In Borden v. 400 East 55th Street1 the Court of Appeals has revisited2 CPLR 901(b) to clarify that its prohibitions are limited to a narrow class of statutory causes of actions requiring mandatory penalties.
CPLR 901(b), which is unique amongst class action rules whether state3 or federal, provides, in relevant part, that “an action to recover a penalty, or minimum measure of recovery created or imposed by statute may not be maintained as a class action” unless authorized by the statute creating the penalty. In 1975, as the Legislature, at the urging of the Court of Appeals,4 was about to enact CPLR Article 9, CPLR 901(b) was engrafted onto an otherwise modern class action statute equal to or better than Federal Rule 23.5 This was done under the treble damages provision of the Donnelly Act, General Business Law (GBL) 340. The Empire State Chamber of Commerce requested enactment of 901(b) (“Penalties and class actions simply do not mix.”).6
Defining the Scope
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