The Business Council of New York State strongly opposes S.2407 (Comrie) / A.679 (Niou) which would greatly expand the consumer protection deceptive acts and practices section of the general business law. This overly broad legislation would lead to a needless spike in the number of meritless lawsuits in our already overly litigious state.
This legislation adds the term “unfair” to §349 of the General Business Law, thus creating a vastly broader definition of excessive or unreasonable actions. Defendants would be liable under this legislation if they, in the eyes of the court, may have known or reasonably should have known that a plaintiff was physically infirm, illiterate, or unable to understand language of an agreement. This impossible standard coupled with the broadening of standing to bring suit, now open to almost any person, puts every business, small and large, that enter into contracts at an extremely heightened and unwarranted risk of litigation.
In addition to creating impossible standards for businesses under contract, this legislation further incentivizes litigation by increasing the minimum damage penalties to $2000 and awarding attorney fees. When coupled with the above, the bill’s addition of class actions to this area of the law, all but guaranties a new flood of meritless lawsuits that will clog our already overburdened court system.
The Business Council understands, recognizes and supports the idea of protecting consumers from unfair practices. However, the broadness of this bill will not protect consumers, but instead will unquestionably harm New York residents. This bill will lead to numerous frivolous lawsuits with the potential for excessive punitive damages, increased fees and higher court costs – all which will ultimately lead to higher costs of goods and services for all New Yorkers. A policy that trades litigation windfalls for the few for higher costs for the many is simply bad public policy.
For these reasons, The Business Council of New York State is strongly opposed this legislation.