Court Opinion

ID: 6449971
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:31:05.240468+00
Date Added: 2024-06-11T15:52:57.327332
License: Public Domain

Abrams, J.
(concurring in part and dissenting in part, with whom Liacos, J., joins). I join in parts 1 and 3 of the court’s decision. I cannot agree, however, with the court’s conclusion in part 2, that, for purposes of G. L. c. 93A, § 11 (1984 ed.), Problem Pregnancy, Inc. (PP, Inc.), is not “engaged in trade or commerce.” In deciding whether PP, Inc. has engaged in activities that would subject it to G. L. c. 93A (1984 ed.), the court errs on two levels. First, it fails to apply the plain language of the statute to the findings of the judge below. Second, instead of emphasizing the competitive market.relationship between PP, Inc. and the Planned Parenthood League of Massachusetts (PPLM) that was so essential to the holding of part 1, the court shifts its focus in part 2 to PP, Inc.’s transactions with the public. I, therefore, respectfully dissent.
General Laws c. 93A, § 11, applies to any “person who engages in the conduct of any trade or commerce,”1 as defined *496'in G. L. c. 93A, § 1 (b) (1984 ed.). This section provides that “trade and commerce” include “the sale, rent, lease or distribution of any services and any property.”2 The judge found that PP, Inc. gave pregnancy tests and counseling, as well as other services relative to pregnancy in the Worcester area. This finding is not challenged and is amply supported by the record. In fact, the testimony of the president of PP, Inc. provides the clearest statement of the company’s services. She stated that PP, Inc. works with social service agencies, medical facilities, and religious organizations. Moreover, it is involved with programs that provide housing and nutritional support for pregnant women. Such activities fall within the customary and usual understanding3 of the words “distribution of services.”
The court itself recognizes that both the plaintiff and the defendant corporations are involved in the distribution of services in its resolution of the service mark infringement issue. The court notes the similarity of services provided by PP, Inc. and PPLM when it affirms the conclusion of the lower court that the public is experiencing actual confusion as a result of PP, Inc.’s actions. See ante at 488-490. The court recognizes in part 1 that PP, Inc. offers services; thus, it is hard to understand what error the judge committed in imposing liability under *497c. 93A. The inconsistency of the court’s analysis is striking. Further, the court goes beyond the clear meaning of the words of §§ 1 (b) and 11 to reach a result which is counter to the legislative intent of encouraging “more equitable behavior in the marketplace.” Manning v. Zuckerman, 388 Mass. 8, 12 (1983).
In the past, we have looked at the trade or commerce requirement in the context of an unfair or deceptive act or practice. See Begelfer v. Najarian, 381 Mass. 111 (1980); Lantner v. Carson, 374 Mass. 606 (1978); Slaney v. Westwood Auto, Inc., 366 Mass. 688 (1975). This case, however, is different: there was no “transaction” between PP, Inc. and PPLM in which an allegedly unfair or deceptive act occurred, but instead there were unfair and deceptive acts perpetrated on the public and PPLM’s clients that amounted to an unfair method of competition against PPLM.4
PP, Inc.’s deceptive practices bear a much closer resemblance to the conduct in common law service mark infringement decisions than to the practices thus far analyzed under c. 93A. Compare, e.g., Massachusetts Mut. Life Ins. Co. v. Massachusetts Life Ins. Co., 356 Mass. 287, 293-294 (1969) and Monroe Stationers & Printers, Inc. v. Munroe Stationers, Inc., 332 Mass. 278, 280 (1955), with Lantner, supra, and Begelfer, supra. As recognized by Justice Holmes, “it is pretty well settled that the plaintiff merely on the strength of having been first in the field may put later comers to the trouble of taking such reasonable precautions as are commercially practicable to prevent their lawful names and advertisements from deceitfully diverting the plaintiff’s custom.” American Waltham Watch Co. v. United States Watch Co., 173 Mass. 85, 87 (1899).5 PP, Inc. not only failed to take reasonable *498precautions, it actively sought to divert PPLM’s clients. Such unfair conduct clearly falls within the broad prohibitions of c. 93A, a statute which obviously includes common law liabilities as well as many new rights. See Datacomm Interface, Inc. v. Computerworld, Inc., 396 Mass. 760, 778 (1986); Slaney, supra at 693; PMP Assocs. v. Globe Newspaper Co., 366 Mass. 593, 596 (1975). Although the court recognizes the difference between this case and our past c. 93A decisions, it fails to analyze this case in light of the difference. The court mechanically applies our prior cases to PP, Inc.’s relationship with the public instead of addressing the on-going competition complained of here between PP, Inc. and PPLM.
Ignoring the plain language of the statute, the court utilizes our prior case law to place a judicial gloss on the requirements of c. 93A. The court today states that “[t]he use of the words ‘distribution of any services’ in conjunction with words such as ‘sale’ and ‘lease’ indicates an intent that the services be distributed in exchange for some consideration or that there must be other strong indications that the services are distributed in a business context.” Ante at 493. The language of the statute does not impose the requirements of consideration or a business context. Using these requirements, we have construed G. L. c. 93A to eliminate a purely private single transaction, as well as private transactions between private individuals, from its coverage. See infra at 500. Accepting these limitations, consistent analysis in this case would nevertheless result in the conclusion that the judge correctly applied c. 93A.
In assessing whether the competition between PP, Inc. and PPLM occurs in a business context, I look to the court’s prior decisions. Begelfer, supra. Lantner, supra. In the Begelfer *499decision, supra at 190-191, the various relevant considerations including the nature of the transaction, the character of the parties, the activities engaged in by the parties, and the motivations underlying the transaction are set forth. The court acknowledges that these factors are relevant, but fails to analyze them as they apply to the relationship between PP, Inc. and PPLM. The nature of this “transaction” is characterized by on-going competition. PP, Inc. is not simply operating a charity that provides services; it is engaging in competitive marketplace behavior. PP, Inc. intentionally engaged in acts which confused PPLM’s clients and diverted trade or commerce away from PPLM and toward the alternate services PP, Inc. provided. PP, Inc. inserted itself into the market in which PPLM operates and tried to alter the behavior of consumers in that market so that they would use the services distributed by PP, Inc. Cf. American Medical Ass’n v. United States, 317 U.S. 519, 528 (1943) (whether physicians’ practice of medicine constitutes “trade” under § 3 of the Sherman Antitrust Act immaterial where purpose and effect of their conspiracy is obstruction and restraint of competitor’s business).
Instead of applying this analysis concerning the nature of the transaction and the activities of the parties, the court primarily focuses on the motivation of the parties. The court emphasizes the benevolent goals of PP, Inc.’s employees. While this is part of the relevant inquiry, it ignores the motivations of the corporation, PP, Inc., in entering the market to compete with PPLM. PP, Inc., as determined in part 1, used an unfair method of competition to confuse the public and prospective clients of PPLM. PP, Inc.’s activities were not simply geared towards helping women; they were designed to damage or destroy its competitor. See Costello Publishing Co. v. Rotelle, 670 F.2d 1035, 1049 (D.C. Cir. 1981) (charitable motivation does not immunize any action taken from antitrust laws). Clearly these business motivations of PP, Inc., in combination with the nature of the transaction and the activities of the parties, establish the “business context” as contemplated by Begelfer. In fact, in part 1 the court fully considers the business context in which the two corporations are competing. The *500presence of this business context is essential to the court’s resolution of the service mark violation issue. Nevertheless, it ignores its own analysis in part 2.
Finally, the cases relied upon by the court, Begelfer, supra, and Lantner, supra, in particular, involve strictly private transactions which the court has found do not involve a business context. Trade or commerce is defined in c. 93A as including those actions which “directly or indirectly affect[ ] the people of this commonwealth.” Because the private sale of a home, as in Lantner, has no effect on the public, it is beyond the scope of c. 93A. Similarly, the Appeals Court applied this portion of the statute to eliminate private transactions between members of the same partnership from the coverage of c. 93A. Newton v. Moffie, 13 Mass. App. Ct. 462, 467 (1982). The Newton court stated that “the effect of the questioned conduct on the public interest is a relevant consideration in deciding whether the conduct falls within our Act.” Id. at 468. Without question, PP, Inc.’s unfair method of competition was designed to have an effect on the public. The potential harm and confusion that resulted from PP, Inc.’s behavior is determinative in part 1 of the court’s opinion; yet, in part 2, the court completely ignores the harm to PPLM and the confusion to the public.
The court does not serve the legislative goal of consumer protection by shielding inequitable marketplace behavior from liability on account of the nonprofit or charitable goals of the organization’s members. See G. L. c. 231, § 85K (1984 ed.) (abolition of charitable immunity). “Labor, the professions, charitable organizations, etc., are merely auxiliary forces [in the marketplace] and may, therefore, be initially subject to their own ethical or other rules of the games. To the extent, however, that their activities may impinge upon or otherwise affect a competitive contest between businessmen, they may be subject to the rules of the game applicable to those competitors.” 1 R. Callmann, Unfair Competition, Trademarks and Monopolies § 1.01 (4th ed. 1981). Those nonprofit organizations participating in the market are as entitled to protection against unfair competition as are other business enterprises. Conversely, simply because an organization is devoted to be*501nevolent purposes does not relieve it of the “obligation to observe the rules of fair play” in the course of its business. See 1 R. Callman, supra at § 1.02. Here, the court has not extended the protection of c. 93A to PPLM despite its determination of unfair competition. Moreover, the court has relieved PP, Inc. of the obligation to follow the rules of fair play by its failure to recognize that PP, Inc. was engaged in the distribution of services.
The court unjustifiably restricts the reach of c. 93A. Under the statute, PPLM need only show that PP, Inc. engaged in trade or commerce. PPLM showed, and the judge found, that “Problem Pregnancy is engaged in giving pregnancy tests, pregnancy counseling and advice and other services relative to pregnancy in the Worcester area.” That finding meets both the plain meaning of the statute and the requirements of the statute as interpreted by this court. By its refusal to impose c. 93A liability on PP, Inc., the court protects the defendant’s conduct admittedly amounting to unfair competition from the sanctions the Legislature has enacted to prevent such behavior. Because PP, Inc.’s distribution of services was purposefully designed to harm PPLM in its business, the judge correctly imposed liability under c. 93A. I, therefore, dissent.

 The plaintiff in a G. L. c. 93A, §11, action must also “engage[ ] in the conduct of any trade or commerce.” In its answer to the complaint, and on appeal, PP, Inc. contends that PPLM is not engaged in trade or commerce. *496The judge did not directly rule on that point, but we may infer from his imposition of liability on PP, Inc. that he found that PPLM is so engaged. See Schrottman v. Barnicle, 386 Mass. 627, 638 n.8 (1982). The judge did find as fact “PPLM runs a reproductive health care clinic .... Services provided at the PPLM clinic include out-patient abortions for women.” This finding is not clearly erroneous, and is sufficient to support a conclusion that PPLM is engaged in trade or commerce. If by its omission of any discussion of this issue the court means to indicate that it is so obvious as not to merit any discussion, I agree.

 General Laws c. 93A, § 1 (b) (1984 ed.), provides in full: “ ‘trade’ and ‘commerce’ shall include the advertising, the offering for sale, rent or lease, the sale, rent, lease or distribution of any services and any property, tangible or intangible, real, personal or mixed, and any other article, commodity, or thing of value wherever situate, and shall include any trade or commerce directly or indirectly affecting the people of this commonwealth.”

 This court has consistently held that when the statutory language is plain, the words must receive their “usual and natural meaning.” Commonwealth v. Thomas, 359 Mass. 386, 387 (1971).

 Passing off’ has been characterized as the “essence” and the “typical and most common case of [common law] unfair competition.” 1 R. Callmann, Unfair Competition, Trademarks and Monopolies § 2.02 (4th ed. 1981), and cases cited.

 This principle was applied in a situation factually similar to the case at bar. Summerfield Co. v. Prime Furniture Co., 242 Mass. 149 (1922). In Summerfield, the defendant, a “later comer,” opened a store near the plain*498tiff’s store and sought to make the stores look similar. The defendant’s conduct was calculated to confuse the public. The court enjoined this behavior stating that the “defendant has equal right with the plaintiff to solicit the patronage of the public. But it has no right intentionally to mislead the public to the harm of the plaintiff. ...” Id. at 155. Moreover, the Summerfield court stated that this principle is not limited to any particular set of facts, but instead applies equally to any methods of deceit designed to divert customers. Id.