N.Y. GBS Law § 394-C — New York Code / Act GBS / Article 26 / Section 394-C
Limitations on certain contracts involving social referral services
Status: in_force

§ 394-c. Limitations on certain contracts involving social referral\nservices. 1. As used in this section, the following terms shall have the\nfollowing meanings:\n  (a) "social referral service" shall include any service for a fee\nproviding matching of members, by use of computer or any other means,\nfor the purpose of dating or general social contact.\n  (b) "ancillary services" shall refer to goods or services directly or\nindirectly related to or to be provided in connection with the social\nreferral service process, including but not limited to photography,\ngrooming, cosmetology, dating etiquette, dating counseling, or other\nservices.\n  (c) "online dating service" shall mean any social referral service\nwhere the services are offered primarily online, such as by means of an\ninternet website or a mobile application.\n  (d) "banned member" shall mean the member whose account or profile is\nthe subject of a fraud ban.\n  (e) "fraud ban" shall mean when a member's account or profile is\nbarred from an online dating service because, in the judgment of the\nservice, the member was found to use or is substantially likely to be\nusing a false identity, or poses a significant risk of attempting to\nobtain money from other members through fraudulent means.\n  (f) "New York member" shall mean a person who provides a New York\nresidential or billing address or zip code or is in New York when\nregistering with the online dating service.\n  (g) "personally identifying information" shall mean any representation\nof information that permits the identity of an individual to whom the\ninformation applies to be reasonably inferred by either direct or\nindirect means which shall include, but shall not be limited to, a\nperson's full name, home address, telephone number, geographic location,\nemail address, social security number, or a combination of\nnon-personally identifying information which, when put together, can\npermit the identification of the person. The first name, last name, and\nimage of an individual, where voluntarily provided to an online dating\nservice with the knowledge that it will be communicated to individuals\non the service's platform other than the individual providing it, shall\nnot be considered personally identifying information when disclosed in\nconnection with a fraud ban.\n  2. No contract for social referral service shall require payment by\nthe purchaser of such service of a cash price in excess of one thousand\ndollars. Services to be rendered to the purchaser under the contract may\nextend over a period not to exceed two years from the date the contract\nis entered into. This subdivision shall not apply to an online dating\nservice contract where the initial term is one year or less and any\nsubsequent terms are one year or less where payment in excess of the\namount provided under this subdivision is reasonable in light of the\nservice's offerings.\n  2-a. No social referral service provider shall require the purchase of\nan ancillary service by a purchaser of a social referral service as a\ncondition of entering into a social referral service contract with such\nprovider.\n  3. Every contract for social referral service which requires payment\nby the purchaser of such service of a total amount in excess of\ntwenty-five dollars shall provide that the seller of such service must\nfurnish to the purchaser a specified certain number of social referrals\nper month.  This subdivision shall not apply to an online dating service\nwhere the user can use a search functionality or is presented with\npossible matches.\n  4. Every contract for social referral service which requires payment\nby the purchaser of such service of a total amount in excess of\ntwenty-five dollars shall provide that in the event that the seller of\nsuch service does not furnish to the purchaser the specified certain\nnumber of social referrals, or in case of an online dating service with\nsearch functionality or algorithm or location based matching, any social\nreferral, for two or more successive months the purchaser shall have the\noption to cancel the contract and to receive a refund of all monies paid\npursuant to the cancelled contract with the exception that the seller\nshall be entitled to retain as a cancellation fee fifteen per cent of\nthe cash price or a pro rata amount for the number of referrals\nfurnished to the purchaser, whichever is greater. Every such contract\nshall set forth in the contract and in the bill of rights the manner in\nwhich such services provider determines its cancellation fee pursuant to\nthis subdivision.\n  5. Every contract for social referral service shall provide that the\nseller will not without the prior written consent of the purchaser sell,\nassign or otherwise transfer for business or for any other purpose to\nany person any information and material of a personal or private nature\nacquired from a purchaser directly or indirectly including but not\nlimited to answers to tests and questionnaires, photographs or\nbackground information.\n  5-a. Every contract for a social referral service shall provide each\npurchaser with the unilateral right to place such purchaser's membership\non hold for a period of up to one year; provided, however, that the\npurchaser and social referral service may mutually agree to a longer\nperiod not to exceed two years. To exercise the unilateral right\nprovided in this subdivision, a purchaser must notify the social\nreferral service provider in writing of such purchaser's intent to do\nso.\n  6. Every contract for social referral service shall provide that at\nthe expiration of the contract or at the expiration of services rendered\nby the seller, for any reason, all information and material of a\npersonal or private nature acquired from a purchaser directly or\nindirectly including but not limited to answers to tests and\nquestionnaires, photographs or background information shall be promptly\nreturned by the seller to the purchaser by certified mail or destroyed\nand deleted from any electronic storage devices, with certification of\ndestruction or deletion promptly provided to the purchaser, unless the\nretention of such information and material is required (a) by federal,\nstate, or local laws, rules or regulations or (b) to comply with a\njudicial court order.\n  7. (a) Every contract for social referral service shall provide that\nsuch contract may be cancelled without a cancellation fee within three\nbusiness days after the date of physical or electronic receipt by the\nbuyer of a copy of the written contract.\n  (b) In every social referral service sale, the seller shall furnish to\nthe buyer a fully completed copy of the contract pertaining to such sale\nat the time of its execution, which is in the same language, e.g.,\nSpanish, as that principally used in the oral sales presentation and\nwhich shows the date of the transaction and contains the name and\naddress of the seller, and in the immediate proximity to the space\nreserved in the contract for the signature of the buyer and in not less\nthan ten-point bold face type, a statement in substantially the\nfollowing form:\nYOU, THE BUYER, MAY CANCEL THIS CONTRACT WITHOUT ANY CANCELLATION FEE\nWITHIN THREE (3) BUSINESS DAYS AFTER THE DATE OF THIS CONTRACT. SEE THE\nATTACHED NOTICE OF CANCELLATION FORM FOR AN EXPLANATION OF THIS RIGHT.\n  (c) Notice of cancellation shall be delivered by certified or\nregistered United States mail at the address, or electronically at the\nemail address, specified in the contract.\n  (d) At the time the buyer signs the social referral service contract,\na completed form in duplicate, captioned "NOTICE OF CANCELLATION", which\nshall be attached to the contract and easily detachable, and which shall\ncontain in not less than ten-point bold face type the following\ninformation and statements in the same language, e.g., Spanish, as that\nused in the contract:\n  NOTICE OF CANCELLATION\n  (enter date of transaction)\n  (Date)\nYOU MAY CANCEL THIS CONTRACT, WITHOUT ANY PENALTY OR OBLIGATION, WITHIN\nTHREE (3) BUSINESS DAYS AFTER THE DATE OF THIS CONTRACT BY MAILING THIS\nSIGNED AND DATED NOTICE OF CANCELLATION BY CERTIFIED OR REGISTERED\nUNITED STATES MAIL OR EMAIL TO THE SELLER AT THE ADDRESS OR EMAIL\nADDRESS SPECIFIED HEREIN. IF YOU CANCEL, ANY PAYMENTS MADE BY YOU UNDER\nTHE CONTRACT WILL BE RETURNED WITHIN TEN (10) BUSINESS DAYS FOLLOWING\nRECEIPT BY THE SELLER OF YOUR CANCELLATION NOTICE. TO CANCEL THIS\nTRANSACTION, MAIL BY CERTIFIED OR REGISTERED UNITED STATES MAIL OR EMAIL\nA SIGNED AND DATED COPY OF THIS CANCELLATION NOTICE TO:\n(Name of Seller)                 NOT LATER THAN _______________\n(Address or email address of Seller)              (Date)\n___________________\n  In case of an online dating service, the contract, including the\nstatement required by this subdivision, may be furnished and signed\nelectronically, provided such contract is provided to the buyer in a\nclear and conspicuous manner.\n  (e) In every social referral service sale or renewal, the seller shall\nprovide each purchaser with a clear and conspicuous, separate written\nnotice, which may be a conspicuous and appropriately labeled hyperlink\nfor an online dating service, to be known as the "Dating Service\nConsumer Bill of Rights", which shall contain at least the following\ninformation:\n                 Dating Service Consumer Bill of Rights\n  1. No social referral service contract shall require the payment by\nyou, the purchaser, of an amount greater than one thousand dollars. In\naddition, no such contract may extend over a period of time greater than\ntwo years.\n  2. No social referral service contract shall require you, the\npurchaser, to purchase a good or service which is directly or indirectly\nrelated to the social referral service. These extra services are known\nas ancillary services and, while these ancillary service may be offered\nto you, the law prohibits the seller from requiring that you purchase\nthis service as a condition of your social referral service contract.\n  3. If your social referral service contract costs more than\ntwenty-five dollars, the seller must furnish a minimum number of\nreferrals per month to you, unless your social referral service provides\nthe user with a search functionality or is presented with possible\nmatches. If this minimum amount is not furnished to you for two\nsuccessive months, or in the case of an online dating service with\nsearch funtionality or algorithm or location based matching, any social\nreferral, you have the option of cancelling the contract and receiving a\nfull refund of all the money you paid, less a cancellation fee which\ncannot exceed either fifteen percent of the cash price or a pro rata\namount for the number of referrals furnished to you.\n  4. Unless your social referral service contract is for online dating\nservices that are generally available to users on a regional, national\nor global basis, your social referral service contract must specify the\ndistance which you, the purchaser, are willing to travel to meet any\nsocial referral. No social referrals shall be furnished where you and\nthe referral live at a distance greater than the distance specified in\nthe contract.\n  5. The provider must have an established policy to address the\nsituation of your moving outside the area it services. This policy must\nbe explained in your contract.\n  6. If any provision of the social referral service contract is\nviolated, you have the right to bring a court action against the\nprovider which has violated the contract.\n  8. Every contract for social referral service shall specify the\ndistance which the buyer is willing to travel to meet any social\nreferral. No social referral shall be furnished by the seller to the\nbuyer if either the buyer or the social referral reside at a distance\nfurther than the distance specified in either the buyer's or social\nreferral's contracts.  This subdivision shall not apply to online dating\nservices that are generally available to users on a regional, national,\nor global basis.\n  8-a. Every social referral service provider must establish and\nadminister a fair and reasonable policy for the situation in which a\npurchaser moves to permanently reside at a location outside the service\narea of such provider. This policy must be set forth in every contract\nfor social referral service.\n  9. (a) Whenever there shall be a violation of this section an\napplication may be made by the attorney general in the name of the\npeople of the state of New York to a court or justice having\njurisdiction by a special proceeding to issue an injunction, and upon\nnotice to the defendant of not less than five days, to enjoin and\nrestrain the continuance of such violation; and if it shall appear to\nthe satisfaction of the court or justice that the defendant has, in\nfact, violated this section, an injunction may be issued by the court or\njustice, enjoining and restraining any further violations, without\nrequiring proof that any person has, in fact, been injured or damaged\nthereby. In any such proceeding, the court may make allowances to the\nattorney general as provided in paragraph six of subdivision (a) of\nsection eighty-three hundred three of the civil practice law and rules,\nand direct restitution. Whenever the court shall determine that a\nviolation of this section has occurred, the court may impose a civil\npenalty of not more than one thousand dollars for each violation. In\nconnection with any such proposed application the attorney general is\nauthorized to take proof and make a determination of the relevant facts\nand to issue subpoenas in accordance with the civil practice law and\nrules, and direct restitution.\n  (b) Any person who has been injured by reason of a violation of this\nsection may bring an action in such person's own name to enjoin such\nviolation, an action to recover such person's actual damages or fifty\ndollars whichever is greater, or both such actions.\n  (c) In cities having a population over one million, the provisions of\nthis section may be enforced concurrently with the attorney general by\nthe director of a local or municipal consumer affairs office. In cities\nhaving a population over one million, such local entities may also\nrequire social referral services to be licensed. Such licensing\nrequirements may be promulgated as are reasonably necessary to\neffectuate licensure, provided, however, that such localities may not\nimpose substantive requirements that are inconsistent with or more\nrestrictive than those set forth in this section. Any fee for such\nlicense may not exceed three hundred forty dollars for a two year\nperiod.\n  10. (a) An online dating service shall disclose to all of its New York\nmembers known to have previously received and responded to an on-site\nmessage from a banned member:\n  (1) the user name, identification number, or other profile identifier\nof the banned member;\n  (2) the fact that the banned member was banned because, in the\njudgment of the online dating service, the banned member may have been\nusing a false identity or may pose a significant risk of attempting to\nobtain money from other members through fraudulent means;\n  (3) that a member should never send money or personal financial\ninformation to another member; and\n  (4) a hyperlink to online information that clearly and conspicuously\naddresses the subject of how to avoid being defrauded by another member\nof an online dating service.\n  (b) The notification required by paragraph (a) of this subdivision\nshall be:\n  (1) clear and conspicuous;\n  (2) by e-mail, text message, or other appropriate means of\ncommunication; and\n  (3) sent within twenty-four hours after the fraud ban, or at a later\ntime if the service has determined, based on an analysis of effective\nmessaging, that a different time is more effective, but in no event\nlater than three days after the fraud ban.\n  (c) An online dating service shall not be liable to any member who has\nan account or profile that is the subject of a fraud ban, for disclosing\nto any member that it has banned the member, the user name or account\nidentifier of the banned member, or the reasons for the online dating\nservice's decision to ban such member in accordance with this\nsubdivision where such disclosure does not contain their personally\nidentifying information.\n  (d) This section does not diminish or adversely affect the protections\nfor online dating services that are afforded in 47 USC 230, or any\nrights or protections otherwise provided to a consumer in law.\n