SB 33 — Protecting consumers against businesses using automatic renewals without consent

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Red = new code to be enacted WEST VIRGINIAvirginia LEGISLATURElegislature REGULARregular SESSIONsession IntroducedCommittee Substitute for Senate Bill 33 By Senators Jeffries, Lindsay, Caputo, Woelfel, Stollings, Romano, Hamilton, and Rucker [Introduced[Originating Januaryin 12,the 2022;Committee on the Judiciary;

referredreported toon theFebruary Committee10, on2022] The  Judiciary]  A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new article, designated §46A-6O-1, §46A-6O-2, §46A-6O-3, §46A-6O-4, §46A-6O-5, and §46A-6O-6, all relating to automatic purchase renewal offers and continuous service offers;

providing that a business shall disclose how to cancel the automatic renewal or continuous service before the consumer payspays, if the offer includes a free gift or trial;

providing thatfor tolling of the statute of limitationslimitations; shall be tolled;

and statingproviding exemptions.

It is the intent of the Legislature to end the practice of ongoing charging of consumera consumer’s credit or debit cardscard or third-party payment accountsaccount without the consumer’s explicit consent for ongoing shipments of a product or ongoing deliveries of service.

(1) “Automatic renewal” means a plan or arrangement in which a paid subscription or purchasing agreement is automatically renewed at the end of a definite term for a specified period of more than one month.

(2) “Automatic renewal offer terms” means the following clear and conspicuous disclosures:

(1)(A) That the subscription or purchasing agreement shall continue until the consumer cancels.cancels;

(2)(B) The description of the cancellation policy that applies to the offer.offer;

(3)(C) The recurring charges that shall be charged to the consumer’s credit or debit card or payment account with a thirdthird-party party as part of the automatic renewal plan or arrangement, and that the amount of the charge may change, and the amount to which the charge shall change, if known.known;

(4)(D) The length of the automatic renewal term or that the service is continuous, unless the length of the term is chosen by the consumer;

and (5)(E) The minimum purchase obligation, if any.

(3) “Clear and conspicuous” or “clearly and conspicuously” means in larger type than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same size, or set off from the surrounding text of the same size by symbols or other marks, in a manner that clearly calls attention to the language.

(4) “Consumer” means any individual who seeks or acquires, by purchase or lease, any goods, services, money, or credit for personal, family, or household purposes.

(5) “Continuous service” means a plan or arrangement for a specified period of more than one month in which a subscription or purchasing agreement continues until the consumer cancels the service.

Provided, That if the offer also includes a free gift or trial, the offer shall include a clear and conspicuous explanation of the price that shall be charged after the trial ends or the manner in which the subscription or purchasing agreement pricing shall change upon conclusion of the trial.trial;

(2) Charge the consumer’s credit or debit card, or the consumer’s account with a thirdthird-party, party, for an automatic renewal or continuous service without first obtaining the consumer’s affirmative consent to the agreement containing the automatic renewal offer terms or continuous service offer terms, including the terms of an automatic renewal offer or continuous service offer that is made at a promotional or discounted price for a limited period of time.time;

or (3) Fail to provide an acknowledgment that includes the automatic renewal offer terms or continuous service offer terms, cancellation policy, and information regarding how to cancel in a manner that is capable of being retained by the consumer:

(f) The requirements of this articlesection apply only prior to the completion of the initial order for the automatic renewal or continuous service, except as follows:

(1) The requirement in subdivision (3), subsection (a) of this section of this code may be fulfilled after completion of the initial order;

and (2) The requirement in subsection (d) of this section shall be fulfilled prior to implementation of the material change.change;

and (3) The requirement of subsection (e) shall apply at least 30 days prior to any charge for automatic renewal or continuous service.

(a) Any violation of §46A-6O-3 of this code shall be an unfair act or deceptive practice:practice.

Any person who alleges that he or she has been harmed by a violation of this article may bring a civil action in a court of competent jurisdiction for appropriate injunctive relief or damages, or both:

Provided, however, That cure offers not accepted within 20 days of receipt shall be considered refused and withdrawn.

(b) Any person who engages, has engaged, or proposes to engage in an unfair competitionact or deceptive practice is liable for a civil penalty not to exceed $1,000 for each violation, which shall be assessed and recovered in a civil action brought in the name of the people of the State of West Virginia by the Attorney General in any court of competent jurisdiction.

The court shall impose a civil penalty for each violation of this chapter.article.

In assessingdetermining the amount of the civil penalty, the court shall consider any one or more of the relevant circumstances presented by any of the parties to the case, including:

The nature and seriousness of the misconduct, the number of violations as to that consumer, the persistence of the misconduct, the length of time over which the misconduct occurred, the willfulness of the defendant’s misconduct, and the defendant’s goodgood-faith faith efforts in resolving the dispute.

(f) A business which makes a good-faith effort to comply with the requirements of this article shall not be subject to the civil penalties provided by this section.

(3) Any entity or one of its affiliates regulated by the Insurance Commission;

 Such NOTE:contract may include a cancellation fee but such fee may not exceed 10 percent of the purchase price or $50, whichever is less.

The purpose of this bill is to protect consumers against businesses using automatic purchase renewals without consent.

Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.