Hospitality Industry Legal Risks: New Jersey Hotel Settles “Price Gouging” Lawsuit For $75,000; Raised Prices 70 Percent During Hurricane Sandy

New Jersey’s price gouging law prohibits excessive price increases during a declared state of emergency or for 30 days after the termination of Hotel Price Gougingthe 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 incurs additional costs during the state of emergency, prices may not exceed 10 percent above the normal markup from cost.

A Hazlet Hotel has agreed to pay penalties for allegedly price gouging in the aftermath of Hurricane Sandy, Acting Attorney General John Hoffman said Wednesday in a press release. The Riya Hazlet Hotel, a Holiday Inn at 2870 Rt. 35, Hazlet, will pay $75,000 to settle the suit, which includes $2,951 in consumer restitution.  The state will receive $52,121 in civil penalties and $19,926 in attorneys’ fees and investigative costs, Hoffman said.

In December 2012, a N.J. state lawsuit alleged that the Hazlet Holiday Inn raised its prices more than 70 percent, from under $135 to almost $230 a night, between Oct. 27 and Nov. 5 during a declared state of emergency.

The Office of the Attorney General and its Divisions of Consumer Affairs and Law have reached settlements with another eight companies alleged to have price gouged customers following Superstorm Sandy, Hoffman said.  Under terms of these settlements, the State will obtain more than $437,000 in penalties, fees and consumer restitution.

For more:  http://www.nj.com/monmouth/index.ssf/2013/10/monmouth_county_hotel_will_pay_75k_for_alleged_price_gouging_during_sandy.html

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