Tarlow, Breed, Hart & Rodgers, P.C.
“[W]hat constitutes an injury or loss for purposes of a
G.L. c. 93A claim, where the plaintiffs had purchased automobiles with
allegedly defective door latches, were nonetheless able to use the
vehicles, and had not suffered any direct personal injury or economic
injury?” That is the question that has been certified to the SJC in Joseph Iannacchino & others v. Ford Motor Company & another, SJC-10059.1 Oral argument occurred on February 4, 2008, and the case is expected to be decided by June 2008.
Whether the Court recognizes a valid Chapter 93A claim on the facts presented in Iannacchino
has broad implications for Massachusetts consumers as well as local,
national, and international businesses that are potential litigants in
the courts of the Commonwealth.
Claims, Defenses, And Procedural Posture
The Iannacchino plaintiff class contends that the
defendants violated Chapter 93A by failing to recall and fix certain
vehicles that allegedly have a defect in their door latching mechanisms
which exposes consumers to the risk of serious injury or death. The
plaintiffs further contend that the alleged defect amounts to a
violation of the implied warranty of fitness. The defendants had
evaluated the latch mechanisms and decided against initiating a
recall. The defendants contend that the door latches comply with
applicable requirements and do not present an unreasonable safety
concern. The plaintiffs counter by alleging that the defendants are
guided predominantly by economic considerations in declining to initiate
The Superior Court in Iannacchino2
granted the defendants’ motion to dismiss the plaintiffs’ Chapter 93A
claim upon finding that the plaintiffs had been able to use the
allegedly defective vehicles, and had not suffered any direct personal
or economic injury as a result of the alleged defect. In the pending
SJC appeal, the plaintiffs challenge the trial court’s dismissal of the
Chapter 93A claim.3
Overview Of Arguments On Chapter 93A Claim
The plaintiffs argue that their Chapter 93A claim should not have been dismissed because they are seeking redress before
they suffer any physical injury and because the defendants’ conduct
has invaded their legally protected rights sufficient to satisfy Chapter
93A’s injury or loss requirement. The latter argument relies on
commentary set forth in Aspinall v. Philip Morris Cos., Inc., 442 Mass. 381 (2004), discussed below.
The defendants rely upon Hershenow v. Enterprise Rent-A-Car Co. of Boston, Inc.,
445 Mass. 790 (2006), where the Court decided that the Chapter 93A
claim was properly dismissed because the plaintiffs could not show any
actual injury or loss.
Chapter 93A Precedent Highlighted By The SJC
In its request for amicus briefs the SJC specifically referenced Hershenow and Aspinall, as follows:4
In this reported class action, the issue presented,
among others, is: what constitutes an injury or loss for purposes of a
G. L. c. 93A claim, where the plaintiffs had purchased automobiles
with allegedly defective door latches, were nontheless able to use the
vehicles, and had not suffered any direct personal or economic injury.
See Hershenow v. Enterprise Rent-A-Car Co. of Boston, Inc., 445 Mass. 790 (2006), and Aspinall v. Philip Morris Cos., Inc., 442 Mass. 381 (2004).
Hershenow addressed whether consumers who had
rented cars and purchased optional collision damage insurance were
harmed by a waiver provision in the rental contract that failed to
comply with statutory requirements (G.L. c. 90, § 32E½, regulating such
collision damage waivers), even though the consumers had not been in
an accident while driving the rented vehicles. The Hershenow
plaintiffs appealed from the trial court’s order granting the defendant
rental car agencies summary judgment and judgment on the pleadings.
The SJC on its own initiative took direct appellate review of the
case. After consideration of legislative changes to Chapter 93A made
in 1979, described by the SJC in Hershenow as “intended to
permit recovery when an unfair or deceptive act caused a personal
injury loss such as emotional distress, even if the consumer lost no
‘money’ or ‘property,’” the Court affirmed the outcome and held that “a
plaintiff seeking a remedy under G.L. c. 93A, § 9, must demonstrate
that even a per se deception caused a loss.”
The Hershenow plaintiffs’ inability to
demonstrate an injury or loss was fatal to their Chapter 93A claim
regardless of whether there had been any unfair or deceptive conduct.
[T]he statutorily noncompliant terms in [the]
automobile rental contracts did not and could not deter the plaintiffs
from asserting any legal rights. Nor did the plaintiffs experience any
other claimed economic or noneconomic loss. The [waiver] made neither
rental customer worse off during the rental period than he or she would
have been had the [waiver language] complied in full with [statutory]
requirements . . . . Assuming that the [rental agreement] was per se
unfair and deceptive because it did not [so] comply . . . , the
plaintiffs have nevertheless failed to establish that the “per se”
deception caused a loss. For that reason, there can be no recovery
under G. L. c. 93A, § 9(1).
Hershenow, 445 Mass. at 800-01; 840 N.E.2d at 534-35.
Aspinall involved a plaintiff class of consumers
that sued the manufacturers of “light” cigarettes under a theory of
false advertising. A single justice of the Appeals Court decertified
the class. The SJC granted the plaintiffs’ application for direct
appellate review and reversed, reasoning that a class action was not
merely an appropriate means to address the allegations that had been
raised, but was in fact the only means for doing so. Aspinall, 442 Mass. at 393; 813 N.E.2d at 486.
After the SJC reached its holding on the class certification issue in Aspinall,
it provided commentary suggesting that deceptive advertising may cause
injury sufficient to satisfy the injury or loss requirement in Chapter
93A. Since Aspinall focused upon the propriety of the certification of the plaintiff class, however, the commentary Aspinall provides regarding the injury or loss requirement of Chapter 93A may fairly be characterized as dicta.5
[T]he deceptive advertising, as alleged by the
plaintiffs in this case, if proved, effected a per se injury on
consumers who purchased the cigarettes represented to be lower in tar
and nicotine. . . . [A]s a matter of law, because [the defendants’
advertising] . . . created the over-all misleading impression that all
smokers would receive ‘lowered tar and nicotine’ . . . all [plaintiffs
in the class] will be entitled to statutory damages, without regard to
whether . . . consumers were overcharged for the deceptively advertised
Aspinall, 442 Mass. at 399-400; 813 N.E.2d at 490-91.
In sum, whereas Hershenow requires a plaintiff to demonstrate a loss even in instances of per se deception, Aspinall implies that certain deceptive conduct in and of itself constitutes sufficient injury for purposes of Chapter 93A.
Consumer Protection And The Efficient Use Of Resources
Several strong but competing policy arguments exist for
the SJC to consider. Consumer advocate groups argue that the ultimate
goal should be improved consumer safety, and that it would be perverse
to interpret existing law to require a consumer to suffer physical
injury as a prerequisite to bringing her claim where she can establish
that a defect exists which reasonably poses an increased risk of
causing harm to consumers situated similarly to her. While it is true
that marketplace factors have resulted in significant improvements in
consumer safety, courts must continue to play their vital role in
framing expectations and enforcing a baseline for permissible conduct.
Proponents of the brighter line drawn in Hershenow
emphasize that consumers are adequately protected under existing law,
but even more so by demand for improvements in safety. Manufacturers
have an economic interest in achieving safe products where the market
demands them, such as in the consumer automobile industry. Litigation
regarding an alleged safety defect that has not resulted in any
physical injury consumes resources that manufacturers might otherwise
invest in product research and development, thereby hindering efforts
to advance safety.
Broader societal costs may exist as well. For instance,
an unanticipated increase in the litigation risks to which
corporations doing business in the Commonwealth are exposed could
operate as a disincentive to economic growth to the ultimate disservice
of many interest groups, including consumers.
Iannacchino has the potential to be a very significant case not only for consumers but for the Commonwealth as a whole.
The question facing the SJC has to do with the proximity
of the injury or loss necessary to maintain a Chapter 93A claim. At
one end of the proximity spectrum is Hershenow, which involved a
plaintiff class that only fleetingly faced the risk of being injured
by an illegal provision in a car rental agreement. The injury never
materialized, and the risk of injury terminated with the agreement.
Towards the other end of the proximity spectrum is Aspinall,
which presented a plaintiff class that had purchased and used “light”
cigarettes under the misimpression that they were safer than other
products on the market. The class’ exposure to an inherently
dangerous product under such circumstances sufficiently constituted an
injury for purposes of Chapter 93A.
Iannacchino is somewhere in between. It is true
that the plaintiffs have been able to use their vehicles and have not
suffered any direct injury. Assuming a defect exists in the door
latches, however, it is also true that the Iannacchino plaintiffs face an elevated risk of injury every time they go for a drive.
1 The SJC solicited amicus curiae briefs on October 15, 2007.
2 Middlesex Superior Court, Civil Action No. 05-0538.
Should the SJC desire to do so, it could dispose of the appeal without
reaching the “injury or loss” issue discussed in this article. The
Superior Court granted the defendants’ motion for judgment as to the
Chapter 93A claim, but denied the motion as to the plaintiffs’ breach
of warranty claim. The court declined to dismiss the warranty claim
after concluding that the plaintiff had sufficiently alleged the
possibility of economic damages. On appeal, however, the plaintiffs
and the defendants both point to a perceived inconsistency in the
Superior Court’s rulings on the Chapter 93A and warranty claims. The
plaintiffs argue that neither claim should have been dismissed. The
defendants argue the opposite. As the court’s December 1, 2006 order
on the defendants’ motion for judgment acknowledged, at Page 5, citing
Slaney v. Westwood Auto, Inc., 366 Mass. 688, 702 (1974), a breach of warranty can constitute a Chapter 93A violation.
5 After reaching its holding, the Aspinall
Court stated as follows: “What has been said above disposes of the
class certification issue. We take this opportunity to comment on the
nature of damages under G.L. c. 93A.” Aspinall, 442 Mass. at 398; 813 N.E.2d at 489-90.