Richards v. Arteva Specialties S.A.R.L.

• Decision Date: 14 July 2006
• Docket Number: No. 05-P-471.,05-P-471.
• Citation: 66 Mass. App. Ct. 726,850 N.E.2d 1068
• Parties: Dawn RICHARDS<SMALL><SUP>1</SUP></SMALL> v. ARTEVA SPECIALTIES S.A.R.L.<SMALL><SUP>2</SUP></SMALL> & others.<SMALL><SUP>3</SUP></SMALL>
• Court: Appeals Court of Massachusetts

850 N.E.2d 1068

66 Mass. App. Ct. 726

Dawn RICHARDS¹ v. ARTEVA SPECIALTIES S.A.R.L.² & others.³

No. 05-P-471.

Appeals Court of Massachusetts, Essex.

Argued February 17, 2006.

Decided July 14, 2006.

COPYRIGHT MATERIAL OMITTED

Douglas M. Brooks, Boston, for the plaintiff.

Steven M. Cowley, Boston, for Wellman, Inc., & others.

Edward J. Naughton, Boston, for Nan Ya Plastics Corporation, America, was present but did not argue.

Present: LAURENCE, DUFFLY, & MILLS, JJ.

LAURENCE, J.

The principal question presented by this appeal is whether the plaintiff's G.L. c. 93A demand letter, purportedly sent on behalf of herself and a class of Massachusetts indirect purchasers who alleged injury as a result of the defendants' illegal price-fixing, "reasonably describ[ed] ... the injury suffered," as required by G.L. c. 93A, § 9(3), inserted by St.1969, c. 690. A Superior Court judge held the demand letter to be defective as matter of law for its failure to describe the alleged injury adequately and dismissed the complaint on the defendants' motions under Mass. R.Civ.P. 12(b)(6), 365 Mass. 755 (1974). Because we conclude that the demand letter was minimally sufficient to meet the statutory requirement on the individual plaintiff's own behalf prior to any class action being certified, we reverse.

Factual background. The defendants, manufacturers of a material called polyester staple,⁴ allegedly conspired over at least a two-year period to fix prices, eliminate competition among them, and allocate customers and markets for polyester staple used in consumer goods sold in and distributed to Massachusetts and other States.⁵ At least one defendant has pleaded guilty to the charge of violation of the Sherman Antitrust Act (15 U.S.C. § 1 [2000] ), and another has admitted to participating in the conspiracy.⁶

The plaintiff, Dawn Richards, brought the instant complaint on April 8, 2004, pursuant to G.L. c. 93A, §§ 2 and 9. She alleged that she represented a class of "millions" of Massachusetts "indirect purchaser[s]," consumers who purchased products containing polyester staple while the defendants' conspiracy was ongoing. She and the putative class members (the supposed class not yet having been certified) were indirect purchasers because they purchased the products at retail from third parties, not directly from the defendants. The plaintiff and the class were assertedly damaged (in an amount yet undetermined) because the products they purchased containing polyester staple were sold at artificially inflated prices as a result of the defendants' price-fixing conspiracy and other anticompetitive conduct.

Prior to filing the complaint, the plaintiff's counsel served on each of the defendants a letter entitled "Demand for Relief Pursuant to [G.L. c.] 93A, § 9." Under a heading captioned "CLAIMANT," the letter described the plaintiff and the class she proposed to represent and stated that the plaintiff personally "has purchased and paid illegally inflated prices on products containing polyester staple such as, but not limited to[,] shirts and other wearing apparel, linens and home furnishings." Under "UNFAIR OR DECEPTIVE ACTS OR PRACTICES," the letter described the defendants' alleged unlawful practices regarding the pricing of polyester staple and the purported effects of that unlawful conduct. The letter described the "INJURIES SUFFERED" as follows:

"Claimant, as well as the other members of the proposed Class, have suffered injury and damages as a result of the Respondent's unfair or deceptive acts or practices in the form of higher out-of-pocket costs to purchase products containing polyester staple and other damages. Claimant is a member of the putative Class. The members of the Class have suffered similar damages. Due to the conduct of Respondent and the inherently self-concealing nature of the conspiracy, the dollar amount of damages suffered by the Class cannot be determined without discovery. However, Respondent possesses enough information as to the supra-competitive prices of polyester staple in order to make a reasonable class wide tender of settlement." (Emphasis supplied.)

The letter demanded that the defendants pay all consequential damages caused by their illegal conduct, pay restitution and refunds to the plaintiff and members of the proposed class to the extent they had paid higher than competitive prices for products containing polyester staple, and reimburse the plaintiff and the proposed class members for their reasonable attorney's fees and expenses. None of the defendants responded to the demand letter.

Defendants Arteva Specialties S.A.R.L., doing business as KoSa (KoSa); E.I. DuPont de Nemours & Company (DuPont); DAK Fibers, LLC (DAK); and Wellman, Inc. (Wellman), moved to dismiss the complaint under Mass.R.Civ.P. 12(b)(6) on the ground that the demand letter was inadequate under G.L. c. 93A, § 9. Defendant Nan Ya Plastics Corporation, America (Nan Ya), separately moved to dismiss on the basis of lack of personal jurisdiction. After a hearing, the motion judge ruled that the demand letter did not reasonably describe the injury suffered and allowed the motion to dismiss on that ground with regard to all the defendants. The judge did not address Nan Ya's jurisdictional motion and argument. This appeal followed.

Discussion. The standards governing our review of the allowance of a rule 12(b)(6) motion to dismiss are well-established, as well as exceedingly indulgent to a plaintiff. "In appraising the sufficiency of the complaint we follow, of course, the accepted rule that a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Nader v. Citron, 372 Mass. 96, 98, 360 N.E.2d 870 (1977), quoting from Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). "Furthermore, the allegations of the complaint, as well as such inferences as may be drawn therefrom in the plaintiff's favor, are to be taken as true." Nader v. Citron, supra. "In passing on a rule 12(b)(6) motion, the court is not to consider the unlikelihood of the plaintiff's ability to produce evidence to support otherwise legally sufficient complaint allegations . . . however improbable appear the facts alleged . . . and `notwithstanding expressions of denial and incredulousness as to ultimate proof by the defendants.'" Brum v. Dartmouth, 44 Mass. App.Ct. 318, 322, 690 N.E.2d 844 (1998), S.C., 428 Mass. 684, 704 N.E.2d 1147 (1999), quoting from Eyal v. Helen Bdcst. Corp., 411 Mass. 426, 431, 583 N.E.2d 228 (1991).

These generous criteria have reduced a plaintiff's obstacle in surmounting a rule 12(b)(6) motion to a "minimal hurdle," Bell v. Mazza, 394 Mass. 176, 184, 474 N.E.2d 1111 (1985), and they are applicable to c. 93A consumer class actions. Ciardi v. F. Hoffmann-La Roche, Ltd., 436 Mass. 53, 55, 762 N.E.2d 303 (2002). In this connection, we also observe that in enacting G.L. c. 93A the Legislature intended to create new substantive rights and procedural devices substantially broadening the vindication of consumers' rights, id. at 58, 762 N.E.2d 303, and that "technicalities are not to be read into the statute in such a way as to impede the accomplishment of substantial justice," Baldassari v. Public Fin. Trust, 369 Mass. 33, 41, 337 N.E.2d 701 (1975); this includes the reading of the demand letter requirement. See id. at 41-42, 337 N.E.2d 701. Indeed, as the Ciardi case made clear, in a G.L. c. 93A, § 9, case involving (as here) an indirect purchaser plaintiff's class action complaint alleging injury from being "forced to pay `supra-competitive prices'" "as a result of [the defendants'] price-fixing conspiracy," the "plaintiff has a relatively light burden to carry to maintain her complaint . . . under rule 12(b)(6)." Ciardi v. F. Hoffmann-La Roche, Ltd., 436 Mass. at 65, 762 N.E.2d 303.

Even a complaint satisfying these liberal standards will, however, be unavailing to a plaintiff proceeding under G.L. c. 93A, § 9, unless she has complied with the distinct prerequisite to filing a suit, namely, serving a demand letter, reasonably describing the claimant's grievances, on the defendants being charged with the c. 93A violation. Entrialgo v. Twin City Dodge, Inc., 368 Mass. 812, 813, 333 N.E.2d 202 (1975). General Laws c. 93A, § 9(3), provides in relevant part:

"At least thirty days prior to the filing of any such action, a written demand for relief, identifying the claimant and reasonably describing the unfair or deceptive act or practice relied upon and the injury suffered, shall be mailed or delivered to any prospective respondent" (emphasis supplied).

Complicating the matter in the instant case is that, in the demand letter, the plaintiff purported to represent not only herself but also a class of similarly situated "indirect purchasers" and demanded a tender of settlement with the entire class. No reported decision has addressed the level of "reasonable" description required of a demand letter by a plaintiff seeking to elicit a settlement on behalf of an as yet uncertified class. As always in such situations, we look at the pertinent words of the statute itself for guidance, see Martha's Vineyard Land Bank Commn. v. Assessors of W. Tisbury, 62 Mass.App.Ct. 25 27-28, 814 N.E.2d 1147 (2004), and cases cited:

"At least thirty days prior to the filing of any such action, a written demand for relief, identifying the claimant . . . shall be mailed or delivered to any prospective respondent. Any person receiving such a demand for relief who, within thirty days of the mailing or delivery of the demand for relief, makes a written tender of settlement which is rejected by the claimant may, in any subsequent action, file the written tender and an affidavit concerning its rejection and thereby limit any recovery to the relief tendered if the court finds that the relief tendered was...