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US Supreme Court Refuses To Hear NJ Rent-A-Center Challenge January 8, 2007

Posted by notapundit in Judiciary, US News.
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WASHINGTON (AP)–The U.S. Supreme Court on Monday refused to hear a challenge to New Jersey consumer protection and usury laws filed by the nation’s largest rent-to-own company, which operates 43 stores in New Jersey.

The New Jersey Supreme Court ruled last year that Rent-A-Center Inc. (RCII) is subject to a 30% interest-rate cap per year that applies to other retailers who allow customers to pay for their purchases in installments.

Rent-A-Center says that it has done business in New Jersey for 20 years on the basis that the state’s retail installment sales act does not apply to rent-to-own transactions.

The company rents household goods to consumers typically without a down payment or credit check and with an option to purchase the goods.

Hilda Perez of Camden, N.J., sued the company after paying $8,100 for household goods that had a cash price of $9,300. If she paid the weekly rates and an additional option-to-buy payment, she would have paid $18,600, according to the New Jersey Supreme Court which ruled in her favor.

The decision could mean that other consumers who paid more than 30% interest rates are entitled to refunds from Rent-a-Center and possibly from other rent-to-own retailers that also charge higher rates.

Lawyers for Perez want to have the a state court certify the lawsuit as a class action so that other New Jersey Rent-a-Center customers may qualify for a refund.

The case is Rent-A-Center v. Perez, 06-657.

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