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Current Developments in the Commercial Divisions of the
New York State Courts by Schlam Stone & Dolan LLP
Posted: June 5, 2020

GBL 349 Claim Fails for Lack of Consumer Impact

On May 8, 2020, Justice Cohen of the New York County Commercial Division issued a decision in Time Warner Cable Enters., LLC v. Accessium Group, Inc., 2020 NY Slip Op. 31426(U), dismissing a GBL 349 claim for lack of consumer impact, explaining:

To state a claim under GBL § 349, Accessium must allege that TWC engaged in conduct that was materially misleading and that caused Accessium to suffer injury. GBL § 349 does not apply to every improper action, but only to conduct that tends to deceive consumers. Although the statute does not preclude its application to disputes between businesses, it does severely limit it. The threshold requirement of consumer-oriented conduct can be met by a showing that the acts or practices have a broader impact on consumers at large in that they are directed to consumers or potentially affect similarly situated consumers.

Here, Accessium fails to show how the complained-of conduct falls within the realm of GBL § 349. Accessium’s claim relates to how TWC’s billing and collection under TWC’s Agreement with Accessium were inaccurate and caused damages to Accessium. Private contract disputes, unique to the parties, would not fall within the ambit of GBL § 349. Further, Accessium’s allegations that TWC’s billing practices negatively affected Accessium’s relationship with its customers do not show that TWC’s actions were directed at Accessium’s customers. In sum, Accessium fails to sufficiently plead a claim for violation of GBL § 349.

(Internal quotations and citations omitted).

Commercial litigation frequently involves fraud-based claims. This decision relates a statute-based fraud claim brought by under General Business Law Section 349. Contact Schlam Stone & Dolan partner John Lundin at jlundin@schlamstone.com if you or a client have a question regarding a fraud-based claim, including one brought pursuant to a state or federal statute.

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