Appellate Division Compels Arbitration of Consumer Fraud and TCCWNA Claims and Dismisses Class Claims

Adrienne C. Rogove

In Griffoul v. NRG Residential Solar Solutions, LLC and NRG Energy, Inc., the Appellate Division recently addressed the validity of an arbitration clause in a lease between the plaintiffs, residents of Elmwood Park and class representatives (“Plaintiffs”), and NRG Residential Solar Solutions (“NRG RSS”) doing business as NRG Home Solar (“NRG Residential”) and NRG Energy, Inc. (“NRG Energy”) (collectively, “Defendants”). A-5535-16T1 (App. Div. May 4, 2018). Plaintiffs filed a class action complaint against Defendants alleging violations of the New Jersey Consumer Fraud Act (“CFA”) and the Truth-in-Consumer Contract, Warranty and Notice Act (“TCCWNA”) based on particular provisions in the lease. The lease required NRG Residential to install solar systems on Plaintiffs’ properties, which would provide electricity to their homes, and which would be connected to the utility’s electrical transmission grid.

Defendants filed a motion to compel arbitration pursuant to an arbitration clause in the lease. In pertinent part, the lease provided:

“[A]ny dispute, disagreement or claim between you and NRG RSS arising out of or in connection with this Lease, or the Solar System…shall be submitted to final and binding arbitration…YOU AND NRG RSS AGREE THAT BY ENTERING INTO THIS LEASE, YOU AND WE ARE WAIVING THE RIGHT TO A JURY TRIAL. IN ADDITION, EACH PARTY MAY BRING CLAMS AGAINST THE OTHER PARTY ONLY IN ITS INDIVIDUAL CAPACITY AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING.”

Defendant NRG Energy also moved to dismiss the CFA claim for failure to plead it with particularity as required by Rule 4:5-8(a), and to dismiss the TCCWNA claim on the basis that NRG Energy was not a party to the lease agreement. Continue reading “Appellate Division Compels Arbitration of Consumer Fraud and TCCWNA Claims and Dismisses Class Claims”

Must Consumer Suffer Adverse Consequence in Order to Sue under TCCWNA?

Stephen M. Orlofsky and Ethan M. Simon

The Third Circuit certified to the New Jersey Supreme Court two questions about the interplay between New Jersey’s furniture delivery regulations and the state’s Truth-in-Consumer Contract, Warranty and Notice Act (TCCWNA). In Spade v. Select Comfort Corp., — A.3d —, 2018 WL 1790394 (N.J. Apr. 16, 2018), the court answered. In so doing, it expanded the reach of TCCWNA, which is intended to “prevent deceptive practices in consumer contracts.” Id. at *7. The act prohibits merchants from offering and entering into written contracts with consumers that include “any provision that violates any clearly established right of a consumer or responsibility of a seller … as established by State or Federal law at the time the offer is made or the consumer contract is signed.” Id. Continue reading “Must Consumer Suffer Adverse Consequence in Order to Sue under TCCWNA?”