TGI Fridays Off Hook for Drink Price Gouging Class-Action, but Not Carrabba’s

TRENTON — The state Supreme Court has ruled that a class action against Carrabba’s Italian Grill can proceed, while sinking a similar class-action lawsuit accusing TGI Fridays of price gauging customers.

Patrons of the restaurant chains alleged the establishments failed to post beverage prices and that they were charged one price for their first drink and a different price for their second without notice.

A patron at a Mount Laurel TGI Fridays location, Debra Dugan, claimed she was charged $2 for a beer at the restaurant’s bar before she was seated and $3.59 for a second beer at her table.

Patron Ernest Bozzi claimed he was charged two different prices for beers at a Carrabba’s Italian Grill in Maple Shade without any notice of a happy hour.

Both attempted to mount class-action lawsuits against the restaurants’ parent companies. The court heard arguments in April over whether failing to list prices is grounds for a class-action lawsuit under the New Jersey Consumer Fraud Act and the Truth in Consumer Contract, Warranty and Notice Act.

The justices split 5-1, with Justice Barry Albin dissenting.

In the TGI Fridays case, the court decertified the class, reversing the lower court and finding that Dugan’s counsel failed to prove there were issues common to the members of the class.

The trial court had broadly certified the class as anyone to visited a New Jersey TGI Fridays between 2004 and 2014 and purchased a beverage when the price was not disclosed.

Dugan’s attorney had argued the company conducted an internal study that found patrons spent $1.72 less per visit when drink prices were in writing and thus paid more than they would have if prices had been listed on the menu.

“Individual plaintiffs may be able to establish ascertainable loss and causation by showing that they would not have purchased the beverages or would have spent less money on them had they been informed of their cost,” Justice Anne Patterson wrote, adding they had not established those damages as a class.

Dugan’s case can proceed as an individual.

In the second case, Bozzi accused Carrabba’s parent company OSI Restaurant Partners of “intentionally misleading customers through stealth price adjustments.”

Patterson said Bozzi focused more narrowly on customers who “were charged different prices for beverages of the same brand, type, and volume.”

“There are common questions of fact relating to OSI’s pricing practices and at least one common question of law — whether increasing the price of a beverage during a customer’s restaurant visit without informing the customer constitutes an unlawful practice,” she wrote.

In his dissent, Albin said Wednesday’s ruling “steepens the path to justice for consumers with small claims.”

“The decision will make it more difficult for a class of many thousands of defrauded consumers to act collectively in pursuit of a common remedy against a corporate wrongdoer,” he wrote.

Donald Doherty, Bozzi’s attorney, agreed the court erred in rejecting Dugan’s class-action, saying Fridays won on a technicality.

“I think the ruling is incorrect. My case was always much simpler because two different prices is two different prices. That’s just wrong. You don’t need to be a rocket scientist to figure that out,” he said. “But big business don’t always act like used car dealers where they’re easy to catch.”

Samantha Marcus may be reached at [email protected]. Follow her on Twitter @samanthamarcus. Find NJ.com Politics on Facebook.

Source: www.nj.com www.nj.com

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