NEWARK - The New Jersey Division of Consumer Affairs, with the assistance of the Division of Law, has settled price gouging lawsuits against two hotels, Berkeley Hotel LLC, d/b/a "The Berkeley Hotel" of Asbury Park and Devsatya Inc., d/b/a "Studio Inn & Suites" of Galloway, and a gas station, East Hanover Amoco Inc., d/b/a "C&M Exxon," which agreed to pay a total of $89,845.68 to resolve lawsuits that alleged these companies engaged in hundreds of incidents of unlawful price gouging in the aftermath of Superstorm Sandy.
"These hotels allegedly raised their room rates by well over 100 percent of their normal prices, and this gas station increased its prices in excess of 25 percent – all at a time when a natural disaster turned the normal laws of supply and demand upside down, New Jersey families were in dire need of shelter and fuel, and price gouging was expressly prohibited due to a state of emergency," Acting Attorney General John J. Hoffman said.
To date, the Divisions of Consumer Affairs and the Division of Law have resolved 21 of the 27 lawsuits filed against businesses accused of price gouging during the Superstorm Sandy state of emergency. Including the three settlements announced today, the State of New Jersey will have obtained a total of $906,158.68 in civil penalties, consumer restitution and reimbursement of fees and investigative costs, as a result of the price gouging lawsuits.
Acting Director Steve Lee of the Division of Consumer Affairs said, "New Jersey's Superstorm Sandy price gougers need to learn that the penalties for violating the law will far outweigh any illicit gains from taking advantage of their fellow New Jerseyans. In these cases, we're doing everything we can to bring full restitution to victims, and to deter any future attempts to take advantage of the suffering caused by a major disaster."
The price gouging settlements announced today are as follows:
Berkeley Hotel LLC, d/b/a "The Berkeley Hotel,"; at 1401 Ocean Parkway, Asbury Park. This business will pay $45,000, including $5,932.50 in consumer restitution. Of the rest of these funds, $22,032.77 represents civil penalties and $17,034.73 will reimburse the State of New Jersey for attorneys' fees and investigative costs. An additional $30,000 in civil penalties is suspended but will become payable if the business violates terms of the consent judgment within one year.
As set forth in the original complaint, between October 27, 2012 and November 11, 2012, during the first two weeks following Governor Christie's declaration of a State of Emergency due to Superstorm Sandy, Berkeley Hotel LLC raised its room 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 unlawful price gouging.
Devsatya, Inc. d/b/a "Studio Inn & Suites," at 257 East White Horse Pike, Galloway. This business will pay $25,000 which includes $1,403.49 in consumer retribution. Of the rest, $18,845.68 represents civil penalties and $4,750.83 will reimburse the State's attorneys' fees and investigative costs. An additional $23,729.82 in civil penalties is suspended but will become payable if the business violates terms of the Consent Judgment within two years.
As set forth in the original complaint, between October 27, 2012 and November 13, 2012, Devsatya Inc. raised its hotel room rates by as much as 283 percent above the prices charged for the same rooms prior to the State of Emergency. In total, according to the complaint, the hotel engaged in a total of 183 instances of price gouging during the State of Emergency.
East Hanover Amoco, Inc., d/b/a "C&M Exxon," at 29 Ridgedale Avenue, East Hanover. This business will pay $26,000, including $22,946 in civil penalties and $3,054 to reimburse the State's attorneys' fees and investigative costs.
As set forth in the original complaint, East Hanover Amoco Inc. charged as much as $4.79 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 $5.09 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, N.J.S.A. 56:8-107 et seq., prohibits excessive price increases during a declared state of emergency, for merchandise used as a direct result of an emergency or used to protect the life, health, safety, or comfort of persons or their property. The law defines excessive price increases as more than 10 percent above the price at which the merchandise was sold during the normal course of business during the state of emergency. If a merchant incurs additional costs during the state of emergency, prices may not exceed 10 percent above the normal markup from cost.
Investigators Michael Bruch, Patrick Mullan, and Jared O'Cone of the Division of Consumer Affairs' Office of Consumer Protection, conducted these investigations. Deputy Attorneys General Jeffrey Koziar, Natalie A. Serock, and Alina Wells, of the Consumer Fraud Section within the Division of Law, represented the State in these actions.
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file a complaint online with the Division of Consumer Affairs or by calling 1-800-242-5846 (toll free within New Jersey ) or 973-504-6200.
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