a. The violation of any provision of this subchapter or of any rule promulgated thereunder shall be punishable by a civil penalty of not less than $350 nor more than $2,500. Notwithstanding any other provision of this subchapter, a person shall be subject to a civil penalty of $150, $250, and $350 for a first, second and third or any subsequent violation, respectively, of the same rule for: (1) failing to display a sign in the required form or location or with the content required by rule, including but not limited to any such violation of section 24, 37, or 66 of chapter 5 of title 6 of the rules of the city of New York, or any successor to such provisions; (2) failing to provide a consumer with a required receipt for a retail purchase below $250, including but not limited to any such violation of section 32 of chapter 5 of such title, or any successor to such provision; (3) charging sales tax on the sale of any good or service not subject to such tax, including but not limited to any such violation of section 41 of chapter 5 of such title, or any successor to such provision; or (4) imposing a restaurant surcharge, including but not limited to any such violation of section 59 of chapter 5 of such title, or any successor to such provision.
b. Each individual statement, description or other representation or omission that constitutes a deceptive trade practice shall give rise to a distinct and independent violation.
c. Each day on which an individual statement, description or other representation or omission that constitutes a deceptive trade practice is distributed, broadcast, posted, published, or otherwise exposed to the public shall give rise to a single separate violation; provided, however, that if the department produces evidence sufficient to show that such statement, description or other representation or omission was distributed, broadcast, posted, published, or otherwise exposed to the public on more than one occasion in a single day, each such exposure shall constitute a separate violation, or, alternatively, if the department produces sufficient evidence to show the number of consumers reached by such statement, description or other representation or omission, and that the person making such statement, description or other representation or omission knew, or should have known, that such statement, description or other representation or omission was a deceptive trade practice, a penalty for such violation shall be based instead on each individual consumer reached by such statement, description or other representation or omission.
d. 1. The knowing violation or the third violation of any provision of this subchapter or of any rule promulgated thereunder shall be punishable:
i. by a civil penalty of $3,500; or
ii. as a violation for which a fine of $3,500 shall be imposed; or
iii. both by a civil penalty and as a violation with a fine as provided in paragraphs i and ii of this subdivision.
2. For the purposes of this subdivision, the term "third violation" means a third violation of the same section of this subchapter or rule in a three-year period, provided that each such violation was set forth in a separate guilty plea, decision or settlement agreement.
e. Whenever any person has engaged in any act or practice which constitutes a violation of any provision of this subchapter or of any rule promulgated thereunder, the city may make application to the supreme court by action or proceeding or the commissioner may commence a proceeding by service of a notice of violation returnable to any tribunal established within the office of administrative trials and hearings or within any agency of the city designated to conduct such proceedings.
f. In addition to the authority granted to the department under section 2203 of the charter, the corporation counsel may initiate any investigation to ascertain such facts as may be necessary for the commencement of an action or proceeding pursuant to this section, and in connection therewith shall have the power to issue subpoenas to compel the attendance of witnesses and the production of documents, to administer oaths and to examine such persons as are deemed necessary.
g. An application to the supreme court made pursuant to subdivision e may seek an order:
1. enjoining such acts or practices, including by granting a temporary or permanent injunction or a restraining order;
2. imposing civil penalties pursuant to this section;
3. compelling a defendant to make restitution of all monies, property, or other things of value, or proceeds thereof, received directly or indirectly as a result of any such violation;
4. directing that the amount of money or the property or other things of value recovered be paid into an account established pursuant to section 2601 of the civil practice law and rules from which shall be paid over to any and all persons who purchased the goods or services during the period of violation such sum as was paid by them in a transaction involving the prohibited acts or practices, plus any costs incurred by such claimants in making and pursuing their complaints; provided that if such claims exceed the sum recovered into the account, the awards to consumers shall be prorated according to the value of each claim proved;
5. directing a defendant to pay to the city the costs and disbursements of the action or proceeding and the costs of the city's investigation leading to the judgment; or if not recovered from a defendant, such costs are to be deducted by the city from the grand recovery before distribution to the consumers;
6. directing that any money, property, or other things of value in the account described in this subdivision and unclaimed by any persons with such claims within six years from creation of the account, be paid to the city; and
7. granting all other appropriate relief.
h. Consumers making claims against an account established pursuant to subdivision g shall prove their claims to the commissioner in a manner and subject to procedures established by the commissioner. The procedures established in each case for proving claims shall not be employed until approved by the court, which shall also establish by order the minimum means by which the commissioner shall notify potential claimants of the creation of the account. Restitution pursuant to a judgment in an action or proceeding under this subdivision shall bar, to the extent permitted by law, the recovery of any damages in any other action or proceeding against the same defendant on account of the same acts or practices which were the basis for such judgment, up to the time of the judgment, by any person to whom such restitution is made. Restitution under this subdivision shall not apply to transactions entered into more than five years prior to commencement of an action by the city. Before instituting an action or proceeding under paragraphs 3 through 6 of subdivision g, the commissioner shall give the prospective defendant written notice of the possible action or proceeding at least five days prior to such action or proceeding.
i. A proceeding by service of a notice of violation returnable to any tribunal established within the office of administrative trials and hearings or within any agency of the city designated to conduct such proceedings, made pursuant to subdivision e, may seek an order:
1. granting all applicable civil penalties pursuant to this section;
2. compelling a defendant to make restitution of all monies, property, or other things of value, or proceeds thereof, received directly or indirectly as a result of any such violations, to all affected consumers whether named or unnamed; and
3. granting all other appropriate relief.
j. To establish a cause of action under this section it need not be shown that consumers are being or were actually injured.
(Am. L.L. 2021/098, 9/26/2021, eff. 1/24/2022)
Editor's note: For related unconsolidated provisions, see Appendix A at L.L. 2021/098.