Robey v. SPARC Group LLC
On November 7, 2023, NJCJI and the United States Chamber of Commerce (“Chamber”) appeared together before the New Jersey Supreme Court as amici in support of the defendant in this consumer class action lawsuit. In this case, the plaintiffs claimed that SPARC’s Aeropostale stores in New Jersey marketed goods as being “50%-70% off,” but never sold those goods at the higher prices those signs implied. A state regulation promulgated under the New Jersey Consumer Fraud Act (“CFA”) prohibits retailers from advertising “fictitious former prices.” The plaintiffs therefore sued to be able to keep the goods they bought, but also to receive three times what they paid for those goods as CFA damages. They also brought a $100-per-violation claim under New Jersey’s unique Truth-in-Consumer Contract, Warranty, and Notice Act (“TCCWNA”), which prohibits the use of any “sign” that contains a “provision” violating any “clearly established right” of a consumer.
Accordingly, one key issue in this case is whether a consumer who (for example) agrees to pay $25 for a sweatshirt, receives that sweatshirt for the agreed price, and does not claim the sweatshirt is “worth” less than $25, suffered any “ascertainable loss,” which is a require element of a consumer fraud claim. The plaintiffs in Robey claimed that the alleged 50% discount was part of the “bargain” they made with Aeropostale stores, so if that discount was not real, they did not get what they thought they were buying.
During oral argument, NJCJI and the Chamber supported SPARC’s position that the plaintiffs did not suffer any ascertainable loss, and further explained to the Court that SPARC had not actually committed any CFA violation. A separate New Jersey regulation, N.J.A.C. § 13:45-9.8(b), provides that where retailers “offer a percentage-off discount” for goods sold below $100, those retailers are “not required to disclose the basis of the percentage reduction.” NJCJI and the Chamber also argued that the plaintiffs cannot satisfy the elements of a TCCWNA claim because no court has ever held that TCCWNA applies to price tags or pricing signage. Further, different regulations, which no court has yet addressed, preclude the plaintiffs from demonstrating that SPARC violated a “clearly established right,” which is an essential element of a TCCWNA claim.
At oral argument, the Justices struggled with the ascertainable loss issue. They rejected each precedential analogy the plaintiff’s counsel proposed. Members of the Court highlighted that in SPARC’s case, buyers received exactly what they expected to receive and paid exactly what they expected to pay. The Supreme Court also showed interest in the offramps NJCJI’s brief offered to them. Multiple Justices asked questions of all parties about the interplay between the regulation the plaintiffs rely upon and the one NJCJI and the Chamber cited. Justices also asked whether the regulations support a TCCWNA claim.
A copy of NJCJI’s and the Chamber’s joint amici curiae brief can be found here. A link to the oral argument in this matter can be found here. NJCJI anticipates an opinion in the coming months. NJCJI thanks Jeffrey S. Jacobson, Esq., of Faegre Drinker Biddle Reath LLP, for his representation of NJCJI and the U.S. Chamber in this matter.
Padilla v. Young Il An
On November 8, 2023, Alex Daniel, counsel for NJCJI, appeared for oral argument before the New Jersey Supreme Court as amicus curiae in connection with this case, which requires the Court to address whether owners of vacant commercial lots have a duty to maintain deteriorating public sidewalks abutting their property. In Stewart v. 104 Wallace Street, Inc., 87 N.J. 146 (1981), the New Jersey Supreme Court first held that owners of commercial properties could be found liable for injuries arising from deteriorating public sidewalks abutting their properties. The Stewart Court found that imposing liability on commercial property owners was reasonable because they derived economic benefits from public sidewalks, were uniquely situated to maintain public sidewalks, and had a revenue stream from their business to offset the cost of property insurance.
In Padilla, the defendants owned a vacant commercial lot in Camden, New Jersey. The defendants’ property was devoid of any improvements and supported no business activities. The plaintiff slipped and fell on a deteriorating public sidewalk abutting the defendants’ vacant lot and filed a claim alleging that the defendants failed to maintain and repair the sidewalk. Both the trial court and the Appellate Division held that the defendants did not have a duty to repair the sidewalk because their property was vacant and devoid of commercial activity.
During oral argument the Court’s questions focused on two lines of inquiry: (1) what constituted commercial activity for purposes of imposing sidewalk liability; and (2) whether insurance coverage existed for owners of vacant properties. The majority of the Court questioned the plaintiff’s view that zoning a property as “commercial” without more was sufficient to impose a duty on landowners. Several members of the Court expressed concern regarding the unfairness of imposing such a duty on property owners who lack any means of generating income from their property and who have not opened their land up to the general public. Concerning income generation, the Court questioned whether the mere possibility a vacant lot can be sold for a profit is sufficient to impose a duty on property owners. The Court struggled, however, with where to draw the line for liability. Based on the questions, the Court appeared to agree with NJCJI’s position that the principles articulated in Stewart should limit landowners’ liability, where there is minimal business activity or improvements on their land.
A copy of NJCJI’s amicus curiae brief can be found here. A link to the oral argument in this matter can be found here. NJCJI anticipates an opinion from the Court in the coming months.