Dep’t of Consumer Affairs v. A New Beginning for Immigrants Rights, Inc., et al. OATH Index No. 2644/17, mem. dec. (Sept. 17, 2018) Petitioner established that respondents engaged in deceptive trade practice by posting online videos and social media posts that contained false and misleading representations, and violated immigration assistance services laws by failing to provide five clients with a written contract, and retaining fees for services not performed. Remaining charges not proven. Respondents ordered to pay a civil penalty of $38,950. NEW YORK CITY OFFICE OF ADMINISTRATIVE TRIALS AND HEARINGS In the Matter of CITY OF NEW YORK DEPARTMENT OF CONSUMER AFFAIRS Petitioner ~ against - ANEW BEGINNING FOR IMMIGRANTS RIGHTS, INC., and CARLOS DAVILA Respondents MEMORANDUM DECISION NOEL R. GARCIA, Administrative Law Judge Petitioner, the New York City Department of Consumer Affairs (“DCA” or “Department”), brought this proceeding pursuant to section 2203(d), (f), (h) of the New York City Charter. See also 6 RCNY § 6-01(a) (Lexis 2018). DCA alleges that respondents, A New Beginning for Immigrants Rights, Inc. (“NBIR”) and its president, Carlos Davila, engaged in various violations of the New York City Consumer Protection Law (“CPL”) and the laws and rules governing immigration assistance services providers (“ISP Law”)! (ALJ. Ex. 1). Admin. Code §§ 20-700 et seq., 20-770 et seq. (Lexis 2016); 6 RCNY § 5-260 et seg. Mr. Davila appeared on behalf of NBIR and himself. Mr. Davila was advised of the right to be represented by an attomey, but elected to proceed pro se (Tr. 6-7) The ISP Law was amended and renumbered after the filing of DCA’s amended petition. Unless otherwise noted, the ISP Law citations reference the provisions in effect atthe time of the alleged misconductOver a three day trial, petitioner called seven witnesses, and offered documentary and video evidence. Mr. Davila testified on behalf of respondents, and offered documentary evidence. For the reasons set forth below, petitioner proved most of the charges against respondents. For the charges proved, respondents are ordered to pay a penalty of $38,950, ANALYSIS Founded in 2011, NBIR is a not-for-profit corporation that represents individuals in immigration-related matters for a fee. Mr. Davila is the founder and president of NBIR (Tr. 182, 324-26, 342). Mr, Davila testified that he is a minister and that NBIR began as an off-shoot to his street ministry. Additionally, he explained that he founded NBIR because, through his employment as a paralegal for a criminal defense attorney, he noted that many individuals were not aware of their constitutional rights and that attorneys were often “ripping people off” when it ‘came to immigration matters (Tr. 323-24). To prepare to help such individuals, Mr. Davila testified that he “started going to different schools and colleges” to “get{] the knowledge that . . . [he] needed” (Tr. 323). He stated that he completed “approximately 180, 190 hours of immigration training” (Tr. 346). Also in 2011, the federal Board of Immigration and Appeals (“BIA”) granted Mr. Davila accredited representative status, which allowed him to represent clients in immigration administrative proceedings (Tr. 106-09, 323-24). Federal law allows for a non-attorney to be granted this status if the person: 1) is affiliated with a “non-profit religious, charitable, social service, or similar organization” that charges only nominal fees, and 2) the organization sponsors the individual’s application. 8 C.F.R. § 292.1(4); 8 CFR. § 292.2(a), (4) (Lexis 2018). The application must include a detailed rendering of the individual’s “experience and knowledge of immigration and naturalization law and procedure.” 8 C.F.R. § 292.2(d). According to Mr. Davila, since becoming an accredited representative, he has represented hundreds of clients with asylum applications, removal proceedings and family petitions (Tr. 342-44). Mr. Davila testified that at first, NBIR did not charge any fees. However, because his application to become a BIA accredited representative required a proposed fee schedule, and because it became apparent that some immigration matters, particularly asylum applications, required “a lot of work,” NBIR began to charge fees for its services (Tr. 324-25). For instance, NBIR charged a fee of $3,000 for asylum cases. However, Mr. Davila explained that a clientwas only required to pay a small initial deposit at the beginning of the representation, and could pay the rest either in installments, or at the conclusion of the case. Often, asylum cases would take two or three years to resolve. NBIR did not receive any outside funding (Tr. 326-27). In 2016, NBIR attempted to augment its revenue stream by offering membership to individuals. The membership structure was akin to a pre-paid legal service plan, Initially, for a fee of $45 a month, NBIR would essentially be on retainer, and would represent the member as needed, including if the member was detained for deportation proceedings. NBIR “recorded some advertising” to test public reaction to its plan (Tr. 326-27). Upon further consideration and consultation with attorney friends, Mr. Davila revised the membership fee structure to $200 for a two-year membership period. Included in the membership benefits was a membership identification card known as ID4ICE (Tr. 327-28). As explained by Mr. Davila, the ID4ICE card would serve both as an identification card, and a “know your rights” card. If questioned by an immigration enforcement agent, the member was to present the agent the ID4ICE card, The card would give notice to the agent that the member was represented by NBIR, and that the member was exercising his or her right to remain silent. Mr. Davila believed that if an agent knew that the member had legal representation, the agent would be careful about respecting the member’s legal rights. Accordingly, the ID4ICE card would offer the member a certain peace of mind (Tr. 328-33). Mr. Davila created and trademarked a logo with the ID4ICE name that was placed on the card (Tr. 348-52) The logo is as follows:(Pet. Ex. 31). The ID4ICE card is as follows: |_ THIS IS NOTA DRIVER LICENSE. CREDIT CARD OR | ‘WORK AUTHORIZATION CARD. Property of: | _ANew Beginning for immigrants Rights, nc |__nonge Te ALLLAW ENFONCENENT Aes ose exe my onl Fs. 6 a wish ‘gest yu arses Your guts ph chad ou Seats bse ony, Ved XN Aenea sec the Ute Sates Cotte md ral anan Fits. cnt ge ou pris ose re oy hme rs, _ youve ara sored by aie or ape vi my mane ont '1DO WANT TO TALK TOMY LEGAL REPRESENTATIVE. |__ Pease crcl my Loge Rapreserative (88) 406-0604 (front) (back) (Pet. Ex. 45; Resp. Ex. G). Mr. Davila described the attempt to offer NBIR membership and the IDAICE card as a “project,” and said that only two individuals purchased the card (Tr. 329). Consumer Protection Law charges In Count 1 of its amended petition, DCA alleged that respondents engaged in deceptive trade practice by posting online videos and social media posts that contained false and misleading representations, including statements that the ID4ICE card was “registered with the federal government,” and that a cardholder would not be deported if he or she was confronted by an immigration enforcement agent (ALI Ex. 1). CPL section 20-700 states that no person “shall engage in any deceptive . . . trade practice in. . . offering for sale. . . any consumer goods or services.” Section 20-701(a) defines “deceptive trade practice” as any “false . . . or misleading oral or written statement . . . made in connection with the. . . offering for sale . . . of consumer goods or services . . . which has the capacity, tendency or effect of deceiving or misleading consumers.” The term includes “the use, in any oral or written representation, of exaggeration, innuendo or ambiguity as to a material fact or failure to state a material fact if such use deceives or tends to deceive.” Admin. Code § 20- TO1(a). Because the CPL “seeks to protect the public from deceptive and unconscionable trade practices [it] should be interpreted broadly.” Polonetsky v, Better Homes Depot, Inc., 185 Misc. 2d 282, 286 (Sup. Ct. NY. Co, 2000) (citing Maldonado v. Collectibles Int'l., 969 F. Supp. 7, 8“5. (S.D.N-Y. 1997). In weighing a statement’s capacity, tendency, or effect in deceiving or misleading consumers, courts “do not look to the average customer but to the vast multitude which the statutes were enacted to safeguard -- including the ignorant, the unthinking and the credulous who, in making purchases, do not stop to analyze but are governed by appearances and general impressions.” Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 273 (1977). There is no requirement of actual harm to a consumer as a result of deceptive trade practice. Admin. Code § 20-703(e).. Respondents’ threshold argument that the CPL charges should be dismissed because they encroach on its First Amendment rights is unavailing (Resp. Mem. at 4-5) It is well-established that the First Amendment does not protect false or deceptive commercial speech from government regulation. See Ibanez v, Florida Dep't of Business & Professional Regulation, 512 USS. 136, 142 (1994) (noting that under the First Amendment, “false, deceptive, or misleading commercial speech may be banned”); In re von Wiegen, 63 N.Y.2d 163, 173 (1984) (“There is no constitutional right to disseminate false or misleading information . . .”). Here, respondents’ advertisements and social media posts promoting the sale of NBIR membership and the ID4ICE card constitute commercial speech that is subject to regulation under the CPL, which bans false and misleading statements. Commercials 1-3 DCA alleged that respondents engaged in deceptive trade practice, in the form of false advertisements, by posting three videos on YouTube containing false and misleading statements. Mr. Davila admitted that he maintained a YouTube channel under his name (Tr. 369). On March 4, 2017, he posted two videos on his YouTube channel entitled: 1) “ID4ICE 1” (‘Commercial 1") and 2) “My Edited Video” (“Commercial 2”) (Pet. Exs. 30-32; Tr. 251-54, 370). Mr. Davila acknowledged that he posted the videos to advertise the ID4ICE card (Tr. 370). Commercials 1 and 2 are identical, and feature an announcer who speaks in Spanish (Pet. Exs. 32A, 32B). At times, as the announcer speaks, the commercials display clips of individuals in handcuffs apparently under arrest by U.S. Immigration and Customs Enforcement (“ICE”) fore trial, Mr. Davila submitted a motion to dismiss with an accompanying memorandum in support. I reserved judgment until the conclusion of trial for the benefit of a full record. Post-tral, respondents submitted a brief that repeated or argued additional defenses to the charges. The arguments made in the motion to dismiss and post-trial brief are discussed as necessary.agents. DCA submitted a certified translation of the commercials (Pet. Ex. 33). As translated, the announcer states: Are you afraid of being deported? With the new executive regulations put in place by the new president there is a real possibility of being detained in your job, school, home...or even in your car! But what can you do to ensure your rights are respected? We have the solution to this problem. We have created a national ID card. This ID is registered with the federal government and can be used in case of detention by the ICE or any other such agency. This card will inform the officers that you wish to exert your constitutional rights and human rights. You should not talk to any officer, ‘no matter how strongly they insist—just stay silent and hand them over your ID4ICE ID card. They are bound to respect your rights; should they fail to do so, your attorney, or ourselves, will use a legal defense of violation against your constitutional rights and the immigration judge will be allowed to maice use of their judiciary discretion, Contrary to DCA’s argument, Commercials 1 and 2 do not state or imply that a person with an IDAICE card is protected from deportation, Instead, the commercial gives the clear impression that even if a person presents an ID4ICE card to an ICE agent, the person may still be detained and brought before a judge, who will consider arguments and make a determination at his or her discretion, However, the commercials do state that the ID4ICE card is “registered with the federal government.” Within the context of the commercials, this statement implies that the card enjoys 4 certain level of recognition and influence with federal immigration agents. But there is no evidence of any such registration, or that the federal government grants recognition to any card for such purpose. The registration of the trademark is not equivalent to the registration of the card. While it is true that NBIR’s registered trademarked logo is displayed on the ID4ICE card, it is a falsehood to suggest, as respondents did, that this form of intellectual property protection is the kind of federal recognition that would benefit a cardholder who is stopped by an ICE agent. Respondents contended that the charges should be dismissed because they are protected by the Lanham Act, and that DCA “target{ed)” respondents “for the use of a duly registered trademark” (Resp. Br. at 4-5). The Lanham Act, also known as the Trademark Act of 1946, is a federal statute that allows for the registration, protection and use of trademarks. 15 U.S.C. §§ 1051 et seq. (Lexis 2018). However, DCA’s complaint against respondents is not for the use of atrademarked logo on the ID4ICE card, but for falsely suggesting that the card enjoys some type of special federal designation related to immigration enforcement, ‘Therefore, because Commercials 1 and 2 contain a misleading statement of a material fact, respondents violated CPL section 20-700. Screenshots of Mr. Davila’s YouTube page established that both commercials were posted on March 4, 2017, and remained posted until at least June 26, 2017 (Pet. Exs. 30-32). DCA requested a finding of 112 violations per commercial, about one violation for each day the commercials remained posted.’ While the CPL : penalty provisions do not specify per day violations, such a penalty scheme has been found appropriate for deceptive trade practice violations based on false advertisement, and is adopted here. Admin. Code § 20-703(a), (b); see also Aponte v. Raychuk, 172 A.D.2d 280, 284 (Ist Dep't 1991) (upholding per-day penalties against attorney for deceptive advertising); People v. Overstock.com, Inc., 12 Cal. App. 5th 1064, 1089 (Ist App. Dist. 2017) (upholding the adoption of per-day penalties for unlawful online advertisements over penalties based on the number of consumers who saw the advertisements or the number of sales made through the offending pages). Therefore, respondents committed 224 violations of the CPL. DCA alleged that respondents engaged in deceptive trade practice by posting a third commercial (“Commercial 3”) containing false and misleading statements (Pet Ex. 37A). Specifically, DCA charged that Commercial 3 falsely states or suggests that an ID4ICE cardholder will not be deported, and that the card is “registered with the federal government.” Mr. Davila admitted that Commercial 3, entitled “La Migra TV,” was posted on NBIR’s YouTube channel (Tr. 371-73). The commercial is in Spanish, and shows Mr. Davila answering questions from an interviewer (Pet. Exs. 34, 37A). DCA submitted a certified translation of the commercial (Pet. Ex. 38). ‘The commercial runs for about fifteen and a half minutes in length, and mostly involves Mr. Davila promoting the ID4ICE card and giving advice on how to respond iffa person is questioned and detained by an ICE agent. In Commercial 3, the ID4ICE card is offered for $50, while membership to NBIR is offered at $45 a month. Significantly, towards the end of the commercial, the following exchange takes place: > Upon review, the number of days between March 4 and June 26, 2017 is 115 days, including the end date. However, as DCA repeatedly stated in its amended petition that Commercials 1 and 2 violated the CPL “at least 112 times” during the dates at issue, 112 is the number that shall be applied.C. Davila: The ID card costs 50 dollars. Interviewer: It’s like an investment. It's an investment, C. Davila: An investment for your peace of mind. Also, if the person wants us to be their representative, we'd like to invite you to be members of our organization, and that would have a cost of 45 dollars a month so wwe can keep your records, and keep you updated on everything going on with your case and any representation we need to do in any U.S. immigration court, if we are not there in person we will have an ally present there. You will be well represented. Interviewer: Exactly. And what are the benefits of being a cardholder and member of that brotherhood, we could say, of people protected against ICE? C. Davila: Okay, the first benefit is peace of mind. Interviewer: Exactly. , Davila: People with this ID will feel safe, protected by the United States Constitution. And that’s very important for many people. Also, you can be sure that if you don't talk and let the ID do its work, you will not be deported (emphasis added). At trial, Mr. Davila denied promising to any because, as he explained, “nobody can guarantee that. You could have the best lawyer and you still could be deported” (Tr. 331-32). Nevertheless, Mr. Davila admitted that in Commercial 3, he did state that if the cardholder would “let the ID do its work,” the person would not be deported (337-38). This statement is patently false and misleading, and constitutes a deceptive trade practice, Commercial 3 also contains the following statement by Mr. Davila: Interviewer: So, what would happen if that family had the card, the ID4ICE? C. Davila: Okay, let's say the person opens the door, right? ‘That person needs to hand the card to the officer. That card is registered by the federal government. That card has a message for ICE on the back, where it says we are exercising our constitutional rights, we are not signing any document, we don’t allow you to come into our house, we don’t allow you to question anyone, we don’t allow you to search our things, why? mnsumer that they would not be deported-9- Because many people feel frightened at that moment by the officers’ presence, because, let me tell you, it’s not only one officer coming. Sometimes there are ten, fifteen officers, and when those people see them carrying weapons, they treat you as if you were a terrorist and then you ‘want to show them your best behavior, but the worst thing we do is that ‘we talk too much (emphasis added). As with the similar statement made in Commercials 1 and 2, the claim that the ID4ICE card is “registered by the federal government” gives the false impression that the card enjoys a degree of respect and influence with ICE agents due to governmental approval. Therefore, DCA proved that Commercial 3 contains false and misleading statements in violation of the CPL. DCA alleged that Commercial 3 was posted on NBIR’s YouTube channel from April 3, 2016, to June 26, 2017, for a total of 449 days, excluding the end date. The evidence established that Commercial 3 was posted in April of 2016, but not specifically on April 3. A screenshot of NBIR’s YouTube channel, dated July 25, 2017, evidences that ‘Commercial 3 was posted “1 year ago,” but does not provide an exact date (Pet. Ex. 34). Mr. Davila admitted on cross-examination that Commercial 3 was posted in April 2016, but was not questioned as to the exact date the commercial was posted (Tr. 378-79). The NBIR screenshot established that Commercial 3 remained continuously posted until at least June 26, 2017. The credible evidence shows that Commercial 3 was posted no later than April 30, 2016, the last calendar date for that month, and remained posted until June 26, 2017, for a total of 423 days. Each day posted is counted as a separate violation, as discussed above. DCA separately charged Mr. Davila with violating the CPL because Commercial 3 identifies him “at least three times” as a “legal representative” or “immigration expert,” and does not state that Mr. Davila is not an attorney." In Commercial 3, the interviewer states twice that Mr. Davila is an immigration expert. Mr. Davila’s name appears on the screen at least three times, and is identified as a legal representative. The commercial never states that Mr. Davila is not an attomey. Mr. Davila protested that he never called himself en immigration expert or legal representative, but instead that it was the interviewer and those who produced the commercial who used those terms (Tr. 335-36). ‘This argument is unavailing. Commercial 3 was posted on * At trial, petitioner withdrew charges that Commercials 1 and 2 contained similar representations.-10- NBIR’s YouTube channel for the purposes of promoting the ID4ICE card, and therefore, respondents are responsible for the content of the commercial. Further, the commercial appears to have been produced by respondents. At the end of the commercial, the interviewer states “This has been another installment of La Migra TV.” Thereafter, the words “La Migra TV” appear, followed by the names of individuals who produced and edited the video, followed by NBIR’s name and address. La Migra TV is not only the name of the video, but also the name of NBIR’s YouTube channel (Pet. Ex. 34). Lastly, federal regulations and guidelines permitted Mr. Davila to use the title of BIA accredited representative, but prohibited him from stating or implying that he is an immigrati specialist (Pet. Ex. 59). 8 C.F.R. § 1003.102(f). In all, the repeated statements in Commercial 3 that Mr. Davila is an immigration expert and legal representative, without the clarification that he is a not an attomey, are misleading, However, these additional misleading and incomplete statements do not constitute separate violations of the CPL. Instead, they will be considered in determining the total penalty for all the misleading statements in Commercial 3. Social media posts DCA charged that respondents engaged in deceptive trade practice by posting several misleading or deceptive advertisements on a Twitter account. The name for the Twitter account is Carlos M. Davila @NBIRINC (Pet. Ex. 40). Three of the postings in question occurred on February 12, 2017, and two other postings occurred on February 17, and April 2 of 2017, respectively, DCA alleged that on February 12, 2017, two of respondents’ Twitter posts contained a link to respondents’ website. The website, in turn, contained statements that falsely suggested that the ID4ICE card is a “national identification card,” and that a consumer with this card would not be detained if confronted by ICE. DCA submitted into evidence a screenshot of three Twitter postings dated February 12, 2017. One posting stated “A Solution to Immigration Raids,” followed by a nondescript hyperlink (Pet. Exs. 40A, 41). Ms. Grullon, DCA’s compliance associate, testified that when she clicked on the hyperlink, she was directed to a website called www.no-mas-deportaciones.com, which translates into “no-more-deportations” (Tr. 277-78). The specific page she was directed tole contained the ID4ICE logo, the NBIR address, and the following statement, pursuant to the certified translation from Spanish to English (Pet. Ex. 42; Tr. 280-81): A SOLUTION TO IMMIGRATION RAIDS If you feel terrified by the ICE raids and the Deportation threat notices, stop being afraid. We have designed a nation-wide identification called ID4ICE. With this identification, you will be able to stand up to any officer and they will not be able to arrest you (emphasis added). Mr. Davila admitted that www.no-mas-deportaciones.com is respondents’ website, and did not dispute that it contained the above statement (Tr. 352-53). Since the statement that the IDAICE card can shield a cardholder from arrest is false, one violation of deceptive trade practice based on this Twitter posting and website page is established, as charged. The deceptive trade practice found for this posting does not include the statement that the ID4ICE card is a “national” identification card. The word “national” is a term often used by businesses and organizations to indicate a scope of geographical reach or availability, and its use is not limited to agencies associated with the federal government. Mr. Davila’s Twitter account contained two other identical posts for February 12, 2017. ‘The two posts state “ID4ICE: Identification Card,” follow by a hyperlink (Pet. Ex. 40A). Ms. Grullon testified that when she clicked on these links, she was directed to a different page on respondents’ website (Pet Ex. 45A; Tr. 282-86). This webpage stated as follows: ID4ICE: IDENTIFICATION CARD If you use this card correctly, it will help you in case you are arrested. Just produce it at the moment when the officer starts asking questions, Don’t talk to them, just show the card. If you are arrested, tell your lawyer that you have a card that protects you against constitutional and human rights violations. ‘Under this statement, the webpage contains a price of $200, and a sample ID4ICE card, which states “National Identification Card” (Pet. Ex. 45). DCA failed to establish that this Twitter posting violated the CPL. The Twitter posts and the webpage do not state or imply that an ID4ICE cardholder cannot be detained if confronted by + For example, the National Football League, National Car Rental, and the National Organization for Women.-12- ICE agents, as alleged. To the contrary, the statement concedes that the cardholder may be arrested. Further, referring the ID4ICE card as a national identification card is not misleading, for the reasons explained above Respondents’ February 17 Twitter posting states “The sky is my limit, We can only go upwards with the ID4ICE. Check out our page,” followed by a hyperlink to respondents” webpage (Pet. Ex. 47). The hyperlink contained the name of respondents’ website. The amended petition alleged, without specificity, that this posting is deceptive and misleading. For this posting, Ms. Grullon did not state whether she clicked on the hyperlink, nor did she describe the content of any NBIR webpage related to this posting. During closing arguments, DCA’s counsel argued that the hyperlink led to an NBIR webpage which stated that the ID4ICE card is a federally-registered national card (Tr. 451-52). This charge is dismissed. Counsel’s argument as to the content of the webpage is not supported by any evidence. The Twitter posting by itself is not deceptive or misleading. Lastly, DCA charged that respondents engaged in deceptive trade practice by posting Commercial 1 on Twitter on April 2, 2017. DCA alleged that Commercial 1 contains misleading statements that give the false impression that the ID4ICE card is registered with the federal government, and that a cardholder will not be deported. DCA submitted into evidence a screenshot of the Twitter posting (Pet. Ex. 48). The posting contains a still-frame picture of Commercial 1, with a hyperlink to YouTube. At trial, Ms. Grullon was asked what “came up” when she pressed the hyperlink. Mr. Grullon answered “{tJhe ID4ICE 1 video on the YouTube page,” which is Commercial 1 (Tr. 291). ‘The misleading statements at issue are contained in Commercial 1, and not on the Twitter posting. Respondents were found to have violated the CPL by posting Commercial 1 on ‘YouTube for 112 days, including for the date in question. Therefore, the violation is duplicative and no additional penalty shall be imposed. See Dep't of Consumer Affairs v. PCC Cleaning Servs., Inc., et al., OATH Index No. 0088/18, mem. dec. at 15 (June 26, 2018) (finding that the imposition of an additional penalty would be duplicative for conduct already adjudicated in earlier count); Dep’t of Buildings v. Inglese, OATH Index No. 2575/10 at 1 n. 1 (Dec. 1, 2010) (duplicative charge alleging same misconduct violating a different rule dismissed); Taxi & Limousine Comm'n v. Linder, OATH Index No. 1176/00 at 4 (Mar. 30, 2000), modified on-13- penalty, Comm'n Dec. (May 10, 2001) (duplicative charge alleging the same misconduct violating different rule dismissed). Client interactions DCA charged that respondents engaged in deceptive trade practice by telling three NBIR clients, Mr. P, Mr. C, and Mr. R, that if they purchased the ID4ICE card, they would not be deported if confronted by ICE agents. ‘The evidence presented was insufficient to establish the violations. Mr. P testified that he retained respondents to represent him and other family members in asylum proceedings (Tr. 115-16). During a meeting, Mr. Davila offered him the ID4ICE card for sale, and stated that the card “could protect [him] from ICE and immigration” (Tr. 122-23). Mr. P did not specify if he understood this statement to mean that the card would shield him from deportation, or that it would provide some other benefit, such as notice to ICE agents that he was represented by NBIR and that he was asserting his right to remain silent, That Mr. P likely understood that the card would not protect him from deportation is evidenced by the fact that he declined to purchase the card (Tr. 122). In any event, this alleged statement, by itself, is insufficient to prove the charge. Mr. C’s testimony regarding this issue was only that Mr. Davila offered him NBIR membership and the ID4ICE card for a fee of $45 to $50 a month, but he declined the offer (Tr. 99-100). Mr. R testified that Mr. Davila offered him the ID4ICE card for sale, and that he understood that the card would help “protect me about my rights,” but not that it would exempt him from deportation (Tr. 189). Accordingly, the evidence did not prove that Mr. Davila told Mr. P, Mr. C or Mr. R that the ID4ICE card would prevent them from being deported. DCA alleged that on September 15, 2016, Mr. Davila falsely stated to Mr. R that he was an attorney. Mr. R testified that at the time in question, he was secking an attorney to represent his daughter in an immigration matter (Tr. 186). A friend recommended Mr. Davila, stating that he was an attorney (Tr. 188). When Mr. R was asked at trial if Mr. Davila represented himself as ° At rial, petitioner withdrew charge that respondents told a fourth client, Mr. F, that the ID4ICE card would protect him from deportation,-14- an attorney when they met, Mr. R. responded “Yes, he, he told me yes and I told him that I needed a, Ineed an attorney to help me with my case and he said yes, that he was able to help me and solve that case with my daughter” (Tr, 187-88). Mr. Davila did not rebut that this conversation took place As explained, deceptive trade practice includes “ambiguity as to a material fact or failure to state a material fact if such use deceives or tends to deceive.” Here, Mr. R was incorrectly informed that Mr. Davila was an attormey. However, Mr. R’s testimony established that Mr. Davila, at the very least, failed to correct Mr. R’s belief that he was an attorney. Therefore, Mr. Davila gave Mr. R the misleading impression that he was an attomey, which constitutes a violation, Lastly, DCA alleged that Mr. Davila told Mr. F that he had paid immigration application processing fees, when instead he had obtained a fee waiver for the applications. Mr. F testified that he retained Mr. Davila to “fix” his immigration status and that of his brother and sister (Tr. 32, 36). On or about February of 2015, Mr. F gave respondents four money orders totaling $2,140 for fees related to his siblings’ applications, as Mr. Davila requested (Pet. Ex. 2; Tr. 39). Mr. F subsequently received two letters from the U.S. Citizenship and Immigration Services (“USCIS”), dated April 20, 2015, stating that fee waivers had been approved for the two applications (Pet. Ex. 5, 6; Tr. 49-51). Mr. F testified that Mr. Davila never informed him that he would be seeking fee waivers, and came to the belief that he was being “ripped off” (Tr. 54). Mr. F denied telling respondents that they could keep the unused fees to help other clients, and added that the fees were not refunded to him (Tr. 89-91). Mr. Davila stated that he first filed the applications and fee waiver requests with USCIS for Mr. F and his siblings, and then informed Mr. F about the submissions. Mr. Davila explained that when Mr. F came to his office and demanded a refund for the application fees, he told him he would return the fees, but that “at the moment we don’t have it” (Tr. 482). Contrary to DCA’s allegation, the evidence does not establish that Mr. Davila specifically represented to Mr. F that he had paid the fees related to the applications for Mr. F's siblings. Instead, Mr. Davila initially requested the fees from Mr. F, but was then able to have the fees waived. While certainly respondents should have explained that they would be seeking fee waivers and immediately refunded the fees once the waivers were granted, the charged-15- misleading statement was not proven. This violation is dismissed. Respondents’ failure to return the fees is discussed below, in Count 3. In all, DCA proved 647 violations of the CPL based on the contents of Commercials 1-3, one violation for the Twitter posting on February 12, 2017, and one violation for Mr. Davila’s failure to state that he was not an attorney, for a total of 649 violations. Immi; ion Assistance Services Ss DCA alleged that respondents were immigration services providers subject to the ISP Law, and that they committed several violations of the statute. DCA acknowledged that, pursuant to section 20-770(b)(2) of the Administrative Code, the ISP Law does not apply to a “tax-exempt, not-for-profit organization that provides immigration assistance services without a fee or other payments from individuals or at nominal fees as defined by [BIA] and any employee of such organization acting within the scope of his or her employment.” The Department conceded that during the relevant time period, NBIR was a tax-exempt, non-profit organization recognized by BIA, and that Mr. Davila was a federally approved BIA accredited representative (Tr. 16-17, 492-93). However, DCA alleged that because respondents failed to charge only nominal fees as defined by BIA, they were not exempt from the requirements of the ISP Law. See, eg., Dep't of Consumer Affairs v. Alliance for Community Servs., DCA Violation No. OLS088276, Dec. and Order (Aug. 15, 2005) (finding a tax-exempt organization not exempt from the ISP Law because it charged beyond nominal fees). Respondents answered that they were not immigration services providers because: 1) they were allowed to charge above nominal fees, or because 2) their fees were nominal (Resp. Mem. at 11-14). Respondents’ claim that they were allowed to charge above nominal fees is unavailing. Respondents base this claim on the fact that in January 2017, BIA eliminated the nominal fee requirement (Pet. Ex. 59; Tr. 473-74). However, most of respondents’ conduct that allegedly violated the ISP Law occurred before this requirement was eliminated. Thus, the key issue is whether respondents charged only nominal fees as defined by BIA at the time the conduct occurred. To determine nominal fees as defined by BIA, both parties point to Matter of Ayuda, 26 I&N Dee. 449 (BIA 2014), a BIA decision analyzing the nominal fees standard. In Ayuda, BIA-16- found that nominal fees “have never been specifically defined,” and that “a modest fee in one locale may be considered costly in another.” 26 I&N Dee. at 451. Nevertheless, BIA held that these considerations “[do] not mean there are no guidelines for determining what constitutes nominal charges.” Id. Instead, it held that “a nominal charge can never be the actual dollar value of the service; it must always be something substantially less.” Id. Additionally, the “fee structure must be true to the goal of providing competent low-cost legal services and may not be designed simply for the purpose of financially sustaining or serving the interests of the organization.” Id. One of the factors that BIA considers in determining nominal fees is “the circumstances under which the organization will waive fees for clients who are unable to pay for services, adjust fees based on the client’s income, and assess fees on an individual or family basis.” Id. at 453. In Ayuda, BIA determined that an organization imposed only nominal fees, in part, because the organization was substantially supported by grants and not dependent on client fees for its operations, that it adjusted its fees according the its clients’ income, and that it explained to clients its fee waiver policy. Id. Despite the lack of a “bright-line” rule for nominal fees, the established facts here are sufficient to determine that, based on Ayuda, respondents charged beyond nominal fees for its services. Specifically, Mr. Davila admitted that NBIR did not receive any grants or other outside funding, and that it began to charge fees for its services after Mr. Davila realized that some immigration matters, particularly asylum applications, required “a lot of work” (Tr. 324-26). Mr. Davila testified that NBIR charged a fee of $3,000 for asylum cases (Tr. 326). Former NBIR clients corroborate that respondents charged $3,000 to file an asylum application for an individual, and charged between $4,000 to $4,500 to file applications for families (Tr. 96, 118+ 19, 136, 189). One client, Mr. F, testified that Mr. Davila refused to work on his case unless he received a deposit of $1,500 (Tr. 37). Respondents did not present any written fee schedule, or any evidence that they waived {fees for clients who were unable to pay for immigration services, or that they adjusted fees based on a client’s income, or that they assessed fees on an individual or family basis.17. Unlike the organization whose fee structure was approved in Ayuda, NBIR was dependent on client fees for its operations. NBIR’s flat-fee structure appeared designed to sustain its operations, and not to meet the goal of providing low-cost legal services. Mr. Davila argued that the fees respondents charged were substantially less than what a law firm would charge (Resp. Mem. at 11-14; Tr, 327). That argument is unpersuasive because NBIR was only permitted to charge nominal fees, and not a lower rate than prevailing attorneys” fees. Similarly unpersuasive is the argument that the proposed NBIR membership fee of $200 for two-years was nominal because it amounts to $8.33 a month. While such a fee structure could be considered nominal, it was never seriously implemented. Respondents admitted that they “stop[ped] the ID4ICE project,” and only sold two cards (Resp. Mem, at 14; Tr. at 329). Therefore, the evidence established that respondents are immigration services providers because they charged beyond nominal fees, and are subject to the ISP Law. Count 2: Threatening to report a client to immigration or other authorities DCA charged respondents with threatening to report Mr. T’s son to immigration authorities to have him deported. The ISP Law prohibits a provider from “threaten[ing] to report” the client to immigration or other authorities. Admin. Code § 20-771 (a). Mr. T testified that he retained Mr. Davila to represent his son in an immigration matter (Tr. 136, 138-39), He became dissatisfied with Mr. Davila’s representation and hired an attomey (Tr. 142, 156). He stated that, while shopping, he had his daughter-in-law call Mr. Davila and inform him of the substitution (Tr. 165-67). Mr. T testified that he overheard the conversation because Mr. Davila was placed on speakerphone, but that he did not speak to Mr. Davila (Tr. 165, 169). He alleged that during the conversation, Mr. Davila became upset and threatened to have his son deported (Tr. 165-66). Mr. Davila adamantly and consistently denied making such a statement (Tr. 480-82). A credibility determination is required where, as here, the parties have presented conflicting testimony on relevant facts. In making a credibility determination, this tribunal may consider such factors as witness demeanor; consistency of the witness's testimony; supporting or corroborating evidence; witness motivation, bias, or prejudice; and the degree to which a witness's testimony comports with common sense and human experience, Dep't of Sanitation v.-18- Menzies, OATH Index No. 678/98 at 2-3 (Feb. 5, 1998), aff'd, NYC Civ. Serv. Comm'n Item No. CD 98-101-A (Sept. 9, 1998). On this point, Mr. Davila’s testimony was more credible than the testimony of Mr. T. Mr. T’s allegation came only at the very end of re-direct examination by DCA’s counsel (Tr. 165-66). DCA’s counsel had previously unsuccessfully attempted to elicit this testimony through leading questions during direct examination, as Mr. T was testifying about the telephone call (Tr. 142). While on direct examination, Mr. T remembered that the call occurred in December 2015, and that during the call he heard his daughter-in-law tell Mr. Davila that they would be retaining an attorney for his son (Tr. 141-42). On re-cross, Mr. T inconsistently stated that the only thing he remembered about the conversation was Mr. Davila’s alleged threat (Tr. 167). Notably, the person who made the call, Mr. T’s daughter-in-law, did not testify. Mr. Davila credibly testified that he did not threaten to report Mr. T’s son to immigration authorities. Instead, he explained that when he received the call from Mr. T’s daughter-in-law, he declined to speak to her about the case due to client confidentiality. He added that he knows that clients have the right to change representation, and that he did not become upset during the call (Tr. 480-82). DCA did not prove by a preponderance of the evidence that Mr. Davila made this threat. The charge is dismissed. Count 3: Demandiny fees for services not performed DCA charged that respondents demanded and retained fees from five clients for immigration-related services, but failed to perform the services related to those fees, Administrative Code section 20-771(b) prohibits an immigration assistance services provider from “[dJemand{ing] or retain{ing] any fees or compensation for services not performed, or costs that are not actually incurred.” Mr. C DCA alleged that Mr. C paid respondents $500, but that Mr. Davila failed to perform any immigration services on his behalf. Mr. C testified that in April 2016, he retained Mr. Davila to file asylum applications for himself and his two sons (Tr. 96, 395). Mr. Davila quoted him a fee-19- of $4,000 to provide that service, and he paid a $500 deposit (Pet. Ex 14; Tr. 98, 395). However, (Tr. 99). ‘Mr. Davila admitted that he did not file asylum applications for Mr. C or his children, and Mr. C testified that he never received a copy of any asylum applicati offered no explanation as to why he failed to do so (Tr. 395). At most, it appears that Mr. Davila had an initial meeting with Mr. C, and may have sent a follow-up letter requesting documents (Tr. 101). ‘The evidence establishes that respondents accepted a fee but failed to perform the requested service, which was to file asylum applications, in violation of Administrative Code section 20-771(b). MnP Similarly, DCA alleged that Mr. P paid respondents to file asylum applications for him and his family, but that respondents failed to do so. Mr. P testified that in early 2016, he retained Mr. Davila to file an asylum application on his behalf, as well as for his spouse and son (Tr. 115- 16). Mr. Davila quoted him a total fee of $4,000 for this service, and Mr. P paid an initial $1,000 deposit (Pet. Ex. 11; Tr. 118-19, 385-86) Mr. P admitted, however, that Mr. Davila did file asylum applications for him and his spouse (126-27). Mr. Davila also presented a letter from the immigration court to show that he ‘was the acknowledged representative for Mr. P.’s son for a removal hearing (Resp. Ex. D; Tr. 130-31). Therefore, the evidence does not establish that respondents received fees but did not perform services for Mr. P and his family. This violation is dismissed. MrR DCA alleged that Mr. R. paid respondents $1,200 to provide immigration services, but that respondents failed to do so. Mr. R testified that in January 2016, he retained Mr. Davila to help him and his daughter with their immigration status, and that Mr. Davila stated that he would submit asylum applications on their behalf. Mr. Davila quoted a fee of $4,500 for the representation, and Mr. R paid him a deposit of $1,200 (Pet. Ex. 19; Tr. 189, 195). According to Mr. R’s testimony, he met twice with Mr. Davila, and Mr. Davila appeared at the immigration court only twice: once to request for an extension of time to submit an application, and once to-20- request an adjournment (Tr. 200-03, 207-12). Mr. R stated that he never received a copy of any asylum applications (Tr. 197, 218). Mr. Davila did not claim or present any evidence that he filed asylum applications for Mr. R or his daughter, and did not explain why he failed to do so. Although Mr. Davila’s cross- examination of Mr. R suggested that he was expecting to receive additional documents from him, Mr. R credibly testified that he provided Mr. Davila with all the documents he requested at their initial meeting (Tr. 200-01, 204-08, 210), The evidence establishes that respondents collected a fee but did not perform the service for which they were retained, which was to file asylum applications. The violation is sustained. MrT DCA alleged that Mr. T paid respondents $1,700 to file certain immigration applications for hi son, but that respondents failed to do so. Mr. T testified that in July or August of 2014, he retained Mr. Davila to help his son become a legal resident. Mr. Davila quoted him a fee of $3,000, and Mr. T made a partial payment of $1,700 (Tr. 135-39). Mr. T stated that Mr. Davila told him that in order to submit an application with the immigration court, he needed to first have custody of his son (Tr. 143-44, 154-57). To obtain custody, Mr. Davila filled out a form for Mr. T to submit to family court (Tr. 139). However, the family court did not accept the document Mr. Davila drafted (Tr. 157). As a result, Mr. T retained an attorney who was able obtain a family court order granting Mr. T custody of his son and then filed the proper forms for his son with the immigration court (Tr. 157-59). Mr. T stated that Mr. Davila appeared in immigration court three times with Mr. T and his son, but the record is not clear as to the reason for those appearances (Tr. 137-38). ‘There is no dispute that Mr. Davila did not file an application with the immigration court for Mr. T’ son, which is the service for which he was retained. ‘The violation is sustained. Me FE DCA alleged that Mr. F gave respondents $2,140 for application fees, but that these costs ‘were not incurred because USCIS waived the fees. It is undisputed that in 2014, Mr. F gave respondents $2,140 for applications fees required by USCIS for his siblings’ applications, but that Mr. Davila obtained waivers for these-21- fees (Pet. Exs. 2, 5, 6; Tr. 39, 49-51). Mr. F credibly testified that the unused fee amounts were not refunded to him (Tr. 89-91). Mr. Davila admitted that Mr. F demanded a refund, and did not rebut that he failed to retum the fees (Tr. 482). Therefore, because DCA proved that respondents retained fees for costs that were not actually incurred, the violation is sustained. Count 4: Failing to provide customers with copies of documents DCA charged that respondents failed to provide three clients with documents filed with a governmental agency. Administrative Code 20-771(c) states that an immigration assistance services provider may not “[fJail to provide a customer with copies of documents filed with a governmental entity or refuse to return original documents . . . ypon the request of the customer, or upon termination of the contract” (emphasis added). DCA alleged that Mr. Davila agreed to file asylum applications on behalf of Mr. P and his family, but failed to provide Mr. P with a copy of these documents. However, while Mr. P acknowledged that Mr. Davila filed the requested applications, he made no claim that Mr. Davila failed to provide him with a copy of these applications upon his request or at the termination of the representation (Tr. 126-27). Therefore, the evidence did not establish that respondents failed to provide Mr. P with documents submitted to a government entity. Similarly, DCA charged that Mr. Davila filed asylum applications for Mr. C’s two sons, but failed to provide him with a copy of the applications. However, Mr. Davila admitted that he did not file asylum applications for Mr. C or his children (Tr. 395). The charge is dismissed because no documents were submitted on Mr. C’s behalf to a government entity. Lastly, DCA alleged that respondents failed to provide Mr. F with copies of immigration applications filed for him and his two younger siblings. It is uncontested that Mr. Davila filed certain applications on behalf of Mr. F's siblings, but that Mr. F became dissatisfied with Mr. Davila’s representation and hired an attomey (Pet. Exs. 7, 8; Tr. 52-53). When asked if he received a copy of any immigration applications, Mr. F claimed that Mr. Davila “never gave me copies of anything” (Tr. $4). But he admitted that when hhe requested copies of the submitted applications for his attorney, Mr. Davila provided the documents (Tr. 54). Mr. F's testimony established that upon his request, Mr. Davila provided him with copies of applications, in compliance with the rule.-22- In sum, because DCA did not prove that respondents failed to provide Mr. P, Mr. C, of Mr. F with documents filed with a government entity in violation of Administrative Code section 20-771(c), the charges are dismissed. Count 5: Causing a customer to believe that the provider possesses special professional skill Administrative Code section 20-771(d) states that no provider may “[aJssume, use or advertise the title of lawyer or attorney at law, or equivalent terms . .. or represent or advertise other titles or credentials . . . that could cause a customer to believe that the person possesses special professional skills or is authorized to provide advice on an immigration matter.” DCA alleged that respondents violated Administrative Code section 20-771(d) by advertising in Commercial 3 that Mr. Davila was a “legal representative” and an “immigration expert,” and by telling Mr. R that he was an attorney. This charge is based on the same conduct alleged under the CPL in Count 1. As discussed, the credible evidence established that Commercial 3 was posted on NBIR’s YouTube channel (Tr. 371-73). In that video, an interviewer states twice that Mr. Davila is an immigration expert, and also identified him as a legal representative (Pet. Ex. 37A). The commercial never clarifies that Mr. Davila is not an attomey. Therefore, the commercial is misleading. Further, the evidence established that, at the very least, Mr. Davila let stand Mr. R’s belief that he was an attorney, which is also misleading (Tr. 188). However, because the charge here arises from the same deceptive conduct as alleged and adjudicated under the CPL, it is duplicative, and no additional penalty is imposed, Count 6: Giving legal advice or otherwise engaging in the practice of law In Count 6, DCA charged respondents with giving legal advice to five clients and in Commercial 3. Administrative Code section 20-771(e) states that an immigration assistance services provider may not “{g]ive legal advice concerning an immigration matter or otherwise engage in the practice of law.” Respondents’ argued that any charge of unauthorized practice of law should be dismissed based on federal preemption. “Federal law preempts state law pursuant to the Supremacy Clause when 1) Congress expressly provides for preemption of state law in the federal statute, 2) the state law conflicts with a federal statute or 3) the scope of the federal statute indicates that Congress intended the-23- federal law to exclusively occupy the field.” Nat'l Ass’n for the Advancement of Multijurisdiction Practice v. Roberts, 180 F. Supp. 3d 46, 59 (D.D.C. 2015); see also Kurns v. RR. Friction Prods, Corp., 565 U.S. 625, 630 (2012). Where a conflict exists due to a clear collision between state and federal law, federal law prevails and the incompatible state legislation must yield. Swift & Co. v. Wickham, 382 U.S. 111, 120 (1965); Hamm v. Rock Hill, 379 U.S. 306, 311-12 (1964); Sperry v. Florida, 373 US. 379, 384 (1963); Free v. Bland, 369 U.S. 663, 666 (1962). In areas of concurrent regulation, the local regulation is permissible only to the extent that there is no impairment to the federal regulation. Presnell v, Leslie, 3 N.Y 2d 384, 390-91 (1957); Matter of Green, 305 N.Y. 148, 154 (1953); United States v. Mayo, 47 F. Supp. 552, 557 (N.D. Fla. 1942). ‘The charges here stem from Mr. Davila’s conduct relating to his representation of clients in immigration matters. A review of the regulations governing the conduct of BIA representatives establishes that Congress did not explicitly preempt state law because the regulations do not contain an express pre-emption clause, 8 C.F.R. § 292 ef seq.; 8 CFR. § 1003.102 et seq. Nor is the scope of the federal statutes governing such conduct so encompassing as to find that Congress intended for federal law to occupy the field. In determining whether Congress sought to foreclose all state and local regulations in a particular area, the Supreme Court has emphasized “the importance of considering the ¢arger at which the state law aims in determining whether that law is pre-empted.” Oneok, Inc, v. Learjet, Inc., 2015 U.S. LEXIS 2808, ***18 (2015) (emphasis in original). ‘The target of the CPL is preventing and penalizing deceptive trade practice, while the ISP Law aims to protect consumers “against immigration services fraud and the unauthorized practice of law.” NYC Local Law 63 of 2017. By contrast, the purpose of the federal regulations at issue is to create a standard of conduct for BIA and immigration court practitioners. 8 C.F.R. § 1003.102 ef seg. The regulations allow for “disciplinary sanctions against a practitioner who is authorized to practice before the [BIA] and the Immigration Courts when such person ha engaged in criminal, unethical, or unprofessional conduct, or in frivolous behavior, as set forth in 8 CFR. § 1003.102.” 8 CER. § 1003.101(a). Sanctions include disbarment or suspension from practice, and public or private censure. 8 CRR. § 1003.101(a\(1)-(3).-24- Therefore, because the federal and local regulations do not target the same field, and because the federal regulations are not so pervasive as to manifest a clear intent by Congress to occupy the field, field preemption is not established. Accordingly, only those portions of the CPL or ISP Law that are in substantial conflict with federal law are subject to preemption Respondents argue that since Mr. Davila was authorized to represent individuals in immigration proceedings, any Administrative Code violation related to the unauthorized practice of law should be dismissed pursuant to Sperry. 373 US. at 379. In Sperry, Florida sought to enjoin a patent agent, who was not admitted to practice law, from the alleged unauthorized practice of law within the. State. Sperry, 373 U.S. at 381. However, the agent was licensed under federal regulations to prosecute patent applications before the Unites States Patent Office. id. The agent advised clients about patentability, drafted patent applications, and prosecuted patents before the Patent Office. /d. at 381-82. Florida argued that the agent could only perform these tasks in Washington, D.C., where the Patent Office was located, and not in Florida, Jd. at 385. The Supreme Court held that, based on the Supremacy Clause, Florida could not deny the agent the right to perform the functions granted to him under federal authority. Jd. Here, unlike Sperry, DCA does not seek to enjoin Mr. Davila from practicing before the immigration court. Rather, it attempts to punish him for the unauthorized practice of law for providing legal advice on immigration matters. It is undisputed that Mr. Davila was a BIA accredited representative at the time the alleged legal advice was provided. That accreditation allowed Mr. Davila to appear on behalf of clients in immigration matters, and to submit applications and other documents as applicable. 8 CFR. § 292.1(a)(4), 8 CER. § 1.2. It is impossible to perform such duties properly without providing clients with legal advice. Hence, because penalizing Mr. Davila for providing legal advice would substantially hinder his ability to perform his duties as a federally-approved accredited representative for immigration matters, Count 6 is dismissed. To the extent that respondents’ argument for preemption was meant to apply to the CPL charges and the remaining ISP Law charges, a conflict between local and federal law is not established. The CPL claims and the majority of the remaining ISP Law claims pertain to allegations of false advertisements, false representation, threatening to report a client to-25- immigration authorities, and demanding fees for services not performed. The two other counts are for failing to provide clients with a written contract and with copies of documents. None of the statutes that form the basis of these charges substantially conflict or prohibit Mr. Davila from carrying out his duties as a BIA representative. See In re Chrysler-Dodge-Jeep EcoDiesel Mkig., Sales Practices & Prods. Liab. Litig., 295 F. Supp. 3d 927, 1003 (N.D. Cal. 2018) (holding that state consumer protection claims are not preempted by the federal Clean Air Act because the claims did not seek to enforce the Act, but sought recovery based on defendant's deceit that at most referenced the Act); see also Kroll v. Finnerty, 242 F.3d. 1359, 1366 (2001) (where an attomey, in matters before the Patent and Trade Office, failed to return documents to one client, overcharged another client’s credit card, and failed to promptly inform a third client that her application was rejected, federal statutes regulating the conduct of patent attorneys did not preempt state law that also regulated the attorney’s conduct); Aponte, 172 A.D.2d at 280 (although state had a comprehensive scheme to regulate attorneys’ conduct, it did not preempt the city’s consumer protection law, which authorized DCA to seek injunctions restraining false, deceptive, or misleading ads, including the attomey’s advertisements). Therefore, these remaining charges are not preempted by federal regulations. Count 7: Failing to provide a written contract for immigration lance services DCA charged that respondents failed to provide a written contract for immigration services to five clients: Mr. P, Mr. C, Mr. F, Mr. R and Mr. T. Administrative Code section 20- 772 states, in part, that “[n]o immigration assistance services shall be provided until the customer has executed a written contract with the provider.” Mr. Davila admitted that he did not provide a written contract to these five clients, but instead argued that he is not subject to the ISP Law (Resp. Mem. at 11-14; Tr. 401-02). However, as discussed above, respondents are subject to the ISP Law because they charged more than nominal fees for the immigration services provided. Accordingly, because the evidence proved that respondents did not provide the required written contract to five clients, they committed five violations of Administrative Code section 20-772.-26- Administrative Code section 20-774(b) states that “{nJo advertisement for immigration services may expressly or implicitly guarantee any particular government action.” DCA alleged that respondents violated this provision by: 1) Advertising in Commercials 1, 2 and 3 that the purchase of an IDAICE card would prevent ICE deportation for the cardholder; 2) Advertising on Twitter on February 12, 2017, that the purchase of an ID4ICE card ‘would prevent an ICE official from detaining the cardholder, 3) Advertising twice on Twitter on February 12, 2017, that the purchase of an ID4ICE card would prevent an ICE official from arresting the cardholder; 4) Advertising on Twitter on February 17, 2017, that “The sky is my limit. We can only go upwards with the ID4ICE. Check out our page,” followed by a hyperlink to respondents’ webpage; and 5) Advertising on Twitter and Commercial 1 on April 2, 2017, that the purchase of an IDAICE card would prevent deportation for the cardholder. ‘The charges here are duplicative of the charges made and adjudicated under the CPL in Count 1. Accordingly, for the commercials and social media posts deemed misleading, no additional penalty is imposed. FINDINGS AND CONCLUSIONS 1. Petitioner established by a preponderance of the credible evidence that respondents engaged in deceptive trade practice by posting three commercials on YouTube which contained false and misleading statements, for a total of 647 violations of Administrative Code section 20-700, 2. Petitioner established by a preponderance of the credible evidence that respondents engaged in deceptive trade practice by publishing a Twitter post on February 12, 2017, which falsely stated that a person with respondents’ identification card could not be arrested, in violation of Administrative Code section 20-700. 3. Petitioner established by a preponderance of the credible evidence that respondents engaged in deceptive trade10. Al -27- practice by publishing a Twitter post on April 2, 2017, that contained a link to Commercial 1, which contained false and misleading statements. However, as this charge is duplicative, no additional penalty is warranted, Petitioner failed to establish that two other Twitter posts dated February 12, 2017, and one Twitter post dated February 17, 2017, contained false or misleading statements, . Petitioner established by a preponderance of the credible evidence that respondents engaged in deceptive trade practice by falsely representing or implying to one client that Mr. Davila is an attorney, in violation of Administrative Code section 20-700. Petitioner failed to establish that Mr. Davila told three clients that purchase of respondents’ identification card ‘would shield them from deportation. Petitioner failed to establish that Mr. Davila falsely stated to a client that he had paid application processing fees. Petitioner failed to establish that Mr. Davila threatened to call immigration authorities and have a client’s son deported, Petitioner established by a preponderance of the credible evidence that respondents retained fees from four clients, but failed to perform the services related to those fees, for a total of four violations of Administrative Code section 20- 77\(b). Petitioner failed to establish that respondents retained fees for one client, Mr. P, but failed to perform the services requested. . Petitioner did not establish that respondents failed to provide three clients with documents filed with a government agency upon request of the client or at the termination of the contract. Petitioner established by a preponderance of the credible evidence that Mr. Davila represented or implied that he was an attomey, and used titles that could cause a customer to believe that he has special professional skills, in violation of Administrative Code section 20-771(d). However, as-28- this charge is duplicative, no additional penalty is warranted 12. Petitioner did not establish that respondents violated Administrative Code section 20-771(e) by providing legal advice, because Mr. Davila was authorized by federal law to provide legal advice and represent clients in immigration court as a BIA accredited representative. 13, Petitioner established by a preponderance of the credible evidence that respondents failed to provide written contracts for immigration assistance services to five clients, for a total of five violations of Administrative Code section 20-772. 14. Petitioner established by a preponderance of the credible evidence that respondents expressly or implicitly ‘guaranteed a particular government action by posting three commercials on YouTube and publishing Twitter posts on February 12, 2017, and April 2, 2017, which contained false and misleading statements. However, as this charge is duplicative, no additional penalty is warranted ORDER DCA established that respondents committed 649 violations of the CPL and nine Violations of the ISP Law, for which penalties are warranted. Joint and several liability DCA requested that NBIR and Mr. Davila be found jointly and severally liable for any penalties ordered (Pet. Mem. at 1). Mr. Davila argued that he should not be held liable for any assessed penalties because he is shielded by section 720-a of the New York Not-For-Profit Corporation Law (Resp. Mem. at 6-7). Section 720-a is an affirmative defense that confers qualified immunity upon certain officers of not-for-profit corporations. See Woodford v. Benedict Community Health Center, 176 A.D.2d 1115, 1116 Gd Dep't 1991). The relevant portion of the statute reads that: “no person serving without compensation as a director [or] officer... ofa corporation . . . described in section $01(c)(3) of the United States internal revenue code shall be liable to any person . . . based solely on his or her-29- conduct in the execution of such office unless the conduct _gross negligence or was intended to cause the resulting harm,” constituted N-PCL § 720-a (Lexis 2018). Therefore, to qualify for immunity under section 720-a, a director or officer must prove that: 1) the not-for-profit is eligible for tax exemption under 26 U.S.C. section 501(c)(3); 2) the director or officer was uncompensated, and; 3) there is no reasonable probability that the conduct alleged constitutes gross negligence or was intended to cause the resulting harm. N-PCL § 720-a, Itis undisputed that NBIR is a not-for-profit organization exempt from taxation under 26 U.S.C. section 501(¢)(3), and that Mr. Davila is the president of the organization (Resp. Mem, at 6; Tr. 19, 403, 491). However, Mr. Davila did not claim nor prove that he was an uncompensated officer for the corporation. Indeed, while the issue of compensation was never addressed directly, the sum of the evidence strongly suggests that his position with NBIR was his full-time employment. Mr. Davila admitted that from 2014 to the day the petition was filed, he was “in the business of . . providing immigration services,” and that he has represented over 1,500 clients (Tr. 342-43). Mr. Davila did not address the third factor required for immunity: whether or not his alleged conduct constituted gross negligence or was intended to cause the resulting harm. In any event, because the evidence did not establish that Mr. Davila was an uncompensated officer for NBIR, he is not entitled to immunity pursuant to section 720-a. To find Mr. Davila liable for his conduct as president of NBIR, DCA argued that the “corporate veil” should be lifted because he personally committed the alleged deceptive acts and other wrongdoing (Pet. Mem. at 4-6). As established by the New York Court of Appeals, piercing the corporate veil is a “concept [that] is equitable in nature,” and requires a showing that “(1) the owners exercised complete domination of the corporation in respect to the transaction attacked; and (2) that such domination was used to commit a fraud or wrong against the plaintiff which resulted in plaintiff's injury.” Morris v. State Dept. of Taxation & Fin., 82 N.Y.2d 135, 140-41 (1993). The Court of Appeals has also held that “[iJn actions for fraud, corporate officers and directors may be held individually liable if they participated in or had knowledge of the fraud, even if they do not stand to gain personally.” Polonetsky v. Better Homes Depot, Inc., 97 N.Y.24 46, 55 (2001), In Polonetsky, the Court refuse to dismiss charges brought by DCA against the corporation’s-30- president in his individual capacity, finding that he could be held personally liable for making fraudulent promises and committing deceptive trade practice in violation of the CPL. 97 N.Y.2d at 55. Accordingly, DCA’s administrative tribunal has found corporate officers personally liable for engaging in deceptive and fraudulent acts, See Dep’t of Consumer Affairs v. Model & Talent Network Development Lid., DCA Violation Nos. PL001055953, PLOO10S1391, LL005164521 & LL002432622, Dec. and Order at 16-17 (Oct. 14, 2011) (“Model & Talent Network") (holding company’s president personally liable where “he made the decisions relating to advertising by [the business}"); Dep't of Consumer Affairs v. Stadium Motors Inc, DCA Violation No. LL 5133401, Dec. and Order at 38 (Feb. 25, 2010) (holding officers of several secondhand auto dealerships personally liable because they “made the decisions relating to advertising [ ] . . . [which] drew into the dealerships the consumer public and should be considered part and parcel of consequent deceptions once members of the public arrived at the dealerships. The ongoing deceptive mailings and similarity of consumer complaints show that the practices were part of a continuing scheme of repeated fraudulent acts”), Here, the evidence overwhelmingly established that Mr. Davila exercised complete dominion of the corporation and engaged in deceptive and misleading conduct. Itwas Mr. Davila who founded and served as president of NBIR, and was the only person mentioned as appearing in immigration court on behalf of clients. All the client witnesses testified that they met with Mr. Davila about their immigration cases, and that he set the fees for his services. There is no mention in the record of any person, besides Mr. Davila, having authority to make decisions for NBIR. Further, it was Mr. Davila who maintained a YouTube channel under his name, where he posted Commercials 1 and 2. It was Mr. Davila who appeared in Commercial 3 and falsely stated that an ID4ICE cardholder would not be deported. It was Mr. Davila’s NBIR Twitter account that contained the proven misleading Twitter posts. It was Mr. Davila who represented himself as an attomey to a client, who retained fees from four clients for services he did not perform, and who failed to provide five clients with contracts. ‘Therefore, DCA proved that Mr. Davila exercised complete dominion of the corporation ‘and used such domination to commit the proven violations.-31- In his post-trial brief, Mr. Davila argued that he should not be held personally liable because DCA’s amended petition did not include a fraud charge and a request for piercing the corporate veil (Resp. Br. at 1). Mr. Davila complained that a fraud claim “aris[ing] under New ‘York Corporate Law” and the “Corporate Veil theory” are mentioned for the first time in DCA’s post-trial brief and that respondents were not given “a fair opportunity to defend” themselves against these charges (Resp. Br. at 4). Mr. Davila claims that Polonetsky is distinguishable because respondents here are not charged with fraud (Resp. Br. at 4). He also appears to argue that this tribunal has no jurisdiction over the “new legal theory of fraud” because only the state attorney general may bring such a charge (Resp. Br. at 6-9). Mr. Davila’s arguments are without merit. Contrary to Mr. Davila’s claim, the fraud mentioned in Polonetsky and in DCA’s post-trial brief refers to deceptive trade practice in violation of the CPL based on fraudulent promises and misleading advertisements, and not @ separate fraud charge based on “New York Corporate Law.” Respondents received a full ‘opportunity to defend themselves against the allegations because DCA’s amended petition sufficiently pled the facts that formed the basis for the CPL and ISP Law charges. Respondents defended themselves against these charges by submitting motions, presenting testimony and documentary evidence, cross-examining witnesses, and making arguments. Mr. Davila’s argument that only the state attorney general may bring fraud charges misses the point. The charges of deceptive and fraudulent conduct here are part of the alleged deceptive trade practice. It is well-established that DCA may bring CPL and ISP Law charges against all persons and organizations conducting business in New York City, and that this tribunal is authorized to adjudicate such charges. Charter §§ 2203(d), (0), (h) (Lexis 2018); 6 RENY § 6-01(a). It is undisputed that respondents conducted their business in New York City (Resp. Mem. at 6). Also, Mr. Davila was on notice that DCA sought to hold him personally liable for any Pe as president of NBIR. In the petition and at trial, DCA stated that respondents, and not just ities ordered. DCA’s amended petition names Mr. Davila as a respondent individually and NBIR, should pay any assessed fines (ALJ Ex. 1; Tr. 18-19). Indeed, before trial, Mr. Davila moved to dismiss the charges against him pursuant to section 720-a of the New York Not-For- Profit Law, which would have granted him, but not NBIR, immunity from any civil penalties (Resp. Mem. at 6-7). Respondents should not have been surprised that, based on the allegation-32- that Mr. Davila committed and directed the alleged fraudulent and deceptive acts at issue, DCA would seek to hold him personally liable by secking to pierce the corporate veil. Moreover, at this tribunal’s request, DCA submitted a post-trial brief addressing the legal and factual basis for finding Mr. Davila personally liable, and Mr. Davila responded with his ‘own post-trial brief. Accordingly, Mr. Davila was given ample opportunity at trial and in his post-trial brief to defend against the imposition of personal liability, as well as reasoned consideration of his request for qualified immunity. Lastly, Mr. Davila argued in his post-trial brief that he should not be held personally liable because NBIR is governed by a board of directors who oversee the organizations day-to- day activities (Resp. Br. at 3). This claim is unsupported by any evidence. At trial, or even in his post-trial brief, Mr. Davila failed to specify the number of persons who are part of this alleged board, how often they meet, and how they manage and supervise NBIR’s day-to day operations. At most, Mr, Davila briefly mentioned that at the time the corporation was formed, an attorney named Marvin Riceman served as an advisor (Tr. 342). There is no evidence that this attomey had decision-making authority for NBIR, or even for how long he served as an advisor. Instead, the evidence established that it was Mr. Davila who controlled and managed NBIR’s day-to-day operations, and who engaged in the proven deceptive trade practice and wrongdoing. Accordingly, NBIR and Mr. Davila are jointly and severally liable for all civil penalties ordered herein, Civil Penalties Based on the CPL and ISP Law penalty provisions, DCA requested in its amended petition that respondents be ordered fo pay the maximum civil penalties of $350 per day for each deceptive advertisement, and penalties ranging from $250 to $500 for the ISP Law violations (ALJ Ex. 1). Administrative Code section 20-703(a) provides for a civil penalty between of $50 to $350 for each violation of the CPL.” Administrative Code section 20-777(2) provides for civil penalties between $250 and $2,000 for violations of the ISP Law, Therefore, for the 649 proven CPL violations, DCA seeks a total civil penalty of $227,150. For the nine proven ISP Law 7 Administrative Code section 703(b) provides for a civil penalty of $500 for knowingly committing violations under the CPL, but DCA did not request penalties under this provision.-33- violations, DCA seeks a total civil penalty of $2,750. The combined requested penalty of $229,900 is excessive. Instead, some reasons for mitigation exist. The evidence presented in this proceeding showed that NBIR was, for several years, a functioning and active not-for-profit corporation that represented numerous individuals in immigration-related matters, and that Mr. Davila was a BIA. accredited representative pursuant to federal law. Respondents ran afoul of the ISP Law when they raised their fees to sustain operations. Mr. Davila acknowledged that NBIR received no outside funding, and that he raised the fee amounts when he realized the time-consuming nature of immigration work. Raising the fees beyond a nominal amount brought respondents under the purview of the ISP Law, and appears to also have violated the federal rules. But in January of 2017, the Department of Justice amended its rules to eliminate the nominal fee restriction (Pet. Ex. 59). This rule change appears to allow non-profit organizations to do exactly what respondents were doing: charge higher amounts to better sustain their ‘operations based on client fees. The ISP Law has also been amended to exempt from its requirements “any individual providing representation in an immigration-related proceeding under federal law for which federal law or regulation establishes such individual’s authority to appear.” Admin. Code § 20-775(b)(7) (Lexis 2018). This exemption, which is not contingent on the amount of fees charged, would appear to provide a safe harbor for Mr. Davila, Nevertheless, the evidence proved that respondents committed nine violations of the ISP Law for the time period in question. Respondents are ordered to pay a civil penalty of $250 for each of the nine violations, for a total of $2,250, Respondents’ other attempt to raise revenue entailed offering NBIR membership and selling the ID4ICE card, To do so, respondents posted three commercials on YouTube, and made various Twitter posts. These advertisements contained statements that are misleading. Yet respondents managed to sell only two ID4ICE cards. It is unknown if the individuals who purchased the cards did so after viewing the advertisements. Mr. Davila stated that he refunded the purchase price of the cards to the individuals, and that he took his “website down” (Tr. 329, 355).-34- DCA proved 224 violations for both Commercials 1 and 2. But these two commercials are identical, and appear next to each other on Mr. Davila’s YouTube channel (Pet. Exs. 30-32; Tr. 251-54, 370). There is no obvious benefit gained by respondents for having the same commercial twice on the same YouTube page. The commercials were posted from March 4, 2017, to June 26, 2017. During that time period, Commercial 1 was viewed 477 times, while Commercial 2 was only viewed 81 times (Pet. Exs. 31, 32). The commercials falsely implied that the ID4ICE card could provide some measure of protection from immigration agents because it was federally recognized, but the only federal recognition the card enjoyed was that it contained a trademarked logo, The offending statements crossed the line from mere puffery to misleading exaggerations that violated the CPL. Respondents are ordered to pay a penalty of $50 for the 224 violations related to these commercials, for a total penalty of $11,200. ‘The main offending content of Commercial 3 is the egregious misrepresentation that if an ID4ICE cardholder did not speak to ICE agents and let the card “do its work,” the cardholder would “not be deported” (Pet. Ex. 37A; Tr. 337-38). Nevertheless, for the 423 days Commercial 3 was posted, it was only viewed 206 times and did not generate any significant sales of the card, and possibly none at all (Pet. Ex. 34). For the 423 proven violations of the CPL based on ‘Commercial 3, respondents are ordered to pay $60 per violation, for a total penalty of $25,380. Respondents are also ordered to pay $60 for the two remaining CPL violations: 1) publishing a Twitter post on February 12, 2017, which falsely states that a person with respondents’ identification card could not be arrested, and 2) falsely representing to a client that Mr. Davila is an attomey. In all, the total penalty for all 649 CPL violations is $36,700. Restitution In its amended petition, DCA requested $10,025 in restitution for five consumers largely based on the alleged ISP Law violations, but failed to cite any statutory authority that provides for this remedy. Section 2203(h)(1) of the City Charter authorizes DCA “upon due notice and hearing, to impose civil penalties for the violation of any laws or rules the enforcement of which is within the jurisdiction . . . and to order equitable relief for and payment of monetary damages in connection with enforcement of” the Earned Sick Time Act (“ESTA”) (emphasis added). The-35- section also provides that “[e]xcept to the extent that dollar limits are otherwise specifically provided, such civil penalties shall not exceed five hundred dollars for each violation” and that “{tJhe remedies and penalties provided for in this subdivision shall be in addition to any other remedies or penalties provided for the enforcement of such provisions under any other law including, but not limited to, civil or criminal actions or proceedings.” Charter § 2203(h)(1). Accordingly, DCA may pursue civil penalties or equitable relief only if such remedies are provided for under applicable law. For instance, equitable relief is granted for violations of ESTA, and, pursuant to Administrative Code section 20-104, DCA is authorized to seek “redress of injuries” caused by licensees for conduct related to their license. Admin, Code § 20- 104(¢)(2). Conversely, as held by the First Department in Donmez v. Department of Consumer Affairs, DCA. cannot impose penalties in the absence of statutory authority to do so. 140 A.D.3d 612, 615 (Ist Dep't 2016). In Donmez, the Court found that DCA exceeded its authority when it denied a pedicab operator’s application to renew his business license for failure to pay outstanding fines. The Court held that while section 20-104(e)(3) of the Administrative Code permits DCA to suspend a license pending payment of a fine or civil penalty, it “makes no mention of authorizing the Department to refuse to renew a license for such failure.” Id. Similarly, in Department of Consumer Affairs v. 809 Collision Inc., which cited Donmez as controlling authority, this tribunal rejected DCA’s request to hold a tow truck company unfit to hold a license because “there is no statutory or regulatory authority that permits a finding of unfitness.” OATH Index No. 578/18 at 35 (Apr. 20, 2018). Here, the CPL and ISP Law penalty provisions authorize civil penalties, but do not authorize this tribunal to grant restitution or any other form of equitable relief. Admin. Code §§ 20-703(a), 20-777(2). The ISP Law specifies that “[a] proceeding to recover any civil penalty authorized pursuant to the provisions of this section . . . [is] retumable to the administrative tribunal of the department of consumer affairs.”* Admin. Code § 20-777(b). By contrast, section 20-778 of the Administrative Code, entitled “Civil Cause of Action,” states that “[a]ny person claiming to be injured by the failure of a provider of immigration "The functions of the DCA administrative tribunal was transferred to the OATH tribunal in 2016 by Mayoral Executive Order No. 18,-36- assistance services to comply with the provisions of the [ISP Law] shall have a cause of action against such provider .. . in any court of competent jurisdiction for any or all of the following relief: a) compensatory and punitive damages; b) injunctive and declaratory relief, ©) attomey’s fees and costs; and d) such other relief as a court deems appropriate” (emphasis added). Therefore, restitution and other equitable relief for violations of the ISP Law are available to consumers if they pursue a civil cause of action in a court of competent jurisdiction, but are not available at this administrative tribunal. See Judiciary Law §§ 2, 3 (Lexis 2018). DCA argues, in a second post-trial brief, that a grant of restitution is authorized by City Charter section 2203(d), which states that: ‘The commissioner shall enforce all laws relating to the advertising and offering for sale and the sale of all commodities, goods, wares and services; in addition he shall receive and evaluate complaints and initiate his own investigations relating to these matters and take appropriate action, including referral to a federal or state agency. DCA posits that the commissioner's authority to “take appropriate action” includes seeking restitution. This argument is unavailing. ‘The section authorizes the commissioner to enforce “all laws” relating the advertisement of goods and services, but those laws do not provide for restitution from a non-licensee. The commissioner's authority to “take appropriate action” is related to receiving complaints and conducting investigations, and not to seeking unauthorized penalties or relief. DCA also relies on Charter 2203(f), which states that: ‘The commissioner, in the performance of said functions, including those functions pursuant to subdivision e of this section, shall be authorized to hold public and private hearings, administer oaths, take testimony, serve subpoenas, receive evidence, and to receive, administer, pay over and distribute monies collected in and as a result of actions brought for violations of laws relating to deceptive or unconscionable trade practices, or of related laws, and to promulgate, amend and modify rules and regulations necessary to carry out the powers and duties of the department. Charter § 2203(0). DCA argues, in essence, that the commissioner's authority to “administer, pay over and distribute monies” must necessarily include the grant of restitution for CPL claims. Indeed, Administrative Code section 20-703(c) allows DCA to bring a claim against persistent violators-37- of the CPL, and to establish an account for proceeds from such a claim to provide restitution to harmed consumers. But the language of this section makes clear that this action must be filed in civil court. Similarly, DCA may seek to enjoin any person from acts or practices that violate the CPL, but that application must be brought in state supreme court, Admin. Code § 20-703(4). The rest of the CPL penalty provisions only authorize civil penalties. Further, although requested to do so, DCA did not provide any case law where it pursued and was granted restitution from a non-licensee who was not required to have a DCA license. In sum, section 2203(d) and (f) do not provide authority for DCA to seek restitution from this tribunal for a non-licensee’s violation of the CPL and ISP Law. Therefore, because there is no statutory authority for granting restitution related to the proven violations, DCA’s request for restitution is denied. For the 649 CPL violations and the nine ISP Law violations established here, respondents GP Ka Noel R. Garcia Administrative Law Judge are ordered to pay $38,950 in civil penalties. September 17, 2018 APPEARANCES: DANIELLE ILACQUA, ESQ. NICOLE ARRINDELL, ESQ. Attorneys for Petitioner CARLOS DAVILA. Appearing for Respondents