Source: https://www.bettsllc.com/blog/2018/09/pennsylvania-superior-court-rejects-its-prior-decisions-and-adopts-expansive-reach-of-consumer-protection-statute-ruling-that-the-utpcpl-imposes-strict-liability/
Timestamp: 2019-04-23 16:37:49+00:00

Document:
A panel of the Superior Court recently issued a decision that could significantly expand the reach of the Unfair Trade Practices and Consumer Protection Law, ruling for the first time that the “catchall” provision of the statute imposes strict liability. Gregg v. Ameriprise Financial, Inc., No. 1504 WDA 2017 (Pa. Super. Sept. 12, 2018). The decision adds to longstanding confusion among the Pennsylvania appellate courts concerning that provision, which was added to the UTPCPL in 1996 to define actionable conduct as including not only fraudulent conduct, but also “deceptive conduct which creates a likelihood of confusion or misunderstanding.” 73 P.S. § 201-2(4)(xxi).
The Gregg case arose out of the purchase of a variable life insurance policy, which the plaintiffs claimed to result from misrepresentations and deceptive conduct on the part of the defendants. At trial, the jury returned defense verdicts on the counts alleging fraudulent and negligent misrepresentations. The trial judge, however, found in favor of the Greggs on a claim under the UTPCPL and awarded damages. Approximately sixty percent of the award consisted of attorney fees and costs claimed on behalf of the Greggs.
In an opinion authored by Judge Kunselman, the Panel addressed whether the jury’s defense verdict on the misrepresentation claims precluded the trial judge’s verdict in favor of the Greggs under the UTPCPL. The Panel ruled that the UTPCPL verdict was not precluded by res judicata or collateral estoppel, finding that “deceptive conduct” under the UTPCPL’s catchall provision can be established in the absence of fraudulent or negligent misrepresentations. In so ruling, the Panel departed from recent Superior Court decisions – e.g., Kirwin v. Sussman Automotive, 149 A.3d 333 (Pa. Super. 2016), and Dixon v. Northwestern Mutual, 146 A.3d 780 (Pa. Super. 2016) – that had expressly held that in order to prove deceptive conduct, consumers were required, at a minimum, to provide a common law negligent misrepresentation. Indeed, Judge Olson had written in Dixon: “Deceptive conduct ordinarily can only take one of two forms, either fraudulent or negligent.” The other panelists in Dixon were President Judge Ford Elliott and Judge Strassburger.
In departing from other Superior Court decisions, the Panel expressed the novel view that the UTPCPL imposes strict liability: “[A]ny deceptive conduct … is actionable … whether committed intentionally (as in a fraudulent misrepresentation), carelessly (as in a negligent misrepresentation), or with the utmost care (as in strict liability).” In support of this view, the Panel relied heavily on a Commonwealth Court decision that involved a public enforcement action under the UTPCPL and that pre-dated Kirwin and Dixon by five years. Commonwealth v. TAP Pharmaceutical Products, Inc., 36 A.3d 1197 (Pa. Cmwlth. 2011), reversed on other grounds, 94 A.3d 350 (Pa. 2014).
The Gregg decision, particularly when accompanied by inconsistent decisions reached by panels in other cases, is likely to engender ongoing confusion among the courts and practitioners concerning the proper interpretation and application of the catchall provision. For example, one might question how one charged with a violation of the UTPCPL could be found to engage in deceptive conduct (i.e., conduct that deceives) in the absence of any intent or fault. It is remarkable that the meaning of “deceptive conduct” as used in the UTPCPL – a fundamental and critically important element of the statute – continues to confound, now twenty-two years after the amendment introducing that prong of actionable conduct. Particularly in light of Gregg, the courts and practitioners will continue to grapple with the interpretation of the UTPCPL’s catchall provision until the Pennsylvania Supreme Court provides guidance and clarity. Several opinions of Pennsylvania’s highest court have made references to the potential scope of the catchall provision. The Court, however, has not yet directly confronted the degree of intent or fault that must be shown to prove deceptive conduct that could give rise to UTPCPL liability. To the extent the Supreme Court has addressed the catchall provision, it has done so in a manner that suggests that Gregg’sstrict liability formulation of the UTPCPL may be of dubious validity. E.g., Grimes v. Enterprise Leasing Co. of Philadelphia, LLC, 105 A.3d 1188, 1192 n.3 (Pa. 2014) (although the Court had granted review in Grimes to consider whether a private plaintiff who alleges deceptive conduct under the catchall provision is required to plead and prove justifiable reliance, the Court declined to address the issue in Grimes because another issue was dispositive); Milliken v. Jacono, 96 A.3d 997, 1003 (Pa. 2014) (stating that in order to establish liability under the catchall provision, “a plaintiff must show that he justifiably relied on the defendant’s wrongful conduct or representation, and that he suffered harm as a result of that reliance”)(concurrence by Madame Justice Todd), citing Yocca v. Pittsburgh Steelers Sports, Inc., 854 A.2d 425, 438 (Pa. 2004). Significantly, the allegedly wrongful conduct involved in all three cases – Grimes, Milliken and Yocca– occurred after the 1996 amendment to the UTPCPL and with the “deceptive conduct” element in effect. The Gregg opinion, however, does not discuss any of these cases or their potential significance.

References: v. 
 § 201
 v. 
 v. 
 v. 
 v. 
 v. 
 v.