S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7438
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                                May 3, 2019
                                ___________
 
 Introduced by M. of A. DINOWITZ -- read once and referred to the Commit-
   tee on Consumer Affairs and Protection
 
 AN  ACT  to  amend  the general business law, in relation to arbitration
   organizations
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1. Subdivision 1 of section 399-c of the general business law
 is amended by adding a new paragraph e to read as follows:
   E. THE TERM "ARBITRATION  ORGANIZATION"  SHALL  MEAN  AN  ASSOCIATION,
 AGENCY,  BOARD,  COMMISSION,  OR OTHER ENTITY THAT IS NEUTRAL AND INITI-
 ATES, SPONSORS, OR ADMINISTERS AN ARBITRATION PROCEEDING OR IS  INVOLVED
 IN  THE  APPOINTMENT OF AN ARBITRATOR UNLESS SUCH INVOLVEMENT IS LIMITED
 TO A CONTRACTUAL RELATIONSHIP THAT AUTHORIZES THE USE OF ARBITRATION.
   § 2. Section 399-c of the general business law is  amended  by  adding
 three new subdivisions 3, 4 and 5 to read as follows:
   3.  A.  ANY  PRIVATE  ARBITRATION  ORGANIZATION THAT ADMINISTERS OR IS
 OTHERWISE INVOLVED IN FIFTY OR MORE CONSUMER ARBITRATIONS A  YEAR  SHALL
 COLLECT, PUBLISH AT LEAST QUARTERLY, AND MAKE AVAILABLE TO THE PUBLIC IN
 A  COMPUTER-SEARCHABLE  DATABASE  THAT  PERMITS  SEARCHING WITH MULTIPLE
 SEARCH TERMS IN THE SAME SEARCH, WHICH SHALL BE ACCESSIBLE AT THE INTER-
 NET WEBSITE OF THE PRIVATE ARBITRATION  ORGANIZATION,  IF  ANY,  AND  ON
 PAPER  UPON  REQUEST,  ALL  OF  THE FOLLOWING INFORMATION REGARDING EACH
 CONSUMER ARBITRATION IT HAS ADMINISTERED OR OTHERWISE BEEN  INVOLVED  IN
 WITHIN THE PRECEDING FIVE YEARS:
   (1) THE NAME OF THE NON-CONSUMER PARTY, IF THE NON-CONSUMER PARTY IS A
 CORPORATION OR OTHER BUSINESS ENTITY;
   (2)  THE STATE AND ZIP CODE IN WHICH THE CONSUMER PARTY RESIDED AT THE
 TIME OF ARBITRATION;
   (3) THE TYPE OF DISPUTE INVOLVED, INCLUDING GOODS, BANKING, INSURANCE,
 HEALTH CARE, EMPLOYMENT, AND, IF IT INVOLVES EMPLOYMENT, THE  AMOUNT  OF
 THE  EMPLOYEE'S ANNUAL WAGE DIVIDED INTO THE FOLLOWING RANGES: LESS THAN
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD02197-01-9

 A. 7438                             2
 
 ONE HUNDRED THOUSAND  DOLLARS,  ONE  HUNDRED  THOUSAND  DOLLARS  TO  TWO
 HUNDRED  FIFTY  THOUSAND  DOLLARS, INCLUSIVE, AND OVER TWO HUNDRED FIFTY
 THOUSAND DOLLARS;
   (4) WHETHER THE CONSUMER WAS THE PREVAILING PARTY;
   (5)  ON  HOW MANY OCCASIONS, IF ANY, THE NON-CONSUMER PARTY HAS PREVI-
 OUSLY BEEN A PARTY IN AN ARBITRATION OR MEDIATION  ADMINISTERED  BY  THE
 PRIVATE ARBITRATION ORGANIZATION;
   (6)  WHETHER THE CONSUMER PARTY WAS REPRESENTED BY AN ATTORNEY AND, IF
 SO, THE IDENTIFYING INFORMATION FOR THAT ATTORNEY, INCLUDING THE  ATTOR-
 NEY'S  NAME,  THE NAME OF THE ATTORNEY'S FIRM, AND THE CITY IN WHICH THE
 ATTORNEY'S OFFICE IS LOCATED;
   (7) THE DATE THE PRIVATE ARBITRATION ORGANIZATION RECEIVED THE  DEMAND
 FOR  ARBITRATION, THE DATE THE ARBITRATOR WAS APPOINTED, AND THE DATE OF
 DISPOSITION BY THE ARBITRATOR OR PRIVATE ARBITRATION ORGANIZATION;
   (8) THE TYPE OF DISPOSITION OF THE DISPUTE, IF KNOWN, INCLUDING  WITH-
 DRAWAL,  ABANDONMENT,  SETTLEMENT,  AWARD  AFTER  HEARING, AWARD WITHOUT
 HEARING, DEFAULT, OR DISMISSAL WITHOUT HEARING;
   (9) THE AMOUNT OF THE CLAIM, THE AMOUNT OF ANY  AWARD  OR  SETTLEMENT,
 AND ANY OTHER RELIEF GRANTED; AND
   (10)  THE  NAME  OF THE ARBITRATOR, THE ARBITRATOR'S TOTAL FEE FOR THE
 CASE, AND THE PERCENTAGE OF  THE  ARBITRATOR'S  FEE  ALLOCATED  TO  EACH
 PARTY.
   B.  IF  THE INFORMATION REQUIRED BY PARAGRAPH A OF THIS SUBDIVISION IS
 PROVIDED BY THE PRIVATE ARBITRATION ORGANIZATION IN A  COMPUTER-SEARCHA-
 BLE  FORMAT AT THE ORGANIZATION'S INTERNET WEBSITE AND MAY BE DOWNLOADED
 WITHOUT ANY FEE, THE ORGANIZATION MAY CHARGE THE ACTUAL COST OF  COPYING
 TO  ANY PERSON WHO REQUESTS THE INFORMATION ON PAPER. IF THE INFORMATION
 REQUIRED BY PARAGRAPH A OF THIS SUBDIVISION IS  NOT  ACCESSIBLE  THROUGH
 THE USE OF THE INTERNET, THE ORGANIZATION SHALL PROVIDE THAT INFORMATION
 WITHOUT CHARGE TO ANY PERSON WHO REQUESTS THE INFORMATION ON PAPER.
   C.  THIS SUBDIVISION SHALL APPLY TO ANY CONSUMER ARBITRATION COMMENCED
 ON OR AFTER JANUARY FIRST, TWO THOUSAND TWENTY-ONE.
   D. THIS SUBDIVISION SHALL NOT APPLY TO ARBITRATIONS INVOLVING DISPUTES
 BETWEEN CONSUMERS.
   E. THE PROVISIONS OF THIS SUBDIVISION SHALL NOT  APPLY  TO  AGREEMENTS
 NEGOTIATED WITH ANY LABOR UNION THROUGH COLLECTIVE BARGAINING.
   4.  A.  NO  PRIVATE ARBITRATION ORGANIZATION MAY ADMINISTER A CONSUMER
 ARBITRATION TO BE CONDUCTED IN THIS STATE, OR PROVIDE ANY OTHER SERVICES
 RELATED TO A CONSUMER ARBITRATION, IF:
   (1) THE ORGANIZATION HAS, OR WITHIN THE  PRECEDING  YEAR  HAS  HAD,  A
 FINANCIAL INTEREST IN ANY PARTY OR ATTORNEY FOR A PARTY; OR
   (2)  ANY  PARTY  OR  ATTORNEY FOR A PARTY HAS, OR WITHIN THE PRECEDING
 YEAR HAS HAD, ANY TYPE OF FINANCIAL INTEREST IN THE PRIVATE  ARBITRATION
 ORGANIZATION.
   B.  THIS  SUBDIVISION  SHALL  OPERATE  ONLY PROSPECTIVELY SO AS NOT TO
 PROHIBIT THE ADMINISTRATION OF CONSUMER ARBITRATIONS  ON  THE  BASIS  OF
 FINANCIAL  INTERESTS  HELD  PRIOR TO JANUARY FIRST, TWO THOUSAND TWENTY-
 ONE.
   C. FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM "FINANCIAL INTEREST"
 MEANS OWNERSHIP OF MORE THAN A ONE PERCENT LEGAL OR  EQUITABLE  INTEREST
 IN A PARTY, OR A LEGAL OR EQUITABLE INTEREST IN A PARTY OF A FAIR MARKET
 VALUE  IN EXCESS OF ONE THOUSAND FIVE HUNDRED DOLLARS, OR A RELATIONSHIP
 AS DIRECTOR, ADVISOR OR OTHER ACTIVE PARTICIPANT IN  THE  AFFAIRS  OF  A
 PARTY, EXCEPT AS FOLLOWS:

 A. 7438                             3
 
   (1) OWNERSHIP IN A MUTUAL OR COMMON INVESTMENT FUND THAT HOLDS SECURI-
 TIES  IS NOT A "FINANCIAL INTEREST" IN THOSE SECURITIES UNLESS THE ARBI-
 TRATOR PARTICIPATES IN THE MANAGEMENT OF THE FUND.
   (2)  AN OFFICE IN AN EDUCATIONAL, RELIGIOUS, CHARITABLE, FRATERNAL, OR
 CIVIC ORGANIZATION IS NOT A "FINANCIAL INTEREST" IN SECURITIES  HELD  BY
 THE ORGANIZATION.
   (3)  THE  PROPRIETARY INTEREST OF A POLICYHOLDER IN A MUTUAL INSURANCE
 ORGANIZATION, OR A DEPOSITOR IN A MUTUAL SAVINGS ASSOCIATION, OR A SIMI-
 LAR PROPRIETARY INTEREST, IS A "FINANCIAL INTEREST" IN THE  ORGANIZATION
 ONLY  IF  THE  OUTCOME  OF THE PROCEEDING COULD SUBSTANTIALLY AFFECT THE
 VALUE OF THE INTEREST.
   5. A.  WHENEVER THERE SHALL BE A VIOLATION OF THIS SECTION, AN  APPLI-
 CATION  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 CONTIN-
 UANCE OF SUCH VIOLATION; AND IF IT SHALL APPEAR TO THE  SATISFACTION  OF
 THE  COURT  OR  JUSTICE  THAT  THE DEFENDANT HAS, IN FACT, VIOLATED THIS
 SECTION, 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.    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 PRAC-
 TICE LAW AND RULES.
   B. NOTWITHSTANDING ANY RIGHT OF ACTION GRANTED TO THE ATTORNEY GENERAL
 PURSUANT TO THIS SECTION, ANY PERSON WHO HAS BEEN INJURED BY REASON OF A
 VIOLATION  OF THIS SECTION MAY BRING AN ACTION IN HIS OR HER OWN NAME TO
 ENJOIN SUCH UNLAWFUL ACT, AN ACTION TO RECOVER HIS OR HER ACTUAL DAMAGES
 OR BOTH SUCH ACTIONS. THE COURT MAY AWARD REASONABLE ATTORNEY'S FEES  TO
 A PREVAILING PLAINTIFF.
   C.    WHENEVER  THE  COURT  SHALL  DETERMINE  THAT A VIOLATION OF THIS
 SECTION HAS OCCURRED, THE COURT MAY IMPOSE A CIVIL PENALTY OF  NOT  MORE
 THAN TWO THOUSAND DOLLARS FOR SUCH VIOLATION.
   D.  EACH  WRITTEN  CONTRACT OFFERED BY A NON-CONSUMER PARTY AND SUBSE-
 QUENTLY ENTERED INTO IN VIOLATION OF SUBDIVISION  TWO  OF  THIS  SECTION
 SHALL CONSTITUTE A SEPARATE VIOLATION.
   § 3. This act shall take effect on the one hundred eightieth day after
 it shall have become a law.