Judge Marrero weighed in on the scope of a consumer claim under § 349 of the NY General Business Law (“GBL”) in Kaufman v. Sirius XM Radio, Inc. 2010 WL 4674829 (S.D.N.Y. 2010). In that case, plaintiffs –- putative national class members — alleged they were charged an administrative fee that was not disclosed by their user agreements. The key GBL question addressed by Judge Marrero was whether a non-New York plaintiff (and those similarly situated) could adequately plead a GBL § 349 claim. The Court opined that the GBL was not intended for national application, and dismissed claims brought on behalf of non-residents, even though the defendants were headquartered in NY. According to the Court, “[i]n short, Plaintiffs have alleged many signals emanating from New York, but have failed to plead the essential act that must have transpired within the boundaries of the state to maintain a viable suit under GBL § 349: that the deception they allege having experienced occurred in New York.”
Keep in mind that this is the second recent SDNY opinion to construe the section 349 as available to NY based plaintiffs only – see Judge McMahon’s opinion last week in Chiste v. Hotel.com, 2010 WL 4630317 (S.D.N.Y.).
Also, hat tip to Judge Marrero as the New York State Appellate Division, First Department, effusively cited him in deciding that the Martin Act does not preempt properly pled common law claims. See, Assured Guaranty (UK) Ltd. v. J.P. Morgan Inv. Mgt. Inc.,603755/08, decided on November 29. According to the First Department, “in an exhaustive analysis of this issue, Judge Victor Marrero of the Southern District of New York argues cogently and forcefully that, to hold that the Martin Act preempts properly pleaded common-law actions actually serves to “leave  the marketplace arguably less protected than it was before the Martin’s Act passage, which can hardly have been the goal of its drafters” (Anwar v. Fairfield Greenwich Ltd., 2010 U.S. Dist. LEXIS 78425 *59 ).”