Website Operators: Revise Your Online Terms of Service

Website Operators: Revise Your Online Terms of Service to Comply With This New Jersey Law.

LawA wave of recently filed class action lawsuits agains website operators has brought to light yet another hidden danger of doing business on the Internet, especially with New Jersey residents.   The lawsuits are being filed under a New Jersey law called the Truth-in-Consumer Contract, Warranty and Notice Act (TCCWNA), and largely stem from a December 2015 court decision which involved a plaintiff suing a web site operator whose site included an attorney’s fee provision in its online terms of service. The court held that the TCCWNA governed a term that purported to waive a prevailing party’s right to collect attorneys’ fees.  Thanks to that ruling, plaintiff attorneys are now suing website operators for alleged violations of New Jersey law.

To add fuel to the fire, under the TCCWNA, plaintiffs are not required to sustain any injury or loss to file a lawsuit, which is often a requirement under other consumer protection statutes.  All a plaintiff apparently needs to allege is that he or she was presented with a warranty, contract, or notice pertaining to personal, family or household merchandise that includes language which violates a “clearly defined” right under New Jersey or federal law.

The TCCWNA is just the sort of statute that sets class action attorneys salivating with greedy anticipation, as it includes statutory penalties of $100 per violation, actual damages, or both at the plaintiff’s choice, along with reasonable attorneys’ fees and court costs.

In light of this alarming trend, website operators would be well advised to re-examine their existing terms of service to ensure compliance with the plaintiff-friendly New Jersey Truth-in-Consumer Contract, Warranty and Notice Act.

Author: Seth Heyman
Seth D. Heyman is a California attorney with extensive experience in advertising and marketing law, corporate law, contracts, governmental regulations, international business, and Internet law. He has counseled numerous successful companies, both public and private, and was responsible for regulatory compliance, contract management, corporate governance, and HR best practices for multiple organizations in many diverse industries, including marketing, telecommunications, energy, and technology development. He offers insight and guidance on federal and state direct mail, TV, radio, telemarketing, and Internet marketing laws, as well as online promotions, Internet privacy, data protection regulations, and similar matters.
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