The Expensive Consumer-Protection Madness in New York Keeps Resurfacing
The Consumer and Small Business Protection Act, currently being rushed into law as part of the state budget, is viewed as a giveaway to class-action lawyers and a detriment to New York business.
Gov. Hochul had initially included this act in her budget proposal, with plans to increase the minimum payout for class-action lawsuits from $50 to $1,000 per person. However, the Legislature is now considering an even stricter version of the act.
The proposed legislation put forward by Sen. Leroy Comrie (D-Queens) and Assemblywoman Helene Weinstein (D-Brooklyn) introduces a subjective standard for lawsuits that does not require actual injury to file a suit against a business.
This act raises concerns about its actual protection for consumers and small businesses.
Albany’s lack of transparency in labeling is clear in this case. This act seems to benefit tort attorneys, providing them with the opportunity to search for targets, recruit plaintiffs, file cases, and demand significant payouts to settle the lawsuits – with the $1,000 minimum incentive per person and the threat of litigation costs if the case goes to trial.
This act seems more like a Consumer and Small Business Protection Racket, as businesses are likely to raise prices to cover the additional costs and susceptibility to baseless lawsuits.
Hochul, who aims to create a business-friendly environment in the state, is under criticism for considering this legislation, especially given New York’s ranking as the No. 4 “judicial hellhole” according to the American Tort Reform Foundation.
Assembly Speaker Carl Heastie consistently argues against including such measures in the budget, and it is hoped he maintains this stance with this act.
If lawmakers choose to pass this anti-business, anti-consumer legislation that benefits trial lawyers, they should do so as a standalone bill. This would allow Hochul to veto it, demonstrating her commitment to promoting a positive business environment in the state.
