Violation of FDCPA Not Necessarily a Violation of Massachusetts' Consumer Protection Act

A Massachusetts law firm which violated the federal Fair Debt Collection Practices Act while trying to collect unpaid condominium fees did not necessarily violate the Massachusetts consumer protection act, according to a U.S. magistrate judge.  McDermott v. Marcus, Errico, Emmer & Brooks, P.C., 09-10159-MBB, August 26, 2013.

The law firm violated the FDCPA by communicating directly with the plaintiff condo owner – not his attorney – and with the owner’s mortgagees without his consent, said U.S. Magistrate Judge Marianne B. Bowler.  The judge then went on to find a per se violation of the state’s consumer protection act, Mass.G.L. 93A.  But a recent decision of the Supreme Judicial Court, the state’s highest court, found that a violation of Massachusetts regulations designed to protect consumers in other contexts does not necessarily mandate liability under the Act.  Klairmont v Gainsboro Restaurant, Inc., 987 N.E.2d 1247 (Mass.2013) established that a violation of such regulations is only a violation of Chapter 93A when the conduct leading to the violation is both unfair or deceptive and occurs in trade or commerce.

Since the law firm’s services to its client were aimed at resolving a private dispute – failure to pay condominium fees – and were not services distributed in a business context, they did not occur in trade or commerce, according to the judge.

Reaction to the decision has been swift, and along predictable lines.  According to various news reports, consumer advocates fear the ruling will leave consumers with no remedy if a particular activity is not covered by other laws, pointing out that Chapter 93A has been used acted as leverage against numerous activities seen as violative of consumer interests in the past.   Other commentators suggest this ruling is evidence of a continuing effort by the judiciary to prevent every potential claim from evolving into a 93A case.

For more information on professional liability matters, contact Attorney Bill Saturley at 603-410-1500 or a member of PretiFlaherty's Professional Liability Group.