The New Jersey Attorney General and the state Division of Consumer Affairs have filed suit against the Parsippany Days Inn and five other businesses for alleged illegal price gouging during the declared state of emergency for Superstorm Sandy.
The six filings are the third group of lawsuits brought by the Attorney General and Consumer Affairs following investigations of complaints filed by consumers. The state has filed suit against 24 New Jersey businesses overall—13 hotels/motels and 11 gas stations—for alleged storm-related price gouging.
The Parsippany Howard Johnson was accused of price gouging in early November.
The Days Inn is accused of increasing room rates by up to 204 percent—bypassing the normal rate of $62.10 to charge $189 per night—during the state of emergency, the Attorney General's Office said. Investigators found 258 occurrences of alleged price gouging, according to the attorney general's statement.
“We allege that these hotel owners broke our price gouging law, at a time when vulnerable consumers desperately needed the most basic of necessities—shelter,” Attorney General Jeffrey Chiesa said. “There is no excuse, legally or morally, for businesses trying to gouge consumers in the aftermath of a widespread disaster, and we are holding them accountable.”
The Parsippany hotel manager was not available for comment Wednesday afternoon.
Also named in the latest lawsuits are an Egg Harbor Econo Lodge, the Homewood Suites by Hilton in Princeton, the Holiday Inn Hazlet, the Pleasantville Howard Johnson Inn and a Gulf Gas in Hackensack.
“Consumer Affairs investigators and the Division of Law have moved quickly on the consumer complaints filed to date," said Eric T. Kanefsky, acting director of the State Division of Consumer Affairs. "These lawsuits send a clear signal to untoward business owners that New Jersey will not permit profiteering on the misfortune of its citizens.”
The state seeks restitution for consumers, imposition of civil penalties ranging up to $10,000 for an initial offense and up to $20,000 for each subsequent offense, and reimbursement of its investigative and legal costs.
New Jersey’s price gouging law bans excessive price increases during a declared state of emergency or for 30 days after the termination of the state of emergency.
Excessive price increases are defined as more than 10 percent higher than the price at which merchandise was sold during the normal course of business prior to the state of emergency. If a merchant faces additional costs during the emergency, prices may not exceed 10 percent above the normal markup from cost.
Consumers who suspect price gouging or any other violation of consumer protection laws, particularly as a result of Sandy, are urged to call the Division of Consumer Affairs at 800-242-5846.