Monday, January 5, 2009
An attorney who had ordered a "Smart Light" over the internet wanted to take advantage of the seller's advertised "free bonus" offer. He sought to pay with his American Express credit card but was advised that there was a shipping charge for the free bonus. The next day, he "filed a putative class action alleging common law fraud and consumer fraud against [the seller], premised on...deceitful advertising of its products on the internet." Because the item purchased was on back order, the product was never delivered, as the seller had cancelled the sale after the suit was filed. The credit card was not debited. The seller filed an abuse of process counterclaim, alleging that the lawyer had filed numerous similar actions against retailers. The trial court dismissed both the claim and counterclaim.
On appeal, the New Jersey Appellate Division affirmed. The plaintiff did not establish an ascertainable loss, as the transaction had not been completed. The fact that the plaintiff had filed 40 similar cases did not establish abuse of process: "Our concern with reliance on this proferred information is that, as represented by [defense] counsel, many of these suits were settled before class certification could be attempted or achieved, and we are in no position to nor will we assess the bona fides of these actions..." (Mike Frisch)