Bill Text: NY A09824 | 2017-2018 | General Assembly | Amended

---

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

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2018-04-18 - print number 9824a [A09824 Detail]

Download: New_York-2017-A09824-Amended.html

---

                STATE OF NEW YORK
        ________________________________________________________________________
                                         9824--A
                   IN ASSEMBLY
                                    February 14, 2018
                                       ___________
        Introduced  by  M. of A. NIOU -- read once and referred to the Committee
          on Consumer Affairs  and  Protection  --  committee  discharged,  bill
          amended,  ordered reprinted as amended and recommitted to said commit-
          tee
        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, unlawful, deceptive or
     7  abusive acts or practices in the  conduct  of  any  business,  trade  or
     8  commerce  or  in the furnishing of any service [in this state are hereby
     9  declared unlawful].
    10    (1) For the purposes of this section, an act  or  practice  is  unfair
    11  when:
    12    (i)  it causes or is likely to cause substantial injury, the injury is
    13  not reasonably avoidable, and the injury is not outweighed  by  counter-
    14  vailing benefits; or
    15    (ii)  it  takes unreasonable advantage of the inability of a person to
    16  protect his or her interests because of the person's infirmity, illiter-
    17  acy or inability to understand the language of an agreement.
    18    (2) For the purposes of this section, an act or practice  is  unlawful
    19  when it violates any law be it civil or criminal, federal, state, munic-
    20  ipal,  statutory,  administrative  or  any  other law applicable in this
    21  state.
    22    (3) For the purposes of this section, an act or practice is  deceptive
    23  when  the  act or practice misleads or is likely to mislead a person and
    24  the person's interpretation is reasonable under the circumstances.
    25    (4) For the purposes of this section, an act or  practice  is  abusive
    26  when:
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD14112-02-8
        A. 9824--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)]  (e)  In  connection  with  any  proposed  proceeding under this
    40  section, the attorney general is authorized to take  proof  and  make  a
    41  determination  of  the relevant facts, and to issue subpoenas in accord-
    42  ance with the civil practice law and rules.
    43    [(g)] (f) This section shall apply to all [deceptive] prohibited  acts
    44  [or]  and practices [declared to be unlawful], whether or not subject to
    45  any other law of this state, and shall not supersede,  amend  or  repeal
    46  any  other law of this state under which the attorney general is author-
    47  ized to take any action or conduct any inquiry.
    48    [(h)] (g) (1) In addition to the right of action granted to the attor-
    49  ney 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. 9824--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    (i) For purposes of this section, a "person" is defined as an individ-
     6  ual, firm, corporation, partnership, cooperative, association, coalition
     7  or any other organization's legal entity, or group of individuals howev-
     8  er 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    [(j)] (h) Notwithstanding any law to the contrary, all  monies  recov-
    29  ered  or obtained under this article by a state agency or state official
    30  or employee acting in their official capacity shall be subject to subdi-
    31  vision 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.