The use of the Internet creates no exception from the application of consumer protection laws, where there is a New York business and a transaction located in New York. For New York consumer fraud claims, the Internet medium is essentially irrelevant, for the focus is primarily upon the location of the relevant actor and whether a statute has been violated.
Claimant women brought small claims actions, consolidated for decision, to recover the amounts they had paid to defendant Internet dating service, arguing that the service had violated the New York Dating Services Law, N.Y. Gen. Bus. Law § 394-c, and that they had received nothing in return for the large fees they had paid. The two claimants sued to recover, respectively, $1,000 and $3,790 paid under a contract for defendant's services, which offer to expand a client's social horizons primarily through posting a client's video and profile on an Internet site on which other clients can review them and thereafter, as desired, approach a selected client for actual social interaction.
Were defendant's written dating service contracts, whereby claimants paid for defendant's social introduction services to be conducted on the Internet without any specified number of monthly referrals, subject to the Dating Service Law?
The court found that even though the service did not guarantee a particular number of referrals to the women, it charged them far more than § 394-c allowed for the minimal services it did provide. Each woman paid between one and two thousand dollars. Their contracts violated § 394-c in many other ways and did not include the client's Bill of Rights, an absolutely mandated provision. The Dating Services Law authorized awards of actual damages, which the court determined, based on its assessment of the parties' relative credibility, equaled the full contract prices paid, plus interest running from the date of payment. The statute also permitted a court, in its discretion, to notify New York State's Attorney General and the city's Department of Consumer Affairs of violators. The court decided that such a notification was appropriate and announced that it would send a copy of its opinion to those offices, and awarded claimants the amounts they had paid on their contracts, plus interest from the date of payment.