"Evergreen" provisions

The same rule applies in New York for automatic renewal provisions of contracts for service, maintenance or repair. NY General Obligations Law § 5-903. At least one trial-level court in New York has ruled that a lessor cannot avoid the impact of New York's notice requirement by use of a choice of law provision in their lease documents. See Andin International v. Matrix Funding Corp., 194 Misc.2d 719, 756 N.Y.S.2d 724 (NY County Sup. Ct. 2003)(notwithstanding a Utah choice of law clause in an equipment lease agreement, the trial court stated that the NY notice statute is applicable "[i]n view of the public policy purpose behind the section"). In the case of Ovitz v. Bloomberg L.P., over a strenuous dissent, the lessor/service provider dodged a bullet and was successful in having a class-action complaint dismissed on the pleadings, notwithstanding that the plaintiff had clearly alleged that the lessor/service provider had violated the New York statutes. Ovitz v. Bloomberg L.P., 18 N.Y.3d 753, 944 N.Y.S.2d 725 (2012). In Ovitz, the complaint alleged that the original term of the lease/service contract expired in 2002 and that the defendant did not send the statutorily required notice of automatic renewal. The plaintiff continued to use and pay for the equipment and services until 2008, at which time he notified the defendant that he wished to terminate. However, the defendant responded by advising the plaintiff that the lease/service agreement had automatically renewed to 2010. After an exchange of email between the parties and unsuccessful demands by the defendant for payment, the plaintiff filed a class-action complaint against defendant, alleging various statutory and common-law claims, and seeking declaratory and injunctive relief, in addition to other relief. Two weeks after suit was filed, defendant waived all fees "as an accommodation" to plaintiff. After several years of litigation, the case was dismissed, primarily because the plaintiff had not paid for any services it did not receive and thus no monetary damages were suffered. In effect, the court held "no harm, no foul". There was a strenuous dissent to the decision, however, which stressed the defendant's alleged admission that it was its "policy" not to send renewal notices and to then vigorously pursue its lessees to collect unenforceable fees. In the dissent's view, the "no harm, no foul" approach was inappropriate and the case should have been allowed to proceed, given the plaintiff's allegation that the putative class members "are entitled to injunctive relief necessary to ensure that Bloomberg's 'illegal, unfair and deceptive conduct will not continue into the future.'"