NY State Senate Bill 2013-S5339

Senate Bill S5339

2013-2014 Legislative Session

Regulates and requires issuance of raincheck by retailer where advertised merchandise is not available for sale

download bill text pdf

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 08, 2014	referred to consumer protection
May 16, 2013	referred to consumer protection

2013-S5339 (ACTIVE) - Details

Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Add §397-b, Gen Bus L
Versions Introduced in Other Legislative Sessions:: 2009-2010: S4445
2011-2012: S3049

2013-S5339 (ACTIVE) - Summary

Mandates that any article of merchandise advertised, and not available throughout advertised period, must be supplied at advertised price by seller within sixty days from the date the purchaser of such article is notified of its availability; specifies terms of raincheck and limited exceptions.

2013-S5339 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S5339

TITLE OF BILL:  An act to amend the general business law, in relation
to availability for sale of advertised merchandise

PURPOSE OR GENERAL IDEA OF BILL: This legislation relates to the
availability of merchandise at a price lower than it is normally sold
for, and outlines a detailed policy in relation to rainchecks.

SUMMARY OF SPECIFIC PROVISIONS:  This bill adds a new Section 397-b to
the General Business Law.

Should a retailer advertise merchandise at a price lower than the
product is usually sold at, and such article is not available though
out the advertised period, then at the request of the purchaser the
store must offer to issue a raincheck unless certain provisions exist

This legislation defines rainchecks, details the information which
must be included on the raincheck, and Prescribes the manner in which
affected retailers must inform consumers of the availability of
rain-checks. Each retailer that advertises sale items would be
required to clearly and conspicuously post a sign indicating where a
raincheck can be obtained. Violation of any provision of the bill
would subject a retailer to the provisions of Article 22-A of the
General Business Law for having committed a false and misleading
advertising practice and/or a civil penalty,

JUSTIFICATION: The practice of "bait and switch" advertising which is
deceptive within the statutory proscription (as in Section 349 (a) of
the General Business Law) involves an advertisement and offer of a
product which is not bona fide because what the merchant actually has
on hand and intends to sell is significantly different from that which
drew the potential customer in, and, hence, is a practice which does
not include conduct of a seller in continually modifying proposed
terms of a contract with the buyer as the negotiations proceed. This
judicial decision was set forth in GOLDBERG V.  MANHATTAN LINCOLN
MERCURY 91985), and is taken from McKinney's.  Enactment of this law
would enable New York State to enforce long-standing Federal Trade
Commission regulation and policy, court orders, and a 1972 New York
City Regulation on bait advertising.

Although many retailers have implemented raincheck policies with the
interests of the consumer in mind, some retailers either do not have
policies or employ policies that do not favor the consumer. The result
is that many consumers view raincheck policies with jaundiced eyes.
The credibility of many retailers' raincheck policies have eroded,
creating an industry-wide crisis of confidence.

Neither the consumer nor the retailer wins. Several studies have found
that the Federal Trade Commission policies, New York City regulation,
bait advertising guides, and general orders have not increased
compliance with the premise that when supplies of an advertised item
will not meet anticipated demand, the advertisement should disclose
that fact.  This bill would serve to statutorily recognize these
current rules and regulations and provide for greater enforcement of
them. Indeed, consumers would receive the protection they deserve from
deceptive bait advertising.


PRIOR LEGISLATIVE HISTORY:  A.443 of 2011/2012 A.10778 and S.4445 of
2009/2010

FISCAL IMPLICATIONS: No fiscal implications are related to this
legislation.

EFFECTIVE DATE:  This act shall take effect on the sixtieth day after
it shall have become law.

2013-S5339 (ACTIVE) - Bill Text download pdf

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

                                  5339

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              May 16, 2013
                               ___________

Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Consumer Protection

AN ACT to amend the general business law, in  relation  to  availability
  for sale of advertised merchandise

  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 section
397-b to read as follows:
  S 397-B. AVAILABILITY FOR SALE OF  ADVERTISED  MERCHANDISE.    1.    A
RETAILER  WHO  ADVERTISES  AN ARTICLE OF MERCHANDISE FOR SALE AT A PRICE
WHICH IS REDUCED, IN GOOD FAITH, TO A PRICE BELOW THE PRICE  SUCH  ARTI-
CLES ARE USUALLY SOLD OR OFFERED FOR SALE FOR IN THE STORE, AND DOES NOT
HAVE  SUCH  ARTICLE AVAILABLE THROUGHOUT THE ADVERTISED PERIOD SHALL, ON
THE REQUEST OF A PURCHASER OF SUCH ARTICLE, OFFER TO ISSUE  A  RAINCHECK
UNLESS ONE OR MORE OF THE FOLLOWING SITUATIONS EXISTS:
  (A)    THE ADVERTISEMENT IS MADE IN RELATION TO MAIL ORDER MERCHANDISE
AS REGULATED BY SECTION THREE HUNDRED NINETY-SIX-M OF THIS ARTICLE.
  (B)  THE ADVERTISEMENT IS OF AN ARTICLE THAT IS ONE OF A KIND AND  THE
ADVERTISEMENT CLEARLY AND CONSPICUOUSLY STATES SUCH FACT.
  (C)    THE ADVERTISEMENT CLEARLY AND CONSPICUOUSLY STATES THE SPECIFIC
QUANTITY OF THE ARTICLE AVAILABLE AT THE OUTSET OF THE SALE.
  (D)  THE ADVERTISEMENT CLEARLY AND CONSPICUOUSLY STATES THAT  A  RAIN-
CHECK  IS NOT AVAILABLE.  THIS EXCLUSION MAY ONLY BE USED IF THE ARTICLE
WILL NOT BE OFFERED FOR SALE FOR AT LEAST ONE HUNDRED TWENTY  DAYS  FROM
THE EXPIRATION DATE OF THE ADVERTISEMENT.
  2.    A  RAINCHECK  ISSUED PURSUANT TO SUBDIVISION ONE OF THIS SECTION
SHALL ENTITLE THE HOLDER TO PURCHASE, AT THE STORE  ISSUING  SUCH  RAIN-
CHECK,  THE ADVERTISED ARTICLE AT THE ADVERTISED PRICE WITHIN SIXTY DAYS
FROM THE DATE OF ISSUANCE OR FOR A PERIOD OF TEN BUSINESS DAYS FROM  THE
FIRST DATE OF AVAILABILITY OF THE ARTICLE, WHICHEVER SHALL BE LATER.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD04747-01-3

S. 5339                             2

  THE  ISSUANCE  OF  SUCH RAINCHECK SHALL CONSTITUTE AN AGREEMENT ON THE
PART OF THE SELLER TO SUPPLY  SUCH  ARTICLE  AT  SUCH  PRICE.    NOTHING
CONTAINED HEREIN SHALL PROHIBIT A SELLER FROM OFFERING A SIMILAR ARTICLE
OF  EQUAL  OR  GREATER  VALUE  EITHER  DURING THE PERIOD COVERED BY SUCH
ADVERTISEMENT OF THE ARTICLE OR WITHIN SIXTY DAYS FROM THE DATE OF ISSU-
ANCE  OF  THE  RAINCHECK,  OR  THE SELLER AND PURCHASER FROM AGREEING TO
LENGTHEN THE REDEMPTION PERIOD  OF  SUCH  RAINCHECK.  IF  THE  PURCHASER
ACCEPTS SUBSTITUTION, SUCH SUBSTITUTION SHALL CONSTITUTE COMPLIANCE WITH
THE PROVISIONS OF SUBDIVISION ONE OF THIS SECTION.
  3.  THE RAINCHECK SHALL INCLUDE AT LEAST THE FOLLOWING INFORMATION:
  (A)  NAME, ADDRESS AND TELEPHONE NUMBER OF THE ISSUER.
  (B)  DATE OF ISSUANCE.
  (C)  LAST DATE THAT THE RAINCHECK CAN BE REDEEMED.
  (D)  NAME, DESCRIPTION AND QUANTITY DESIRED OF THE ARTICLE.
  (E)  THE ADVERTISED PRICE.
  4.  THE RAINCHECK SHALL CONTAIN THE FOLLOWING NOTICE:
  YOU MAY REDEEM THIS RAINCHECK FOR THE ADVERTISED ITEM DESCRIBED ON THE
OTHER SIDE WITHIN SIXTY DAYS OF ISSUANCE OR FOR A PERIOD OF TEN BUSINESS
DAYS FROM THE FIRST DATE OF AVAILABILITY OF THE ITEM, WHICHEVER SHALL BE
LATER.
  YOU WILL PAY ONLY THE ADVERTISED PRICE FOR THE ITEM.
  YOU ARE UNDER NO OBLIGATION TO BUY THE ITEM.
  5.  EVERY  RETAILER  WHO ADVERTISES SUCH AN ARTICLE OF MERCHANDISE FOR
SALE, WHICH IS NOT AVAILABLE, SHALL NOTIFY THE PURCHASER NO  LATER  THAN
FIFTEEN  DAYS  AFTER  THE RECEIPT OF SUCH MERCHANDISE BY THE SELLER THAT
THE MERCHANDISE IS NOW AVAILABLE FOR PURCHASE.
  6. THERE SHALL BE, WITHIN EACH RETAIL  ESTABLISHMENT  THAT  ADVERTISES
ITEMS  FOR  SALE  AT  A PRICE BELOW THE USUAL SELLING PRICE, A CLEAR AND
CONSPICUOUSLY POSTED SIGN, POSTER OR PLACARD INDICATING  WHERE  A  RAIN-
CHECK CAN BE OBTAINED.
  7.  IT SHALL BE AN AFFIRMATIVE DEFENSE TO AN ALLEGED VIOLATION OF THIS
SECTION THAT THE SELLER WAS UNABLE  TO  HONOR  A  RAINCHECK  WITHIN  THE
REDEMPTION  PERIOD  BECAUSE SUCH SELLER DID NOT RECEIVE A REORDER OF THE
ADVERTISED ARTICLE FROM A  SUPPLIER  THROUGH  NO  FAULT  OF  THE  SELLER
PROVIDED,  HOWEVER,  THAT THE SELLER MUST MAINTAIN RECORDS SUFFICIENT TO
SHOW THAT THE ADVERTISED SALE ITEMS WERE REORDERED IN ADEQUATE TIME  FOR
DELIVERY AND IN SUFFICIENT QUANTITY TO FULFILL RAINCHECK OBLIGATIONS.
  8. THIS SECTION SHALL NOT APPLY TO A PURCHASE FOR RESALE.
  9.  NOTHING  IN  THIS SECTION SHALL BE CONSTRUED TO RELIEVE THE SELLER
FROM ANY OTHER PROVISION OF LAW PROHIBITING THE ADVERTISING OF GOODS  OR
SERVICES WITH THE INTENT NOT TO MEET REASONABLY EXPECTED DEMAND.
  10. NO PURCHASER SHALL BE REQUIRED TO PREPAY THE PURCHASE PRICE OR ANY
PART THEREOF IN ORDER TO OBTAIN A RAINCHECK.
  11. A PERSON WHO VIOLATES ANY PROVISION OF THIS SECTION IS GUILTY OF A
FALSE  AND MISLEADING ADVERTISING PRACTICE AND SUBJECT TO THE PROVISIONS
OF ARTICLE TWENTY-TWO-A OF THIS CHAPTER.
  12. NOTHING HEREIN SHALL BE CONSTRUED TO RESTRICT  THE  POWER  OF  ANY
COUNTY,  CITY,  TOWN  OR  VILLAGE  TO ADOPT AND ENFORCE ADDITIONAL LOCAL
LAWS, ORDINANCES, OR REGULATIONS WHICH  EXCEED  THE  MINIMUM  APPLICABLE
STANDARDS IN THIS SECTION.
  S  2.  This  act  shall take effect on the sixtieth day after it shall
have become a law.

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