Opinion ID: 2001572
Heading Depth: 3
Heading Rank: 4

Heading: Proximate Cause Actual Deception

Text: The appellate court's conclusion that State Farm's representations led numerous class members to blindly accept the non-OEM parts specified    without knowledge of their categorical inferiority cannot apply in DeFrank's case for an additional reason  lack of proximate causation. In a series of three cases, this court has held that in a cause of action for fraudulent misrepresentation brought under the Consumer Fraud Act, a plaintiff must prove that he or she was actually deceived by the misrepresentation in order to establish the element of proximate causation. The three cases are Zekman v. Direct American Marketers, Inc., 182 Ill.2d 359, 231 Ill.Dec. 80, 695 N.E.2d 853 (1998), Oliveira v. Amoco Oil Co., 201 Ill.2d 134, 267 Ill.Dec. 14, 776 N.E.2d 151 (2002), and Shannon v. Boise Cascade Corp., 208 Ill.2d 517, 281 Ill.Dec. 845, 805 N.E.2d 213 (2004). In the case at bar, State Farm argues that under Zekman and Oliveira ( Shannon was not yet filed at the time of briefing and argument), DeFrank's consumer fraud claim must fail because he has not established that he was actually deceived by any omissions or representations made by State Farm. Plaintiffs, in response, argue that Zekman and Oliveira are distinguishable from the present case because those cases involved deceptive advertising and alleged fraud on the market, i.e., misrepresentations made to the public at large, rather than misrepresentations directed specifically at plaintiffs as policyholders. According to plaintiffs, a covenant of good faith is implied in every contract and the presence of such a covenant here gave rise to a relationship quite different than the attenuated nexus between a merchant and prospective consumer in an impersonal deceptive advertising campaign. Though not entirely clear, it appears that plaintiffs are arguing in favor of a different definition of causation for those individuals who have contracts with a consumer fraud defendant versus those who do not. To the extent that this is plaintiffs' argument, we reject it. Further, and more importantly, we reject plaintiffs' attempt to distinguish Zekman and Oliveira. The critical point of these cases is not that they involved advertising. Rather, the important legal principle established in Zekman, Oliveira and Shannon is that in a case alleging deception under the Act, it is not possible for a plaintiff to establish proximate causation unless the plaintiff can show that he or she was, in some manner, deceived by the misrepresentation. Oliveira, 201 Ill.2d at 155, 267 Ill. Dec. 14, 776 N.E.2d 151. Proximate causation is an element of all private causes of action under the Act. Thus, DeFrank must establish that he was deceived by State Farm's representations or omissions in order to prove his claim. The circuit court did not discuss deception in its judgment order and the court's entire analysis of proximate causation is contained in its finding that as a direct and proximate result of State Farm's violation of the Consumer Fraud Act, the plaintiffs were injured and incurred actual damages. The appellate court did address deception, although in a summary fashion. The court stated, without further explanation, that [t]here is overwhelming evidence of State Farm's calculated deception of its policyholders. 321 Ill.App.3d 269, 254 Ill.Dec. 194, 746 N.E.2d 1242 (quote contained in a portion of the opinion unpublished under Supreme Court Rule 23). The notion that DeFrank was deceived by the omissions or representations in his estimate and brochure into accepting non-OEM parts is categorically refuted by the record. At trial, DeFrank gave the following testimony: Q. [Plaintiffs' counsel] I may have asked you this. Did you report the collision to State Farm? A. [DeFrank] Yes. Q. Did you report it promptly? A. Yes. Q. Okay. Tell the jury what happened, Sam, after you called State Farm. A. They made an appointment with me to take my truck to the claims center which is out by the airport. Q. Okay. A. And which I did on that particular day. Q. Okay. Was it on November the 5th that you did that? A. Yes, sir. Q. Okay. Tell the jury what happened on November the 5th when you went out there. A. Well, I took my truck to the claims center. I pulled it inside. And the fellow there that  he started looking it over. And I said, Oh, yeah. By the way, I said, I want all GM parts on that truck. Q. Why did you happen to bring that up? A. Seeing commercials on TV where they say, you know, keep your GM car all GM. Q. Okay. That was all you knew about it? A. That was all I knew about it at the time. Q. What did he tell you? A. He said, We will talk about that later. Q. Did that indicate anything  what did you think? A. I figured something was up. Q. Okay. Did you talk to a man named  a claim representative or somebody named Richard Hill? A. Yes, sir. Q. Okay. When did you do that? A. When? Q. Yeah. When did you do that? Was that while the truck  A. While this other fellow was looking at my truck and, I guess, writing the estimate on that, we went into his office. Q. Richard Hill? A. Richard Hill's office. Q. Okay. And did what [ sic ] Mr. Hill give you? A. We talked for a little bit, and then he handed me a little brochure from State Farm. Q. Okay. A. That stated their policy. Q. Okay. Did it tell you that  state their policy about what? A. If they used non-OEM parts on your vehicle. Q. That they would use non-OEM? A. That they stand behind it. Yeah. Q. What was your reaction to finding out that they were going to use non-OEM parts on your vehicle? A. I was very upset. Q. Did you complain? A. Did I to Mr. Hill at that time? Yes. Q. And what was Mr. Hill's response to you? A. He just promised me that  or basically said that there was really  that's how they do it, and that they stand behind their non-OEM parts. If I had any trouble they would take care of me. DeFrank's testimony makes it abundantly clear that he was not deceived by anything State Farm said, or did not say, regarding the quality of non-OEM parts. Even before he spoke to the State Farm adjuster, DeFrank believed, in his own mind, that non-OEM parts were not as good as OEM parts. Otherwise, he would not have insisted that GM parts be installed on his truck. Further, DeFrank would not have become, in his words, very upset upon learning that non-OEM parts were to be used on his truck unless he believed that non-OEM parts were not as good as OEM parts. Neither the appellate court nor the circuit court addressed DeFrank's testimony or explained how, in light of that testimony, it can be said that he blindly accepted the non-OEM parts without knowledge of their categorical inferiority. 321 Ill. App.3d 269, 254 Ill.Dec. 194, 746 N.E.2d 1242 (quote contained in a portion of the opinion unpublished under Supreme Court Rule 23). DeFrank plainly was not deceived by State Farm's estimate or Quality Replacement Parts brochure. Because he was not deceived by State Farm, DeFrank failed to establish the proximate causation necessary to recover under the Consumer Fraud Act. In light of the above, it is clear that DeFrank suffered no actual damage, and that he failed to establish proximate causation. For these reasons, DeFrank failed to prove a private cause of action under the Consumer Fraud Act. Because DeFrank, as the representative plaintiff, has not proven his claim for consumer fraud, there can be no Illinois class for plaintiffs' consumer fraud count. See, e.g., Oliveira, 201 Ill.2d at 156-57, 267 Ill.Dec. 14, 776 N.E.2d 151; Charles Hester Enterprises, Inc. v. Illinois Founders Insurance Co., 114 Ill.2d 278, 294-95, 102 Ill.Dec. 306, 499 N.E.2d 1319 (1986). Therefore, we reverse the judgments of the circuit and appellate courts in favor of plaintiffs on the consumer fraud count.