Opinion
No. X04-CV-02-0126869S
August 25, 2003
MEMORANDUM OF DECISION RE MOTION TO STRIKE
1. Facts and Procedural History
The plaintiff, Carmen Emmanuelli, commenced this lawsuit individually and on behalf of a class of individuals similarly situated, against the defendant, Merriam Motors, Inc., for alleged violations of the Connecticut Unfair Trade Practices Act ("CUTPA"). The basic claim is that the defendant sold new motor vehicles to various individuals at prices higher than the manufacturer's suggested retail price ("MSRP"), as reflected on stickers commonly referred to as "Monroney Stickers," without affixing supplemental stickers to those vehicles advising that an enhanced asking price was being sought.
In the complaint, it is conceded that the Monroney Stickers are affixed by the manufacturer (paragraph 6) and that the federal statutes do not prohibit selling new motor vehicles for prices higher than the MSRP (paragraph 7). Plaintiff claims, however, that the Monroney Sticker is the "advertised price" of the vehicle, as defined in Connecticut Regulation Sec. 42-110b-28 (b), and that the defendant cannot sell the vehicle for more than the "advertised price" absent a supplemental sticker. The supplemental sticker together with the Monroney Sticker would then constitute the "advertised price."
By motion dated May 29, 2003, the defendant moves to strike the entire complaint on the ground that plaintiff's claim of a violation of CUTPA is legally insufficient. Although several reasons are set forth, the defendant's primary claim is that a Monroney Sticker does not constitute an "advertisement" as defined in Connecticut Regulation Sec. 42-110b-28 (a)(3). A hearing on the subject motion was held on July 28, 2003.
2. Legal Standard CT Page 9392
"The purpose of a motion to strike is to contest . . . the legal sufficiency of the allegations of any [complaint] . . . to state a claim upon which relief can be granted." (Internal quotation marks omitted.) Peter-Michael, Inc. v. Sea Shell Associates, 244 Conn. 269, 270, 709 A.2d 558 (1998). In ruling on a motion to strike, the trial court examines the complaint "construed in favor of the plaintiffs, to determine whether the [pleading party has] stated a legally sufficient cause of action." (Internal quotation marks omitted.) Dodd v. Middlesex Mutual Assurance Co., 242 Conn. 375, 378, 698 A.2d 859 (1997). When deciding the motion, "the court is limited to the facts alleged in the complaint." (Internal quotation marks omitted.) Faulkner v. United Technologies Corp., 240 Conn. 576, 580, 693 A.2d 293 (1997). "[I]f facts provable in the complaint would support a cause of action, the motion to strike must be denied . . ." (Citation omitted; internal quotation marks omitted.) Lombard v. Edward J. Peters, Jr., P.C., 252 Conn. 623, 626, 749 A.2d 630 (2000).
3. Discussion
The regulation at issue here, Sec. 42-110b-28 (b)(1), promulgated by the Department of Consumer Protection under CUTPA, provides as follows: "It shall be an unfair or deceptive act or practice for a new car dealer or used car dealer to fail to sell or lease, or refuse to sell or lease, a motor vehicle in accordance with any terms or conditions which the dealer has advertised, including, but not limited to, the advertised price." "Advertisement," as defined in Sec. 42-110b-28 (a)(3), includes "any oral, written or graphic statement made by a new car dealer or used car dealer in any manner in connection with the solicitation of business and includes, but is not limited to statements and representations made in a newspaper or other publication or on radio or television or contained in any notice, handbill, sign, billboard, poster, bill, circular, brochure, pamphlet, catalogue or letter." Although the manufacturer affixes the Monroney Sticker to the vehicle, the plaintiff claims that the price listed on the Monroney Sticker is a statement made by the defendant. To ask a higher price, the plaintiff claims the defendant must affix a supplemental sticker next to the Monroney Sticker. It is alleged that other car dealerships place supplemental stickers on their vehicles.
The plaintiff alleges in paragraph 11 of her complaint that "[m]any of [new car dealerships seeking prices greater than the MSRP] advise prospective purchasers of the enhanced asking price of the vehicles by displaying window stickers containing pricing information right next to the Monroney Sticker. Some of these supplemental stickers include designations such as `ADP' which stands for `Additional Dealer Profit,' or `ADM' additional dealer mark-up, or similar notations." The court notes that it is not alleged that such a practice is a common trade practice or that it is customary in the trade of selling new motor vehicles to affix these supplemental stickers to the vehicles.
A violation of the cited state regulation, by its very wording, would be a per se violation of CUTPA. See Meadows v. Higgins, 49 Conn. App. 286, 296, 714 A.2d 51 (1998), rev'd, 249 Conn. 155, 733 A.2d 172 (1999). But even construing the complaint in the manner "most favorable to sustaining its legal sufficiency," Eskin v. Castiglia, 253 Conn. 516, 523, 753 A.2d 927 (2000), the court cannot conclude that the Monroney Sticker is a statement by the defendant. It is not disputed that the manufacturer, not the dealership, affixes the Monroney Sticker to the vehicle. An advertisement, by definition, is a statement made "by a new car dealer or used car dealer in any manner in connection with the solicitation of business . . ." The defendant did not place the Monroney Sticker on the subject vehicle. It was not the defendant's advertisement of the price, it was the manufacturer's compliance with federal law which resulted in the sticker being affixed to the vehicle. The defendant, although unable to remove it by law, had nothing to do with it being placed on the vehicle in the first place.
This does not end the court's inquiry, however. Although a failure to place a supplemental sticker next to the Monroney Sticker is not a per se violation of the cited regulation under CUTPA, the defendant's actions may still be considered violations of CUTPA if they fall within the criteria set forth in the "cigarette rule."
It is well settled that in determining whether a practice violates CUTPA we have adopted the criteria set out in the cigarette rule by the federal trade commission for determining when a practice is unfair: (1) [W]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise — whether, in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers [competitors or other businessmen] . . . All three criteria do not need to be satisfied to support a finding of unfairness. A practice may be unfair because of the degree to which it meets one of the criteria or because to a lesser extent it meets all three . . . Thus a violation of CUTPA may be established by showing either an actual deceptive practice . . . or a practice amounting to a violation of public policy . . . Furthermore, a party need not prove an intent to deceive to prevail under CUTPA. (Citations omitted; internal quotation marks omitted.) Cheshire Mortgage Service, Inc. v. Montes, 223 Conn. 80, 105-06, 612 A.2d 1130 (1992).
Journal Publishing Co. v. Hartford Courant Co., 261 Conn. 673, 695-96, 804 A.2d 823 (2002).
"[T]he legislature enacted CUTPA, announcing that `[i]t is the intention of the legislature that this chapter be remedial and be so construed.'" Hinchliffe v. American Motors Corp., 184 Conn. 607, 616, 440 A.2d 810 (1981). "[R]emedial statutes . . . are to be liberally construed in favor of those whom the legislature intended to benefit." Hartford Fire Ins. Co. v. Brown, 164 Conn. 497, 503, 325 A.2d 228 (1973). "[A] single instance of misconduct may be actionable [under CUTPA] . . ." Johnson Electric Co. v. Salce Contracting Assoc., 72 Conn. App. 342, 344, 805 A.2d 735 (2002).
The defendant relies heavily on the case of Kenney v. Healey Ford-Lincoln-Mercury, Inc., 53 Conn. App. 327, 730 A.2d 115 (1999) in support of its motion to strike. In Kenney, the plaintiffs claimed the defendant violated CUTPA by not disclosing the rental and collision history of a used vehicle. The Court noted that failing to disclose is not a deceptive practice if, under all of the circumstances, there is no duty to disclose. Because the plaintiffs in Kenney never inquired into the vehicle's history, and there is no statute requiring disclosure of that particular information, the Court concluded there was no duty to make such a disclosure voluntarily.
The Kenney case, although it may be helpful to the defendant at a later stage of the proceedings, is not dispositive of the current motion. Kenney was appealed following a full trial to the court. All of the circumstances which needed to be taken into account to determine whether there was a duty to disclose had been explored. Even if there is no duty to disclose imposed by statute or regulation, such a duty may arise by virtue of the "common law or otherwise." Journal Publishing Co., supra, 695. Violations of CUTPA do not arise only by virtue of statutory violations; practices may be unethical or against public policy in the absence of statutory violations. Id.
Taking the allegations of the complaint in the light most favorable to the plaintiff as the court must do on a motion to strike, the court concludes that the plaintiff sets forth a cause of action under CUTPA. The claims are that the display of the Monroney Sticker communicates an advertised price, that other dealerships display supplemental stickers next to the Monroney Stickers when they want to sell vehicles for more than the MSRP, and that the defendant did not place a supplemental sticker on the vehicle sold to the plaintiff even though it sought a higher price than that displayed on the Monroney Sticker. For purposes of a motion to strike, such allegations are sufficient.
For the foregoing reasons, the court denies the defendant's motion to strike.
BY THE COURT
BARBARA M. QUINN, Judge