Consumer Protection or Business Protection: New York Updates Consumer Protection Law to Go Beyond Protecting Consumers

New York Governor Kathy Hochul recently signed into law the Fostering Affordability and Integrity through Reasonable (FAIR) Business Practices Act (the Act). Effective February 2026, the Act represents a significant expansion of New York’s primary consumer protection statute, General Business Law (GBL) Section 349. The amendments dramatically expand the New York Attorney General (NYAG) scope and enforcement authority.  The NYAG has signaled that health care is a key enforcement priority under the Act, and industry should be paying attention. 

Expanded Prohibition: “Abusive” and “Unfair” Acts

"Deceptive acts or practices in the conduct of any business, trade, or commerce" have long been prohibited under Section 349. The Act now expands the prohibition to include both "abusive" and "unfair" acts or practices.  Importantly, under N.Y. GEN. BUS. LAW § 349(h) a private right of action exists only for deceptive acts and practices, meaning that only the attorney general may bring an action for unfair or abusive acts and practices.

Conduct is considered “abusive” if it materially interferes with a person’s ability to understand a term or condition of a product or service or takes unreasonable advantage of a person’s (A)  lack of understanding of the material risks, costs, or conditions; (B)  interests in selecting or using a product or service; or (C)  reliance on the actor to act in their interests. N.Y. GEN. BUS. LAW § 349(a)(2).

Conduct is considered "unfair" if it "causes or is likely to cause substantial injury which is not reasonably avoidable and is not outweighed by countervailing benefits to consumers or to competition". N.Y. GEN. BUS. LAW § 349(a)(1). This definition largely tracks the Federal Trade Commission Act[1] with one notable - and important - distinction: the Act does not require injury to consumers.

Elimination of the “Consumer-Oriented” Requirement 

New York Courts have historically limited Section 349 claims to conduct that has a “broad impact on consumers at large,” excluding private, one-off commercial disputes between sophisticated parties[2].  As a result, "private contract disputes, unique to the parties," have been generally held to be outside the scope of Section 349. No more. The Act explicitly declares that: "An act or practice made unlawful by this section is actionable by the attorney general regardless of whether or not that act or practice is consumer-oriented." N.Y. GEN. BUS. LAW § 349(b)(3).  Consequently, purely commercial conduct – previously outside the statute’s reach – may now be subject to enforcement, even in the absence of consumer involvement. 

Minimal Nexus to New York Required 

The Act enables the NYAG to bring actions against "any person conducting any business, trade, or commerce or furnishing a service" in New York, regardless of whether that person is located in New York. N.Y. GEN. BUS. LAW § 349(b)(2). The Act also allows the NYAG to bring an action against any person within New York, "whether or not the business, trade, commerce, or service is conducted or furnished within the state." N.Y. GEN. BUS. LAW § 349(b)(2). This new provision subjects conduct to the NYAG’s enforcement authority that courts previously dismissed for a lack of connection to New York[3]. 

Key Takeaways

The Act provides the NYAG significant new enforcement tools. Businesses should keep the following in mind:

• “Unfair” and “abusive” practices are subject to government enforcement, but not to private rights of action. The Act allows for government enforcement actions against "unfair" and "abusive" practices, but private rights of action arestill limited to deceptive acts. N.Y. GEN. BUS. LAW § 349(h).
• Purely commercial conduct is now at risk: The NYAG is now vested with authority to enforce against abusive and unfair practices in purely commercial transactions, without any alleged harm to consumers. Businesses should be mindful of this when crafting commercial agreements, as provisions such as pricing and indemnity may now be evaluated under this framework.
• Broad application to businesses that touch New York: Businesses engaging in New York, located in New York, or touching New York consumers in any way should be mindful of this expansion - the Act broadly applies to anyone engaging in business in New York or located in New York and acting elsewhere.
• Health care remains an enforcement priority: The NYAG’s press release announcing  enactment of the Act emphasizes that health care enforcement remains a top priority, with the NYAG specifically citing efforts to curb “unfair billing practices by health care companies” and noting that “health insurance companies that present customers with long lists of in-network doctors who, in reality, do not accept the insurance” as among the “unfair and abusive” practices now subject to enforcement.  

Mintz continues to closely monitor developments regarding consumer protection laws in New York and elsewhere. If you have questions about consumer protection enforcement, please contact one of the individuals above or your regular Mintz attorney.

[1] 15 U.S.C. § 45(n) (“The Commission shall have no authority . . . to declare unlawful an act or practice on the grounds that such act or practice is unfair unless the act or practice causes or is likely to cause substantial injury to consumers which is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or to competition.”).

[2] See, e.g., Bates v. Abbott Labs., No. 24-CV-919, 2025 U.S. App. LEXIS 496, at *2 (2d Cir. Jan. 10, 2025); Singh v. City of New York, 40 N.E.3d 1, 5 (N.Y. 2023); Himmelstein, McConnell, Gribben, Donoghue & Joseph, LLP v. Matthew Bender & Co., 37 N.Y.3d 169, 176 (N.Y. 2021).

[3] See e.g., Scott v. Bell Atl. Corp., 726 N.Y.S.2d 60, 63 (N.Y. App. Div. 2001) (finding that “the General Business Law claims should have been dismissed . . . [S]ection[] 349 expressly proscribe[s] specified conduct that takes place "in this state."); Murrin v. Ford Motor Co.,  756 N.Y.S.2d 596, 598 (“The plaintiff also did not adequately plead a cause of action alleging a violation of General Business Law § 349, since he failed to allege that the deceptive acts complained of took place within the State of New York.”).

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