§ 527-A — Unlawful practices

§ 527-a. Unlawful practices. 1. It shall be unlawful for any business\nmaking an automatic renewal or continuous service offer to a consumer in\nthis state to:\n a. fail to present to the consumer, in a clear and conspicuous manner,\nthe material terms of any automatic renewal offer or continuous service\noffer, including but not limited to a description of the product or\nservice subject to renewal, the amount of the costs that will be\ncharged, the frequency of charges, the deadline by date or frequency by\nwhich the consumer must act to prevent or stop further charges, and\ncancellation mechanisms described in paragraphs d and d-1 of this\nsubdivision, before consent to the offer or billing information has been\nrequested and in visual proximity, or in the case of an offer conveyed\nby voice, in temporal proximity, to the request for consent to the\noffer. If the offer also includes a free gift or trial, or the price is\ntemporary, the offer shall include a clear and conspicuous explanation\nof how and when the price will change and the price or prices that will\nsubsequently be charged to the consumer;\n b. charge the consumer or the consumer's account with a third party\nfor the initial term of an automatic renewal or continuous service\nwithout first obtaining the consumer's affirmative consent to the\nagreement containing the the terms of automatic renewal offer or\ncontinuous service offer, including the terms of an automatic renewal\noffer or continuous service offer that is made at a promotional or\ndiscounted price for a limited period of time;\n b-1. charge the consumer or the consumer's account with a third party\nfollowing an increase in price, or a price higher than what was\ndisclosed pursuant to paragraph a of this subdivision, relating to an\nautomatic renewal or continuous service offer to which the consumer\npreviously consented, without either: (i) first obtaining the consumer's\naffirmative consent to such increased price; or (ii) allowing the\nconsumer to cancel such automatic renewal or continuous service anytime\nwithin, at least, fourteen days after such charge and refund the\nconsumer in the amount equivalent to the price of the remaining term of\nthe service, at the time of such cancellation, on a pro rata basis. The\nprovisions of this paragraph shall not be construed to require any\nbusiness to obtain affirmative consent from the consumer regarding a\nprice increase, or a price increase not disclosed pursuant to paragraph\na of this subdivision, more than once prior to charging the consumer\nsuch increased price;\n c. fail to provide a notice promptly following affirmative consent, in\na manner that is capable of being retained by the consumer. Such notice\nshall include:\n (i) the terms of the automatic renewal or continuous service\nagreement;\n (ii) the amount of costs that will be charged;\n (iii) the frequency of charges;\n (iv) the deadline by date or frequency by which the consumer must act\nto prevent or stop further charges; and\n (v) the cancellation mechanisms, as described in paragraphs d and d-1\nof this subdivision;\n d. fail to provide the consumer with the option to cancel at any time\nusing a simple cancellation mechanism that is as easy to use as the\nmechanism that the consumer used to provide consent and that is through\nthe same medium that the consumer used to provide consent;\n d-1. fail to provide the consumer with the option to cancel, at any\ntime through all mediums by which the business allows a consumer to\nprovide affirmative consent to, the automatic renewal, continuous\nservice offer, or any price increase. Provided further that, where\nconsent was obtained in person, in addition to offering cancellation,\nwhere practical via an in-person method similar to that the user used to\nconsent, the business shall at least offer cancellation through an\nonline mechanism or over a telephone number;\n e. impose unreasonable or unlawful conditions upon, refuse to\nacknowledge, obstruct or unreasonably delay cancellation requested or\nattempts to request cancellation by a consumer. Provided further that:\n (i) unreasonable or unlawful conditions include, but without\nlimitation, hanging up on consumers who call to cancel, providing false\ninformation about how to cancel, misrepresenting the consequences or\ncosts of cancellation, or misrepresenting the reasons for delays in\nprocessing consumers' cancellation requests; and\n (ii) if a consumer conveys a request to cancel, the business may\npresent the consumer with a discounted offer, retention benefit or\ninformation regarding the effect of cancellation but may not impose\nunreasonable or unlawful conditions upon consumer's ability to cancel,\nrefuse to acknowledge, obstruct or unreasonably delay cancellation\nrequested;\n f. fail to notify a consumer of an automatic renewal or continuous\nservice charge for an automatic renewal or continuous service offer with\nan initial paid term of one year or longer, provided that such automatic\nrenewal or continuous service renews for a paid term of six months or\nlonger, at least fifteen days before, but not more than forty-five days\nbefore, the cancellation deadline for such automatic renewal in the\nmanner selected by the consumer, including text, email, app notification\nor any other notification channel offered by the business. Such notice\nshall include instructions on how to cancel such renewal charge;\n g. fail to provide a consumer who has accepted an automatic renewal or\ncontinuous service offer with a clear and conspicuous notice of any\nmaterial change to the terms of the automatic renewal or continuous\nservice offer, including any price increases, at least five business\ndays prior, but no more than thirty days prior, to the date of the\nchange, in the same manner as required by paragraph f of this\nsubdivision; or\n h. fail to notify a consumer of an automatic renewal or continuous\nservice charge for an automatic renewal or continuous service offer if\nthe automatic renewal or continuous service offer includes a free gift\nor trial for a period of more than a month, followed by an upcoming\nautomatic renewal or continuous service charge, at least three days\nbefore but not more than twenty-one days before the cancellation\ndeadline for the first chargeable period in the manner selected by the\nconsumer, including text, email, app notification or any other\nnotification channel offered by the business. Such notice shall include\ninstructions on how to cancel such renewal charge.\n 2. In any case in which a business sends any goods, wares,\nmerchandise, or products to a consumer, under a continuous service\nagreement or automatic renewal of a purchase, without first obtaining\nthe consumer's affirmative consent, the goods, wares, merchandise, or\nproducts shall for all purposes be deemed an unconditional gift to the\nconsumer, who may use or dispose of the same in any manner such consumer\nsees fit without any obligation whatsoever on the consumer's part to the\nbusiness, including, but not limited to, bearing the cost of, or\nresponsibility for, shipping any goods, wares, merchandise, or products\nto the business.\n 3. Whenever there shall be a violation of this section, an application\nmay be made by the attorney general in the name of the people of the\nstate of New York to a court or justice having jurisdiction to issue an\ninjunction, and upon notice to the defendant of not less than five days,\nto enjoin and restrain the continuance of such violations; and if it\nshall appear to the satisfaction of the court or justice that the\ndefendant has in fact, violated this section, an injunction may be\nissued by such court or justice, enjoining and restraining any further\nviolation, without requiring proof that any person has, in fact, been\ninjured or damaged thereby. In any such proceeding the court may make\nallowances to the attorney general as provided in section eighty-three\nhundred three of the civil practice law and rules, and direct\nrestitution. In connection with any such proposed application, the\nattorney general is authorized to take proof and make a determination of\nthe relevant facts and to issue subpoenas in accordance with the civil\npractice law and rules. Whenever the court shall determine that a\nviolation of this section has occurred, the court may impose a civil\npenalty of not more than one hundred dollars for a single violation and\nnot more than five hundred dollars for multiple violations resulting\nfrom a single act or incident. A knowing violation of this section shall\nbe punishable by a civil penalty of not more than five hundred dollars\nfor a single violation and not more than one thousand dollars for\nmultiple violations resulting from a single act or incident. No business\nshall be deemed to have violated the provisions of this section if such\nbusiness shows, by a preponderance of the evidence, that the violation\nwas not intentional and resulted from a bona fide error made\nnotwithstanding the maintenance of procedures reasonably adopted to\navoid such error.\n 4. The following are exempt from the requirements of this article:\n a. any service provided by a business or its affiliate where either\nthe business or its affiliate is doing business pursuant to a franchise\nissued by a political subdivision of the state;\n b. any entity, or subsidiary or affiliate thereof, regulated by the\ndepartment of financial services;\n c. security system alarm operators;\n d. banks, bank holding companies, or the subsidiary or affiliate of\neither, or credit unions or other financial institutions, licensed under\nstate or federal law; and\n e. sellers and administrators of a service contract, as defined\npursuant to section seven thousand nine hundred two of the insurance\nlaw.\n