New Jersey Supreme Court Favors Retailers In Landmark Ruling Limiting TCCWNA Claims

Brett Carroll and Brian Leary are Partners and Stephen Hall is an Associate in the Boston office

HIGHLIGHTS:

In what has been described as a landmark ruling on behalf of both national retailers and consumers alike, the New Jersey Supreme Court has established critical law to limit exposure to purported class action claims involving the New Jersey Truth-in-Consumer Contract Warranty and Notice Act (TCCWNA). Specifically, the Court's recent 7-0 opinion enforced TCCWNA as the New Jersey Legislature intended - requiring that a consumer asserting a TCCWNA claim must be adversely affected by the alleged violation in order to establish a claim for relief. The decision is a victory for national retailers that were facing "gotcha litigation" where no real harm or impact had occurred and, instead, were being held hostage to threats of protracted litigation by consumer class counsel with mounting legal fees and costs. Earlier this year, Holland & Knight's publication on the New Jersey Truth-in-Consumer Contract Warranty and Notice Act (TCCWNA) concluded that the New Jersey Supreme Court had two options when interpreting the certified questions of law posed by the U.S. Court of Appeals for the Third Circuit. TCCWNA's application could continue to embolden class claims even where a consumer incurred no harm or adverse consequences. Alternatively, it could limit TCCWNA's intended reach to its logical conclusion such that only those consumers who have suffered actual harm could sustain a claim. (See Holland & Knight's alert, " With Some Progress in 2017, Where Does TCCWNA Head in 2018?", March 1, 2018.)

In what has been described as a landmark ruling on behalf of both national retailers and consumers alike, the New Jersey Supreme Court established critical law to limit exposure to purported class action claims involving TCCWNA. Specifically, the Court's recent 7-0 opinion enforced TCCWNA as the New Jersey Legislature intended - requiring that a consumer asserting a TCCWNA claim must be adversely affected by the alleged violation in order to establish a claim for relief. This pronouncement confirms a significant shift in favor of all retailers, which protects them against the abuse of TCCWNA's reach by consumer class counsel.

TCCWNA Background

During the past five years or so, the recent wave of purported consumer class actions brought under TCCWNA did not just target "bad actors" in order to protect the rights of New Jersey consumers. Rather, the vast...