Read publication

Any company that makes sales through the Internet to New Jersey consumers should be aware of a recent trend in consumer class actions based on New Jersey’s Truth-in-Consumer Contract, Warranty and Notice Act (the TCCWNA), N.J.S.A. 56:12-14, et seq. The plaintiff’s bar is attracted to the TCCWNA as a basis for consumer class actions because, like many other statutes underlying consumer class actions [1], it provides for statutory damages and attorneys’ fees to consumers even in the absence of actual financial loss or injury.[2] In addition, the statute provides no exception for a seller’s good faith compliance and expressly applies to consumers and “prospective” consumers. With such a broad definition of potential plaintiffs and the broad reach of an online sales platform, the minimum statutory award of USD 100 per TCCWNA violation can quickly become excessive when aggregated in a class action setting.

 [1] At the time of this writing, the highly publicized case, Spokeo, Inc. v. Robins, 135 S.Ct. 1892, 191 L.Ed.2d 762 (2015), is pending at the Supreme Court of the United States, which decision may determine whether Congress can confer Article III standing by authorizing a private right of action based on the violation of a statute alone, despite a plaintiff having suffered no concrete harm. The Supreme Court’s decision could have profound effects on the proliferation of consumer class actions alleging only a statutory violation with no accompanying tangible injury (e.g., FCRA, FACTA, TCPA, VPPA, ECPA, SCA, CCPA, RESPA, ERISA, ADA).

[2] Barrows v. Chase Manhattan Mortg. Corp., 465 F. Supp. 2d 347, 362 (D.N.J. 2006) (TCCWNA “provides a remedy even if a plaintiff has not suffered any actual damages”).

Explore More Insight