N.J. Admin. Code § 13:45A-9.6
Current through Register Vol. 56, No. 19, October 7, 2024
Section 13:45A-9.6 - Pricing; prohibition on fictitious pricing and methods of substantiation(a) An advertiser shall not use a fictitious former price. Use of a fictitious former price will be deemed to be a violation of the Consumer Fraud Act.(b) A former price or price range or the amount of reduction shall be deemed fictitious if it can not be substantiated, based upon proof:1. Of a substantial number of sales of the advertised merchandise, or comparable merchandise of like grade or quality made within the advertiser's trade area in the regular course of business at any time within the most recent 60 days during which the advertised merchandise was available for sale prior to, or which were in fact made in the first 60 days during which the advertised merchandise was available for sale following the effective date of the advertisement;2. That the advertised merchandise, or comparable merchandise of like grade or quality, was actively and openly offered for sale at that price within the advertiser's trade area in the regular course of business during at least 28 days of the most recent 90 days before or after the effective date of the advertisement; or3. That the price does not exceed the supplier's cost plus the usual and customary mark-up used by the advertising merchant in the actual sale of the advertised merchandise or comparable merchandise of like grade or quality in the recent regular course of business.(c) If the former price specifically references a time in the remote past during which it was offered, it shall be deemed fictitious unless substantiated pursuant to either (b)1 or 3 above.(d) The following examples of fictitious pricing are provided for illustration only and are not intended to limit the types of advertising the Division shall consider to be fictitious:1. John Doe is a retailer of Brand X fountain pens which cost him $ 5.00 each. His usual markup is 50 percent over cost. That is, his regular retail price is $ 7.50. In order subsequently to offer an unusual "bargain," Doe temporarily raises the price of Brand X pens to $ 10.00 each. In so doing, Doe realizes that he will only be able to sell a few pens, if any, at this inflated price. But he does not care, because he intends to maintain that price for only a few days. Then he "cuts" the artificially inflated price of $ 10.00 to the usual price--$ 7.50 at which time he advertises: "Terrific Bargain: X Pens, Were $ 10, Now Only $ 7.50." This is obviously a false claim. The advertised "bargain" is not genuine.2. Retailer Doe advertises Brand X pens as having a "Retail Price $ 15.00, My Price $ 7.50," when, in fact, only a few small suburban boutique-type stores in the area charge $ 15.00. All of the larger outlets, like retailer Doe's, located in and around the main shopping areas charge approximately $ 7.50. This advertisement would be deceptive because the price charged by the small suburban boutique or specialty stores would have no real significance to Doe's customers, to whom the advertisement of "Retail Value $ 15.00" would suggest a prevailing, and not merely an isolated and unrepresentative price in the area in which they shop.3. Retailer Doe advertises Brand X pen as "Comparable Value $ 15.00" when only a small number of unrepresentative specialty stores in the trade area offer Brand Y, an essentially similar pen, for that price. This is a related form of misleading advertising because the price of the comparable merchandise (that is, Brand Y), which is cited for comparison is not representative of the price for Brand Y being charged by representative retail outlets in the advertiser's trade area.N.J. Admin. Code § 13:45A-9.6
New Rule, R.1996 d.309, effective 7/1/1996 (operative August 15, 1996).
See: 28 New Jersey Register 1186(a), 28 New Jersey Register 3304(a).