NEWARK, N.J. (Legal Newsline) — Another class action lawsuit has been filed that claims a company violated New Jersey's Truth-in-Consumer Contract, Warranty and Notice Act (TCCWNA), but there are ways for companies to protect themselves from such litigation, an attorney says.
Michelle Murphy has sued Wal-Mart, alleging that the walmart.com terms of service require users to exempt the store and its affiliates from any claims regarding use of the site. The TCCWNA bars a company’s terms and services from violating any legal rights that a user might have under federal or state law.
David Zaslowsky, an attorney with Baker & McKenzie, said there are ways for companies to avoid litigation under the TCCWNA.
“In my view, the best way to try to protect yourself from this particular statute is to include an arbitration clause in your terms and conditions along with a provision that there will be no class action arbitration,” Zaslowsky recently told Legal Newsline.
“That seems to me to be the best way to try to protect yourself, because without class actions, there's not enough incentive for class action lawyers to bring an arbitration.”
Companies need to make the effort both because of the increasing numbers of such suits and the fact that the statute seems to bar attempts to use generic language to avoid running afoul of the statute, he said.
“It looks like that kind of generic language is itself unenforceable under the New Jersey statute — at least it looks like that's the intent of the New Jersey statute, according to one decision,” Zaslowsky said. “So you would need to say 'Provision X is not enforceable under New Jersey law,' and then it would not apply to a buyer in New Jersey.”
Attorneys and companies were hoping the decision in a similar case the U.S. Supreme Court heard in November would offer some clarity on whether people can sue when there isn’t concrete harm, only a violation of a statute. Earlier this month, the court sent that case, Spokeo Inc. v Robins, back to a lower court with instructions to consider whether the plaintiff showed that he had suffered concrete harm.
“There was a recent Supreme Court decision, the Spokeo case, and a lot of people hoped that the Supreme Court in that case would address the issue of whether a class action can be brought when there's no actual damage other than the violation of the statute itself," he said.
"In the view of many, the Supreme Court just punted on that issue instead of addressing it. To the extent that people were waiting to see what the Supreme Court did, and now that they didn't make a decision, I think it will get even more attention.“
A Wal-Mart spokesman said the company had received the complaint and would respond in court as appropriate. "We believe our terms of use are consistent with applicable laws and regulations," he said.
U.S. District Court for the District of New Jersey case number 2:16-CV-02629-ES-JAD