The recent decision by the Massachusetts Appeals Court in Agnitti v. Philip Morris USA Inc., (24-p-780) offers a warning for companies regarding any representations made to consumers, such as product labeling or advertising, as well as litigators pursuing or defending misrepresentation claims under both tort theories and Chapter 93A, which provides for potential multiplication of damages and award of claimant attorneys fees and costs.
Given the increase in consumer product labeling litigation, the takeaway for consumer product manufacturers and sellers is to be mindful that representations made, whether through advertising, marketing, or labeling to consumers, or otherwise, may leave it vulnerable to claims for misrepresentation, even if those representations are true. Businesses should consider the “overall impression” made by its statements in light of what information is known about the product. Soliciting consumer impressions through commissioned studies, focus groups, and the like may prove valuable in defending claims of misrepresentation.
The case involved an appeal from a judgment on a jury verdict in favor of Phillip Morris. The personal representative of the decedent, a lifetime smoker of cigarettes advertised as “light”, sued Phillip Morris for wrongful death, negligence, breach of implied warranty for design defect, conspiracy to commit fraud and misrepresentation, fraud and misrepresentation, and for violations of Chapter 93A, for which a jury trial returned a defense verdict on all counts. Plaintiff appealed the trial judge’s jury instructions on the counts of violation of Chapter 93A and fraud and misrepresentation.
The key issue on appeal was the trial judge’s instruction on the Chapter 93A claim that a finding for plaintiff on at least one tort claim was required to sustain liability under Chapter 93A. The court found this to be error, noting that a Chapter 93A claim is not always derivative of an underlying tort claim. With respect to claims for fraud and misrepresentation, the standard of liability under Chapter 93A § 2 “goes far beyond the scope” of the standard for tort-based claims. Specifically, the 93A claim does not require a showing of falsity, intent to deceive, and reliance by plaintiff as required for common law misrepresentation and can be actionable even if a statement is literally true but creates an overall misleading impression through omission of material information.
In the context of this case, the plaintiff presented evidence at trial showing that the defendant, after a decrease in sales following studies linking smoking to lung cancer, engaged in public relations efforts to cast doubt on that finding and promoted “filtered,” “light,” and “low tar” cigarettes as healthier alternatives to regular cigarettes, despite knowing that these products were not safer. While the direct representations made may be literally true, the court found this evidence sufficient to allow a jury to determine whether the “overall impression” created by the defendant’s efforts were actionable under Chapter 93A.
