Assembly Bill A10762

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10762
 
                           I N  A S S E M B L Y
 
                               April 1, 2026
                                ___________
 
 Introduced  by  M.  of  A.  BUTTENSCHON -- read once and referred to the
   Committee on Consumer Affairs and Protection
 
 AN ACT to amend the general business law, in relation to certain  proce-
   dural  protections  granted to third-party sellers and seller profiles
   of online marketplaces
 
   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
 48 to read as follows:
                                ARTICLE 48
   FAIR AND TIMELY PROCESS FOR SUSPENDING THIRD-PARTY SELLERS AND SELLER
                      PROFILES OF ONLINE MARKETPLACES
 SECTION 1705. DEFINITIONS.
         1706. THIRD-PARTY SELLER AND SELLER PROFILE PRE-SUSPENSION WARN-
                 ING PERIOD.
         1707.  THIRD-PARTY  SELLER  AND  SELLER  PROFILE  SUSPENSION AND
                 APPEALS PROCESSES.
         1708. ENFORCEMENT AND PENALTIES.
   § 1705. DEFINITIONS. AS USED IN THIS ARTICLE:
   1. "ONLINE MARKETPLACE" MEANS ANY PERSON OR  ENTITY  THAT  OPERATES  A
 CONSUMER-DIRECTED   ELECTRONICALLY   BASED  OR  ACCESSED  PLATFORM  THAT
 INCLUDES FEATURES THAT ALLOW  FOR,  FACILITATE,  OR  ENABLE  THIRD-PARTY
 SELLERS  AND/OR SELLER PROFILES TO ENGAGE IN THE ADVERTISEMENT, DISPLAY,
 SALE, PURCHASE, PAYMENT, STORAGE, SHIPPING, AND/OR DELIVERY OF A CONSUM-
 ER PRODUCT IN THE UNITED STATES; AND IS USED BY ONE OR MORE  THIRD-PARTY
 SELLERS AND/OR SELLER PROFILES FOR SUCH PURPOSES.
   2.  "THIRD-PARTY SELLER" MEANS ANY PERSON OR ENTITY, INDEPENDENT OF AN
 ONLINE MARKETPLACE, WHO SELLS, OFFERS TO SELL, OR CONTRACTS  TO  SELL  A
 CONSUMER  PRODUCT IN THE UNITED STATES THROUGH SUCH ONLINE MARKETPLACE'S
 PLATFORM.
   3. "SELLER PROFILE" MEANS ANY PERSON  OR  ENTITY,  INDEPENDENT  OF  AN
 ONLINE  MARKETPLACE,  THAT  USES  AN  ONLINE  MARKETPLACE TO SHOWCASE OR
 OTHERWISE ADVERTISE ITS BUSINESS INFORMATION IN ORDER  TO  INDEPENDENTLY
 SOLICIT SALES OF CONSUMER PRODUCT.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD15192-02-6
 A. 10762                            2
 
   4.  "CONSUMER  PRODUCT"  MEANS ANY TANGIBLE PERSONAL PROPERTY WHICH IS
 ADVERTISED AND/OR DISTRIBUTED IN COMMERCE BY  A  THIRD-PARTY  SELLER  OR
 SELLER PROFILE THROUGH AN ONLINE MARKETPLACE.
   5.  "SUSPENSION" MEANS ACTION TAKEN BY AN ONLINE MARKETPLACE TO TEMPO-
 RARILY OR PERMANENTLY BLOCK SELLING PRIVILEGES OF THIRD-PARTY SELLERS OR
 SELLER PROFILES  FOR  ALLEGED  OR  ACTUAL  POLICY  OR  CODE  OF  CONDUCT
 VIOLATIONS, PERFORMANCE ISSUES, OR ACCOUNT INTEGRITY PROBLEMS, INCLUDING
 BUT NOT LIMITED TO PRODUCT QUALITY OR AUTHENTICITY, INTELLECTUAL PROPER-
 TY  INFRINGEMENT,  CUSTOMER  COMPLAINTS  OR  FEEDBACK,  LATE  SHIPMENTS,
 CANCELLATIONS, PRICING OR LISTING ISSUES, OR CUSTOMER SERVICE.
   § 1706. THIRD-PARTY SELLER AND SELLER PROFILE  PRE-SUSPENSION  WARNING
 PERIOD.  1.  NO ONLINE MARKETPLACE SHALL SUSPEND A THIRD-PARTY SELLER OR
 SELLER PROFILE WITHOUT FIRST PROVIDING  A  TWO-WEEK  WARNING  PERIOD  IN
 WHICH THE ONLINE MARKETPLACE:
   (A)  NOTIFIES THE THIRD-PARTY SELLER OR SELLER PROFILE WITH REASONABLE
 DOCUMENTATION AND DETAILS RELATED TO ANY AND  ALL  INFRACTIONS  USED  TO
 JUSTIFY A PARTICULAR SUSPENSION;
   (B)  ALLOWS  THE  THIRD-PARTY  SELLER  OR  SELLER PROFILE TO OFFER ANY
 DEFENSE OR JUSTIFICATION AGAINST ALLEGED OR ACTUAL CULPABILITY, AS  WELL
 AS  THE ABILITY TO CURE ANY AND ALL INFRACTIONS THAT ARE USED TO JUSTIFY
 A PARTICULAR SUSPENSION; AND
   (C) PROVIDES A REASONABLE RESPONSE  TO  ANY  CORRESPONDENCE,  COMMUNI-
 CATION, OR OUTREACH BY A THIRD-PARTY SELLER OR SELLER PROFILE.
   2. SUCH TWO-WEEK WARNING PERIOD SHALL BEGIN WHEN AN ONLINE MARKETPLACE
 PROVIDES  A  THIRD-PARTY  SELLER OR SELLER PROFILE WITH THE NOTIFICATION
 REQUIRED IN PARAGRAPH (A) OF SUBDIVISION ONE OF THIS SECTION AND MAY  BE
 EXTENDED  AT  THE  ONLINE MARKETPLACE'S DISCRETION IN ORDER TO ALLOW THE
 THIRD-PARTY SELLER OR SELLER PROFILE TO CURE ANY AND ALL INFRACTIONS FOR
 THE PURPOSES OF AVOIDING SUCH SUSPENSION.
   § 1707. THIRD-PARTY SELLER AND SELLER PROFILE SUSPENSION  AND  APPEALS
 PROCESSES.  1. AN ONLINE MARKETPLACE SHALL DESIGNATE A REPRESENTATIVE TO
 LIAISE WITH A THIRD-PARTY SELLER  OR  SELLER  PROFILE  WHO  IS  ACTIVELY
 SUSPENDED  OR  PENDING  SUSPENSION,  AS  WELL  AS PROVIDE SUCH REPRESEN-
 TATIVE'S CONTACT  INFORMATION  TO  SUCH  THIRD-PARTY  SELLER  OR  SELLER
 PROFILE.  SUCH  REPRESENTATIVE  SHALL BE WITHIN THE ONLINE MARKETPLACE'S
 DECISION MAKING DEPARTMENT FOR SUSPENSIONS AND SHALL  MAINTAIN  CONSIST-
 ENT,  DIRECT COMMUNICATION WITH A SUSPENDED THIRD-PARTY SELLER OR SELLER
 PROFILE TO WORK TO RESOLVE THE ISSUE LEADING TO SUSPENSION.
   2. A SUSPENDED THIRD-PARTY SELLER OR SELLER  PROFILE  SHALL  HAVE  THE
 RIGHT  TO  APPEAL THE DETERMINATION OF THE ONLINE MARKETPLACE IN SEEKING
 ACCOUNT REINSTATEMENT. SUCH APPEALS SHALL BE ACKNOWLEDGED BY THE  ONLINE
 MARKETPLACE  WITHIN ONE WEEK OF THE APPEAL BEING MADE. AN ONLINE MARKET-
 PLACE SHALL ACKNOWLEDGE AND REASONABLY RESPOND TO A SUSPENDED THIRD-PAR-
 TY SELLER'S OR SELLER PROFILE'S APPEAL WITHIN ONE WEEK OF  THE  APPEAL'S
 SUBMISSION.
   3. UPON A FINAL DETERMINATION BY THE ONLINE MARKETPLACE TO PERMANENTLY
 SUSPEND  A  THIRD-PARTY SELLER OR SELLER PROFILE, THE ONLINE MARKETPLACE
 SHALL PROVIDE ANY AND ALL DOCUMENTS AND INFORMATION DETAILING ALLEGED OR
 ACTUAL INFRACTIONS USED TO JUSTIFY A PARTICULAR SUSPENSION THAT HAVE NOT
 PREVIOUSLY BEEN SHARED WITH THE THIRD-PARTY SELLER OR SELLER PROFILE  AS
 SET  FORTH  IN  SECTION SEVENTEEN HUNDRED SIX OF THIS ARTICLE, WHICH MAY
 ADDITIONALLY BE UTILIZED AND CONSIDERED FOR THE PURPOSES OF  ANY  SUBSE-
 QUENT LEGAL ACTION OR DISPUTE RESOLUTION PROCESS.
   4.  AN  ONLINE  MARKETPLACE  IS  PROHIBITED  FROM SEIZING OR HOLDING A
 SUSPENDED THIRD-PARTY SELLER'S OR  SELLER  PROFILE'S  CONSUMER  PRODUCTS
 A. 10762                            3
 
 THAT  ARE OTHERWISE UNRELATED TO ANY AND ALL INFRACTIONS USED TO JUSTIFY
 A PARTICULAR SUSPENSION.
   5.  A  SUSPENDED  THIRD-PARTY  SELLER OR SELLER PROFILE SHALL HAVE THE
 RIGHT TO RECALL ALL  CONSUMER  PRODUCTS  FROM  AN  ONLINE  MARKETPLACE'S
 POSSESSION THAT ARE LISTED FOR SALE THROUGH SUCH ONLINE MARKETPLACE THAT
 ARE  OTHERWISE  UNRELATED  TO  ANY AND ALL INFRACTIONS USED TO JUSTIFY A
 PARTICULAR SUSPENSION.
   6. AN ONLINE MARKETPLACE IS PROHIBITED FROM HOLDING OR  SEIZING  FUNDS
 FROM  SUSPENDED  THIRD-PARTY SELLERS OR SELLER PROFILES THAT WERE GENER-
 ATED FROM SALES OF CONSUMER PRODUCTS UNRELATED TO ANY  AND  ALL  INFRAC-
 TIONS USED TO JUSTIFY A PARTICULAR SUSPENSION.
   §  1708.  ENFORCEMENT  AND PENALTIES. ANY THIRD-PARTY SELLER OR SELLER
 PROFILE WHO HAS BEEN INJURED BY REASON OF ANY VIOLATION OF THIS  ARTICLE
 MAY  BRING  AN  ACTION  IN SUCH PERSON'S OR ENTITY'S OWN NAME AGAINST AN
 ONLINE MARKETPLACE TO ENJOIN SUCH UNLAWFUL ACT OR PRACTICE, AN ACTION TO
 RECOVER SUCH PERSON'S OR  ENTITY'S  ACTUAL  DAMAGES  OR  FIFTY  DOLLARS,
 WHICHEVER  IS  GREATER,  OR  BOTH  SUCH  ACTIONS.  THE COURT MAY, IN ITS
 DISCRETION, INCREASE THE AWARD OF DAMAGES TO AN  AMOUNT  NOT  TO  EXCEED
 THREE TIMES THE ACTUAL DAMAGES IF THE COURT FINDS THE DEFENDANT WILLFUL-
 LY  OR  KNOWINGLY  VIOLATED THIS ARTICLE. THE COURT MAY AWARD REASONABLE
 ATTORNEY'S FEES TO A PREVAILING PLAINTIFF.
   § 2. This act shall take effect on the ninetieth day  after  it  shall
 have become a law.