§4.7 A. Remoteness Bar To Standing Under Gbl § 349

• Jurisdiction: New York

A. Remoteness Bar to Standing under GBL § 349

As with the Donnelly Act, even with this private right of action, a court may still reject a claim under GBL § 349 if a court finds plaintiffs’ injuries too remote from the alleged anticompetitive conduct. In Blue Cross and Blue Shield of New Jersey, Inc. v. Philip Morris USA Inc.,⁴¹³ the Court of Appeals held that insurance companies that paid medical bills for smoking-related illnesses lacked standing to seek damages from tobacco companies under GBL § 349. The plaintiff insurers had alleged that the tobacco companies’ advertisements misrepresented the dangers of smoking. This in turn allegedly led to increased medical costs that were borne by the insurers.⁴¹⁴

Blue Cross came to the Court of Appeals as a certified question from the Second Circuit. The Court held that neither the text of GBL § 349 nor its legislative history suggested that the Legislature intended to permit indirect, derivative claims under GBL § 349 and to abrogate the common law rule that an insurer’s sole remedy for this type of injury is equitable subrogation.⁴¹⁵ Put differently, there was no indication that the Legislature intended “to authorize insurers...