New York has long protected consumers from deceptive and fraudulent business practices. There are laws on the books intended to empower consumers, particularly those who are disadvantaged, and to level the playing field in cases against big businesses and well-funded companies that can better afford the cost of going to court. These laws seek to ensure an honest marketplace where business confidence prevails over deception and mistrust. The experienced New York commercial litigation attorneys at Levy Goldenberg LLP have an impressive track record litigating cases involving deceptive trade practices. Here is what you need to know.
New York’s consumer protection statute, General Business Law Section 349, makes it unlawful to engage in deceptive acts or practices in the conduct of any business, trade, or commerce or in the furnishing of any service in the state. The prohibition against deceptive and misleading business practices applies to nearly all types of economic activity. The statute is very broad in scope, and gives courts the ability to address and respond to the numerous and always evolving kinds of false and deceptive business practices that plague New York consumers.
The statute creates a private right of action for plaintiffs to sue for all sorts of deceptive, consumer-oriented, business conduct. In recent years, New York courts have extended the expansive reach of the statute to include not only products and services directed at individuals for personal or home use, but also to sales and marketing practices directed at businesses and professionals.
Except for television or radio broadcasting stations, or any publisher or printer of newspapers, magazines, or other form of printed advertising, that broadcasts, publishes, or prints ads, the statute applies to every business operating in New York State, including:
There is no requirement that the challenged acts or business practices be intentional, fraudulent, or even reckless, in order to be able to sue under the statute. Justifiable reliance likewise is not an element of a claim under Section 349. To establish liability under this statute, a plaintiff must show that:
The broad consumer protection statute in New York does not apply to every improper action. It is directed at wrongs against the consuming public at large rather than private individuals. This means that private contract disputes that are unique to the parties involved in a particular transaction, rather than consumers as a whole, are not covered by the statute. In order for an act or practice to be actionable under New York Law, it must be likely to mislead a reasonable consumer acting reasonably under the circumstances.
Deceptive trade practices are often characterized by disinformation, false claims, and other misleading tactics that are intended to lure customers into buying a product or service. Examples of activities which have been found to violate the statute include:
It is also unlawful for businesses in New York to engage in false advertising. This includes deceptive ads, product labels and packaging. Mildly inflated claims about a product or service, also known as puffery, are not actionable. However, much like cases brought under the consumer protection statute set forth in General Business Law Section 349, the false advertising need not be as egregious as fraud in order to be actionable under Section 350.
Nonetheless, in addition to pleading and proving that the consumer-oriented advertisement was misleading in a material way, and damages resulting therefrom, a plaintiff suing under General Business Law Section 350 must have relied on the misleading ad. This is generally harder to prove, because reliance will not be presumed if the consumer had a reasonable opportunity to discover the facts about the transaction by using ordinary intelligence or due diligence, or if other factors influenced the consumer’s decision.
Levy Goldenberg LLP, New York’s leading commercial litigation firm, represents consumers and corporate competitors who have been harmed due to a business’ deceptive practices or acts. A successful claimant may recover treble damages, meaning that the court may award three times a plaintiff’s actual damages, as well as punitive damages and attorney’s fees. If you have sustained damages as a result of a deceptive trade practice or false advertising, do not delay. Contact Levy Goldenberg LLP today to discuss your case.
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