STATE OF NEW YORK ________________________________________________________________________ 824 2017-2018 Regular Sessions IN SENATE January 5, 2017 ___________ Introduced by Sen. FUNKE -- read twice and ordered printed, and when printed to be committed to the Committee on Consumer Protection AN ACT to amend the general business law, in relation to establishing a cap that limits the amount a consumer may be charged for leasing a modem from a cable or internet provider The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. The general business law is amended by adding a new article 2 28-F to read as follows: 3 ARTICLE 28-F 4 LEASING OF MODEMS FROM CABLE OR INTERNET PROVIDERS 5 Section 495-a. Purpose. 6 495-b. Definitions. 7 495-c. Prohibited acts. 8 495-d. Enforcement by the attorney general. 9 495-e. Civil penalty. 10 § 495-a. Purpose. The purpose of this article is to limit the amount a 11 cable or internet provider may charge consumers for the lease of a 12 modem. 13 § 495-b. Definitions. For the purposes of this article: 1. "Modem" 14 means an electronic device that makes possible the transmission of data 15 to or from a computer via telephone or other communication lines. 16 2. "Lease" means a contract or instrument conveying property to anoth- 17 er for a specified period or for a period determinable at the will of 18 either lessor or lessee in consideration of compensation. 19 3. "Internet or cable provider" means an organization that provides 20 services for accessing, using, or participating on the internet or 21 cable. 22 § 495-c. Prohibited acts. 1. No cable or internet provider shall 23 charge any consumer an amount which is more than sixteen percent over 24 the actual cost of the modem device paid by the provider. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD03772-01-7S. 824 2 1 2. A cable or internet provider shall disclose in an initial billing 2 correspondence: (a) the amount the modem costs the provider, (b) how 3 many payments the consumer must make on the modem in total, and (c) 4 information regarding how or where a consumer may purchase a modem at 5 retail. 6 3. No cable or internet provider shall charge any consumer a monthly 7 fee for the lease or use of a new modem beyond twelve months after the 8 modem has been provided by such cable or internet provider. If an inter- 9 net or cable provider replaces the customer's existing modem with a new 10 modem during or after such twelve month period an additional twelve 11 month period shall commence. 12 4. No cable or internet provider shall charge an additional or monthly 13 fee for the maintenance of a provided modem. 14 § 495-d. Enforcement by attorney general. Whenever there shall be a 15 violation of this article, application may be made by the attorney 16 general in the name of the people of the state of New York to a court or 17 justice having jurisdiction by a special proceeding to issue an injunc- 18 tion, and upon notice to the defendant of not less than five days, to 19 enjoin and restrain the continuance of such violations; and if it shall 20 appear to the satisfaction of the court or justice that the defendant 21 has, in fact, violated this article, an injunction may be issued by such 22 court or justice, enjoining and restraining any further violation, with- 23 out requiring proof that any person has, in fact, been injured or 24 damaged thereby. In any such proceeding, the court may make allowances 25 to the attorney general as provided in paragraph six of subdivision (a) 26 of section eighty-three hundred three of the civil practice law and 27 rules. 28 § 495-e. Civil penalty. Whenever the court shall determine that a 29 violation of this article has occurred, the court may impose a civil 30 penalty of not more than five hundred dollars for each violation. In 31 connection with any such proposed application, the attorney general is 32 authorized to take proof and make a determination of the relevant facts 33 and to issue subpoenas in accordance with the civil practice law and 34 rules. 35 § 2. This act shall take effect immediately.