Overpayment Caused By Deceptive Ad Could Be Recoverable Under Massachusetts Law

This posting was written by Jody Coultas, Editor of CCH State Unfair Trade Practices Law.

A baby formula purchaser stated a Massachusetts Consumer Protection Act (CPA) claim against the formula manufacturer that allegedly engaged in unlawful and deceptive advertising, according to the federal district court in Boston.

Mead Johnson & Company sent out direct mailings and developed print advertisements for its Enfamil LIPIL baby formula, stating that it was the only formula on the market that improved brain and eye development and contained two important nutrients.

The purchaser alleged that she and other consumers chose to pay more for Enfamil than for other brands based on these statements and that the statements were deceptive because other brands of baby formula contained the nutrients as well. Accordingly, the purchaser filed a class action under the CPA.

Pleading Requirement

To state a CPA claim, the purchaser needed to meet the heightened pleading standard of Federal Rule of Civil Procedure 9(b). The manufacturer argued that the purchaser failed to meet the Rule 9(b) standard by not including (1) the exact amount of loss, (2) the advertisements that were untrue as opposed to misleading, and (3) the dates of the advertisements.
It was sufficient to allege that the purported class consisted of purchasers that bought the baby formula from September 25, 2005 to the present and to include copies of the advertisements.

Ascertainable Injury

Some Massachusetts courts have held that overpayment for a product is not a recoverable injury where the purchaser no longer has the products and did not suffer any other injury from the product. However, the federal district court rejected the magistrate judge’s recommendation that the claim be dismissed for lack of injury.

The Massachusetts Supreme Judicial Court has held that overpayment was recoverable if the underlying advertisement was false. The facts of the case were more analogous to cases in which the purchaser had standing based on pleading of an injury stemming from his decision to pay a higher price because of a company’s advertising.

Puffery

A jury could find the statements made in the advertising deceptive because a reasonable consumer would have chosen the Enfamil over cheaper products because of the advertising. Finally, it was reasonable to rely on the statements made in the advertising because they were specific enough to be interpreted as more than a mere opinion or puffery.

The decision is Martin v. Mead Johnson Nutrition Co., CCH State Unfair Trade Practices Law ¶32,145.

Further information regarding CCH State Unfair Trade Practices Law appears here.