S901

An Act concerning claims alleging violations of consumer fraud or antitrust, and amending various sections of the statutory law.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 2 of P.L.1960, c.39 (C.56:8-2) is amended to read as follows:

2. The act, use or employment by any person of any [unconscionable] commercial practice that is unconscionable or abusive, deception, fraud, false pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with intent that others rely upon such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise or real estate, or with the subsequent performance of such person as aforesaid, whether or not any person has in fact been misled, deceived or damaged thereby, is declared to be an unlawful practice; provided, however, that nothing herein contained shall apply to the owner or publisher of newspapers, magazines, publications or printed matter wherein such advertisement appears, or to the owner or operator of a radio or television station which disseminates such advertisement when the owner, publisher, or operator has no knowledge of the intent, design or purpose of the advertiser.

(cf: P.L.1975, c.294, s.1)

2. Section 4 of P.L.1960, c.39 (C.56:8-4) is amended to read as follows:

4. a. To accomplish the objectives and to carry out the duties prescribed by this act, the Attorney General, in addition to other powers conferred upon him by this act, may issue subpoenas to any person, administer an oath or affirmation to any person, conduct hearings in aid of any investigation or inquiry, promulgate such rules and regulations, and prescribe such forms as may be necessary, which shall have the force of law.

b. In an action brought by the Attorney General, any commercial practice that violates State or federal law is conclusively presumed to be an unlawful practice under section 2 of P.L.1960, c.39 (C.56:8-2).

(cf: P.L.1960, c.39, s.4)

3. Section 8 of P.L.1971, c.247 (C.56:8-20) is amended to read as follows:

8. Any party to an action asserting a claim, counterclaim or defense based upon violation of this act, or the act hereby amended or supplemented, shall electronically mail to a dedicated address or account established by the Attorney General for this purpose a copy of (i) the initial [or], responsive or amended pleading containing the claim, counterclaim or defense and any dispositive motion on such claim, counterclaim or defense, with any accompanying brief or legal memoranda, and (ii) any Appellate Civil Case Information Statements or appellate brief relating to such a claim, counterclaim or defense to the Attorney General within [10 days] 24 hours after the filing of such pleading or document with the court. Upon application to the court wherein the matter is pending, the Attorney General shall be permitted to intervene or to appear in any status appropriate to the matter.

(cf: P.L.1971, c.247, s.8)

4. Section 12 of P.L.1970, c.73 (C.56:9-12) is amended to read as follows:

12. a. Any person who shall be injured in his business or property by reason of [a] anticompetitive conduct in violation of the provisions of [this act] P.L.1970, c.73 (C.56:9-1 et seq.) may sue therefor and shall recover a sum of not less than $1,000 or threefold the damages sustained by him and interest on the damages from date of complaint, whichever amount is greater, together with reasonable attorneys' fees, filing fees and reasonable costs of suit; provided that indirect purchasers injured by an illegal overcharge shall be entitled to recover only compensatory damages, together with reasonable attorneys’ fees, filing fees, and reasonable costs of suit in actions not brought under subsection b. of this section. Reasonable costs of suit may include, but shall not be limited to the expenses of discovery and document reproduction.

b. The State and any of its political subdivisions and public agencies shall be deemed a person within the meaning of this section. The Attorney General, on behalf of the State or any of its political subdivisions or public agencies, or the political subdivision or public agency at the direction of or with the permission of the Attorney General, may institute an action to recover the damages provided for by this section or by any comparable provisions of Federal law, together with reasonable attorneys’ fees, filing fees and reasonable costs of suit.

c. In any action pursuant to P.L.1970, c.73 (C.56:9-1 et seq.), the fact that the State, or any political subdivision or public agency of the State or any political subdivision, or any person who has sustained damages by reason of violation of P.L.1970, c.73 (C.56:9-1 et seq.), has not dealt directly with the defendant shall not bar or otherwise limit recovery except as provided in this section. In any action or actions in which claims are asserted against a defendant by both direct and indirect purchasers, the court may take such steps as the court deems appropriate to avoid duplicate recovery of damages and to obtain substantial fairness. In any action in which both direct and indirect purchasers are involved, a defendant shall be entitled to prove as a partial or complete defense to a claim for damages that the illegal overcharge has been passed on to others, including the defendant, who are themselves entitled to recover, so as to avoid duplication of recovery of damages.

d. In the event damages in a class action or an action instituted by the Attorney General remain unclaimed by, or undistributed to, the direct or indirect purchasers, the class representative or the Attorney General, as applicable, the Attorney General may apply to the court and such funds shall escheat to the State upon showing that reasonable efforts made by the State to distribute the funds have been unsuccessful.

(cf: P.L.1970, c.73, s.12)

5. Sections 1, 2, and 4 of this act shall take effect immediately and section 3 shall take effect on the first day of the third month next following enactment.

STATEMENT

This bill updates various provisions of the consumer fraud act and the “New Jersey Antitrust Act,” in part to enhance the enforcement authority of the Division of Consumer Affairs in the Department of Law and Public Safety.

Under the bill, language in the consumer fraud act on prohibited commercial practices is expanded to include commercial practices that are unconscionable or abusive. Additionally, the bill adds language to declare that in an action brought by the Attorney General, any commercial practice that violates State or federal law is conclusively presumed to be an unlawful practice under the consumer fraud act. The bill also adds language regarding the notice of private lawsuits based on violations of the consumer fraud act. Notice is to be sent electronically to a dedicated address established by the office of the Attorney General, and requires certain legal filings to be sent as part of the notice. The bill stipulates notice is to be sent to the Attorney General within 24 hours of filing rather than 10 days, as is required under current law.

Lastly, the bill amends current State antitrust law by allowing parties, including municipalities and the State, who are harmed by anticompetitive conduct to file suit even if the alleged harmed party is an indirect purchaser who did not deal directly with the defendant. The bill also stipulates that a defendant is entitled to prove that as a partial or complete defense to a claim for damages, an illegal overcharge has been passed on to others, including the defendant, who are entitled to recover, so as to avoid duplicate recovery damages. The bill adds language to clarify that a person seeking treble damages may do so if there is an alleged violation of State antitrust law that demonstrates anticompetitive conduct. Moreover, the bill adds provisions stating that in the event damages awarded as a result of a class action or an action instituted by the Attorney General remain unclaimed or undistributed, the Attorney General may apply to the court and have such funds escheat to the State upon showing that reasonable efforts were made by the State to distribute the funds but were unsuccessful.