
     9  in section four hundred fifteen of the vehicle and traffic law;
    10    (b)  The  registration number issued to the automobile broker business
    11  or new automobile broker  business  pursuant  to  section  four  hundred
    12  fifteen of the vehicle and traffic law;
    13    (c)  Whether any fees may be imposed by the automobile broker business
    14  or new automobile broker business for services rendered. Details of such
    15  compensation shall be provided by the automobile broker business or  new
    16  automobile broker business upon request by the consumer; and
    17    (d)  That  no warranty repair services will be provided by the automo-
    18  bile broker business or new automobile broker business.
    19    § 12. Section 741-b of the general business law, as added  by  chapter
    20  28 of the laws of 2018, is amended to read as follows:
    21    §  741-b.  [Disclosure] Disclosures. 1.  An automobile broker business
    22  or new automobile broker business shall provide a disclosure at the time
    23  such automobile broker business or new automobile broker business  takes
    24  an  order  to  search  for  a  leased  or  purchased vehicle meeting the
    25  prospective buyer or  lessee's  specifications.  Such  disclosure  shall
    26  provide  the amount of any fees, commissions or other valuable consider-
    27  ation the automobile broker business or new automobile  broker  business
    28  expects  to  receive  for  any assistance the automobile broker business
    29  provides in effecting the lease or purchase transaction,  including  any
    30  reasonably  foreseeable fees or charges, including delivery fees. In the
    31  case of an automobile broker business this shall include, if known,  any
    32  payments  from  a  dealer,  lessor or any other person or entity for any
    33  assistance the automobile broker  business  provides  in  effecting  the
    34  lease  or  purchase transaction. If the amount of any such fees, commis-
    35  sions or other valuable consideration  the  automobile  broker  business
    36  expects  to  receive  is unknown at the time of the required disclosure,
    37  the automobile broker business shall disclose:  (a)  whether  it  has  a
    38  contract  with  any dealer, lessor or any other person or entity for the
    39  provision of assistance in effecting a lease transaction; and (b) wheth-
    40  er the automobile broker business may  be  compensated  by  the  dealer,
    41  lessor  or  any  other  person or entity for any assistance in effecting
    42  such lease transaction.  Nothing in this subdivision shall be  construed
    43  to permit the payment of any fees, commissions or other valuable consid-
    44  eration to a new automobile broker business by any dealer.
    45    2.  A  new  automobile  broker  business  shall  provide an additional
    46  disclosure at the time such new  automobile  broker  business  takes  an
    47  order  to search for a vehicle meeting the prospective buyer or lessee's
    48  specifications. Such additional disclosure shall state that  the  broker
    49  shall  make  a bona fide attempt to obtain a bid, quote or offer from at
    50  least three unaffiliated dealers on behalf of the prospective  buyer  or
    51  lessee  for a vehicle meeting the prospective buyer or lessee's specifi-
    52  cations, including from the new motor vehicle dealer of such  line  make
    53  located  closest  to  the  home or place of business of such prospective
    54  buyer and that the new automobile broker has a duty to act for the bene-
    55  fit of the prospective buyer or lessee, including by  making  reasonable
    56  efforts  to  obtain  the  lowest possible price, down payment, number of

        A. 6655--D                          8

     1  payments, amount of payments, finance charges,  annual  percentage  rate
     2  and/or fees.
     3    3.  Each  disclosure required by this section shall be acknowledged in
     4  writing by each respective prospective buyer or lessee.
     5    § 13. Section 742 of the general business law, as added by chapter 616
     6  of the laws of 1988, is amended to read as follows:
     7    § 742. Action for  recovery  of  damages  by  consumer.  Any  consumer
     8  injured by a violation of this article or by the breach by an automobile
     9  broker  business  or  new automobile broker business of a contract which
    10  has been entered into pursuant to section seven hundred  thirty-nine  of
    11  this article may bring an action for recovery of damages. Judgment shall
    12  be entered in favor of a consumer in an amount not to exceed three times
    13  the  actual  damages,  but  in  no case less than the amount paid by the
    14  buyer to the automobile broker business or new automobile  broker  busi-
    15  ness.    The  court may award reasonable attorney's fees to a prevailing
    16  plaintiff.
    17    § 14. Section 743 of the general business law, as amended  by  chapter
    18  372 of the laws of 2016, is amended to read as follows:
    19    §  743.  Enforcement  [by]. 1. By attorney general. In addition to the
    20  other remedies provided, whenever there shall be  a  violation  of  this
    21  article,  application may be made by the attorney general in the name of
    22  the people of the state of New York to a court or justice having  juris-
    23  diction  by a special proceeding to issue an injunction, and upon notice
    24  to the defendant of not less than five days, to enjoin and restrain  the
    25  continuance  of such violations; and if it shall appear to the satisfac-
    26  tion of the court or justice that the defendant has, in  fact,  violated
    27  this  article,  an  injunction  may  be issued by such court or justice,
    28  enjoining and restraining any further violation, without requiring proof
    29  that any person has, in fact, been injured or damaged  thereby.  In  any
    30  such  proceeding,  the court may make allowances to the attorney general
    31  as provided in paragraph six of subdivision (a) of section  eighty-three
    32  hundred  three  of the civil practice law and rules, and direct restitu-
    33  tion. Whenever the court shall determine that a violation of this  arti-
    34  cle  has  occurred,  the  court shall impose a civil penalty of not less
    35  than one thousand dollars and not more than three thousand  dollars  for
    36  each  violation.  In the case of an automobile broker, not less than one
    37  thousand dollars and not more  than  three  thousand  dollars  for  each
    38  violation;  and  in  the  case of a new automobile broker, not less than
    39  four thousand dollars and not more than ten thousand  dollars  for  each
    40  violation.  In connection with any such proposed application, the attor-
    41  ney  general is authorized to take proof and make a determination of the
    42  relevant facts and to issue subpoenas in accordance with the civil prac-
    43  tice law and rules.
    44    In connection with any such proposed application, the attorney general
    45  is authorized to take proof and make a  determination  of  the  relevant
    46  facts  and  to issue subpoenas in accordance with the civil practice law
    47  and rules.
    48    2. By local authorities. a. Municipalities may, pursuant to local law,
    49  act upon the business activity that is  the  subject  of  this  article,
    50  provided  that  no  local  government  may  diminish  the protections or
    51  requirements of this article or prevent enforcement of its provisions by
    52  appropriate state officials.
    53    b. The provisions of this article may be enforced in the  same  manner
    54  as  set  forth  in  subdivision one of this section by the director of a
    55  municipal consumer affairs office or a business integrity commission, or
    56  by the town attorney, city corporation counsel, or other lawfully desig-

        A. 6655--D                          9

     1  nated enforcement officer of a municipality or local government, and all
     2  monies collected thereunder shall be retained by  such  municipality  or
     3  local government, provided that no local government may prevent enforce-
     4  ment of its provisions by appropriate state officials.
     5    3.  By  private  party.  Any  persons injured by any violation of this
     6  article may bring an action in his or her own name against an automobile
     7  broker business or a new  automobile  broker  business  to  enjoin  such
     8  unlawful act or practice, an action to recover his or her actual damages
     9  and statutory damages of four thousand dollars, or both such actions. In
    10  the case of a new motor vehicle dealer, injury shall include depriving a
    11  new  motor  vehicle  dealer located closest to a lessee or purchaser the
    12  opportunity to bid on such lease or purchase as entitled by  this  arti-
    13  cle.  Damages  shall  include  the value of incentive payments, bonuses,
    14  holdbacks or similar payments that would have been realized had a lessee
    15  or purchaser purchased or leased such vehicle from the new motor vehicle
    16  dealer in closest proximity to such lessee  or  purchaser  but  for  the
    17  actions  of a person who knowingly aided the violation of the provisions
    18  of this article. Nothing in this section  shall  require  a  franchisor,
    19  manufacturer, or distributor to grant a new motor vehicle dealer a bene-
    20  fit  under an incentive, bonus, holdback or similar payment that the new
    21  motor vehicle dealer did not earn or for which the new motor dealer  did
    22  not  complete or qualify. In any such judicial action or proceeding, the
    23  court may award reasonable attorney's fees and costs.  Such actions  may
    24  be  brought  regardless  of  whether  or not the underlying violation is
    25  consumer-oriented or  has  a  public  impact.  The  court  may,  in  its
    26  discretion, increase the award of damages if the court finds the defend-
    27  ant  willfully or knowingly violated this section. The court shall award
    28  reasonable attorney's fees and costs to a prevailing plaintiff.
    29    § 15. Section 415 of the vehicle and traffic law is amended by  adding
    30  two new subdivisions 21 and 22 to read as follows:
    31    21. Penalties and rights of action for failure to obtain a certificate
    32  of  registration  as  a  new  automobile  broker pursuant to subdivision
    33  three-a and paragraph b-3 of subdivision five of this  section.  a.  The
    34  commissioner,  or  any  person  designated  by  him  or her, may proceed
    35  against a party who has operated as  a  new  automobile  broker  without
    36  certificate  of  registration  in accordance with the provisions of this
    37  article, in any one or more proceedings and by order require the offend-
    38  ing party to pay the people of this state a penalty  in  a  sum  not  to
    39  exceed  two  thousand  dollars  for  each  violation  found to have been
    40  committed. Civil penalties assessed under this subdivision shall be paid
    41  to the commissioner for deposit into  the  state  treasury,  and  unpaid
    42  civil  penalties  may be recovered by the commissioner in a civil action
    43  in the name of the commissioner. For the purposes of this subdivision, a
    44  "violation" shall mean each vehicle sold or leased  to  a  consumer  for
    45  which  the party that failed to obtain certification as a new automobile
    46  broker has served as a new automobile broker.
    47    b. In addition to any civil action brought by the commissioner or  any
    48  person  appointed by him, any persons injured by any violation of subdi-
    49  vision three-a and paragraph b-3 of subdivision five  of  this  section,
    50  shall  be  entitled  to  sue  for and have injunctive relief and damages
    51  against, any party in violation of subdivision three-a and paragraph b-3
    52  of subdivision five of this section in any court  of  the  state  having
    53  jurisdiction over the parties.  In the case of a new motor vehicle deal-
    54  er,  injury shall include depriving the new motor vehicle dealer located
    55  closest to a lessee or purchaser the opportunity to bid on such lease or
    56  purchase as entitled by this article. Damages shall include the value of

        A. 6655--D                         10

     1  incentive payments, bonuses, holdbacks or similar  payments  that  would
     2  have  been  realized  had a lessee or purchaser purchased or leased such
     3  vehicle from the new motor vehicle dealer in closest proximity  to  such
     4  lessee  or purchaser but for the actions of a person who knowingly aided
     5  the violation of the provisions of this article. Nothing in this  subdi-
     6  vision shall require a franchisor, manufacturer, or distributor to grant
     7  a new motor vehicle dealer a benefit under an incentive, bonus, holdback
     8  or similar payment that the new motor vehicle dealer did not earn or for
     9  which  the  new  motor  dealer  did not complete or qualify. In any such
    10  judicial action or proceeding, the court may award reasonable attorney's
    11  fees and costs.  Such actions may be brought regardless  of  whether  or
    12  not  the  underlying  violation  is  consumer-oriented  or  has a public
    13  impact. The court may, in its discretion, increase the award of  damages
    14  if  the  court  finds the defendant willfully or knowingly violated this
    15  section. The court shall award reasonable attorney's fees and costs to a
    16  prevailing plaintiff.
    17    22. New automobile  broker  record  requirements.  a.  New  automobile
    18  brokers  shall  maintain  a  permanently  bound  book  in which shall be
    19  recorded the make, model, year color and vehicle  identification  number
    20  of  all  previously  unregistered  automobiles for which such broker has
    21  provided a service of purchasing, arranging, assisting, facilitating  or
    22  effecting  the purchase or lease of such automobile within any preceding
    23  six-year period.  Such book shall also have recorded  a  record  of  the
    24  name and address of the purchaser or lessor of such automobile, the date
    25  of  sale  or  commencement  of lease of such automobile and the name and
    26  address of the dealer from which the automobile was purchased or leased.
    27    b. New automobile brokers shall maintain a permanently bound  book  in
    28  which  shall be recorded all completed orders to search for a previously
    29  unregistered automobile. Such book shall also have recorded a record  of
    30  the  date  of  such  order, the name and address of the person or entity
    31  ordering such search, the automobile  specifications  provided  by  such
    32  prospective  buyer  or  lessee  and  the name and address of the dealers
    33  solicited for a quote or offer on behalf of such  prospective  buyer  or
    34  lessee.
    35    c. Such books shall be open for inspection by the commissioner, or his
    36  or  her  agent,  during  reasonable business hours. The commissioner may
    37  establish by rule the form of any such book.
    38    d. As an alternative to a bound book, a new automobile broker may  use
    39  a  computer  and  software  approved  by  the department to maintain the
    40  records required to be kept by this section,  provided  all  information
    41  required  by  paragraphs  a  and  b of this section are recorded and the
    42  records conform to such additional requirements  as  determined  by  the
    43  commissioner.
    44    §  16. Section 465 of the vehicle and traffic law is amended by adding
    45  a new subdivision 8 to read as follows:
    46    8. A franchisor may require a franchisee to submit to a franchisor the
    47  name and registration number of any new automobile broker business  that
    48  arranged, assisted, facilitated or effected the purchase or lease of any
    49  vehicle  from  such  dealer. A franchisor may charge back the franchisee
    50  any sales, advertising or  marketing  incentive  payment  or  any  other
    51  payment or benefit associated with the sale or lease of such vehicle for
    52  failure to submit such information.
    53    §  17.  The  general  business  law is amended by adding a new section
    54  737-a to read as follows:
    55    § 737-a. Bona fide bid soliciting required. 1. In providing a  service
    56  of  purchasing,  arranging,  assisting,  facilitating  or  effecting the

        A. 6655--D                         11

     1  purchase or lease of a previously unregistered automobile, a new automo-
     2  bile broker business shall solicit bids from at least three unaffiliated
     3  new motor vehicle dealers on behalf of a prospective buyer or lessee for
     4  a new motor vehicle meeting the specifications of such prospective buyer
     5  or  lessee,  including  the  new motor vehicle dealer located in closest
     6  proximity to the home address of such prospective buyer or lessee or, in
     7  the case of an entity, its place of doing business.
     8    2. The commissioner of motor vehicles may adopt rules and  regulations
     9  necessary to effectuate the provisions of this section.
    10    §  18.  Severability. If any provision of this act, or any application
    11  of any provision of this act, is held to  be  invalid,  that  shall  not
    12  affect the validity or effectiveness of any other provision of this act,
    13  or  of  any other application of any provision of this act, which can be
    14  given effect without that provision or application; and to that end, the
    15  provisions and applications of this act are severable.
    16    § 19. This act shall take effect immediately; provided that all  auto-
    17  mobile  brokers  registered on the effective date of this act shall have
    18  ninety days to come into compliance with the provisions of this act.
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