New Jersey § 2a:32-2

§ 2a:32-2.

a. Notwithstanding any agreement to the contrary, a participant, other than a leader,

in a pyramid promotional scheme, may declare the related sale or contract for sale

void and, unless the defendant made available to the participant an inventory repurchase

program as set forth in subsection b. of this section, may bring an action in a court

of competent jurisdiction to recover the consideration the participant paid to participate

in the scheme or course of conduct. In any action the court shall, in addition to any judgment awarded to the plaintiff,

require the defendant to pay interest, reasonable attorneys' fees, and costs. b. To qualify as an inventory repurchase program for the purposes of subsection a.

of this section, there shall be an enforceable agreement by the business enterprise

to repurchase all unencumbered products that are in commercially resalable condition

at a price not less than 90 percent of the amount actually paid by the participant

for the products being returned, less any reasonable consideration as may have been

received by the participant for the purchase of the products being returned. In the case of consumable or durable goods, a product is in commercially resalable

condition if it is unopened, unused, and within its commercially reasonable use or

shelf-life period. A product that is no longer marketed by the business enterprise because it is a

discontinued, seasonal, or special promotional item shall be considered commercially

resalable, unless before the participant purchased the product it was clearly disclosed

to the participant and the participant acknowledged in writing that the product was

sold as a discontinued, seasonal, or special promotional item and would not be returnable. In the case of service products and intangible property, including Internet websites,

the unexpired portion of any contract or agreement shall be deemed commercially resalable,

and the repurchase of any service products shall be on a pro rata basis. Additionally, there shall be a clear description of the inventory repurchase program

in any recruiting literature or sales manual provided to participants prior to their

entry into the scheme or course of conduct, and the details of the inventory repurchase

program, including the manner in which the repurchase is exercised, shall be memorialized

in the contract that obligated participation in the scheme or course of conduct. c. Nothing in subsection a. of this section shall be construed to define any scheme

or course of conduct as a pyramid promotional scheme based solely upon the fact that

participants in the scheme or operation give consideration in return for the right

to receive compensation based upon purchases of goods, services, or intangible property

by participants for personal use, consumption, or resale. d. (1) The provisions of subsection a. of this section shall not be waived or modified

by contract or agreement. Any effort to waive or modify the remedy established by subsection a. of this section

through a contract for indemnification or otherwise, that is executed or renewed after

the date of enactment of this act, shall be void. (2) The rights and remedies provided under this section are independent of and supplemental

to any other right or remedy for any violation or conduct provided for in any other

law, and nothing contained herein shall be construed to diminish or to abrogate any

such right or remedy. e. As used in this section: “ Compensation ” means payment of any money, thing of value, or financial benefit. “ Consideration ” means the payment of cash or the purchase of goods, services, or intangible property,

but does not include the purchase of goods or services furnished at cost to be used

in making sales and not for resale, or the time and effort spent in pursuit of sales

or recruiting activities. “ Financier ” means a person who, with the intent to derive a profit, provides money or credit

or other thing of value in order to finance the operations of a scheme or course of

conduct. “ Inventory ” includes both goods and services, including but not limited to promotional materials,

sales aids, and sales kits produced by or on behalf of the scheme or those engaged

in the course of conduct that are offered to participants for purchase by the scheme

or those engaged in the course of conduct. “ Leader ” is a person who conspires with any other person as an organizer, supervisor, financier,

or manager. “ Pyramid promotional scheme ” is any scheme or course of conduct by which a person gives consideration for the

opportunity to receive compensation that is derived primarily from a person's introduction

of another person to participate in the scheme or course of conduct rather than from

the sale of a product by a person introduced into the scheme or course of conduct.