Bill Summary for H 1005 (2021)

Summary date: 

Jun 1 2022

Bill Information:

View NCGA Bill Details2021
House Bill 1005 (Public) Filed Thursday, May 19, 2022
AN ACT TO INCREASE THE PENALTIES FOR ORGANIZED RETAIL THEFT, TO PROVIDE ADDITIONAL PENALTIES FOR DAMAGE TO PROPERTY OR ASSAULT OF A PERSON DURING THE COMMISSION OF ORGANIZED RETAIL THEFT, TO PROVIDE ADDITIONAL RECOVERY TO RETAIL ESTABLISHMENTS FOR LOSS DUE TO ORGANIZED RETAIL THEFT, AND TO REGULATE HIGH-VOLUME THIRD-PARTY SELLERS OPERATING ON ONLINE MARKETPLACES.
Intro. by Boles, Davis, McNeill, C. Smith.

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Bill summary

House committee substitute to the 1st edition makes the following changes.

Makes organizational changes to the criminal offenses relating to organized retail theft in GS 14-86.6.

Moves proposed GS 14-86.6(a4), which makes it a Class G felony to conspire with another to commit theft of retail property from a retail establishment with a value exceeding $1,000, and damage, destroy, or deface real or personal property in excess of $1,000, into new GS 14-86.7 and labels the offense as damage to property during organized retail theft. Also moves proposed (a5), which makes it a Class G felony to conspire with another to commit theft of retail property from a retail establishment with a value exceeding $1,000, and commit an act of assault or battery against an employee or independent contractor of the retail establishment or law enforcement officer in the commission of the offense, into new GS 14-86.7 and labels the offense as assault during organized retail theft.

Makes further technical changes in GS 14-86.1.

Adds the following new content.

Amends GS 15-11.1, concerning law enforcement seizure of property by adding the following. Provides that if the seized property is retail property or other property this is evidence of a violation of GS Chapter 14, Articles 16 (larceny), 16A (organized retail theft), or 18 (embezzlement); or GS 14-100 (obtaining property by false pretenses), then upon his determination or upon request by someone entitled to possess the property, the district attorney may apply for a court order authorizing that the property be returned to the owner or entity entitled to possession before the trial for which the property was seized as evidence. Upon making such an application, requires the district attorney to notify the defendant of the request and give the defendant 10 business days to inspect and photograph the property. Requires the court, after giving notice and hearing, to order the property to be returned if: (1) the defendant has been given notice and an opportunity to inspect and photograph the property before the hearing, (2) identification or analyses of the property will provide sufficient evidence at the trial, (3) the introduction of the substitute evidence is not likely to substantially prejudice the defendant's rights at the criminal trial, and (4) there is satisfactory evidence of ownership. Specifies that photographs or other identification or analyses of the returned property are presumed admissible in lieu of the actual property at the criminal trial. Allows the returned property to be lawfully disposed of by the owner or entity entitled to possession. Makes conforming changes to GS 14-86.6. Applies to offenses committed on or after December 1, 2022.

Amends GS 1-538.2 to make also people (other than minors) who violate GS 14-86.6 or new GS 14-86.7 and GS 14-72.11 (larceny from a merchant) liable for civil damages to the property owner. Adds that for all listed violations the property owner is also entitled to recover for the loss to real or personal property caused by the commission of the act. Increases the cap on consequential damages (was, compensatory and consequential damages) at $3,000 (was, $1,000) and includes GS 14-86.6 and GS 14-86.7 in those that have no cap. Also makes the parent or legal guardian of an emancipated minor who commits an act punishable under GS 14-72.11, GS 14-86.6, or GS 14-86.7 civilly liable to the property owner if the parent or guardian knew or should have known of the child's propensity to commit such an act and had the opportunity and ability to control the child and made no reasonable effort to correct or restrain the child. Increases the cap on consequential (was, compensatory and consequential) damages for these and other already listed offenses to $3,000 (was, $1,000). Deletes the provision that would have allowed a property owner to seek payment for damages before filing a civil action by sending the violator a demand letter. Applies to offenses committed on or after December 1, 2022.

Effective January 1, 2023, enacts new Article 50, Regulation of High-Volume Third-Party Sellers Operating on Online Marketplaces, in GS Chapter 66, providing as follows. Sets out the Article's purpose and defines terms used in the Article. Defines high-volume third-party seller as a participant in an online marketplace that: (1) is a third-party seller; (2) has, in any continuous 12-month period during the previous 24 months, entered into 200 or more separate sales or transactions of new or unused consumer products through the online marketplace to consumers in this state; (3) had an aggregate total of $5,000 or more in gross revenues for those sales or transactions; and (4) payment for the sales was processed by the online marketplace or through a third party. Defines online marketplace as any person or entity operating a consumer-directed, electronically based or accessed platform that: (1) includes features that allow for, facilitate, or enable third-party sellers to engage in the sale, purchase, payment, storage, shipment, or delivery of a consumer product in the state; (2) is used by one or more third-party sellers to engage in the sale, purchase, payment, storage, shipment, or delivery of a consumer product within the state; and (3) has a contractual or similar relationship with consumers governing consumer use of the platform to purchase consumer products. Defines third-party seller as any seller, independent of an online marketplace, that sells, offers to sell, or contracts to sell a consumer good in this state through an online marketplace.

Requires a high-volume third-party seller to provide an online marketplace no more than 10 days after the seller becomes a high-volume third party seller on an online marketplace platform, with specified banking, contact, and tax information. Requires an online marketplace to: (1) at least annually notify each high-volume third-party seller on its platform of the requirement to keep the information current and (2) require each high-volume third-party seller on its platform to, no later than 10 days after receiving notice, electronically certify that the information previously provided is correct or that any changes to the required information have been provided. Requires the online marketplace to suspend further sales activity of a seller that does not provide the information or certification within 10 days. Provides for verification of the information and documents. 

Requires an online marketplace to require any high-volume third-party seller with an aggregate total of $20,000 or more in annual gross revenues on its platform to provide to the marketplace and disclose to consumers the four listed categories of identity information, including specified contact information for the seller and their supplier. Sets out circumstances under which a high-volume third-party seller may request that an online marketplace provide for partial disclosure of the required identity information; sets out actions that may be taken when the seller fails to respond or makes a false representation in order to justify providing partial disclosure. Requires the online marketplace to suspend future sales activity of a seller that does not comply with the information disclosure requirements; sets out notice requirements. Requires an online marketplace to disclose to a consumer on the product listing of any high-volume third-party seller a reporting mechanism that allows the reporting of any suspicious marketplace activity to the online marketplace by electronic and telephonic means. 

Requires an online marketplace to use reasonable security procedures and practices to protect the collected information or documents from unauthorized use, disclosure, access, destruction, or modification.

Allows the Attorney General to bring a civil action when there is reason to believe that an online marketplace has violated this Article and the violation affects one or more state residents, in order to (1) enjoin further violation by the defendant; (2) enforce compliance with this Article; (3) obtain damages, restitution, or other compensation; and (4) obtain other remedies.

Specifies that violations of this Article are also violations of GS Chapter 75 (Monopolies, Trusts and Consumer Protection). Specifies that this Article does not prohibit any district attorney, law enforcement officer, official, or agency of the state from initiating or continuing any proceeding in a court against an online marketplace for failure to comply with any other civil law or a violation of criminal law.

Amends the act's long title.

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