Gibbons Law Alert

Gibbons Law Alert

Author: Christopher Walsh

New Jersey Appellate Division Limits Application of Parol Evidence Rule in Fraudulent Inducement Cases and Finds that Unsophisticated Fraud Claimant Can Only Be Charged With His Actual Knowledge

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Posted in General Litigation

On April 17, 2012

In a to-be-published opinion in Walid v. Yolanda for Irene Couture, Inc., the New Jersey Appellate Division reaffirmed and clarified the scope of the fraudulent inducement exception to the parol evidence rule. The court also clarified the level of knowledge to be imputed to a contracting party when assessing the reasonableness of that party’s reliance on the alleged misrepresentations.

No Class Certification in Consumer Fraud Case When Lead Plaintiff Seeks to Recant Critical Allegations in Complaint

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Posted in Class Action Defense

On October 11, 2011

A lead plaintiff in a consumer class action who attempts to recant allegations in her complaint concerning the date she purchased the product at issue places her credibility in issue and, therefore, subjects her claim to unique defenses. Such a plaintiff may not be an adequate class representative under Rule 23(a)(4) and therefore may not be able to certify a class.

Limited Partners May Be Liable for Partnership’s Obligations Under Traditional Veil-Piercing Standards

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Posted in General Litigation

On September 19, 2011

In Canter v. Lakewood of Voorhees, the Appellate Division held that limited partners may be liable for their partnership’s obligations under traditional common-law veil-piercing standards, as well as under the circumstances set forth in the limited partnership statute. In a negligence suit against a nursing home and one of its limited partners, the limited partner sought to avoid liability by arguing that limited partners may be liable to third parties for the partnership’s obligations only under the narrow circumstances set forth in the New Jersey Uniform Limited Partnership Law, specifically N.J.S.A 42:2A-27(a) .

Corporate Officers and Employees May Be Liable for Corporation’s Violations of Consumer Fraud Act

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Posted in General Litigation

On September 19, 2011

In Allen v. V and A Bros., Inc., the New Jersey Supreme Court broke new ground under the New Jersey Consumer Fraud Act (“CFA”) by holding that officers and employees of corporations and other businesses can be personally liable under the CFA for the entity’s CFA violations, even when the violations are regulatory in nature and do not require affirmative actions by the corporation’s agents and employees. Indeed “principals” of a corporation will be “broadly liable” for the corporation’s CFA violations.

AT&T Mobility Permits Nullification of Arbitration Agreements Containing Class-Action Waivers When Agreements are so Ambiguous and Internally Inconsistent that Mutual Assent is Lacking

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Posted in Class Action Defense

On September 19, 2011

In AT&T Mobility LLC v. Concepcion, the United States Supreme Court held that the Federal Arbitration Act preempted state laws providing that arbitration agreements containing class-action waivers are unconscionable and therefore unenforceable. But the Supreme Court also stated that “generally applicable contract defenses” continue to apply to arbitration agreements, so long as such defenses do not conflict with the FAA or frustrate its purposes.

No Class Certification When Class Members Can Obtain Adequate Statutory Damages in Small Claims Court

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Posted in Class Action Defense

On September 19, 2011

In Local Baking Prods., Inc. v. Kosher Bagel Munch, Inc., the New Jersey Appellate Division held that private causes of action under the Telephone Consumer Protection Act (TCPA), which prohibits the sending of unsolicited faxes, cannot be prosecuted as class actions under Rule 4:32. The court reasoned that a class action is not a “superior” method for adjudicating such claims, as required by Rule 4:32-1(b)(3), because the TCPA entitles victims to at least $500 in statutory damages which can be recovered in the Small Claims section of the Special Civil Part in a matter of months.

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