Expressions Hair Design, et al., Respondents,v.Eric T. Schneiderman,, et al., Appellants.BriefN.Y.January 2, 2018No. CTQ-2018-00004 To be argued by: JUDITH N. VALE 15 minutes requested On Certified Question from the United States Court of Appeals for the Second Circuit State of New York Court of Appeals EXPRESSIONS HAIR DESIGN, et al., Plaintiffs-Respondents, -against- ERIC T. SCHNEIDERMAN, in his official capacity as Attorney General of the State of New York, et al., Defendants-Appellants, GERALD MOLLEN, &c, Defendant. REPLY BRIEF FOR APPELLANT ATTORNEY GENERAL STEVEN C. WU Deputy Solicitor General JUDITH N. VALE Senior Assistant Solicitor General of Counsel BARBARA D. UNDERWOOD Attorney General State of New York 28 Liberty Street New York, NY 10005 (212) 416-6274 (212) 416-8962 (facsimile) Dated: August 29, 2018 i TABLE OF CONTENTS Page TABLE OF AUTHORITIES ............................................................. ii PRELIMINARY STATEMENT ........................................................ 1 ARGUMENT .................................................................................... 2 A SELLER COMPLIES WITH GBL § 518 SO LONG AS IT POSTS ITS CREDIT-CARD PRICE IN DOLLARS AND CENTS .......................... 2 A. A Seller May Not Comply with GBL § 518’s Prohibition on Credit-Card Surcharges by Adding a Surcharge for Credit-Card Use. .................................. 4 B. Neither the Rule of Lenity Nor Constitutional Avoidance Supports Plaintiffs’ Interpretation. ........... 16 CONCLUSION ............................................................................... 23 ii TABLE OF AUTHORITIES Cases Page(s) Connecticut Bar Assn. v. United States, 620 F.3d 81 (2d Cir. 2010) ......................................................... 20 Dana’s R.R. Supply v. Attorney General, 807 F.3d 1235 (11th Cir. 2015) .................................................. 21 Italian Colors Rest. v. Becerra, 878 F.3d 1165 (9th Cir. 2018) ............................................... 21-22 Jennings v. Rodriguez, 138 S. Ct. 830 (2018) .................................................................. 18 McDonald v. Board of Election Commrs. of Chicago, 394 U.S. 802 (1969) .................................................................... 16 National Institute of Family & Life Advocates v. Becerra, 138 S. Ct. 2361 (2018) ................................................................ 19 People v. Green, 68 N.Y.2d 151 (1986) ................................................................. 16 Spirit Airlines Inc. v. United States Dept. of Transp., 687 F.3d 403 (D.C. Cir. 2012) .............................................. 16, 20 United States v. Lanier, 520 U.S. 259 (1997) .................................................................... 17 Williamson v. Lee Optical of Okla., Inc., 348 U.S. 483 (1955) .................................................................... 15 Zauderer v. Office of Disciplinary Counsel of Supreme Ct. of Ohio, 471 U.S. 626 (1985) .............................................................. 18, 20 Laws C.P.L.R. 3001 .................................................................................... 6 iii Legislative Hearings Page(s) Cash Discount Act: Hr’g Before the S. Subcommittee on Consumer Affairs, 97th Cong. (1981) (CIS No. 81-S241-18) ................................................................. 11 The Fair Credit Billing Act Amendments: Hr’g Before the H.R. Subcomm. on Consumer Affairs, 94th Cong. (1975) (CIS No. 76-H241-1D) ................................................................ 10 FCBA Two-Tiered Pricing: Hr’g Before the S. Subcomm. on Consumer Affairs, 94th Cong. (1975) (CIS No. 76-S241-3) ................................................................... 10 Miscellaneous Authorities Expressions Hair Design, Services, at http://www.expressionshairvestal.com/services.asp ................. 14 Ian Lee et al., Macdonald-Laurier Inst., Credit Where It’s Due (Oct. 2013), at https://goo.gl/21TQGL........................................ 21 Nat’l Econ. Council, The Competition Initiative and Hidden Fees (2016), at https://obamawhitehouse. archives.gov/sites/whitehouse.gov/files/documents/hi ddenfeesreport_12282016.pdf ......................................... 15-16, 21 Patio.com, Product Page for Quantum 30 inch Round Glass Top Table, at https://www.patio.com/product- page/quantum-30-round-glass-top-table ................................... 14 S. Rep. No. 97-23 ........................................................................ 9, 10 PRELIMINARY STATEMENT From the outset of this long-running litigation, plaintiffs have persistently argued—and every court has agreed—that General Business Law (GBL) § 518 forbids merchants from adding a separate credit-card surcharge amount on top of a single dollars- and-cents price. In this Court, plaintiffs reverse course, taking the remarkable position that GBL § 518 should be interpreted to permit what it plainly prohibits. But there is no plausible basis to read a statute that forbids merchants from “impos[ing] a surcharge” as instead allowing such surcharges, so long as they are announced ahead of time. And because plaintiffs’ reading of GBL § 518 is implausible, they cannot rely on either the rule of lenity or the doctrine of constitutional avoidance to support their interpretation. This Court should accordingly reject plaintiffs’ argument, and answer the certified question in the manner explained in the State’s opening brief. 2 ARGUMENT A SELLER COMPLIES WITH GBL § 518 SO LONG AS IT POSTS ITS CREDIT-CARD PRICE IN DOLLARS AND CENTS The United States Court of Appeals for the Second Circuit has certified to this Court a specific, narrow question about the scope of GBL § 518: namely, whether a seller complies with the statute so long as it posts the total dollars-and-cents price that it charges to credit-card users. (Appendix (A.) 309-310 (CA2-2).) Plaintiffs concede that the answer to this question is “yes.” Specifically, plaintiffs agree that a seller may comply with GBL § 518 by adopting any of three pricing practices that each apprise consumers of total credit- card prices. See Br. for Appellant Attorney General (“State Br.”) at 32-35. First, a seller may post a single sticker price applicable to all users regardless of payment method—e.g., “$100.” See id. at 32-34. Second, a seller may offer incremental discounts to cash users from a total dollars-and-cents price charged to credit-card users—e.g., “$100, 3% less for cash.” See id. at 34; Br. for Plaintiffs-Respondents (“Pls. Br.”) at 37. Third, a seller may post different dollars-and- cents prices for credit-card users and cash users—e.g., “$100 for credit cards, $97 for cash.” See State Br. at 34-35; Pls. Br. at 37. 3 As the State explained in its opening brief (State Br. at 37), the common thread tying together all three of the pricing structures permitted under GBL § 518 is that, under each scheme, customers are exposed in advance to the total dollars-and-cents price that the seller will charge to credit-card users, regardless of whether the seller also offers a different price to cash users. Plaintiffs’ agreement that these pricing schemes are allowed under GBL § 518 should thus dispose of the question certified by the Second Circuit. Instead, plaintiffs urge this Court to disregard the certified question and adopt an interpretation of GBL § 518 that would authorize the credit-card surcharges that the statute plainly prohibits. Specifically, plaintiffs ask this Court to read GBL § 518 to allow their preferred practice of posting only their cash prices in dollar and cents, along with a credit-card fee expressed solely as an incremental percentage or dollar value—e.g., “$97 plus 3% for credit cards.” This interpretation is belied by every court decision on this statute; plaintiffs’ own position from the outset of this litigation; and the plain language, history, and purpose of both § 518 and the prior federal surcharge law on which it was based. 4 A. A Seller May Not Comply with GBL § 518’s Prohibition on Credit-Card Surcharges by Adding a Surcharge for Credit-Card Use. As plaintiffs acknowledge (Pls. Br. at 29), every court that has considered GBL § 518 in this long-running litigation has agreed that the statute forbids what plaintiffs now insist it allows. As the Second Circuit explained, “it is basically self-evident” that a seller violates GBL § 518 by posting only a single dollars-and-cents price and then charging more than that price for credit-card use—even if the seller discloses the credit-card fee as an incremental percentage or dollar value. (A. 239; see also A. 243-244; A. 21 (Dist. Ct. Op.) (explaining that GBL § 518 prohibits sellers from posting credit- card fees “above the price they would otherwise charge” a cash- paying customer).) This conclusion followed from the ordinary meaning of the term “surcharge,” which dictionaries define as “‘a charge in excess of the usual’” or regular price. (See A. 237 (quoting Webster’s Third New International Dictionary 2299 (2002)).) The United States Supreme Court agreed, rejecting plaintiffs’ vagueness challenge on the ground that their preferred pricing practice of “listing one price[] and a separate surcharge amount” is “‘clearly 5 proscribed’” under GBL § 518. (A. 289 (quoting Holder v. Humanitarian Law Project, 561 U.S. 1, 20 (2010)).) Plaintiffs’ own allegations throughout this litigation also belie their current position that GBL § 518 may plausibly be read to allow sellers to add credit-card surcharges to a baseline dollars-and- cents price. Plaintiffs alleged in their complaint and accompanying sworn affidavits that GBL § 518 bars them from posting a single price charged to cash users alongside a credit-card fee expressed as an incremental percentage or dollar value. (A. 56-57, 88-89, 98, 149.) And plaintiffs reiterated this interpretation of GBL § 518 in their briefs and oral arguments to the federal district court, Second Circuit, and United States Supreme Court—insisting all along, for example, that under GBL § 518 “say[ing] that the widget costs $100 plus a $2 credit-card surcharge . . . is a crime.”1 Br. for Petitioners 1 Plaintiffs suggest (Pls. Br. at 30) that they have now changed their interpretation of GBL § 518 because this appeal presents their first opportunity to seek a definitive construction of the statute from the New York courts. But this suggestion is meritless. If plaintiffs thought that GBL § 518 allows them to impose incremental credit-card surcharges without posting their total credit-card prices, they likely could have brought a declaratory judgment action in New York court to seek such an interpretation. 6 at 2, Expressions Hair Design v. Schneiderman, No. 15-1391, 2016 WL 6833414 (U.S. Nov. 14, 2016). The State has likewise maintained throughout this litigation that GBL § 518 plainly prohibits a seller from adding an incremental credit-card surcharge to the regular dollars-and-cents price.2 Plaintiffs’ repeated accusations that the State has been inconsistent in this position (see e.g., Pls. Br. at 20) are simply false. In particular, plaintiffs mischaracterize the record in describing the State as endorsing in the federal district court an interpretation of GBL § 518 that would allow incremental credit-card surcharges added to a dollars-and-cents price if such surcharges are disclosed. See C.P.L.R. 3001. Instead, they filed a federal lawsuit alleging that GBL § 518 is unconstitutional because it broadly prohibits not only incremental credit-card surcharges but also the use of certain “words and labels” to describe differential prices between cash and credit-card users. 2 See Mem. of Law in Supp. of Attorney General’s Mot. to Dismiss at 2, 19-24, Expressions Hair Design v. Schneiderman, No. 13-cv-3775 (S.D.N.Y. July 12, 2013), ECF No. 27; Corrected Br. for Appellant Attorney General at 56-59, 63-65, Expressions Hair Design v. Schneiderman, Nos. 13-4533, 13-4537 (2d Cir. Mar. 18, 2014), ECF No. 59; Br. for Respondent at 26-30, Expressions, No. 15-1391, 2016 WL 7321781 (U.S. Dec. 14, 2016). 7 See id. at 21-22. In fact, the State rejected any such interpretation and explained that, in keeping with the prior federal surcharge law, GBL § 518 allows a seller to charge different amounts to credit-card users and cash users so long as the seller displays its “total credit- card price” expressed as “a dollar figure.”3 Reply Mem. of Law in Supp. of Attorney General’s Mot. to Dismiss at 2, 8, Expressions, No. 13-cv-03775 (S.D.N.Y. Aug. 7, 2013), ECF No. 51 (second emphasis added); see id. at 9-14 (explaining that a seller would violate § 518 by posting solely a single price with an “additional credit card fee”). There are good reasons that the courts and parties have to date uniformly interpreted GBL § 518 to prohibit a seller from 3 Plaintiffs are also incorrect in asserting (Pls. Br. at 23-25, 29) that the State has otherwise altered its interpretation of GBL § 518 during the course of this litigation. As any responsible litigant would, the State has presented alternative legal arguments to defend the statute as constitutional—such as arguing that GBL § 518 does not implicate the First Amendment at all because it regulates conduct rather than speech, and that, if § 518 does regulate speech, then it does so in a manner that comports with the First Amendment. Contrary to plaintiffs’ assertions, these arguments are not inconsistent interpretations of § 518, but rather alternative justifications for the statute under different legal doctrines. 8 adding incremental credit-card fees on top of posted dollars-and- cents prices. As the State’s opening brief explained, that interpre- tation fits with the text, history, and purpose of both the federal and state surcharge laws. Plaintiffs’ arguments to the contrary are unavailing. First, plaintiffs concede (Pls. Br. at 35) that GBL § 518 was intended to have the same effect as the prior (now-lapsed) federal surcharge law, but they assert that the federal law was ambiguous as to whether it permitted sellers to add incremental surcharges for credit-card use—such as imposing a $0.20 additional fee for credit cards on top of a $10 regular, posted price. Contrary to plaintiffs’ assertion, the federal law unambiguously forbade this pricing practice. As the State’s opening brief explained (State Br. at 6), the federal surcharge law defined a prohibited “surcharge” as “any means of increasing the regular price to a cardholder” that is not also imposed on a cash-paying customer (id., Addendum at 2). And the federal law defined “regular price” as the single posted price, if only “a single price [were] tagged or posted.” Id. These definitions made clear that if a seller posted only a single dollars-and-cents 9 price, as plaintiffs intend to do, then this single posted price would be the “regular price,” and the seller would violate the statute by adding any additional fee or charge for a customer who used a credit card. Plaintiffs simply ignore these express definitions in arguing that the federal surcharge law might have allowed a seller to post only the price charged to a cash-paying customer, along with an incremental credit-card fee. See Pls. Br. at 15-16, 35-37. Second, the legislative history of the federal law confirms that Congress did not intend to allow sellers to add credit-card surcharges to their posted prices. As the State noted in its opening brief (State Br. at 6-7, 14-15), a Senate Report explained that the purpose of the prior federal surcharge law was to ensure that “when prices are tagged or posted, the consumers will be exposed to the highest price when they see a tagged or posted price.” S. Rep. No. 97-23 (“Senate Report”) at 4; see id. at 6 (explaining that statute’s definition of “regular price” assured “that at least the higher price will appear on any tagging or posting of prices”). Thus, although the federal surcharge law provided a seller with considerable flexibility to implement its pricing scheme (see Pls. Br. at 36, 41 n.2), the 10 statute plainly did not allow a seller to post credit-card fees as incremental values without also posting the total credit-card price because such a pricing scheme could “deceive or mislead” consumers. Senate Report, supra, at 4. Contrary to plaintiffs’ contention (Pls. Br. at 35-36), this Senate Report was not the sole source of legislative history in which Congress expressed its concern about sellers tacking on incremental credit-card surcharges without providing customers with total credit-card prices. For example, during congressional hearings that led to the enactment of the federal surcharge law, multiple witnesses explained that allowing credit-card surcharges might “confuse consumers and frustrate comparison shopping” because consumers “would have to perform a mathematical computation to compare” the final prices charged to credit-card users at different stores. See FCBA Two-Tiered Pricing: Hr’g Before the S. Subcomm. on Consumer Affairs 8, 94th Cong. (1975) (CIS No. 76-S241-3) (statement of Federal Reserve Board member); see also The Fair Credit Billing Act Amendments: Hr’g Before the H.R. Subcomm. on Consumer Affairs 8, 94th Cong. (1975) (CIS No. 76-H241-1D) 11 (Consumer Federation of America) (“Consumers should not have to endure the confusion which would result from a wide variety of methods of advertising the price of an item.”). And legislators who supported the federal surcharge statute agreed, explaining that “constantly throwing before the shopper calculations involving credit and cash” prices would lead to consumer confusion about the total credit-card price. Cash Discount Act: Hr’g Before the S. Subcommittee on Consumer Affairs 110, 97th Cong. (1981) (CIS No. 81-S241-18) (Senator Chafee). Indeed, Congress rejected a proposal to amend the surcharge law to allow sellers to post credit-card fees solely as incremental values. See State Br. at 15-16. In light of this history, it is simply not plausible to interpret the federal surcharge law as having allowed sellers to add incremental credit-card fees without posting the total credit-card price in dollars and cents. Third, as this history demonstrates, plaintiffs are simply incorrect in arguing (Pls. Br. at 39-40) that the federal surcharge law—and by extension GBL § 518—aimed to prevent only outright fraud, such as when a credit-card fee is entirely hidden until the 12 time of purchase. To be sure, such bait-and-switch tactics were one of the harms that the surcharge laws sought to address. But the history of both the federal and state surcharge laws makes plain that Congress and the Legislature each concluded that expressing a credit-card fee solely as an incremental value would likewise harm consumers. As Congress and the Legislature determined, consumer confusion and frustration can arise whenever a seller obscures its total credit-card price—either by hiding it until the point of sale or by making it difficult to calculate in practice because it is expressed as an incremental percentage or dollar value. See State Br. at 11-12, 15-17, 19, 38-39. And posting the total credit- card price in dollars and cents would prevent such consumer confusion and frustration by ensuring that the total credit-card price is unmistakably clear to consumers before they make a purchase or select a payment method. See id. at 13-15, 46-47. Plaintiffs’ interpretation of the prior federal surcharge law and GBL § 518 would undermine this basic goal of both surcharge laws by obscuring total credit-card prices and making such prices more difficult for consumers to apprehend in practice. 13 Plaintiffs assert that consumers can just as easily understand an incremental credit-card fee as a total dollars-and-cents credit- card price (Pls. Br. at 1-2, 28), but Congress and the Legislature were entitled to reach a different policy view based on the way pricing schemes are usually implemented in practice. Although plaintiffs are careful to rely on hypothetical pricing schemes designed to make the calculation of the total credit-card price particularly easy (see id. at 1, 16, 28), many pricing regimes are not so straightforward. As Justice Kagan explained during oral argument, most consumers cannot quickly calculate the total credit-card price if a seller were to post its price as “$32.46 plus 2 percent” for credit cards. See Transcript of Oral Argument, No. 15- 1391, 2017 WL 87471, at *36 (U.S. Jan. 10, 2017). Indeed, plaintiffs’ own prices highlight the difficulty that consumers will face if forced to calculate total credit-card prices on their own. For example, plaintiff Expressions Hair Design charges $68 for hair coloring and would like to impose a 3% credit-card 14 surcharge.4 It is hardly self-evident that the total credit-card price for this service is $70.04. Likewise, plaintiff Patio.com sells a glass table for $532.35.5 If Patio.com used its preferred pricing scheme to impose a 3% credit-card surcharge, even sophisticated consumers would be unlikely to know off the top of their heads that the total credit-card price for that table is $548.32. Congress and the Legislature rationally determined that it would be easier for consumers if sellers simply posted their total credit-card prices in dollars and cents, rather than requiring consumers to engage in such difficult calculations themselves. Plaintiffs’ strained interpre- tation of GBL § 518 simply disregards this legislative judgment. Plaintiffs suggest that it would be “nonsensical” for Congress and the Legislature to want customers to be informed of dollars- and-cents credit-card prices because such prices could still exclude “a whole gamut of potentially significant costs,” such as shipping 4 Expressions Hair Design, Services, at http://www.expre- ssionshairvestal.com/services.asp. 5 Patio.com, Product Page for Quantum 30 inch Round Glass Top Table, at https://www.patio.com/product-page/quantum-30- round-glass-top-table. 15 fees and tips. Pls. Br. at 41-42; see also id. at 48-49. But a legislature is entitled to proceed “one step at a time, addressing itself to the phase of the problem which seems most acute to the legislative mind.” Williamson v. Lee Optical of Okla., Inc., 348 U.S. 483, 489 (1955). The federal surcharge law and subsequently GBL § 518 focused on the specific consumer harms caused by sellers obscuring total credit-card prices—including by engaging in the very pricing practices that plaintiffs now want this Court to endorse. If other pricing practices give rise to similar harms, then it would be appropriate for Congress or the Legislature to address such problems if and when they arise.6 But “a legislature need not run 6 Pricing tactics that obscure a dollars-and-cents price inclusive of other types of extra fees have already raised significant consumer-deception concerns—such as ticket sellers that post a numeric price for a concert ticket and then tack on a percentage convenience fee. See Nat’l Econ. Council, The Competition Initiative and Hidden Fees 10-15 (2016) (describing fees for, inter alia, event tickets, resort use, and banking services). Indeed, consumer advocates have warned that such pricing practices may cause consumer confusion and frustrate comparison shopping—even when a seller displays the fee as a mathematical computation. See id. at 8-9. Federal or state governments may reasonably address such harms by ensuring that consumers see a dollars-and-cents price that includes a particular fee, without also requiring that posted prices include every other conceivable extra charge. See id. 16 the risk of losing an entire remedial scheme simply because it failed, through inadvertence or otherwise, to cover every evil that might conceivably have been attacked.” McDonald v. Board of Election Commrs. of Chicago, 394 U.S. 802, 809 (1969). B. Neither the Rule of Lenity Nor Constitutional Avoidance Supports Plaintiffs’ Interpretation. Plaintiffs assert that the rule of lenity and the doctrine of constitutional avoidance support their interpretation of GBL § 518, but their arguments are meritless. The rule of lenity applies only “if two constructions of a criminal statute are plausible.” People v. Green, 68 N.Y.2d 151, 153 (1986) (quotation marks omitted). Because plaintiffs’ interpretation of GBL § 518 is not plausible, for the reasons given above, the rule of lenity has no application here. Indeed, plaintiffs’ reliance on the rule of lenity is largely foreclosed by the United States Supreme Court’s rejection of their at 15-16; Spirit Airlines Inc. v. United States Dept. of Transp., 687 F.3d 403, 410-12 (D.C. Cir. 2012) (upholding Department of Transportation regulation requiring airlines to post total dollars- and-cents prices inclusive of government taxes and fees). 17 vagueness challenge to GBL § 518. See United States v. Lanier, 520 U.S. 259, 266 (1997) (recognizing rule of lenity as a “junior version of the vagueness doctrine” (quotation marks omitted)). Specifically, plaintiffs contend that the rule of lenity applies here because they need “clarity” about whether GBL § 518 applies to their preferred pricing practice. See Pls. Br. at 3; see id. at 50-51. But the United States Supreme Court and the Second Circuit have already determined that plaintiffs can readily understand that GBL § 518 prohibits them from posting a single dollars-and-cents price with a credit-card fee expressed as an incremental value. (A. 289 (USSCT Op.); A. 273 (CA2-1).) And under the State’s interpretation of GBL § 518, plaintiffs receive ample clarity that, contrary to their own claims, the statute does not prohibit sellers from using any particular words and labels to describe their prices so long as they post the total credit-card price in dollars and cents. Plaintiffs’ reliance on the doctrine of constitutional avoidance fails for largely the same reasons. As the United States Supreme Court recently confirmed, “[t]he canon of constitutional avoidance comes into play only when, after the application of ordinary textual 18 analysis, the statute is found to be susceptible of more than one construction. In the absence of more than one plausible construction, the canon simply has no application.” Jennings v. Rodriguez, 138 S. Ct. 830, 842 (2018) (quotation marks and citations omitted). While plaintiffs’ interpretation would indeed make GBL § 518 constitutional, it would do so only at the cost of disregarding the statute’s text, history, and purpose. In any event, plaintiffs’ attempts to cast doubt on the constitutionality of GBL § 518 under the State’s interpretation are vastly overstated. As the State explained in its opening brief (State Br. at 45-47), GBL § 518 as construed by the State is properly analyzed under the more deferential First Amendment scrutiny set forth in Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U.S. 626 (1985). That is because, properly construed, the statute simply requires sellers to disclose their total credit-card prices in dollars and cents when they post prices. Plaintiffs question whether GBL § 518 can in fact be read as equivalent to a disclosure requirement. Pls. Br. at 45-48. But that question is precisely the one that the Second Circuit has certified to this Court, and that this 19 Court has the power to definitely resolve. And the history and purpose of both the federal and state surcharge statutes demonstrate that both Congress and the State Legislature meant to permit pricing practices that expose consumers to the total credit-card price in dollars and cents. The best way to understand the statutes is thus as disclosure rules, even though they were not expressly labeled as such by legislators. Indeed, plaintiffs urge the Court to interpret GBL § 518 as a disclosure rule; they simply prefer a different disclosure policy than the one adopted by Congress and the Legislature. Plaintiffs also suggest (id. at 46) that the Supreme Court’s recent decision in National Institute of Family & Life Advocates v. Becerra, 138 S. Ct. 2361 (2018), portends a stricter view of the Zauderer test. But that case found Zauderer inapplicable to a quite different state law, which the Court concluded required certain clinics to disclose the availability of third-party services, rather than their own services; and to convey information about “abortion, anything but an ‘uncontroversial’ topic.” Id. at 2372. Here, by contrast, a seller can comply with GBL § 518 by disclosing its own 20 prices, and such prices are the type of “purely factual and uncontroversial information” that Zauderer was intended to address. Zauderer, 471 U.S. at 651. Moreover, as the State’s opening brief explained (State Br. at 46-47), GBL § 518 as interpreted by the State fully satisfies Zauderer’s deferential standard. Commercial experience and common sense support the Legislature’s “intuitive conclusion that customers are likely to be deceived by price quotes” that provide only a single dollars-and-cents figure that is lower than the price they will actually be charged if they use a credit card. Spirit Airlines Inc. v. United States Dept. of Transp., 687 F.3d 403, 411 (D.C. Cir. 2012). And although, contrary to plaintiffs’ contention (Pls. Br. at 48), the Zauderer framework “does not demand evidence or empirical data to demonstrate the rationality of mandated disclosures,” Connecticut Bar Assn. v. United States, 620 F.3d 81, 97 (2d Cir. 2010), ample evidence supports the reasonableness of the Legislature’s determination that a posted price is misleading when it lacks the total credit-card price. For example, the legislative records of the prior federal surcharge statute on which GBL § 518 21 is based support the Legislature’s policy determination. See State Br. at 5-19. And numerous articles by consumer advocates or economic scholars further support the Legislature’s determination that such consumer confusion and frustration may be alleviated by ensuring that sellers post their total credit-card prices when they post prices. See, e.g., Nat’l Econ. Council, The Competition Initiative and Hidden Fees 15-16 (2016); Ian Lee et al., Macdonald-Laurier Inst., Credit Where It’s Due 22 (Oct. 2013). Plaintiffs misplace their reliance on several federal lawsuits that challenged the constitutionality of other States’ surcharge statutes—challenges that were each brought by sellers represented by the same counsel that represents plaintiffs here. See Pls. Br. at 45-46; Letter from Joshua Matz to John P. Asiello, Chief Clerk (Aug. 17, 2018). None of these cases analyzed whether Zauderer’s more lenient First Amendment standard would be satisfied by a surcharge statute that required sellers to post their dollars-and- cents credit-card prices when they post prices. See Dana’s R.R. Supply v. Attorney General, 807 F.3d 1235, 1249-51 (11th Cir. 2015); Italian Colors Rest. v. Becerra, 878 F.3d 1165, 1176-79 (9th 22 Cir. 2018); Order on Cross-Mots. for Summ. J. at 8-11, Rowell v. Paxton, No. 14-cv-190 (W.D. Tex. Aug 16, 2018), ECF No. 95 (declining to apply Zauderer because plaintiffs asserted that they would not impose a credit-card fee higher than the swipe fee charged by credit-card companies). Indeed, these cases did not focus on whether the relevant State’s surcharge statute would be satisfied so long as a seller posts its credit-card price in dollars and cents—likely because none of the cases involved a certified question seeking such a definitive statutory interpretation from that State’s highest court. Finally, if the principle of constitutional avoidance were to factor into the Court’s interpretation of GBL § 518, then the principle would support construing the statute to prohibit sellers from imposing any price differential between cash and credit-card users. Such an interpretation would be far more plausible than plaintiffs’ interpretation because it would at least comport with the statute’s plain language. See State’s Br. at 30; see also Pls. Br. at 2 (acknowledging that GBL § 518 “looks like . . . a total ban on differential pricing for cash and credit cards”). And if the Court 23 were to so construe GBL § 518 as prohibiting any price differential between cash and credit-card users, the statute would indisputably comport with the First Amendment and this litigation would undoubtedly be over. CONCLUSION For the foregoing reasons, this Court should answer the certified question in the affirmative. Dated: New York, NY August 29, 2018 STEVEN C. WU Deputy Solicitor General JUDITH N. VALE Senior Assistant Solicitor General of Counsel Respectfully submitted, BARBARA D. UNDERWOOD Attorney General State of New York By:________________________ JUDITH N. VALE Senior Assistant Solicitor General 28 Liberty Street New York, NY 10005 (212) 416-6274 Reproduced on Recycled Paper AFFIRMATION OF COMPLIANCE Pursuant to the Rules of Practice of the New York Court of Appeals (22 N.Y.C.R.R.) § 500.13(c)(1), Judith N. Vale, an attorney in the Office of the Attorney General of the State of New York, hereby affirms that according to the word count feature of the word processing program used to prepare this reply brief, the reply brief contains 4,378 words, which complies with the limitations stated in § 500.13(c)(1). ______________________________ Judith N. Vale