Shelton v. Restaurant.com, Inc.
214 N.J. 419
| N.J. | 2013Background
- Restaurant.com sells certificates redeemable at participating restaurants, issued as tangible-like coupons but delivered digitally.
- Certificates state value, restaurant, redemption conditions, and Restaurant.com's terms; some conditions restrict use (e.g., weekends, alcohol).
- Shelton and Bohus purchased multiple certificates; their purchases were for personal use and at prices below face value.
- District court dismissed CFA, GCS, and TCCWNA claims for lack of ascertainable loss and because certificates were not property/consumer contracts.
- Third Circuit certified questions about whether TCCWNA covers tangible and intangible property and whether restaurant certificates are consumer contracts or warranties.
- Court reformulated questions and ultimately held that TCCWNA covers intangible property and certificates are consumer contracts and notices under the Act.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does TCCWNA cover tangible and intangible property? | Shelton/Bohus: includes intangible property under TCCWNA. | Restaurant.com: only tangible property falls within TCCWNA. | Intangible property covered; broad interpretation adopted. |
| Are Restaurant.com certificates property primarily for personal, family, or household use? | Certificates used for personal dining, hence personal use. | Contingent, discount-right character undermines personal-use classification. | Certificates meet personal use criterion; fall within the target use. |
| Are the certificates consumer contracts or merely warranties/notices under TCCWNA? | Certificates are consumer contracts; terms function as notices/warranties under TCCWNA. | No consumer contract; not a warranty or notice. | Certificates are consumer contracts and the standard terms constitute notices; within TCCWNA. |
Key Cases Cited
- Kent Motor Cars, Inc. v. Reynolds & Reynolds Co., 207 N.J. 428 (2011) (remedial purpose; broad statutory interpretation)
- Hodges v. Sasil Corp., 189 N.J. 210 (2007) (use-based debt and consumer classification)
- Collins v. Uniroyal, Inc., 64 N.J. 260 (1974) (use-focused interpretation of 'primarily for personal, family or household purposes')
- Bosland v. Warnock Dodge, Inc., 396 N.J. Super. 267 (App. Div. 2007) (TCCWNA and Plain Language Act relation; separate analyses)
- Smith v. SBC Communications Inc., 178 N.J. 265 (2004) (contract elements and electronic records in modern transactions)