New York Rules

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Consider a hypothetical person named Jane, who bought a chair twenty years ago. The chair was designed to help relieve back pain, but it actually made it worse. Because Jane was trying many different remedies, she did not associate the chair with the new pain. Additionally, the problems with the chair were not discovered for many years, when a newspaper reported that the company had known this was a possibility. However, Jane had stopped using the chair after just a couple months, when she underwent a medical procedure that relieved her pain. Jane wants to bring a products liability claim for personal injury and negligent design, but are her claims time-barred? The answer may depend on the state in which Jane brings the action.

Businesses may be wondering whether there is increased risk of price gouging liability when they impose higher penalty terms, ask for higher up-front payments, raise rates, or otherwise seek terms that may be more burdensome. Sellers and service provides should consider the risk of being held liable for non-price terms that result in higher customer costs.

In early April 2020, the First Department affirmed the dismissal of a complaint by a Russian lawyer who had received an L.L.M. from Fordham University alleging “civil conspiracy” against Fordham and several American attorneys, reasoning that New York does not recognize a stand-alone claim of civil conspiracy.

Amid the COVID-19 pandemic, New York Attorney General Letitia James has stated her office will be aggressive in prosecuting price gouging. On March 10, AG James stated, “we will not tolerate schemes or frauds designed to turn large profits by exploiting people’s health concerns.” The NY Office of Attorney General (“OAG”) is tasked with enforcing New York General Business Law Section 396-r, which prohibits parties from selling or offering certain goods or services at an unconscionably excessive price during an abnormal disruption in the market.

This month, the Second Circuit weighed in on open issues relating to discovery under 28 U.S.C. § 1782. Section 1782 allows federal courts to order entities that “reside[] or [are] found” in their district to produce evidence for use in a proceeding before “a foreign or international tribunal” upon request by “any interested person.”

What would companies need to do to comply with the law?

The Stop Hacks and Improve Electronic Data Security (SHIELD) Act imposes requirements in two areas: cybersecurity and data breach notification. The cybersecurity provisions of the proposed SHIELD Act would require companies to adopt “reasonable safe-guards to protect the security, confidentiality and integrity” of private information. The Act provides examples of appropriate administrative, technical, and physical safeguards, such as designating an employee to oversee the company’s data security program; identifying “reasonably foreseeable” risks to data security; selecting vendors that can maintain appropriate safeguards; detecting, preventing and responding to attacks and system failures; and preventing unauthorized access to private information. 

In November 2017, New York Attorney General Eric Schneiderman introduced the Stop Hacks and Improve Electronic Data Security (SHIELD) Act (the “Act”) in the state’s Legislature. Companies – big and small – that collect information from New York residents should take note, as the Act could mean increased compliance costs, as well as potential enforcement actions for those that do not meet the Act’s requirements. This blog post provides a breakdown of the essential components of the SHIELD Act and information on how to comply with this potential new law.