Consumer Protection Class Actions Have Important Position, Applying New York's Statutory Scheme

Consumer Protection Class Actions (continued)

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Consumer protection class actions can also serve the important function of deterrence. Although the nation's attorneys general have stepped up their enforcement of state consumer protection laws (consider the attorneys general activity in tobacco litigation), their offices lack the resources to challenge all wrongful and fraudulent schemes perpetrated on the citizens of their states. Indeed, in New York, the legislature recognized the need for private enforcement of the State's consumer protection laws in 1980 by providing a right of action to "any person who has been injured" as a result of another's deceptive business, act or practice. See Note: New York Creates A Private Right of Action to Combat Fraud: Caveat Venditor, 48 Brooklyn L.R. 509 (1982); Burns v. Volkswagen of America, Inc., 460 N.Y.S.2d 410, 411-413 (Sup. Ct. 1982) (discussing the causation of the private right of action).

In a June 19, 1980 memorandum from the governor's office approving the creation of the private right of action, it was pointed out that the new laws "will encourage private enforcement of these consumer protection statutes [and] add a strong deterrent against deceptive business practices and supplement the activities of the Attorney General in the prosecution of consumer fraud complaints." Beslity v. Manhattan Honda, 450 N.Y.S.2d 278, 280-81 (1982). See also, Genesco Entertainment v. Coch, 593 F. Supp. 743, 751 (S.D.N.Y. 1984) ("Section 349 is a powerful remedy for consumer fraud. Its broad language was intended to provide a 'strong deterrent against deceptive business practices' and to 'increase the effectiveness of the consumer protection laws'").

P.C. Winner and Ed Tort agree that it would serve the public interest and make sound economic sense to assert Ed's claims on a class basis. They have found that a number of Ed's friends in the retirement home also bought the Super Ear and are dismayed at its failure to perform as promised by Acme. Neither Ed or his friends can afford to sue Acme individually. The expenses alone would be far greater than a complete recovery. P.C. too cannot afford to bring just one or a few Super Ear cases. The only way to get Acme's attention is to file a class action. P.C. checks to see that Section 459 and 350 claims may be brought on a class-wide basis.

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