The Appellate Division recently addressed, for the first time, the standard governing whether an employee or officer of a corporation may be held liable under the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1 to -184 (“NJCFA”) for the corporation’s violation of a New Jersey consumer protection regulation in Allen v. V and A Brothers, Inc ., 997 A.2d 1067 (App. Div. 2010). The court concluded that the standard for imposition of NJCFA liability on any officer or employee is “personal participation in the regulatory violation.” In light of the ambiguity inherent in the term “participation,” the number and scope of consumer protection regulations, the serious consequences of liability under the NJCFA and the fact that intent is not a necessary element of NJCFA liability based on a regulatory violation, the decision in Allen v. V and A Brothers may have far-reaching impact for employees of a wide variety of corporations.

A claim can be asserted under the NJCFA, whenever a “person” uses or employs an “unlawful practice” in connection with the sale or advertisement of merchandise or real estate which causes any person to suffer an ascertainable loss. N.J.S.A. 56:8-2 and 56:8-19. See also Cox v. Sears Roebuck & Co ., 138 N.J. 2 (1994). “Person” is defined to include any natural person or his legal representative, partnership, corporation, company, trust, business entity or association, and any agent, employee, salesman, partner, officer, director, member, stockholder, associate, trustee or cestuis que trustent thereof. N.J.S.A. 56:8-1d.

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