False Advertising and Deceptive Trade Practices (NY General Business Law § 349)

In New York, one of the most common ways plaintiffs bring fraud-related claims isn’t through common law fraud — it’s through General Business Law § 349 (GBL § 349). This statute is powerful because it’s broader, easier to prove, and applies to virtually any business operating in New York. It’s a favorite tool of plaintiffs’ lawyers — and a risk that many small and mid-sized businesses overlook.

Here’s what every business owner should understand about GBL § 349, what it prohibits, who can sue, and how to stay compliant.

What Does GBL § 349 Prohibit?

The statute makes it unlawful for any business to engage in:

“Deceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service.”

That sounds broad — and it is. Courts have interpreted this language to cover almost any misleading conduct directed at consumers, from false advertising and hidden fees to deceptive pricing or misrepresenting services.

Examples include:

• Misleading promotional claims or advertisements.

• Omitting key information about pricing or product performance.

• Creating a false impression about refund or return policies.

• Burying critical terms in fine print that consumers would not reasonably expect.

Even if the business didn’t intend to deceive, a practice can still violate GBL § 349 if it would mislead a reasonable consumer.

Why Plaintiffs Like GBL § 349

GBL § 349 is popular among plaintiffs because it’s easier to prove than common law fraud.

To win a traditional fraud claim, a plaintiff must prove intentional deception, reliance, and damages — a high bar that often requires showing the defendant’s state of mind.

By contrast, under GBL § 349, the plaintiff only needs to show that the conduct was:

1. Consumer-oriented – it affected the public at large, not just a private dispute.

2. Materially misleading – it was likely to mislead a reasonable consumer.

3. Injurious – it caused actual harm, such as financial loss.

Intent doesn’t have to be proven, and reliance doesn’t have to be specific. This makes § 349 claims far more accessible — and riskier for businesses.

Who Can Sue Under GBL § 349?

GBL § 349 gives several parties the right to bring claims:

• The New York Attorney General can bring enforcement actions on behalf of the public.

• Consumers can sue directly if they believe they were deceived by a business’s conduct.

• Competitors can also sue — if they can show that the deceptive practice harmed their business or gave the other company an unfair advantage.

This last category — business competitors — is particularly important for SMBs. If your marketing, labeling, or pricing strategies are even arguably misleading, your competitors may use GBL § 349 as a weapon in commercial litigation.

The Damage Multiplier

GBL § 349 also includes a damage multiplier that can significantly increase exposure. If a court finds that a business’s deceptive conduct was “willful or knowing,” it can award up to three times the actual damages, with a maximum multiplier of $1,000. In addition, prevailing plaintiffs can recover attorney’s fees, making lawsuits even more attractive — and settlements more costly.

How Businesses Can Protect Themselves

To reduce the risk of GBL § 349 claims, businesses should take proactive compliance steps:

1. Review Marketing and Advertising Materials

Ensure that all product or service descriptions are accurate, substantiated, and not misleading — even by implication. Avoid vague claims like “best in the market” unless they can be objectively supported.

2. Disclose Material Information Clearly

If you’re offering subscriptions, promotions, or automatic renewals, make sure consumers understand the terms. Hidden fees or unclear cancellation processes are common triggers for § 349 lawsuits.

3. Train Sales and Customer Service Teams

Employees who interact with customers should be trained to communicate clearly and avoid overstating capabilities, guarantees, or pricing details.

4. Monitor Competitors and Vendors

If competitors are using deceptive tactics that hurt your business, you may have your own GBL § 349 claim. Understanding how the law works protects you from both sides of the equation.

5. Consult Counsel for Risk Assessments

Regularly review your marketing, website content, and terms of service with legal counsel to ensure compliance with New York’s consumer protection laws.

Final Thoughts

General Business Law § 349 is one of New York’s most far-reaching consumer protection statutes — and one of the most commonly used in litigation. Because it doesn’t require proof of intent, GBL § 349 makes it easier for plaintiffs to sue and harder for businesses to defend. But with clear communication, transparent practices, and periodic compliance reviews, your business can minimize risk and maintain trust.

In today’s competitive environment, honesty isn’t just the best policy — it’s the safest one.

This blog is for informational purposes only and not legal advice. If your business is facing or concerned about a potential false advertising or deceptive trade practices claim, consult experienced counsel.