Pub. 16 2017-2018 Issue 4

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E N O . 1 , 2 0 1 8 30 new jersey auto retailer Hammering A Square Peg Into A Round Hole: Advertising Motor Vehicles On The Internet In New Jersey BY ANTHONY ANASTASIO, ESQ. W i t h Gove r no r Ph i l Murphy’s administra- tion now at the helm in Trenton, NJ CAR expects major legisla- tive and regulatory changes over the next several years. To the extent that the former Governor Chris Christie’s administration took a “hands off” approach to dealing with the New Jersey business community, we expect a full reversal of that approach with this new administration. Indeed, we anticipate that the new administration will aggressively pursue a “pro-consumer” and “pro-employee” agenda. Accordingly, before the administration begins to act on this agenda, NJ CAR urges all members to conduct an immediate, top-down review of all internal policies and procedures to ensure compliance. Investigators from the New Jersey Di- vision of Consumer Affairs’ Office of Consumer Protection (DCA) will surely be tasked with a mandate to increase enforcement of the State’s consumer pro- tection laws. The first area where dealers should tighten any loose screws in this re- gard is their Internet advertising practices. For the consumer protection watchdogs in Trenton, Internet advertising violations are low hanging fruit. All a DCA investigator must do to prove his or her case is access the Internet, visit a dealership’s website, and hit the “print” button–it is literally that simple. Indeed, during the final year of Governor Christie’s “pro-business” admin- istration, the DCA cited dozens of dealers for non-compliant Internet advertisements in which motor vehicles were “price-adver- tised.” The resulting settlements were gen- erous (ranging from$500 to $2,500 per violation) considering the possible exposure, but this could change moving forward. The DCA's motor vehicle advertising regulations are some of the strictest ad- vertising rules in the country. They set forth a detailed regulatory regime that applies equally to all types of motor vehicle advertisements–traditional print, radio, television, Internet, e-mail, social media, and even dealership signage and vehicle price stickers. Essentially, the reg- ulations prohibit dealers’ use of “bait and switch” tactics or illusory promises made in advertisements to lure customers to the dealership. To that end, they prohibit misleading statements and formats, and limit the use of specific words or phrases in advertisements, among other things. Most important though, dealers who "price advertise" (i.e., quote a specific price for which a consumer can purchase or lease a vehicle) must make a series of detailed disclosures regarding the advertised vehicle. To the extent that manufacturer advertising (both traditional and Internet) requirements violate these regulations, they are void. Violations of these rules and disclosure requirements can lead to enforcement ac- tions by the DCA. If successful, the DCA is empowered to seek $10,000 penalties for initial violations, and $20,000 penalties