NRF sues to block New York Algorithmic Pricing Law

The law requires retailers to disclose the use of “algorithmic” pricing.

The National Retail Federation is seeking to block the implementation of a New York state law that would require retailers to tell customer that they use algorithmic pricing.

The NRF asked a federal court to block the New York Algorithmic Pricing Disclosure Act set to go into effect July 8 week that requires retailers to disclose the use of “algorithmic” pricing, saying the measure would unfairly malign a system that helps merchants give customers lower prices and personalized offers. 

The law, which was passed with little debate as part of the state’s budget bill and signed by Governor Kathy Hochul on May 9, is set to take effect July 8. The measure requires any retailer that sets prices using virtually any information about its customers to place a disclosure next to each affected product saying, “This price was set by an algorithm using your personal data.”

“This law interferes with retailers’ ability to provide their customers with the highest value and best shopping experience they can,” stated NRF chief administrative officer and general counsel Stephanie Martz. “Algorithms are created by humans, not computers, and they are an extension of what retailers have done for decades, if not centuries, to use what they know about their customers to serve them better. It’s just done at the scale of the modern economy. Stigmatizing tools that drive prices down turns offering deals into a liability, and consumers will end up paying more.”