On Dec. 24, 2015, a home furnishings company called Croscill Home sold a tealight candle holder online to an Ocean County man. That transaction now has the company facing the threat of a class action lawsuit and the possible loss of a huge sum of money. The consumer, Ryan Russell, earlier this year sued Croscill, alleging that the terms and conditions on its web site violate an obscure pre-Internet era New Jersey consumer law, among several other state laws.
Russell’s lawsuit cites the New Jersey Truth-in-Consumer Contract, Warranty and Notice Act, a law passed back in the days when consumers had to go to a store or use a catalogue to shop for and buy goods. But the law now has seen a resurrection, and is coming up in a spate of potential class actions against big, deep-pocketed retailers and businesses such as Apple, Toys R Us, Facebook, Staples and Devils Arena Entertainment.
Russell’s suit does not say he received a defective product, nor that he suffered any harm because he bought it. It doesn’t suggest any dissatisfaction with the transaction. It does not even suggest that Russell read the website’s terms and conditions.
The law permits statutory penalties of $100 per person for consumers who shopped on the web site. It also covers “prospective consumers,” so plaintiffs can sue for consumers who may use the site in the future. For a big retailer, that could amount to “tens of millions of dollars” in penalties, said Edward J. Fanning Jr. of McCarter & English in Newark. According to Fanning, the litigation is being filed by a few lawyers looking to generate substantial legal fees.
“This is not for one single consumer or one single transaction,” he said. “They’re interested in putative class actions … to really add up those numbers to get a large attorney fee.” Fanning said “dozens” of companies have gotten “demand letters,” that ask for an immediate settlement in lieu of the filing of a lawsuit. “I’m getting calls from companies regularly on this,” he said earlier this year.
Click for full article: Those Terms and Conditions (That Nobody Reads) Could Cost N.J. Retailers