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Jeffrey S. Chiesa,
Attorney General

Division of Consumer Affairs
Eric T. Kanefsky, Acting Director

 

 

For Immediate Release:
May 10, 2013
For Further Information Contact:
Jeff Lamm, 973-504-6327
Neal Buccino, 973-504-6327

 

New Jersey Division of Consumer Affairs Sues Three More Businesses Accused of Price Gouging During Superstorm Sandy Emergency

NEWARK – Continuing the State’s commitment to investigate and follow through on each complaint of fraud related to Superstorm Sandy, Attorney General Jeffrey S. Chiesa announced that the State Division of Consumer Affairs has filed new lawsuits against businesses accused of price gouging during the storm’s immediate aftermath.

“Anyone paying attention in New Jersey knows we will not tolerate illegal attempts to take financial advantage of anyone affected by Superstorm Sandy,” Attorney General Chiesa said.  “We continue to investigate the more than 2,000 consumer complaints that were received during the storm’s immediate aftermath, even as we watch for possible new types of post-disaster fraud.”

The newest lawsuits include a Studio Inn and Suites hotel in Galloway, accused of raising its room rates by as much as 283 percent during the days following the storm, and a Berkeley Hotel in Asbury Park, accused of raising its room rates by as much as 117 percent.  The two hotels allegedly engaged in a total of more than 460 incidents of price gouging.

The State is also suing a C&M Exxon gas station, in East Hanover, which is accused of raising its prices for regular gasoline by as much as 26.3 percent, and for premium by as much as 34.2 percent.  According to the State’s lawsuits, none of the three businesses faced higher costs that would have justified the price increases during a declared state of emergency.  Such conduct is prohibited under New Jersey’s price gouging law.

“The victims of price gouging are families who were displaced from their homes, desperate for shelter, heat, and fuel as a result of the most severe natural disaster in New Jersey’s history,” Eric T. Kanefsky, Acting Director of the State Division of Consumer Affairs, said.  “We owe it to these New Jersey residents to see every allegation of price gouging to its proper end.”

The defendants in the newest lawsuits are:

  • Devsatya, Inc., doing business as Studio Inn & Suites, at 257 East White Horse Pike, Galloway.  Between October 27 and November 13 this hotel allegedly raised its rates by as much as 283 percent above the prices charged for the same rooms prior to the state of emergency. The hotel allegedly engaged in a total of 183 instances of price gouging during the state of emergency.

 

  • Berkeley Hotel LLC, doing business as The Berkeley Hotel, at 1401 Ocean Parkway, Asbury Park.  Between October 27 and November 11, this hotel allegedly raised its rates by as much as 117 percent above the prices charged for the same rooms prior to the state of emergency.  The hotel allegedly engaged in a total of 280 instances of price gouging during the state of emergency.
  • East Hanover Amoco, Inc., doing business as C&M Exxon, at 29 Ridgedale Avenue, East Hanover.  This gas station allegedly charged as much as $4.799 for credit card sales of regular gasoline – an increase of 26.3 percent above its price prior to the state of emergency.  The business allegedly charged as much as $5.099 for credit card sales of premium gasoline – an increase of 34.2 percent above the price prior to the state of emergency. 

 

New Jersey’s price gouging statute prohibits 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.

In addition to the three new price gouging lawsuits, the State has also filed three actions in Superior Court to enforce subpoenas it previously served on companies accused by consumers of price gouging during Sandy’s aftermath.  The companies failed to comply with the State’s request for information regarding the allegations, and the State is suing to enforce their compliance.

To date, the State has filed suit against a total of 27 businesses – 15 hotels and 12 gas stations – for alleged price gouging during the Superstorm Sandy emergency.  Two of the lawsuits have been settled, with two gas stations agreeing to collectively pay $46,000.

The State Division of Consumer Affairs is part of New Jersey’s Statewide Sandy Fraud Working Group, created by Attorney General Chiesa. Victims or witnesses of fraud committed in the aftermath of Sandy, including but not limited to home repair fraud, insurance fraud, and fraudulent charitable solicitations, should contact the Working Group at 855-SANDY39 (855-726-3939) or www.StopSandyFraud.org.

Follow the Division of Consumer Affairs on Facebook, and check our online calendar of upcoming Consumer Outreach events.

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