S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 8373--A

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                              June 15, 2011
                               ___________

Introduced by M. of A. DINOWITZ -- read once and referred to the Commit-
  tee on Consumer Affairs and Protection -- reported and referred to the
  Committee on Codes -- recommitted to the Committee on Codes in accord-
  ance  with  Assembly  Rule  3,  sec.  2  -- 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 enacting the
  discount buying club consumer protection act

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The general business law is amended by adding a new article
30-B to read as follows:
                              ARTICLE 30-B
              DISCOUNT BUYING CLUB CONSUMER PROTECTION ACT
SECTION 641.   SHORT TITLE.
        641-A. DEFINITIONS.
        641-B. BUYER'S OR OTHER OBLIGOR'S RIGHT TO CANCEL.
        641-C. FORM OF NOTICE; STATEMENT OF BUYER'S RIGHTS.
        641-D. ENFORCEMENT; PENALTIES.
  S  641.  SHORT  TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
THE "DISCOUNT BUYING CLUB CONSUMER PROTECTION ACT".
  S 641-A. DEFINITIONS. AS USED IN THIS  ARTICLE,  THE  FOLLOWING  TERMS
SHALL MEAN:
  1.  "BUSINESS  DAY"  MEANS ANY CALENDAR DAY EXCEPT SUNDAY OR ANY LEGAL
HOLIDAY.
  2. "BUYER" AS USED IN THIS ARTICLE MEANS  ANY  INDIVIDUAL  WHO  ENTERS
INTO AN AGREEMENT FOR SERVICES WITH A DISCOUNT BUYING CLUB.
  3.  "DISCOUNT  BUYING  CLUB"  MEANS  ANY  PERSON, FIRM OR CORPORATION,
WHICH, IN EXCHANGE FOR VALUABLE CONSIDERATION,  OFFERS  TO  SELL  OR  TO
ARRANGE THE SALE OF GOODS OR SERVICES TO ITS CUSTOMERS AT PRICES REPRES-
ENTED  TO  BE  LOWER  THAN  ARE GENERALLY AVAILABLE. SUCH TERM SHALL NOT
INCLUDE:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
              

                                                           LBD09185-06-2

A. 8373--A                          2

  A. ANY COOPERATIVE BUYING ASSOCIATION  OR  OTHER  GROUP  IN  WHICH  NO
PERSON IS INTENDED TO PROFIT OR ACTUALLY PROFITS BEYOND THE BENEFIT THAT
ALL MEMBERS RECEIVE FROM BUYING AT A DISCOUNT;
  B. ANY PERSON, FIRM OR CORPORATION THAT:
  (I)  FOR  FIFTY DOLLARS OR LESS SELLS TICKETS OR COUPONS VALID FOR USE
IN OBTAINING GOODS OR SERVICES FROM A RETAIL MERCHANT; OR
  (II) AS A SERVICE COLLATERAL TO ITS PRINCIPAL  BUSINESS,  AND  FOR  NO
ADDITIONAL  CHARGE, ARRANGES FOR ITS MEMBERS OR CUSTOMERS TO PURCHASE OR
LEASE DIRECTLY FROM PARTICULAR MERCHANTS AT A SPECIFIED DISCOUNT; OR
  (III) CHARGES AN ADVANCE FEE FOR ACCESS TO SERVICE,  OR  MEMBER  BENE-
FITS,  AND  ALLOWS  THE  BUYER  TO TERMINATE MEMBERSHIP BY NOTIFYING THE
PERSON, FIRM OR CORPORATION OF INTENT TO  TERMINATE  MEMBERSHIP  WITHOUT
FURTHER OBLIGATION TO MAKE ADDITIONAL PAYMENTS.
  4. "SELLER" SHALL MEAN ANY PERSON, PARTNERSHIP, CORPORATION OR ASSOCI-
ATION ENGAGED IN THE SALE OF DISCOUNT BUYING CLUB SERVICES.
  S 641-B. BUYER'S OR OTHER OBLIGOR'S RIGHT TO CANCEL. 1. IN ADDITION TO
ANY  RIGHT OTHERWISE TO REVOKE AN OFFER, THE BUYER MAY CANCEL A DISCOUNT
BUYING CLUB AGREEMENT UNTIL MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE
DAY ON WHICH THE BUYER HAS SIGNED THE AGREEMENT.  SUCH  AGREEMENT  SHALL
IMPOSE NO LIABILITY ON THE BUYER FOR SUCH CANCELLATION. THE SELLER SHALL
PROVIDE  A  REFUND  OF  ANY FEE PAID BY THE BUYER NOT MORE THAN TEN DAYS
AFTER SUCH CANCELLATION.
  2. CANCELLATION OCCURS WHEN WRITTEN NOTICE OF CANCELLATION IS GIVEN TO
THE SELLER.
  3. NOTICE OF CANCELLATION, IF GIVEN BY MAIL,  SHALL  BE  DEEMED  GIVEN
WHEN DEPOSITED IN A MAILBOX PROPERLY ADDRESSED AND POSTAGE PREPAID.
  S 641-C. FORM OF NOTICE; STATEMENT OF BUYER'S RIGHTS. 1. IN A DISCOUNT
BUYING CLUB SERVICE SALE, THE SELLER SHALL FURNISH TO THE BUYER:
  (A)  A  FULLY COMPLETED RECEIPT OR COPY OF ANY AGREEMENT PERTAINING TO
SUCH SALE AT THE TIME OF ITS EXECUTION, WHICH IS IN THE  SAME  LANGUAGE,
E.G.    SPANISH, AS THAT PRINCIPALLY USED IN THE ORAL SALES PRESENTATION
AND WHICH SHOWS THE DATE OF THE TRANSACTION AND CONTAINS  THE  NAME  AND
ADDRESS  OF THE SELLER, AND IN IMMEDIATE PROXIMITY TO THE SPACE RESERVED
IN THE AGREEMENT FOR THE SIGNATURE OF THE BUYER AND  IN  NOT  LESS  THAN
TWELVE-POINT  BOLD FACE TYPE, A STATEMENT IN SUBSTANTIALLY THE FOLLOWING
FORM:
  "YOU, THE BUYER, MAY CANCEL THIS TRANSACTION  AT  ANY  TIME  PRIOR  TO
MIDNIGHT  OF  THE THIRD BUSINESS DAY AFTER THE DATE OF THIS TRANSACTION.
SEE THE ATTACHED NOTICE OF CANCELLATION FORM FOR AN EXPLANATION OF  THIS
RIGHT."; AND
  (B)  AT THE TIME THE BUYER SIGNS THE DISCOUNT BUYING CLUB AGREEMENT, A
COMPLETED FORM IN DUPLICATE, CAPTIONED "NOTICE OF  CANCELLATION",  WHICH
SHALL  BE  ATTACHED  TO  THE  AGREEMENT AND EASILY DETACHABLE, AND WHICH
SHALL CONTAIN IN NOT LESS THAN TWELVE-POINT BOLD FACE TYPE THE FOLLOWING
INFORMATION AND STATEMENTS IN THE SAME LANGUAGE, E.G. SPANISH,  AS  THAT
USED IN THE AGREEMENT:
                         NOTICE OF CANCELLATION
  (ENTER DATE OF TRANSACTION) _________________________________________
  (DATE)
  YOU  MAY  CANCEL  THIS TRANSACTION, WITHOUT ANY PENALTY OR OBLIGATION,
WITHIN THREE BUSINESS DAYS FROM THE ABOVE DATE.
  IF YOU CANCEL, ANY PAYMENTS MADE BY YOU UNDER THE  AGREEMENT  AND  ANY
NEGOTIABLE  INSTRUMENT EXECUTED BY YOU WILL BE RETURNED WITHIN TEN BUSI-
NESS DAYS FOLLOWING RECEIPT BY THE SELLER OF YOUR  CANCELLATION  NOTICE,
AND  ANY  SECURITY  INTEREST  ARISING  OUT  OF  THE  TRANSACTION WILL BE

A. 8373--A                          3

CANCELLED. TO CANCEL THIS TRANSACTION, MAIL  OR  DELIVER  A  SIGNED  AND
DATED COPY OF THIS CANCELLATION NOTICE OR ANY OTHER WRITTEN NOTICE TO
  (NAME  OF  SELLER),                             AT (ADDRESS OF SELLER)
__________________
  _________________________________
  (PLACE OF BUSINESS)                      NOT LATER THAN MIDNIGHT OF
  ____________________________________ (DATE)
  I HEREBY CANCEL THIS TRANSACTION.
  _________________ (DATE)
  ______________________________ (BUYER'S SIGNATURE)
THE SELLER SHALL COMPLETE BOTH COPIES BY ENTERING THE NAME OF THE  SELL-
ER, THE ADDRESS OF THE SELLER'S PLACE OF BUSINESS, THE DATE OF THE TRAN-
SACTION, AND THE DATE, NOT EARLIER THAN THE THIRD BUSINESS DAY FOLLOWING
THE  DATE  OF  THE  TRANSACTION,  BY  WHICH THE BUYER MAY GIVE NOTICE OF
CANCELLATION.
  2. THE SELLER SHALL INFORM EACH BUYER ORALLY AT THE  TIME  HE  OR  SHE
SIGNS THE AGREEMENT OF HIS OR HER RIGHT TO CANCEL.
  3.  A  DISCOUNT BUYING CLUB AGREEMENT OR RECEIPT SHALL NOT INCLUDE ANY
CONFESSION OF JUDGMENT OR ANY WAIVER OF ANY OF THE RIGHTS TO  WHICH  THE
BUYER  IS  ENTITLED UNDER THIS ARTICLE INCLUDING SPECIFICALLY HIS OR HER
RIGHT TO CANCEL THE SALE IN ACCORDANCE WITH THE PROVISIONS OF THIS ARTI-
CLE.
  4. NO SELLER, OR ANY AGENT OR  EMPLOYEE  THEREOF,  SHALL  DIRECTLY  OR
INDIRECTLY  REPRESENT  IN  ANY MANNER DURING A SALES PRESENTATION THAT A
CONSUMER MUST SIGN AN AGREEMENT ON THE SAME DAY AS SUCH PRESENTATION  IN
ORDER TO AVOID A LIFETIME PROHIBITION ON PURCHASING DISCOUNT BUYING CLUB
SERVICES FROM SUCH SELLER.
  S  641-D.  ENFORCEMENT;  PENALTIES.  1.  WHENEVER  THERE  SHALL  BE  A
VIOLATION OF THE PROVISIONS OF THIS ARTICLE, AN APPLICATION MAY BE  MADE
BY  THE  ATTORNEY  GENERAL IN THE NAME OF THE PEOPLE OF THE STATE OF NEW
YORK TO A COURT OR JUSTICE HAVING JURISDICTION BY A  SPECIAL  PROCEEDING
TO  ISSUE  AN  INJUNCTION,  AND UPON NOTICE TO THE DEFENDANT OF NOT LESS
THAN  FIVE  DAYS,  TO  ENJOIN  AND  RESTRAIN  THE  CONTINUANCE  OF  SUCH
VIOLATIONS;  AND  IF IT SHALL APPEAR TO THE SATISFACTION OF THE COURT OR
JUSTICE THAT THE DEFENDANT HAS,  IN  FACT,  VIOLATED  THIS  ARTICLE,  AN
INJUNCTION  MAY  BE  ISSUED  BY  SUCH  COURT  OR  JUSTICE, ENJOINING AND
RESTRAINING ANY FURTHER VIOLATION,  WITHOUT  REQUIRING  PROOF  THAT  ANY
PERSON  HAS,  IN  FACT,  BEEN  INJURED  OR  DAMAGED THEREBY. IN ANY SUCH
PROCEEDING, THE COURT MAY MAKE ALLOWANCES TO  THE  ATTORNEY  GENERAL  AS
PROVIDED  IN  PARAGRAPH  SIX  OF SUBDIVISION (A) OF SECTION EIGHTY-THREE
HUNDRED THREE OF THE CIVIL PRACTICE LAW AND RULES, AND  DIRECT  RESTITU-
TION.  WHENEVER THE COURT SHALL DETERMINE THAT A VIOLATION OF THIS ARTI-
CLE HAS OCCURRED, THE COURT MAY IMPOSE A CIVIL PENALTY OF NOT MORE  THAN
ONE  THOUSAND  DOLLARS  FOR  EACH VIOLATION. IN CONNECTION WITH ANY SUCH
PROPOSED APPLICATION, THE ATTORNEY GENERAL IS AUTHORIZED TO  TAKE  PROOF
AND MAKE A DETERMINATION OF THE RELEVANT FACTS AND TO ISSUE SUBPOENAS IN
ACCORDANCE WITH THE CIVIL PRACTICE LAW AND RULES.
  2.  NOTHING  IN THIS SECTION SHALL IN ANY WAY LIMIT RIGHTS OR REMEDIES
WHICH ARE OTHERWISE AVAILABLE UNDER LAW TO THE ATTORNEY GENERAL.
  S 2. If any provision of article 30-B of the general business law,  as
added  by  section one of this act, or the application of such provision
in certain circumstances shall be held  invalid,  the  validity  of  the
remainder  of  such article and its applicability to other circumstances
shall not be affected.
  S 3. This act shall take effect on the first of January next  succeed-
ing the date upon which it shall have become a law.