Acting Attorney General John J. Hoffman and the New Jersey Division of Consumer Affairs today announced that Tapah LLC, d/b/a “Comfort Suites Mahwah,” has agreed to pay $110,000 to resolve the State’s lawsuit alleging that the hotel engaged in 473 instances of unlawful price gouging in the aftermath of Superstorm Sandy.
“This hotel allegedly violated New Jersey’s price gouging law nearly 500 times during the first 12 days of the Superstorm Sandy state of emergency, when desperate families had to flee their homes and seek new shelter,” Acting Attorney General John J. Hoffman said.
To date, Hoffman said the Division of Consumer Affairs and the Division of Law have resolved 22 of the 27 lawsuits filed against businesses accused of price gouging during the Superstorm Sandy state of emergency. Including the settlement with Comfort Suites Mahwah, the State will have obtained a total of $1,016,158.68 in civil penalties, consumer restitution, and the reimbursement of fees and investigative costs, as a result of the price gouging lawsuits.
“By now, the businesses that sought to take advantage of this natural disaster have learned that we are relentless in protecting consumers and enforcing the law,” Division of Consumer Affairs Acting Director Steve Lee said. “With recoveries now totaling more than $1 million, these actions should serve as a strong deterrent to price gougers in the future.”
Comfort Suites Mahwah, at 220 Route 17, will pay $110,000 including $17,449 in consumer restitution, $47,600 in civil penalties, and $44,941 in reimbursement of the State’s attorneys’ fees and investigative costs. An additional $35,000 in civil penalties is suspended but will become payable if the business violates terms of the settlement within one year.
As alleged in the State’s complaint, filed in November 2012 by the Division of Law, Comfort Suites Mahwah raised its room rates to various excessive amounts immediately after Governor Chris Christie declared a state of emergency on October 27, 2012 in advance of Sandy’s landfall. From October 27 through November 7, 2012, the hotel allegedly engaged in 473 instances of unlawful price gouging. In some instances, the hotel allegedly charged more than $100 in excess of the price increases that would have been allowed under New Jersey’s price gouging statute.
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 immediately prior to the state of emergency. If a merchant incurs additional costs during the state of emergency, prices may not exceed 10 percent above the markup from cost applied in the usual course of business prior to the state of emergency.
Investigator Patrick Mullan, of the Division of Consumer Affairs’ Office of Consumer Protection, conducted this investigation.
Deputy Attorney General/Assistant Section Chief General Patricia Schiripo and Deputy Attorney General Cathleen O’Donnell, of the Consumer Fraud Prosecution Section within the Division of Law, represented the State in this action.