Tuesday, June 14, 2016

CREDIT CARD SURCHARGES IN NEW YORK



In Expressions Hair Design et al v. Schneiderman et al, 808 F.3d 11 (2d Cir. 2015), the court revived a New York state law banning surcharges on credit card purchases.

General Business Law §518 states that no seller in any sales transaction may impose a surcharge on a holder who elects to use a credit card in lieu of payment by cash, check, or similar means. Any seller who violates the provisions of this section shall be guilty of a misdemeanor punishable by a fine not to exceed $500 or a term of imprisonment up to one year, or both. Confusingly, the law does not prevent retailers from charging different prices to customers paying with cards vis-à-vis those paying with cash—the law only prevents surcharges. Retailers will still be allowed to provide cash-paying customers with discounts off the full price. So, while a hair salon like the one in this case cannot advertise $20 haircuts and charge credit card users $22, it can advertise $20 cuts and charge cash payers $18.

A petition for a writ of certiorari filed was filed on April 5, 2016 and a response is now due August 1, 2016. Brief amicus curiae of Marion B. Brechner First Amendment Project was filed on June 7, 2016.

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