Thu Jul 03 01:07:10 UTC 2025: **Summary:**
The National Retail Federation (NRF) is suing New York State over its new Algorithmic Pricing Disclosure Act, which requires retailers to inform customers when their personal data is used to set prices. The NRF argues the law violates retailers’ First Amendment rights by compelling them to display misleading warnings and is based on unsubstantiated fears of price gouging. New York’s Attorney General and Governor have not yet responded.
**News Article:**
**Retailers Sue New York Over “Surveillance Pricing” Law**
**NEW YORK – July 3, 2025** – The National Retail Federation (NRF), the world’s largest retail trade group, has filed a lawsuit against New York State, challenging its newly enacted Algorithmic Pricing Disclosure Act. The law, set to take effect on July 8th, mandates that retailers notify customers when their personal data is used in determining pricing, a practice critics have dubbed “surveillance pricing.”
The NRF alleges that the law violates retailers’ First Amendment rights, arguing that it forces them to disseminate misleading information to consumers. The group contends that the mandated warnings are unnecessarily alarming and based on unfounded fears of price gouging. They further argue that algorithms are often used to offer discounts and loyalty rewards, potentially leading to lower prices for consumers.
“This law compels a broad range of retailers to express misleading government-scripted opinion without justification,” the NRF stated in its complaint filed in Manhattan Federal Court, adding that violations could result in fines of $1,000 per instance.
New York Governor Kathy Hochul, who signed the legislation into law in May, defended the act as a means to ensure price transparency and empower consumers to make informed purchasing decisions.
The lawsuit names New York Attorney General Letitia James, whose office is responsible for enforcing state laws, as the defendant. Neither Attorney General James nor Governor Hochul’s office have yet issued a statement in response to the suit.
The legal challenge comes months after the Federal Trade Commission (FTC) released a study on surveillance pricing, raising concerns about the potential for targeted price discrimination based on consumer data. However, the FTC’s study was met with controversy, with then-Commissioner Andrew Ferguson dissenting, alleging it was rushed to publication for political purposes.
The case highlights the growing debate surrounding data privacy and the ethical implications of using algorithms to personalize pricing in the retail industry. The outcome of the lawsuit could have significant ramifications for retailers nationwide.
First Piper 