Supply chain disruptions and accompanying inflation for raw materials have challenged many businesses. A recent case involving paint retailer Sherwin-Williams shows how not to deal with these challenges. In a putative class action, plaintiffs accused Sherwin-Williams of surreptitiously adding a hidden “Supply Chain Charge” to every sales transaction. On October 24, the U.S. District Court for the Northern District of New York said the claims may proceed.
The plaintiffs allege they suffered economic injury as a result of a “deceptive bait-and-switch scheme” perpetrated by Sherwin-Williams. They asserted claims of deceptive acts or practices under New York General Business Law § 349, breach of contract, and unjust enrichment. On Sherwin-Williams’ motion to dismiss, the Northern District of New York tossed the unjust enrichment claim, but held that the Section 349 claim and breach of contract claim were plausibly alleged.
Continue Reading Supply Chain Surcharges? Plaintiffs Say You Better Not Conceal Them
States can now require internet retailers to collect sales taxes even if the retailer has no physical presence in the state.
Scrolling online through the California Business and Professions Code the other day, I was struck by a frightening sight. My pulse raced. My jaw dropped. I called out to an associate for help. I wanted to make sure that what I was seeing was real, i.e., that I wasn’t out of my mind. Many lawyers have read 
As states continue their quest to compel online vendors to collect sales and use tax on sales to customers located in the state and to subject such vendors to state income tax, a current trend has been targeting vendors selling via online marketplaces. Some states assert that the presence of inventory held for a vendor or the presence of the marketplace provider/facilitator in a state acting on behalf of a vendor is sufficient nexus or connection of the vendor with the state to subject the vendor to the state’s taxing jurisdiction.
The New York State Department of Health recently proposed a new set of regulations that would loosen marketing and advertising laws affecting New York’s medical cannabis program. The proposed regulations were published in the New York Register on August 23, 2017, and are open for a 30-day public comment period before the new regulations are to take effect.
It’s no secret that automatic renewal (or continuity or negative option programs) are on many regulators hit lists. Regulators argue that consumers are often unaware that they have signed up for services or products for which they will be billed on a monthly basis unless and until they cancel, particularly when it involves a free trial period. In some cases cancellation may not always be easy and the billing descriptor that appears on the consumer’s credit card statement may differ significantly from the branded product or service name. Finally, otherwise busy consumers may simply forget about the upcoming renewal, particularly if the subscription term is lengthy.