Collateral Loanbrokers Association of New York, Inc., et al., Plaintiffs-Respondents,
The City of New York, et al., Defendants-Appellants. CTIA-The Wireless Association, Amicus Curiae.
appeal from an order of the Supreme Court, Bronx County
(Mitchell J. Danziger, J.), entered June 8, 2015, which,
insofar as appealed from as limited by the briefs, granted
plaintiffs' motion for a preliminary injunction enjoining
defendants from enforcing General Business Law § 45, New
York City Charter §§ 435 and 436, Local Law No. 149
of 2013 and its amendments to Administrative Code
§§ 20-267, 20-273, and 20-277, Rules of City of New
York Department of Consumer Affairs (6 RCNY) § 1-16 and
Police Department (38 RCNY) §§ 21-03(a) and (b),
21-04(a) and (c), 21-07(a)-(f), and 21-08, and the procedures
outlined in a 1998 memorandum by then NYPD Deputy
Commissioner of Legal Matters George A. Grasso, and in NYPD
Patrol Guide Procedure No. 214-38.
Zachary W. Carter, Corporation Counsel, New York (Max O.
McCann, Richard Dearing and Susan Greenberg of counsel), for
Kriss & Brignola, LLP, Albany (Mark C. Kriss of counsel),
Stone & Dolan LLP, New York (Richard H. Dolan of
counsel), for amicus curiae.
Richard T. Andrias, J.P., David B. Saxe, Paul G. Feinman,
Judith J. Gische, Marcy L. Kahn, JJ.
appeal concerns a statutory and regulatory scheme comprised
of provisions of the General Business Law, the New York City
Charter, the Administrative Code of the City of New York, the
Rules of the City of New York, and New York Police Department
(NYPD) procedures, which together form a framework of
reporting and inspection requirements applicable to
pawnbrokers and other secondhand dealers. Plaintiffs, a
statewide association of pawnbrokers, along with various
individual pawnbrokers, secondhand dealers, and customers of
pawnbrokers and/or secondhand dealers, brought this
declaratory judgment action challenging the constitutionality
of that statutory and regulatory framework. Relying
substantially on People v Keta (sub nom. People
v Scott)  (79 N.Y.2d 474');">79 N.Y.2d 474 ), they contend
that the entire statutory and regulatory scheme violates the
unreasonable search and seizure prohibition under New York
Constitution article I, § 12. The motion court agreed,
and granted plaintiffs' motion for preliminary injunctive
relief prohibiting enforcement of the statutes, regulations
and procedures. Defendants appeal, arguing that the
challenged reporting requirements and inspection programs
satisfy the constitutional requirements applicable to closely
regulated industries and do not implicate constitutional
prohibitions against unreasonable searches and seizures. We
now reverse the motion court's order, and conclude that
the challenged statutory and regulatory scheme does not
violate the New York State Constitution's proscription
against unreasonable searches and seizures. While plaintiffs
are correct that article I, § 12 of the New York
Constitution affords greater protection than the
corresponding provision in the Fourth Amendment to the U.S.
Constitution (see People v Keta, 79 N.Y.2d 474');">79 N.Y.2d 474,
497-498), those greater protections do not implicate the
statutes, regulations and procedures at issue here.
obtain a preliminary injunction prohibiting enforcement of
these laws, regulations and procedures, plaintiffs were
required to demonstrate a likelihood of success on the
merits, irreparable injury, and a balancing of the equities
in their favor (see CPLR 6301; Nobu Next Door,
LLC v Fine Arts Hous., Inc., 4 N.Y.3d 839, 840 ).
establish a likelihood of success, plaintiffs rely primarily
on People v Keta. Keta held that former
Vehicle and Traffic Law § 415-a(5)(a), which authorized
police to conduct random warrantless administrative searches
of vehicle dismantling businesses, violated the New York
State Constitution's proscription against unreasonable
searches and seizures (79 N.Y.2d at 497). Although the United
States Supreme Court had previously reversed the New York
Court of Appeals in order to hold that section 415-a(5) did
not violate the Fourth Amendment's proscription
against unreasonable searches and seizures (see New York
v Burger, 482 U.S. 691');">482 U.S. 691 , revg People v
Burger, 67 N.Y.2d 338');">67 N.Y.2d 338 ), the Court of Appeals in
Keta held that our State Constitution's
proscription against unreasonable searches and seizures
affords greater protection than the corresponding provision
in the United States Constitution. In reliance on those
greater protections, the Keta Court concluded that
the statute violated the privacy rights encompassed within
article I, § 12 of the New York State Constitution
(see People v Keta, 79 N.Y.2d at 497).
People v Keta does not justify invalidating the
challenged statutory and regulatory framework at issue here.
framework begins with the relevant provisions of General
Business Law article 5, now entitled "Collateral Loan
Brokers." The antecedents of that article were first
enacted in 1909 (see L 1909, ch 25, as amended), and
some were derived from laws going back to 1883 (see
L 1883, ch 339, § 1). General Business Law section 40
requires pawnbrokers in New York City to be licensed by the
City's Commissioner of Consumer Affairs. Section 43
requires pawnbrokers to maintain a book containing a
"description of the goods... pawned or pledged, the
amount of money loaned thereon, ... the rate of interest to
be paid..., the name and residence of the person pawning...
said goods." Section 45 requires that the books kept by
collateral loan brokers "at all reasonable times be
open to the inspection of... the mayor or local
licensing authority, ... [and] police
inspectors" (emphasis added).
to the 2013 enactment of Local Law 149, Administrative Code
§ 20-273 required dealers in secondhand goods to keep a
book in which they recorded information such as a description
of every article purchased or sold and the name, address, and
a general description of the person buying or selling the
item. It is uncontested that pawnbrokers and secondhand
dealers have historically reported transactions on a
Second-Hand Article Store Log provided by the NYPD, which
requires the store owner to provide the date and time of the
transaction, a description of the article, and the name,
address, gender, date of birth, and race of the seller.
Administrative Code § 20-267 provides that all dealers
in secondhand articles, "upon being served with a
written notice to do so by a member of the police department,
shall report to the police commissioner..., a copy of any of
the records required to be kept under section 20-273."
New York City adopted Local Law 149, which amended several
provisions of the Administrative Code so as to require
certain dealers to also create records and make them
available in electronic form. Local Law 149 amended
Administrative Code § 20-273 by adding an electronic
record requirement for transactions involving articles
comprised of gold, silver, platinum, or other precious
metals, electrical appliances, excluding kitchen equipment,
and electrical equipment, computer, or component parts of
electrical equipment or computers (Administrative Code §
20-273[b], [c]). The provisions state that such electronic
records "may include real-time sharing or accessing of
such records in an electronic format and/or through use of an
internet website designated by the police commissioner"
(id.). Depending on the type of dealer, the
electronic record shall or "may include... digital
photographs... in accordance with specifications as provided
by rule of the police commissioner" (id.).
to the enactment of Local Law 149, Administrative Code §
20-277 authorized the police commissioner to require
pawnbrokers "to report to such commissioner, upon blank
forms to be furnished by the police department, a description
of all goods, articles or things... pawned or pledged, "
as well as "a general description as to sex, color and
apparent age of every person depositing such pledges."
Local Law 149 amended Administrative Code § 20-277 so as
to add an electronic record component. As amended, the
provision now permits the use of an Internet website
designated by the police commissioner, and allows the police
commissioner to require that the forms recording the
transactions include "identifying information regarding
any pledgors or persons redeeming any articles pledged or
pawned, including name, address, phone number, date of birth,
sex and race or ethnicity" (Administrative Code §
20-277[a], [b]). The amended § 20-277 further provides
that "[r]ecords required to be ...