New Jersey Coalition of Automotive Retailers, Inc. v. Ford Motor Co., ___ N.J. ___ (2025). As Justice Pierre-Louis observed in her opinion for a unanimous Court in this case today, New Jersey state courts have long “take[n] a more liberal approach to standing than federal law.” But in this appeal, the statute sued upon, the Franchise Practices Act, N.J.S.A. 56:10-1 et seq. (“FPA”), stated that only a “franchisee” could sue its franchisor. Because plaintiff here (“NJCAR”) was not a franchisee but an association of franchisees, NJCAR lacked standing to bring a FPA case.
NJCAR is a trade association of automobile and truck retailers located in New Jersey. Ford has Lincoln franchisee dealerships in New Jersey, eighteen of which are members of NJCAR. NJCAR itself, however, is not a franchisee.
NJCAR brought suit against Ford under the FPA, alleging that Ford had violated N.J.S.A. 56:10-7.4(h). That section bars price differentials, as Justice Pierre-Louis explained in more detail. The parties brought cross-motions for summary judgment, in which Ford (among other arguments) contended that NJCAR lacked standing to sue. NJCAR asserted that it had both statutory standing and associational standing. The Law Division held that NJCAR had neither type of standing. That was because N.J.S.A. 56:10-10 defines a cause of action under the FPA as being brought by “[a]ny franchisee . . . against its franchisor,” and NJCAR was not a franchisee.
NJCAR appealed, and the Appellate Division reversed. That court held that NJCAR had associational standing. The panel relied on an associational standing test laid out by the Supreme Court of the United States that required “that there was a justiciable issue and controversy; that NJCAR’s members would have individual standing to sue; that the issue was relevant to NJCAR’s organizational purpose; and that, because NJCAR did not seek damages, there was no need to include NJCAR’s members individually.” Furthermore, as Justice Pierre-Louis put it, “New Jersey’s liberal jurisprudence on standing countenanced against strict application of Section 10’s text.”
The Supreme Court granted review and today reversed the Appellate Division, applying de novo review to the legal and statutory interpretation issues presented in the summary judgment posture. After recapping caselaw giving rise to New Jersey’s liberal standing rules, more liberal than the federal courts due to the absence from New Jersey’s Constitution of any “case or controversy” limitation, Justice Pierre-Louis focused on the intent of the Legislature in selecting the language used in section 10 of the FPA. That was because “the Legislature is within its power to define -- and, thus, limit -- the class of persons entitled to bring suit under an act for injuries cognizable under that act.”
Justice Pierre-Louis relied on two sides of the same coin. First, “[i]n providing that ‘[a]ny franchisee may bring an action against its franchisor, the FPA uses specific terms that set boundaries as to who can bring an FPA action, and against whom. By using those terms, the Legislature made it evident that a cause of action arising from the FPA must be specific to the individual franchisee-franchisor relationship. In plain and unambiguous language, the statute states that franchisees are the only ones who can bring actions against their franchisors for violations of the FPA” (citation omitted).
Second, the language the Legislature did not choose called for the same result. “The FPA’s definition of ‘person’ includes ‘a natural person, corporation, partnership, trust, or other entity,’ but the Legislature chose to use the word ‘franchisee,” specifically “a person to whom a franchise is offered or granted,’ in stating who could bring suit. It could have allowed suit by ‘any person,’ or even ‘any party’ or ‘any injured party,’ but it chose not to do so.”
The Court carefully limited its ruling to claims brought against franchisors under the FPA. Justice Pierre-Louis explained that the Court’s opinion today “is not to say that NJCAR is barred from seeking associational standing in bringing another claim on behalf of its members under a different law, statute, or theory of injury.” Given that NJCAR was barred from standing under the FPA, the Court did not reach the question of whether NJCAR had associational standing, leaving that question for another day, when NJCAR might “bring a suit under an appropriate theory of liability.”
It seems odd that New Jersey’s liberal standing principles would support a ruling that because only a franchisee can sue its franchisor, a trade association consisting solely of franchisees could not do that. But the Court’s textual analysis led to a unanimous conclusion that that was the right result, at least for an FPA claim.
