YOU READ IT HERE FIRST: A trio of hotels operated by a North Bergen-based company, a gas station in the township and a Comfort Suites in Mahwah are among 10 businesses smacked with price-gouging lawsuits by state authorities.
Seven hotels in all are accused of more than 1,000 collective incidents in the second round of suits filed against businesses for illegally overcharging consumers during the Hurricane Sandy state of emergency.
The hotels allegedly charged more than $400 per night in some instances, and excessively increased the rates for rooms by varying amounts, up to more than 200%, court records show.
Three of the hotels are owned by an affiliated group of companies, Ratan Hospitality Group, based in North Bergen:
- Holiday Inn Express ( photo above ), at the foot of 26th Street and Tonnelle Avenue in North Bergen, went from $208 a night to $399.99 per room per night during the state of emergency, a suit alleges. More than 100 complaints were lodged against the hotel, which is just outside the Lincoln Tunnel;
- Howard Johnson Express, 680 Route 3W in Clifton, is accused of hiking what had been a $179-per-night room to $449.99. State authorities said they received 177 complaints;
- Ramada Inn, 120 Evergreen Place, East Orange.
A Howard Johnson Express in Parsippany, also owned by Ratan Hospitality, was charged in the first round of suits earlier this month ( SEE: Subpoenas for 65 NJ businesses in price-gouging probe ).
The four Ratan sites are accused of more than 500 separate offenses.
“This one company and its four hotels allegedly committed a staggering number of violations of the price gouging law, and each separate violation merits a penalty of up to five figures,” Attorney General Jeffrey Chiesa said. “Safe, comfortable lodging is not a luxury when people have been displaced from their homes during a state of emergency. It is a basic necessity.”
Also sued was Comfort Suites, 220 Route 17 Mahwah, which is accused of raising its rates by various excessive amounts, up to 208% — drawing a whopping 473 complaints. In at least one instance, the hotel charged $219 after the storm for a room that ordinarily rented t $71.20, the suit alleges.
Three more gas stations are included, as well — among them, one that authorities said raised the price of regular gasoline by 80 cents to $4.50 per gallon – a 22% boost above pre-storm rates.
Another station, Delta, near the corner of 73rd Street and Bergenline Avenue in North Bergen, is accused of boosting the price for cash sales of regular from $3.40 per gallon to $4.10 per gallon after receiving shipments of fuel on consecutive days at the beginning of this month.
New Jersey’s price gouging statute prohibits excessive price increases during a declared state of emergency or for 30 days after its termination. Excessive price increases are defined as more than 10% higher than the price at which merchandise was sold during the normal course of business prior to the state of emergency. If a merchant faces additional costs during the emergency, prices may not exceed 10% of the normal markup from cost.
Violators face civil penalties of up to $10,000 for a first offense and up to $20,000 for each subsequent offense. Under the law, each individual sale of merchandise is considered a separate and distinct event.
Eric Kanefsky, the acting director of the state Division of Consumer Affairs, said his agency has received more than 2,000 consumer complaints since Gov. Christie declared a state of emergency Oct. 27 – an unprecedented number in such a short period of time.
“The last thing people put out of their homes in a natural disaster should have to confront is price gouging from unscrupulous profiteers,” Gov. Christie said, in announcing the suits this morning.
“It’s illegal, offensive and completely opposite the spirit of cooperation we saw just about everywhere else in our state in the aftermath of Hurricane Sandy,” the governor said.
Christie added that he’s encouraged Chiesa to keep the pedal to the floor in seeking out and prosecuting price gougers.
DCA investigators Michael Costello, Michelle Davis, Roger Hines, John Kulina, Patrick Mullan, Jared O’Cone, and Joseph Rothstein conducted the investigations.
Deputy Attorney General Lorraine Rak, chief of the Consumer Fraud Prosecution Section, as well as Deputy Attorneys General Glenn Graham, Jah-Juin Ho, Nicholas Kant, Lindsay Smith Puteska, Lorena Salzmann, Patricia Schiripo, Alina Wells, and Special Deputy Attorneys General Labinot A. Berlajolli and Krima Shah represented the state in court.
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