All New Jersey Court Decisions Found that
Rent to Own Violated the New Jersey Consumer Fraud Act

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Legislative Update

Court Decisisons on rent to own:
**Passaic County
**Camden County

Class Action settled for $59 million

Who to call for information about the Class Action

What is N.J. Attorney General doing?

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Fact Sheet: Iris Green v. Continental Rentals

Iris Green, of Paterson NJ in suit stated that Continental Rentals was selling the following items in a series of rent to own sales on credit:


Cash Price

Total of Payments
to buy item
Living room set $ 499 $ 1157 130%
Two end tables 234 390 74%
Stereo; freezer 808 2020 148%
Washing machine 404 1010 148%
Dinette; hutch 840 2102 156%
Totals: 2,785.00 6,679.00

After Mrs. Green had paid $3950- more than their value- she had to go into the hospital, and missed payments. Continental Rentals repossessed all the furniture, so she had nothing to show for her $3950.

The N.J. Superior Court saw through this scam, holding this rent to own was criminal usury and violation of N.J. Consumer Fraud Act:

Green v. Continental Rentals; Robert Del Tufo, Attorney General, Intervenor, 292 N.J. Super 241 (Superior Court, Passaic County, 1994), held:

  • Rent to own is really a sale of goods on credit, not a lease,
  • Rent to own's extra cost is not " This is interest."
  • Rent to own violated the N.J. Criminal Usury Law, NJSA 2C:21-19, therefore
  • Rent to own contracts were unconscionable, therefore
  • Rent to own violated the N.J. Consumer Fraud Act. Rent to own violated the N.J. Retail Installment Sales Act.
  • Rent to own violated the federal Truth in Lending Act.

The attorney for Ms. Green was Madeline Houston, Paterson.

Two decisions from the Superior Court, Camden County also held that RTO violated the N.J. Consumer Fraud Act and the N.J. Retail Installment Sales Act:

  • Gallegher v. Crown Leasing & Renter's Choice, No. L-3859-94 (1996) and
  • Robinson v. ThornAmericas and Rent-a-Center, No. L-06397-95 (1997)

Class action settled for $59 million:

After appealing the Robinson class action to the Appellate Division, Rent-a-Center agreed to settle the class action. Rent to own thus is now set to pay $59 million to former N.J. customers in a case where RTO was held guilty of consumer fraud.

The attorneys for the consumers in Robinson and related cases are Donna Siegel Moffa, Tomar Simonoff Adourian O'Brien Kaplan Jacoby & Graziano, 20 Brace Rd, Cherry Hill NJ 08034 (856-429-1100) and Lisa Rodriguez, Trujillo, Rodriguez & Richards, 3 Kings Hwy East, Haddonfield NJ 08033 (856-795-9002). Questions about the class action, such as timing and amounts of payments to consumers, should go to these attorneys.

The NJ Legislature is constantly being asked by the RTO industry lobbyists to put its goverment stamp of approval on the same practices which the Judiciary held to be consumer fraud in the above cases.

What is the N.J. Attorney General doing?

The N.J. Attorney General's Office has entered all the RTO lawsuits on the side of consumers. Consumers Affairs Director Mark Herr has supported the pro-consumer bills, and opposed the industry bills. consumers. But the recent Attorney Generals have taken an apparent oath of silence while the rent to own legalization bills sail through the Legislature. The Attorney Generals have not allowed Mr. Herr to testify in the Legislature on rent to own in the last several years.

One word from our state's chief law enforcement officers, Attorney General John Farmer, Jr.or Governor Whitman, could kill the bills. Governor Whitman was silent in 1997-98-99 while the rent to own lobbyist, Dale Florio (yes, Governor Whitman's chief fundraiser in her last election) has been sweet talking the Legislature to get soft on criminal usury. We would love to see the Governor get involved on the cosnumer side. The more publicity on these awful rent to own bills, the more politicians find they agree with Consumers League that N.J.'s urban citizens should not be scammed with outrageously high prices and loanshark-high interest rates, and that there should not be a set of second class laws permtting exploitation of the poor. All citizens of New Jersey, especially the poor, deserve to be protected by the same laws, such as the 30% criminal usury limit.

The Division of Consumer Affairs could still promulgate a regulation on rent to own, to control the practices which were found by the Judiciary to violate the N.J. Consumer Fraud Act and the Criminal Usury Act. This has not been done in New Jersey.

Click here for the latest on bills A.1097/S.1343 (199 bill numbers) in the Legislature.

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