New Jersey Reaches Agreement with Floor Superstore Owner to Resolve Alleged
Violations of Consumer Fraud Act
Rosenberg to Pay Penalties & Consumer Restitution, Change Business Practices
NEWARK - The owner of several Floor Superstores retail stores has agreed to pay $343,000 to settle a lawsuit filed by the state, Acting Attorney General Anne Milgram and Acting Consumer Affairs Director Stephen B. Nolan announced today. Samuel Rosenberg also has agreed to make substantial changes to his business practices.
AThis settlement is the result of our holding a retailer accountable for actions that ultimately hurt New Jersey consumers,” said Acting Attorney General Milgram. AWe will continue to monitor Rosenberg=s business interests to ensure our laws protecting consumers are followed to the letter.”
This settlement, filed on September 6, 2006 in Bergen County Superior Court, resolves alleged violations of the Consumer Fraud Act (CFA), as well as state regulations governing the delivery of household furniture and furnishings, merchandise advertising and home improvement practices. As part of the settlement, Rosenberg has agreed to pay $343,000 for civil penalties, fees and costs, and consumer restitution.
AConsumers paid their hard-earned money for carpet or floor coverings that either never came, finally came after customers repeatedly complained following no-show delivery appointments, or was installed incorrectly," said Acting Director Nolan. "To add insult to injury, Floor Superstore did nothing to help remedy the situation when customers called to complain or demand their money back.
Rosenberg, who did not admit to any wrongdoing, agreed to many terms as outlined in the final consent judgment, including:
to not use any type, size, location lighting, illustration graphic depiction or color in advertisements that would lead to customer confusion;
to include specific written notice, phrases and information in all invoices and statements regarding delivery dates and/or terms and conditions;
to advise consumers in writing that no sale is final until the consumer has agreed to the type, quantity, price and measurement of merchandise
to not refuse or fail to issue a refund when requested nor charge a fee for the provision of a refund or the removal of defective merchandise;
to provide refunds within 14 days of a consumer's request;
to not demand a deposit prior to signing a contract, including specific terms: final measurements, quantity of merchandise, as well as price and installation fee and;
to alert the Division at least 30 days before opening a new business in New Jersey and to post a $100,000 bond to protect New Jersey consumers.
Under the settlement, for a period of two years, if Rosenberg opens a new flooring business, Rosenberg has agreed to attempt to resolve all consumer complaints with each consumer having the option to submit the matter to binding arbitration before the Division=s Alternative Dispute Resolution (ADR) Unit if the complaint has not been resolved within 60 days of receipt by Rosenberg.
This settlement resolves an initial lawsuit filed in October, 2004 in Bergen County Superior Court that alleged numerous violations of the CFA, including unconscionable commercial practices, false promises or misrepresentations, and knowing omissions of material fact, as well as state regulations governing the delivery of household furniture and furnishings, merchandise advertising and home improvement practices.
The stores named in the original suit, including each of the six retail stores in New Jersey, have filed for bankruptcy and failed to respond to the state=s suit. On July 18, 2006, Judge Robert P. Contillo issued a final judgment by default and order against the six stores assessing consumer restitution, civil penalties, costs and attorney's fees totaling $1,314,825.86 to resolve 750 violations after customers experienced problems with product quality, delivery and installation, and refunds and returns of deposits. Under the terms of this final order and judgment, the defendants are permanently banned from engaging in any future violations of the CFA as well as relevant regulations.
The six former Floor Superstore retail stores named in the judgment were located in East Brunswick, Eatontown, Livingston, Paramus, Springfield and West Paterson.
Deputy Attorney General Geoffrey R. Gersten represented the state in both of these matters.