STATE OF NEW YORK ________________________________________________________________________ 3369--A 2025-2026 Regular Sessions IN ASSEMBLY January 27, 2025 ___________ Introduced by M. of A. DINOWITZ, WILLIAMS, COLTON, SEAWRIGHT, REYES, KELLES -- read once and referred to the Committee on Consumer Affairs and Protection -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the general business law, in relation to requiring notice of mandatory arbitration clauses in certain consumer contracts The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 399-c of the general business law, as added by 2 chapter 946 of the laws of 1984, is amended to read as follows: 3 § 399-c. Mandatory arbitration clauses in certain consumer contracts 4 [prohibited]. 1. Definitions. 5 a. The term "consumer" shall mean a natural person residing in this 6 state. 7 b. The term "consumer goods" shall mean goods, wares, paid merchandise 8 or services purchased or paid for by a consumer, the intended use or 9 benefit of which is intended for the personal, family or household 10 purposes of such consumer. 11 c. The term "mandatory arbitration clause" shall mean a term or 12 provision contained in a written contract for the sale or purchase of 13 consumer goods, which requires the parties to such contract to submit 14 any controversy thereafter arising under such contract to arbitration 15 prior to the commencement of any legal action to enforce the provisions 16 of such contract and which also further provides language to the effect 17 that the decision of the arbitrator or panel of arbitrators in its 18 application to the consumer party shall be final and not subject to 19 court review. 20 d. The term "arbitration" shall mean the use of a decision making 21 forum conducted by an arbitrator or panel of arbitrators within the 22 meaning and subject to the provisions of article seventy-five of the 23 civil practice law and rules. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD05854-02-5
A. 3369--A 2 1 e. The term "representative" shall mean an employee or agent of a 2 company who is responsible for administering a contract for consumer 3 goods to a consumer. 4 2. a. Prohibition. No written contract for the sale or purchase of 5 consumer goods, entered into on or after the effective date of this 6 section, to which a consumer is a party, shall contain a mandatory arbi- 7 tration clause. Nothing contained herein shall be construed to prohibit 8 a non-consumer party from incorporating a provision within such contract 9 that such non-consumer party agrees that the decision of the arbitrator 10 or panel of arbitrators shall be final in its application to such non- 11 consumer party and not subject to court review. 12 b. Mandatory arbitration clause null and void. The provisions of a 13 mandatory arbitration clause shall be null and void. The inclusion of 14 such clause in a written contract for the sale or purchase of consumer 15 goods shall not serve to impair the enforceability of any other 16 provision of such contract. 17 3. In the event that a consumer is required to sign a contract for 18 consumer goods containing a mandatory arbitration clause the represen- 19 tative shall disclose the mandatory arbitration clause to the consumer 20 and clearly explain, in plain language, what an arbitration clause is. 21 If the consumer is agreeing to a contract by any form of contact that is 22 not personal, including but not limited to, electronically, using the 23 internet or through the mail, such contract shall have, at the end of 24 such contract, information informing the consumer that they are signing 25 a mandatory arbitration clause and an internet link to a valid and plain 26 written explanation of what an arbitration clause is. 27 § 2. This act shall take effect on the one hundred eightieth day after 28 it shall have become a law.