Bill Text: NY A06655 | 2019-2020 | General Assembly | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
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 58-13)
Status: (Introduced - Dead) 2020-02-24 - print number 6655e [A06655 Detail]
Download: New_York-2019-A06655-Amended.html
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 58-13)
Status: (Introduced - Dead) 2020-02-24 - print number 6655e [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. LBD08916-15-9A. 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 theA. 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 theA. 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; [and234.] (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 ofA. 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 ofA. 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 theA. 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.