Discount restaurant coupons purchased online qualify as contracts under the state’s consumer protection statute, according to the Supreme Court of New Jersey.
The panel was asked to weigh in by the Third Circuit Court of Appeals, which is considering the dismissal of a class-action lawsuit against Restaurant.com.
The TCCWNA makes it unlawful to “offer to any consumer or prospective consumer or enter into any written consumer contract or give or display any written consumer warranty, notice or sign … which includes any provision that violates any clearly established legal right of a consumer or responsibility of a seller, lessor, creditor, lender or bailee as established by State or Federal law ….” The TCCWNA further provides that any person who violates the provisions of the statute shall be liable to an aggrieved consumer for a civil penalty not less than $100, actual damages, or both at the election of the consumer, in addition to reasonable attorneys’ fees and court costs.
In Shelton v. Restaurant.com, the plaintiffs alleged that Restaurant.com’s certificates violate the New Jersey Gift Certificate Statute (GCS), the New Jersey Consumer Fraud Act (CFA), and the TCCWNA because they contain a provision specifying an expiration period less than twenty-four months from the date of issue or sale of the certificate. The certificates terms and condition specifically contained the following language: 1) the certificate “[e]xpires one (1) year from date of issue, except in California and where otherwise provided by law[,]” and 2) the certificate is “[v]oid to the extent prohibited by law.”
A district court judge dismissed the suit on several grounds, including that plaintiffs were not “consumers” as defined in the TCCWNA because the certificates purchased by them were not property. The plaintiffs appealed.
The Court’s Decision
In its advisory opinion to the Third Circuit, the state Supreme Court concluded that TCCWNA covers the sale of tangible and intangible property. It further held that the plaintiffs are “consumers” within the scope of the TCCWNA because the certificates acquired by them through the Restaurant.com website are “property . . . primarily for personal, family, or household purposes.”
“Plaintiffs and other purchasers paid money to Restaurant.com, which in turn issued a certificate for use at a participating restaurant. Upon presentation, the purchaser receives goods, namely food and drinks, at a discounted price,” Judge Mary Cuff explained.
The New Jersey Supreme Court further concluded that because the TCCWNA is a remedial statute, it is entitled to a broad interpretation to facilitate its stated purpose. As highlighted by the court, “The Legislature enacted the TCCWNA to permit consumers to know the full terms and conditions of the offer made to them by a seller or of the consumer contract into which they decide to enter.”
The Impact on New Jersey Businesses
Prior to this case, very few consumer class-action lawsuits have included violations of the TCCWNA. However, in the wake of the court’s broad interpretation of the statute, businesses should be aware of the potential for liability.
If you have any questions about this case or would like to discuss the legal issues involved, please contact me, Christine Vanek, or the Scarinci Hollenbeck attorney with whom you work.
Redefining Labor Relations: NLRB's Pivot from Abruzzo’s Memoranda
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
If you purchase real property from a foreign person or entity, you may be required to withhold taxes from your payment to the seller under the Foreign Investment in Real Property Tax Act (FIRPTA). The federal tax law is designed to ensure that foreign sellers pay any applicable capital gains tax on profits realized from […]
Does Your Homeowners Insurance Provide Adequate Coverage?
Your home is likely your greatest asset, which is why it is so important to adequately protect it. Homeowners insurance protects you from the financial costs of unforeseen losses, such as theft, fire, and natural disasters, by helping you rebuild and replace possessions that were lost While the definition of “adequate” coverage depends upon a […]
Understanding the Importance of a Non-Contingent Offer
Making a non-contingent offer can dramatically increase your chances of securing a real estate transaction, particularly in competitive markets like New York City. However, buyers should understand that waiving contingencies, including those related to financing, or appraisals, also comes with significant risks. Determining your best strategy requires careful analysis of the property, the market, and […]
Fred D. Zemel Appointed Chair of Strategic Planning at Scarinci & Hollenbeck, LLC
Business Transactional Attorney Zemel to Spearhead Strategic Initiatives for Continued Growth and Innovation Little Falls, NJ – February 21, 2025 – Scarinci & Hollenbeck, LLC is pleased to announce that Partner Fred D. Zemel has been named Chair of the firm’s Strategic Planning Committee. In this role, Mr. Zemel will lead the committee in identifying, […]
Novation Agreement Process: Step-by-Step Guide for Businesses
Big changes sometimes occur during the life cycle of a contract. Cancelling a contract outright can be bad for your reputation and your bottom line. Businesses need to know how to best address a change in circumstances, while also protecting their legal rights. One option is to transfer the “benefits and the burdens” of a […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Discount restaurant coupons purchased online qualify as contracts under the state’s consumer protection statute, according to the Supreme Court of New Jersey.
The panel was asked to weigh in by the Third Circuit Court of Appeals, which is considering the dismissal of a class-action lawsuit against Restaurant.com.
The TCCWNA makes it unlawful to “offer to any consumer or prospective consumer or enter into any written consumer contract or give or display any written consumer warranty, notice or sign … which includes any provision that violates any clearly established legal right of a consumer or responsibility of a seller, lessor, creditor, lender or bailee as established by State or Federal law ….” The TCCWNA further provides that any person who violates the provisions of the statute shall be liable to an aggrieved consumer for a civil penalty not less than $100, actual damages, or both at the election of the consumer, in addition to reasonable attorneys’ fees and court costs.
In Shelton v. Restaurant.com, the plaintiffs alleged that Restaurant.com’s certificates violate the New Jersey Gift Certificate Statute (GCS), the New Jersey Consumer Fraud Act (CFA), and the TCCWNA because they contain a provision specifying an expiration period less than twenty-four months from the date of issue or sale of the certificate. The certificates terms and condition specifically contained the following language: 1) the certificate “[e]xpires one (1) year from date of issue, except in California and where otherwise provided by law[,]” and 2) the certificate is “[v]oid to the extent prohibited by law.”
A district court judge dismissed the suit on several grounds, including that plaintiffs were not “consumers” as defined in the TCCWNA because the certificates purchased by them were not property. The plaintiffs appealed.
The Court’s Decision
In its advisory opinion to the Third Circuit, the state Supreme Court concluded that TCCWNA covers the sale of tangible and intangible property. It further held that the plaintiffs are “consumers” within the scope of the TCCWNA because the certificates acquired by them through the Restaurant.com website are “property . . . primarily for personal, family, or household purposes.”
“Plaintiffs and other purchasers paid money to Restaurant.com, which in turn issued a certificate for use at a participating restaurant. Upon presentation, the purchaser receives goods, namely food and drinks, at a discounted price,” Judge Mary Cuff explained.
The New Jersey Supreme Court further concluded that because the TCCWNA is a remedial statute, it is entitled to a broad interpretation to facilitate its stated purpose. As highlighted by the court, “The Legislature enacted the TCCWNA to permit consumers to know the full terms and conditions of the offer made to them by a seller or of the consumer contract into which they decide to enter.”
The Impact on New Jersey Businesses
Prior to this case, very few consumer class-action lawsuits have included violations of the TCCWNA. However, in the wake of the court’s broad interpretation of the statute, businesses should be aware of the potential for liability.
If you have any questions about this case or would like to discuss the legal issues involved, please contact me, Christine Vanek, or the Scarinci Hollenbeck attorney with whom you work.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
