In a recent precedential decision, the Third Circuit, in Bohus, et al. v. Restaurant.com, held that the New Jersey Supreme Court’s Shelton decision — responding to a question of law certified by the Third Circuit as to the proper interpretation of the Truth in Consumer Contract, Warranty, and Notice Act (“TCCWNA”) — may be applied prospectively, thus defeating the class claims and leaving only two individual claims for a $100 penalty.
Plaintiffs’ complaint (in the matter entitled Shelton and Bohus v. Restaurant.com) alleged that plaintiffs purchased certificates from Restaurant.com, which provided a coupon or credit for the purchase of food and beverages at select restaurants. Though plaintiffs did not allege that they were denied the ability to use the certificates, they claimed that the certificates violated the TCCWNA because they stated that the certificates expired in one year “except in California and where otherwise prohibited by law,” and the Gift Certificate Act prohibited gift certificates from expiring within two years. Further, it was argued that the certificates violated the TCCWNA’s prohibition against language stating “that any of its provisions is or may be void, unenforceable or inapplicable in some jurisdictions without specifying which provisions are or are not void, unenforceable or inapplicable within the State of New Jersey.” The District Court granted Restaurant.com’s Motion to Dismiss, finding that the complaint failed to plead an ascertainable loss under the Consumer Fraud Act (“CFA”) and that, because the certificates provided intangible, contingent rights to a discount, they were not “property” and the plaintiffs were not “consumers” within the meaning of the TCCWNA.
On the first appeal, the Third Circuit certified a question to the New Jersey Supreme Court as to whether the TCCWNA was intended to cover both tangible and intangible property, and the New Jersey High Court concluded that “[t]he statute as drafted . . . covers the certificates in question.” The Circuit then affirmed dismissal of the CFA claim and remanded the TCCWNA claim to the district court.