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N.J.S.A. 56:8-1 to -20. Plaintiff claimed that MBUSA misrepresented, in a marketing brochure, the scope of coverage
of the satellite-based navigation system in its 2000 S-class automobiles. Plaintiff was unable to obtain directions to
an exact address from the navigation system in his vehicle and arrived forty minutes late to a business meeting; he
did not lose any money or business due to his late arrival. The trial court found he did not sustain an ascertainable
loss under the CFA. On appeal, plaintiff contends the court applied the wrong legal standard for ascertainable loss
under N.J.S.A. 56:8-19 by requiring him to show: (1) the existence of a navigation system on the market with the
coverage as represented by MBUSA and (2) reliance on MBUSA's misrepresentations regarding the scope of
coverage of the navigation system. Plaintiff also contends the court erred in limiting certification of the class to
Connecticut and New Jersey residents. We affirm the grant of summary judgment based on plaintiff's failure to
demonstrate an ascertainable loss under the CFA. Accordingly, the issue of class certification is moot. "> 378 N.J.
Super. 105"> Original Wordprocessor Version
(NOTE: The status of this decision is Unpublished.) Original Wordprocessor Version
(NOTE: This decision was approved by the court for publication.)
This case can also be found at 378 N.J. Super. 105, 874 A.2d 111.
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0970-03T5
AMIEL DABUSH, on behalf of
himself and all others
similarly situated,
Plaintiff-Appellant,
v.
MERCEDES-BENZ USA, LLC,
f/k/a MERCEDES-BENZ USA, INC.,
Defendant-Respondent.
Argued: January 26, 2005 - Decided: May 26, 2005
Amended Opinion: June 8, 2005
Before Judges Newman, Axelrad, and Holston, Jr.
On appeal from the Superior Court of New Jersey, Law Division, Bergen County, L-4750-
00.
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Bruce D. Greenberg argued the cause for appellant (Lite DePalma Greenberg & Rivas,
attorneys; Mr Greenberg, Joseph J. DePalma, and John M. Podesta, on the brief).
James F. Bennett of the Missouri bar, admitted pro hac vice, argued the cause for
respondent (Graham, Curtin & Sheridan and Bryan Cave, attorneys; Kathleen N.
Fennelly, Peter W. Herzog, III, admitted pro hac vice, Mr. Bennett, and Thomas J.
Palazzolo, admitted pro hac vice, on the brief).
The opinion of the court was delivered by
AXELRAD, J.T.C. (temporarily assigned).
Plaintiff Amiel Dabush, a vehicle lessee, appeals from summary judgment dismissing his class action against
defendant Mercedes-Benz USA, Inc. (MBUSA), seeking damages under the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1
to -20. Plaintiff claimed that MBUSA misrepresented, in a marketing brochure, the scope of coverage of the satellite-
based navigation system in its 2000 S-class automobiles. Plaintiff was unable to obtain directions to an exact
address from the navigation system in his vehicle and arrived forty minutes late to a business meeting; he did not
lose any money or business due to his late arrival. The trial court found he did not sustain an ascertainable loss
under the CFA.
On appeal, plaintiff contends the court applied the wrong legal standard for ascertainable loss under N.J.S.A. 56:8-
19 by requiring him to show: (1) the existence of a navigation system on the market with the coverage as
represented by MBUSA and (2) reliance on MBUSA's misrepresentations regarding the scope of coverage of the
navigation system. Plaintiff also contends the court erred in limiting certification of the class to Connecticut and
New Jersey residents. We affirm the grant of summary judgment based on plaintiff's failure to demonstrate an
ascertainable loss under the CFA. Accordingly, the issue of class certification is moot.
I
Plaintiff, a Connecticut resident, was the co-owner of a company that developed software and hardware for the
telecommunications industry. His expertise was in the software component of the company.
Plaintiff obtained a marketing brochure for a 2000 Mercedes S-Class vehicle at a local dealer. The brochure
contained the statement -- "The S-Class has a standard navigation system to help you find your way . . ." with a
picture depicting a highway sign pointing towards "Middle of Nowhere," "Nowhereville," and the "Boonies." The
brochure further declared: "Using 24 satellites that transmit positioning signals to earth, the S-Class can tell what
street it's on and what time zone it's in. Ship and aircraft navigators use the same system." As to the navigation
system, the brochure specifically stated:
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DID YOU EVER WONDER IF YOU'RE GOING THE RIGHT WAY?
THAT FEELING WILL SOON BE A FAINT MEMORY.
IF THERE'S A ROAD THAT GOES THERE, THE S-CLASS CAN SHOW YOU THE WAY.
Built into every 2000 S-Class is a satellite-based navigation system that helps get you to
your destination by the quickest route, or the shortest distance, or by using more or
fewer freeways. The navigation computer reads your latest copy of a CD-ROM map to
start the process (a CD-ROM map of your region comes with the car). Enter your
destination and your car pinpoints its location, using the GPS [Global Positioning
System] satellite. As you travel, the car's wheel speed sensors and COMAND's [Cockpit
Management and Data System's] gyroscopic sensor continually compare notes with the
satellites to keep track of your progress.
CD-ROMs for additional areas, as well as periodic updates, are available at additional
cost.
[Emphasis added].
The S-Class was MBUSA's flagship vehicle, retailing for approximately $70,000. The 2000 S-Class was first made
available for lease or purchase in March 1999. Every 2000 S-Class contained as a standard feature the COMAND
System, which included the control unit for the telephone, the radio/audio system, the cassette tape player, and the
navigation system. As the brochure declared, the navigation system used a combination of satellite technology and
map data contained on a CD-ROM to help the driver find a location. Satellite technology provided the location of
the vehicle through GPS signals. Using these signals, the computer evaluated the map data in relation to the
position of the vehicle and calculated a route to a determined destination. The navigation system split the United
States into nine regions, each with its own CD-ROM. Each customer was provided with a CD-ROM for his or her
region; CD-ROMs for other regions were available for separate purchase. These satellite-based systems were an
option on MBUSA's 2000 E-Class models.
In March l999, plaintiff leased a 2000 S-Class from a Mercedes-Benz dealer on Long Island. Plaintiff never test drove
the car, tried the navigation system, or questioned the dealer about the navigation system before he signed his
lease. Plaintiff deposed that he wanted to own the S-Class Mercedes because of the way it looked, its technology,
and its "level of luxury." He also claimed the navigation system was "a major part of and the reason why [he] bought
the car." A CD-ROM map for the New England region was included with his S-Class, containing maps for the states of
Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont, and for the northern part of New
Jersey, which included a southern border of counties formed by Hunterdon, Somerset, Middlesex, Monmouth, and
Ocean.
On October 13, 1999, after having driven the vehicle for six months and thousands of miles, plaintiff got lost trying
to drive to a business meeting in Aberdeen (Monmouth County), New Jersey. Contrary to the "COMAND Navigation
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System User's Guide" ("User's Guide"), plaintiff did not input the address of his destination into the navigation
system before starting the trip. When plaintiff realized he had lost his way and the navigation system was not
providing the assistance he needed, plaintiff pushed the "i" button, which automatically connected him via a
telephone built into his car with one of MBUSA's customer service representatives. The representative checked
NavTech's website, and Aberdeen was not listed on any of its maps, so she obtained directions for plaintiff from an
employee at the Aberdeen Borough Hall. Plaintiff arrived about forty minutes late to the meeting; he did not lose
any money or business due to his late arrival.
Plaintiff complained to MBUSA, who responded by letter of October 26, 1999:
[W]e immediately contacted [NavTech] about your query pertaining to the percentage
of areas digitized. They have advised that approximately 60 percent of areas are
digitized at this point in time. Please be aware, however, that the task of creating
detailed information for each street in the USA is very large and time consuming.
NavTech is working continuously to prepare detailed city coverage data for all of the
population centers in excess of 100,000 by the year 2004. Beyond this time, smaller
population areas will be added as resources allow. Since new data is constantly added
to the database, newly updated CD Roms can be helpful for the navigation system user.
Because of plaintiff's complaints, MBUSA offered to buy the vehicle back before the end of the lease, provided
plaintiff pay an additional $6500 for excess mileage and for depreciation due to plaintiff's replacement of the
original hood. Plaintiff refused the offer. In November 2000, plaintiff and other owners of Mercedes equipped with
the COMAND system were provided updated navigation CD-ROMs at no cost. Plaintiff's lease expired in March 2002,
and he returned the vehicle.
II
On June 2, 2000, plaintiff filed a class action against MBUSA for breach of contract (count one) and for violation of
the CFA (count two), alleging the satellite navigation system included as standard equipment on the S-Class
Mercedes that he had leased did not work as advertised in the marketing literature for the vehicle. Plaintiff
presented evidence that defendant knew the database coverage was less than 100% when the S-Class was
launched in March 1999. Plaintiff also submitted the report of David H. Kinney, an expert automobile appraiser, on
the issue of damages. Kinney opined: (1) the replacement cost of the COMAND system in the S-Class, which
included the navigation system, was at least $4666; (2) the navigation system alone would cost at least $1995 if it
had been offered as an option; and (3) the value of the navigation system, as opposed to its price, if it functioned as
represented in defendant's brochure, was $4000. Kinney's determinations were based on the manufacturer's
suggested price of the navigation system available as an option in MBUSA's E-Class automobiles, which was
identical to the system in the S-Class, and information that MBUSA had offered future credits of $3250 to E-Class
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customers who wanted to buy a navigation system as an option but received cars that could not be retrofitted with
that system.
MBUSA presented the report of Bobby J. Calder, an expert in marketing and psychology, who opined that plaintiff's
reaction to the vehicle he leased and its navigation system was not that of an average or typical consumer of the
vehicle. It also presented the report of Herbert E. Walter, a business and financial consultant with experience in the
automotive industry, which disputed Kinney's opinions and his methodologies as to damages. MBUSA further
presented the User's Guide that was provided to customers who purchased a 2000 S-Class vehicle, which stated,
among other items, that urban and suburban areas had more detailed coverage than rural areas and that only
"major, named roads" are included for rural and interstate locations. In addition, the User's Guide specifically warned
that navigation CD-ROMs might contain "inaccurate or incomplete data or information" and stated that the driver
was to input the destination's address before starting on a journey. MBUSA also presented a certification of Eric
Wendell, an engineer and manager of its parts department, that the street data contained on the CD-ROMS could
never be completely up-to-date because of the very nature of software and changes in the local transportation
systems. He declared that "[t]he Navigation System in the Mercedes S-Class vehicles was designed to aid customers
in arriving at locations, but was never intended to completely replace paper maps or other means of vehicle
navigation. The Navigation System is simply a supplemental system."
In earlier motions, the court ruled that New Jersey law would apply to plaintiff's individual claim. On March 1,
2002, the court denied plaintiff's request for a nationwide class but certified a class limited to Connecticut and New
Jersey residents. We denied leave to appeal, as did the Supreme Court. By order of April 5, 2002, the trial court
granted partial summary judgment in favor of MBUSA as to plaintiff's breach of contract claim (count one), finding a
lack of privity between the parties and declaring that plaintiff failed to establish as a matter of law that the
marketing brochure established an enforceable contract. This ruling has not been appealed. The court denied
summary judgment as to plaintiff's CFA claim (count two).
Following completion of discovery, MBUSA renewed its motions to decertify the class and for summary judgment
on the CFA. Judge Mecca declined to modify the prior judge's ruling on class certification. In ruling on MBUSA's
motion for summary judgment on the CFA claim, the judge found a genuine issue of material fact as to whether
defendant's statements in its marketing brochure were affirmative misrepresentations in violation of the CFA and
had the capacity to mislead the average consumer. Nevertheless, the judge granted partial summary judgment to
MBUSA, finding that plaintiff offered "absolutely no evidence of [MBUSA's] intent to mislead or knowing omission"
as required by N.J.S.A. 56:8-2, and did not prove with reasonable certainty any ascertainable loss of money or
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property as a result of the alleged violation of the CFA, as required by N.J.S.A. 56:8-19. This ruling was memorialized
in an order of July 16, 2003.
The court initially held that plaintiff could pursue attorney fees, but following cross-motions for
reconsideration, granted MBUSA's motion to dismiss plaintiff's claim for damages in its entirety pursuant to
Weinberg v. Sprint Corp., 173 N.J. 233 (2002), which mandates dismissal of the entire case if no ascertainable loss is
present. The court denied plaintiff's cross-motion for reconsideration, holding that plaintiff failed to identify either a
controlling decision that the court had overlooked or any new evidence that would permit revisiting the merits.
These rulings were memorialized in orders of August 25, 2003. Plaintiff's appeal ensued.
III
In determining a motion for summary judgment, the judge must decide whether "the competent evidential
materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a
rational fact finder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins.
Co. of Am., 142 N.J. 520, 540 (1995). Summary judgment must be granted if "the pleadings, depositions, answers to
interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to
any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R.
4:46-2(c). The essence of the inquiry is "'whether the evidence presents a sufficient disagreement to require
submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Brill, supra, 142
N.J. at 536 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52, 106 S. Ct. 2505, 2512, 9l L. Ed.2d 202, 214
(1986)). On appeal, we apply the same standard. Prudential Prop. & Cas. Ins. Co. v. Boylan, 307 N.J. Super. 162, 167
(App. Div. 1998).
The CFA affords a private cause of action under limited circumstances. To state a claim under the CFA, a private
"plaintiff must allege each of three elements: (1) unlawful conduct by the defendants; (2) an ascertainable loss on
the part of the plaintiff; and (3) a causal relationship between the defendant's unlawful conduct and the plaintiff's
ascertainable loss." New Jersey Citizens Action v. Schering-Plough Corp., 367 N.J. Super. 8, 12-13 (App. Div.), certif.
denied, 178 N.J. 249 (2003) (citing Cox v. Sears Roebuck & Co., 138 N.J. 2, 24 (1994)).
The proscribed unlawful conduct is defined as:
The act, use or employment by any person of any unconscionable commercial
practice, deception, fraud, false pretense, false promise, misrepresentation, or the
knowing, concealment, suppression, or omission of any material fact with intent that
others rely upon such concealment, suppression or omission, in connection with the
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sale or advertisement of any merchandise . . . whether or not any person has in fact
been misled, deceived or damaged thereby[.] . . .
[N.J.S.A. 56:8-2.]
"To constitute consumer fraud . . . the business practice in question must be 'misleading' and stand outside
the norm of reasonable business practice in that it will victimize the average consumer. . .                              ." Schering-Plough, supra,
367 N.J. Super. at 13 (quoting Turf Lawnmower Repair, Inc. v. Bergen Record Corp., 139 N.J. 392, 416 (1995), cert.
denied, 516 U.S. 1066, 116 S. Ct. 752, 133 L. Ed.2d 700 (1996)). Courts in New Jersey have also recognized a
distinction between misrepresentations of fact actionable under the CFA and mere puffery about a product that will
not support relief. See Rodio v. Smith, 123 N.J. 345, 352 (1991) "However persuasive, 'You're in good hands with
Allstate,' is nothing more than puffery"); Schering-Plough, supra, 367 N.J. Super. at 13 (statements in
pharmaceutical company's advertising for allergy medication that "you . . . can lead a normal nearly symptom-free
life again" were not understood by consumers as a guarantee of total and universal effectiveness of the product and
were in the nature of puffery and not actionable under the CFA).
We query in the first instance whether the statement contained in MBUSA's brochure "IF THERE'S A ROAD
THAT GOES THERE, THE S-CLASS CAN SHOW YOU THE WAY" was an actionable statement of fact within the
meaning and intendment of the CFA, rather than mere puffery. MBUSA did not cross-appeal the court's denial of its
summary judgment motion asserting that this representation did not serve as a basis for a CFA claim under N.J.S.A.
56:8-2. Nor did MBUSA argue in its brief that summary judgment could be sustained on alternate grounds, even
though counsel made this argument orally. Resolution of this issue, however, is not necessary in view of our
affirmance of the trial court's finding of plaintiff's failure to prove an ascertainable loss under the CFA.
Simply showing a violation of the CFA, however, is insufficient to entitle a private citizen to damages under
the Act. "[T]he [CFA] does not provide for recovery of statutory damages where a plaintiff cannot show actual harm."
Cannon v. Cherry Hill Toyota, Inc., 161 F. Supp.2d 362, 373 (D.N.J. 2001). While the Attorney General does not have
to prove that the victim was damaged by the unlawful conduct in order to recover any damages, Cox, supra, 138
N.J. at 21, a private plaintiff must demonstrate "an ascertainable loss of moneys or property, real or personal," as a
result of the defendant's unlawful conduct. N.J.S.A. 56:8-19. "[T]o have standing under the Act a private party must
plead a claim of ascertainable loss that is capable of surviving a motion for summary judgment." Weinberg, supra,
173 N.J. at 237; see also Pron v. Carlton Pools, Inc., 373 N.J. Super. 103, 113 (App. Div. 2004) (applying the Weinberg
doctrine in CFA case where defendant obtained involuntary dismissal at the end of plaintiff's case for failure to
prove an ascertainable loss).
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Even though a plaintiff need not actually expend a sum of money as a result of defendant's unlawful
consumer practice in order to demonstrate a loss, the amount of the loss must be ascertainable and must be
established with reasonable certainty. Cox, supra, 138 N.J. at 22. Plaintiff "bear[s] the ultimate burden of showing a
causal link between the offending practice and the claimed loss, with the amount of the ascertainable loss to be
demonstrated to a reasonable degree of certainty[.]" Cannon, supra, 161 F. Supp. at 374.
Plaintiff contends his ascertainable loss was the failure to receive the benefit of his bargain because the
navigation system did not give him directions to and from every road. Essentially plaintiff claims he paid a higher
price for a less effective product; he paid for something he did not receive. Plaintiff further claims he supplied an
estimate of damages calculated within a reasonable degree of certainty sufficient to demonstrate an ascertainable
loss under Cox, supra, 138 N.J. at 22. He points to his expert's testimony concerning the replacement cost of the
entire COMAND system, the value of a navigation system that could function as represented, and the cost of the
system as an option available in Mercedes E-Class vehicles.
MBUSA counters that, even if there were a violation of the CFA, plaintiff did not demonstrate an
ascertainable loss because he (1) did not pay extra for the COMAND system which included the navigation
component, as it was a standard feature on the vehicle he leased; (2) did not show that his loss was the cost of
replacing the system with one that had better map data, because all other cars with a navigation system used the
same data; or (3) did not claim that his late arrival at the meeting cost him money or property such as lost work time
or failure to gain additional work or some other actual harm. We agree with MBUSA.
In a supplemental submission, R. 2:6-11(d), plaintiff sought to rely on a subsequently decided published
opinion by another panel of our court, Thiedemann v. Mercedes-Benz USA, 369 N.J. Super. 402 (App. Div.), certif.
granted, 181 N.J. 547 (2004). The Thiedemann case had been argued before the Supreme Court but had not been
decided as of the time of oral argument on the present appeal and submission of our initial opinion for filing. We
found plaintiff's reliance on Thiedemann to be misplaced. In that case, car owners of a series of Mercedes-Benz
models from 1998 to 2000 brought a class action suit against the manufacturer, alleging that defective fuel gauges
in their cars amounted to a violation of the CFA. One of the named plaintiffs purchased a vehicle; the other one
leased a vehicle. Id. at 405-06. The complaint alleged a "fuel sending unit defect" which resulted in the sudden,
unexpected and dangerous depletion of fuel "such that the amount of gasoline in the fuel tank [would] not properly
be reflected on the dashboard fuel gauge" and an operational failure of the vehicle would occur while in use. Id. at
404. The defect could not be cured and was apparently present in every replacement component. Id. at 408. All
repairs to the unit were done under warranty at no cost to the plaintiffs and they never ran out of gasoline while
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driving the vehicles. Id. at 405-406. For summary judgment purposes, defendant conceded that the fuel-sending
unit was defective and it had knowledge of the defect. Id. at 408. The plaintiffs advanced two theories of loss: the
cost of repairs under warranty and the failure to receive the benefit of the bargain by having to drive vehicles with
defective fuel sending units. Id. at 411-12.
A panel of this court reversed the grant of summary judgment dismissing the complaint, finding plaintiffs
presented sufficient evidence to raise a debatable question of an ascertainable loss. The panel rejected the
argument that the plaintiffs' loss could be measured by the money defendant had to expend to replace the fuel-
sending component and declined to address the benefit-of-the-bargain theory, recognizing in essence a new
theory of ascertainable loss under the CFA:
[P]laintiffs have a car with a defect in a significant component, which defect is present
in every replacement of that component, and will likely manifest itself at some future
time. We believe that common knowledge, indeed common sense, compels a
conclusion that the value of the vehicle is impaired to a measurable, if presently
unknowable degree. Can it possibly be doubted that if the [plaintiffs who purchased
the vehicle] sought to sell their car on the used car market, and advised prospective
buyers of the fuel-sending unit problem, that they would receive less than if the
vehicles had no such defect? We think not. . .                                                                          . The loss we posit is not simply a loss of
consumer expectation or an unquantifiable benefit-of-the-bargain loss. There is more
here than just a sense of unease in driving a car that has a potential problem that could
impact on safety. There is a loss in value, not simply a loss of expectation. Of course, to
quantify damages, plaintiffs will have to quantify that loss in some manner, but that
proof need not be offered at this stage in order to defeat summary judgment.
[Id. at 413-414.]
We concluded it was irrelevant whether or not we agreed with the novel theory advanced by the panel in
Thiedemann recognizing a hypothetical loss of resale value as an ascertainable loss under the CFA, as that case is
factually and legally inapposite to the present case. Contrary to the present plaintiff's assertion, the court in
Thiedemann did not recognize the car owners' benefit-of-the-bargain loss theory as a cognizable ascertainable loss
under the CFA. Additionally, the court expressly rejected the car owners' claims of an ascertainable loss based on
money expended by the manufacturer to replace the defective item. Most critically, the defect which could not be
cured had a "readily apparent impact on safety" which particularly imposed a hazard because of the consumers'
absence of knowledge. Id. at 409-10.
The diminution of the resale value of the vehicle is not an issue in the present case, as was acknowledged by
plaintiff's counsel at oral argument. Plaintiff declined MBUSA's offer to buy the vehicle back before the end of the
lease with no reduction for the allegedly faulty navigation system. He continued to drive the car for the two-and-
one-half years remaining on the lease. Any diminution in the value of the vehicle would be shifted to the lessor
upon its return. Moreover, the navigation system does not implicate a safety concern. Nor was it a recurring
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problem. From the outset, it was anticipated and represented that the navigational data would be updated. In fact,
in November 2000, plaintiff and other owners of Mercedes equipped with the COMAND system were provided with
updated navigation CD-ROMS at no extra cost.
Due to a processing delay, our initial opinion was submitted to this court's clerk's office prior to the release of the
Supreme Court's decision in Thiedemann but was not filed until after the Thiedemann opinion, necessitating this
revision of our opinion to reflect the current case law. 183 N.J. 234 (2005). We permitted both counsel to forward
supplemental submissions addressing the Court's decision. Contrary to plaintiff's assertion, the Thiedemann opinion
lends further credence and support to the analysis contained in our initial opinion.
In reversing this court and directing the entry of summary judgment in favor of Mercedes, the Court in Thiedemann
found plaintiffs' proofs were insufficient to support a finding or inference that plaintiffs suffered a quantifiable or
otherwise measurable loss as a result of the alleged CFA violation. Id. at 238. The Court set forth in full and adopted
the trial court's reasoning in dismissing the complaint, which insightful comments apply equally to the appeal
before us:
Defendant maintains that each time the plaintiffs encountered a problem related to
fuel with their vehicles, the problem was repaired at no cost to plaintiffs. Furthermore,
the Flahertys have not endured a fuel-related problem since March 2001 and Lam has
not endured such a problem since February 2001. None of the plaintiffs [have] spent a
single penny in relation to the fuel system problems they experienced. Nevertheless,
plaintiffs attribute to themselves as a species of damages, an unincurred cost of repair
extrapolated from defendant's internal warranty remediation efforts. Plaintiffs further
assert an inchoate and unsubstantiated loss of the benefit of the bargain. Plaintiffs
insist that they did not get what they bargained for and instead received an unsafe
motor vehicle with a known fuel-reporting defect. Essentially, what plaintiffs urge here
is that they are entitled to a Mercedes-Benz motor vehicle without any flaws or glitches,
without any reasonably-remediable problems, and without any of the ordinary
tribulations of automobile ownership or lease: in other words, a perfect car unaffected
by the laws of physics and common sense. Plaintiffs are not so entitled, and they may
not seek legal remedies because of their unrealistic disappointment. If plaintiffs'
position were to be sustained—that is, their subjective and intangible disenchantment
be translated into legally recoverable damages—it would severely impair the working
relationship among automobile manufacturers, distributors, and consumers and
undermine the efficacy of the very warranties consumers have fought so hard to obtain
and protect. Here, defendant has honored every warranty claim made by plaintiffs and
has made their motor vehicles fully operational with minimal consumer travail. Is not
that the way the consumer society is supposed to work? The record in this case
discloses nothing more than an efficiently operating consumer-complaint and
remediation system. To allow plaintiffs any remedies in this case—on this record
—would interrupt and distort that system. Within each of plaintiffs' theories[,] damages
are an essential element that must be proved to the satisfaction of the trier of the facts.
For purposes of analysis, the least searching and most indulgent standard that plaintiffs
must satisfy is the notion of an ascertainable loss within the meaning of the New Jersey
Consumer Fraud Act. Here, no rational fact finder could conclude that plaintiffs suffered
an objectively ascertainable loss or damage, even under the lens of the expansively
protective legislative purpose of the Consumer Fraud Act and this State's public policies
affording broad protection to consumers against deceptive commercial practices.
[Id. at 243 (emphasis added).]
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In defining the elusive term "ascertainable loss," N.J.S.A. 56:8-19, the Court stated, "[t]o give effect to the legislative
language describing the requisite loss for private standing under the CFA, and to be consistent with Weinberg, a
private plaintiff must produce evidence from which a factfinder could find or infer that the plaintiff suffered an
actual loss." Id. at 248. Recognizing that defects often arise in connection with "complex instrumentalities such as
automobiles", Justice LaVecchia noted that "[t]he ascertainable loss requirement operates as an integral check upon
the balance struck by the CFA between the consuming public and sellers of goods. The importance of maintaining
that balance is obvious." Id. at 251. The Justice concluded:
The mere fact that an automobile defect arises does not establish, in and of itself, an
actual and ascertainable loss to the vehicle purchaser. Indeed, the warranty provided as
part of the contract of sale or lease is part of the benefit of the bargain between the
parties. The defects that arise and are addressed by warranty, at no cost to the
consumer, do not provide the predicate "loss" that the CFA expressly requires for a
private claim under the CFA, bringing with it the potential for treble damages,
attorney's fees, and court costs and fees.
We are not persuaded as to the correctness or appropriateness of the Appellate
Division's resort to common knowledge or common sense to provide the needed
additional support for plaintiffs' claim of loss of benefit-of-the-bargain based on a
vehicle problem that required warranty service. The warranty program was part of
plaintiffs' bargain and it was provided, as required, by defendants. Plaintiffs need to
produce specific proofs to support or infer a quantifiable loss in respect of their benefit-
of-the-bargain claim; subjective assertions without more are insufficient to satisfy the
requirement of an ascertainable loss that is expressly necessary for access to the CFA
remedies.
[Id. at 251-52 (emphasis added).]
Specific to our case, the Court further found that since one of the plaintiffs leased her vehicle and did not own it,
"she is unable to advance an argument that she might be able to demonstrate loss in future resale value due to
alleged, potentially defective replacement parts, assuming some proof to support that claim. At the end of the
lease, the party who receives back the leased vehicle is the one that arguably receives a vehicle having some
diminution in future value." Id. at 253.
Plaintiff's benefit-of-the-bargain argument is founded on a loss of expectation based on a utopian concept similar
to that rejected in Thiedemann. Even though in the present case plaintiff does not assert a mechanical defect in the
automobile rectifiable by warranty, the Thiedemann rationale applies here with equal force. Plaintiff's loss must rest
upon an objectively reasonable basis. The navigation system is exactly what it was designed and intended to be; an
aid to navigation, not a perfect instrumentality of navigation. A reasonable consumer would expect no more,
namely, a device that directs the driver to most destinations most of the time. The extent of coverage of other
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navigation systems on the market is relevant to this inquiry. The MBUSA data was state-of-the-art and as good as
any other replacement system available from any automobile manufacturer at the time. In fact, as plaintiff's own
expert conceded at depositions, there was no "navigation system offered by any manufacturer contained in any
2000 model year vehicle sold in the United States that [had] all streets and roads in the United States on it." Thus
plaintiff's asserted loss was based on an unreasonable expectation of what was "promised" in the brochure - a
perfect navigation system that would include data of all locations and provide directions no matter where he
happened to be at a particular point. There was no navigation system in any automobile at the time that was
capable of fulfilling this expectation.
MBUSA's advertising also has to be causally related to plaintiff's loss. While the element of traditional reliance
required in a fraud case need not be proven in order to recover damages under the CFA, a private plaintiff must still
"prove a causal nexus between the alleged [misrepresentation]" and his or her damages. Schering-Plough, supra,
367 N.J. Super. at 15; Varacallo v. Massachusetts Mut. Life Ins. Co., 332 N.J. Super. 31, 43 (App. Div. 2000). In
Schering-Plough we rejected the plaintiffs' attempt to merge reliance and causation by theorizing that defendant's
advertising of its products caused the prices to rise both for those that were effective and for the allegedly
ineffective products as well; therefore, the causal connection between the misstatements about the latter and their
ascertainable loss is "they must have paid a higher price for the less effective product." Schering-Plough, supra, 367
N.J. Super. at 16. We "decline[d] the invitation to stretch the bounds of the [CFA] to such an extent" as to allow "the
relationship between the alleged misstatement and the ascertainable loss suffered [to] become so attenuated that
it would effectively disappear," deeming that result contrary to the Court's holding in Weinberg. Schering-Plough,
supra, 367 N.J. Super. at 16.
Though couched in different terms, plaintiff advances the same "price-inflation" theory that we rejected in Schering-
Plough. He claims he paid for the lease of a vehicle that he expected to contain a navigation system that had all
roads and highways and, therefore, he must have paid a higher price for the less effective product which did not
contain full coverage of every road. Adopting this theory of ascertainable loss would "fundamentally alter the
concept of causation in the CFA context," ibid., and would effectively afford private citizens rights that the
Legislature has expressly reserved for the Attorney General.
Nor, as a lessor, is plaintiff able to advance an argument that he might be able to demonstrate loss in future resale
value due to the allegedly defective navigation system. Thiedemann, supra, 183 N.J. at 253. Plaintiff's proofs are also
deficient in that he presented no evidence whatsoever concerning any cost, price or value of the navigation system
itself. Nor did plaintiff present any evidence, expert or otherwise, from which an estimate of the value of the
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navigation system as delivered compared to the value of the navigation system as allegedly promised could be
calculated within a reasonable degree of certainty. Plaintiff's evidence of the hypothetical retail cost of a COMAND
system that was not optional does not provide a reasonably certain estimate of damages regarding the S-Class
navigation system. With no out-of-pocket loss attributable to the allegedly defective navigation system and no
evidence of value or cost of the navigation system, plaintiff's claim is insufficient as a matter of law "to satisfy the
CFA requirement of a demonstration of a quantifiable or otherwise measurable loss as a condition of bringing a CFA
suit." Id. at 252. Contrary to plaintiff's assertion, Judge Mecca did not impermissibly engraft a "reliance standard" on
the CFA; rather, he appropriately required plaintiff to satisfy the causation element of the CFA. There was ample
basis in the record for the court's conclusion that plaintiff's evidence, as a matter of law, was insufficient to establish
with reasonable certainty the likelihood of an ascertainable loss under the CFA. Even if the statements contained in
MBUSA's advertising brochure misrepresented the scope of the navigation system of plaintiff's vehicle and resulted
in plaintiff driving to Aberdeen without consulting a map or obtaining directions before he left, getting lost along
the way, and arriving forty minutes late to a meeting, we agree there is no ascertainable loss shown within the
intendment of the CFA.
Summary judgment was appropriately granted on the issue of
ascertainable loss, and attorney fees are not recoverable. Weinberg, supra, 173 N.J. at 253 (holding that a plaintiff,
who pleads but cannot survive a motion for summary judgment in respect of the issue of ascertainable loss, may
not proceed with remaining claim for attorney's fees under the CFA).
Affirmed.
Navigation Technologies Corp. (NavTech) provided the map data for the navigation system in the 2000 S-Class.
NavTech was the exclusive provider of map data to all navigation system suppliers.
As discussed infra, the Appellate Division decision was reversed by the Supreme Court on May 18, 2005. 369 N.J.
Super. 402 (App. Div. 2004), rev'd, 183 N.J. 234 (2005).
Weinberg v. Sprint Corp., 173 N.J. 233 (2002).
(continued)
(continued)
28
A-0970-03T5
APPROVED FOR PUBLICATION
June 8, 2005
APPELLATE DIVISION
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