False Advertising by Car dealerships, Bait and Switch Advertising, Fake and false Advertising
Deceptive Advertising & Misleading Advertising Lawyer and The Consumer Fraud Act
Dealership False Advertising
New Jersey has some very strong and powerful laws to stop auto dealerships and others from engaging in a deceptive or false advertising. As I have set forth above there are numerous specific examples that are automatically deceptive, false or misleading advertisements. The legislature has determined that certain statements are not proper when selling vehicles or other goods. The legislature has determined that certain practices are prohibited and are considered deceptive practices. The New Jersey Consumer Fraud Act in implementing the intent of the legislature has provided a claim or cause of action for certain statements that might be made by car dealerships or others attempting to influence purchasers to purchase goods.
In fact, a statement might be literally true, but have the capacity to mislead the potential consumer. Under the circumstances is not required that the consumer be actually misled to maintain a claim under the New Jersey law. The strong position taken by the New Jersey legislature combined with a very strong reading of the Consumer Fraud Act, a remedial reading of the act, provides various claims for those who have been deceived. The law also provides claims for those who might not have been deceived however been lured into a dealership or business based on the advertisement. The court and the legislature, both, have taken a very strong position to prohibit deceptive and false advertising. The court and the legislature, both, have provided very strong remedies for those who have fallen victim to deceptive or false advertising. Most of the remedies are implemented through the act however there are other claims under theories however these are the most convenient.
You can actually have a claim if the dealership advertises a vehicle to you and does not sell the car. The law provides remedies to those who have not purchased goods from an advertising dealer under various theories. So long as a measurable or ascertainable loss is available to a consumer based on the advertisement the law will permit a plaintiff received. Ultimately, this is a question for the judge as to whether or not a claim can proceed. However, as an example if the dealership advertises a car for a dollar and refuses to sell the car to for dollar you should have a claim against the dealership even if you have not purchased the vehicle. The definitional section of the act does not require the completed transaction. The attempted transactions considered within the definitional section of the sale.
If you have viewed an advertisement and have not purchased the vehicle you might have a claim. If you have viewed an advertisement or a specific price and purchased a similar or identical vehicle for a higher price it is much easier to demonstrate and measure the ascertainable loss.
The basic concept underlying The Consumer Fraud Act pertaining to misleading, false, fraudulent or deceptive advertisements is that it attempts to prohibit advertising that is either deceptive or misleading or that has the capacity to mislead. The New Jersey Consumer Fraud Act prohibits advertisements that might be true but have the capacity to mislead. There are also prohibitions against specific types of advertising statements or certain phrases. THE PRIMARY ISSUE IS WHETHER THERE IS THE CAPACITY TO MISLEAD. THE CONSUMER FRAUD ACT ATTEMPTS TO REDUCE BUSINESSES' ATTEMPTS TO MISLEAD AND DECEIVE. THE ACT ATTEMPTS TO LEVEL THE PLAYING FIELD SOMEWHAT. IT IS REMEDIAL LEGISLATION FOR THE CONSUMER'S BENEFIT.
Another basic concept of the prohibitions of deceptive or misleading advertising is that consumers can potentially waste much of their time chasing down false or misleading advertisements, as well as spending money on those periodicals or publications in which those advertisements are contained. Both the advertisers and the state want credibility and the advertisements produced in this media. As an example, there are certain terms or phrases that the state deems to be inherently misleading such as “Dealer cost,” “Floor plan,” “Inventory price,” “Factory invoice,” “Wholesale” or “At no profit.” Other terms, such as “Guaranteed discount,” “Guaranteed lowest prices” or “We will beat your best deal” are also not permitted.
Examples of advertisements that would not be proper:
We are having a sale and all the prices are listed at “dealer cost”.
There are extensive regulations prohibiting deceptive advertising. These apply specifically to dealerships and other businesses. The following apply to car sales only. If these are used the dealer has violated the Consumer Fraud Act if there has been an ascertainable loss.
Unlawful, false and deceptive advertising practices
- Any media used to make an advertisement misleading or hide the advertisement.
- A listing of prices that does not indicate that there are deductions in the price for items such as rebates.
- All disclaimers, time limits and modifiers must be clearly stated and not hidden in some footnote smaller than ten-point type.
- Advertising that items are free when the purchase price is increased to offset the "Free" item.
- Dealer must disclose if he/she knew or should have been aware if the car had more than $1,000 in repairs.
- Cannot use the terms "Public Notice," "Public Sale," or "Liquidation" unless permitted by the Court.
- Cannot use terms which imply that the advertiser has a special relationship with the manufacturer, such as "Authorized Sale," "Authorized Distribution Center Factory Outlet," or "Factory Authorized Sale".
- Other terms that are considered misleading such as "Dealer's cost," "Floor plan," "Inventory price," "Factory invoice," "Issue," "Wholesale" or "At no profit".
- Cannot use "Guaranteed discount," "Guaranteed lowest prices," or the advertiser clearly discloses the manner in which the guarantee will be performed in a footnote.
- The use of the statement "We will beat your best deal," or similar term or phrase, if a consumer must produce a contract that the consumer has signed with another dealer or lessor in order to receive the better deal.
- Cannot use the statements "Lowest prices," "Lower prices than anyone else" or "Our lowest prices of the year," unless the dealer can prove they are true.
The underlying principle behind all the false advertising laws in New Jersey and behind all of the bait and switch rules and regulations in New Jersey is to make sure that the advertising is fair. The advertising must be fair to the average consumer who's is relying upon the advertising to purchase a consumer good.
Advertising is part of the sales process. It is important that it is an honest an integral part of the sales process for both the consumer and business is engaging in advertising. Consumers rely upon advertising to save time, consumers rely upon advertising to save money. both the courts and the legislature in drafting laws and interpreting the laws must understand this idea of truthful advertising that is not misleading. Even truthful but misleading advertisements are improper. The literal truth of an advertisement does not necessarily protect the advertiser/seller of goods from damages under the New Jersey Consumer Fraud Act
New Jersey law permits the purchaser of a good to rely upon the affirmative representations of a seller of the good. This has significant impacts and consequences as it relates to Commerce. As an example, what happens when one business is advertising a good at a false or fake price. This business has an advantage. Disadvantage to this business becomes a cost to the consumer. In addition, the other business was competing must advertised falsely to stay competitive.
New Jersey courts have recognized that it is the capacity to mislead which is the prime ingredient of consumer fraud. New Jersey courts have recognized that truthful yet misleading advertisements are actionable if they cause an ascertainable or measurable loss. The consumer fraud act does not require a completed transaction. Did law requires an ascertainable loss, and in ascertainable loss alone. If a loss is measurable it is deemed ascertainable. The law requires that you have a loss to pursue a lawsuit. This is also known as a standing requirement.