A surge of class actions in New Jersey under the Truth in Consumer Contract, Warranty and Notice Act is expected to subside in light of the Supreme Court’s recent mandate that actual harm is needed to make a case under the act.

The court’s April 16 decision in Spade v. Select Comfort and Wenger v. Bob’s Discount Furniture was welcomed by retailers, who said it could help clear up the many class suits filed over terms of service for online transactions and would also prevent filing of more such cases. The justices said a consumer whose contract for furniture delivery does not comply with state regulations, but has not suffered any adverse consequences as a result of the compliance, does not meet the “aggrieved customer” standard to bring a TCCWNA claim.

But the Supreme Court ruling is by no means the end of litigation under TCCWNA, according to lawyers who have worked on this type of case. Some lawyers expect the decision will be met with a new crop of cases brought by the plaintiffs’ bar to test what kind of harms will or will not confer standing. And suits brought by individuals and by the state to address consumer grievances against businesses remain viable after the court’s ruling, according to lawyers versed in consumer law.

The justices’ opinion in Select Comfort and Bob’s was issued on direct certification from the U.S. Court of Appeals for the Third Circuit. Now that the court of appeals has received guidance from the New Jersey Supreme Court, it’s expected to affirm a District Court judge’s dismissal of the Select Comfort and Bob’s cases, according to TCCWNA observers.

Another TCCWNA case pending at the Third Circuit, Russell v. Crosscill Home, has also been stayed pending outcome of the Select Comfort case, and a number of cases have been stayed pending both Russell and the Select Comfort case, said Jeffrey Jacobson of Kelley Drye & Warren in New York.

The Select Comfort ruling was significant because of the many TCCWNA cases still pending, and the amount at stake—the statute provides $100 in damages per class member, said Jacobson.  The act’s essential function remains intact, even after the latest ruling, said Jacobson.

Enacted in 1980, TCCWNA bars language in consumer contracts that violates any clearly established legal right. The measure drew little attention until around 2015, when plaintiffs lawyers began using it to target provisions in e-commerce terms of service.

“It puts an important tool in consumers’ hands when somebody wanted to hold you to a contract that is not lawful,” said Jacobson, who previously served as director of the Division of Law and then as chief counsel in the New Jersey Attorney General’s Office. Yet “there is no indication that the Legislature contemplated class actions when they adopted TCCWNA,” he said.

Jacobson said it’s unclear what will come of the court’s holding that cognizable harm is not limited to injuries compensable by monetary damages. This might include, he said, someone who received a late delivery and was dissuaded from seeking a refund because an unlawful provision told her she could not do so.  Such claims, however, would tend to be highly individualized and would not lend themselves to class action treatment, Jacobson said.

Newark attorney Daniel Zemel, who brought TCCWNA class actions against J.Crew, Avis Rent A Car and others, said he would not bring any more class action suits under the act. But he believes individual claims under TCCWNA are still viable, adding that he is preparing to file one such case soon.

Zemel, who represents plaintiffs in consumer suits, said that lawyers like him are likely to make more use of the state’s Consumer Fraud Act in light of the court’s heightened standard for TCCWNA. Before the Select Comfort ruling, the bar for providing a CFA claim was higher than for proving a TCCWNA claim, but now they’re at the same level, said Zemel.

Zemel said the purpose of TCCWNA was to help a consumer who signs a contract that places improper limits on their rights to help them understand that such provisions are unenforceable. “By making this more difficult, the end result will be that there will be a number of provisions in contracts that are not enforceable, and consumers will not know that, and therefore not utilize the rights they have,” Zemel said.

Matthew Fedor of Drinker Biddle & Reath in Florham Park, New Jersey, said the Select Comfort ruling was “a welcome decision for companies that do business in New Jersey.”

Fedor and some firm colleagues submitted an amicus curiae brief in the Select Comfort case on behalf of The Retail Litigation Center, but he emphasizes that his comments about the case are his alone.

In the future, plaintiffs filing TCCWNA suits “are going to have to articulate an injury at the outset of the case,” he said.

“If plaintiffs are able to do that, [and] the injury is unique, or esoteric, it may be very difficult to certify a class in those cases. I can’t say it’s definitely the end” of TCCWNA class actions, but “I think we will see a lot fewer of those ‘gotcha’ cases such as the terms-of-service cases,” said Fedor.

The justices in Select Comfort, on the question of whether a party is an aggrieved consumer, said the showing of harm need not be of a type compensable by monetary damages. That holding is likely to prompt some future plaintiffs lawyers to “get creative in terms of what they articulate what the harm is,” said Fedor.