Making Business Claims Under The NH Consumer Protection Act

Published in the New Hampshire Bar News: New Hampshire's Consumer Protection Act, RSA 358-A, is a potentially powerful tool for business litigators considering claims for wrongful business practices. Given its multiple damages and attorney's fees remedies, a well-grounded Consumer Protection Act (CPA) claim can change the game.

Despite its title, several courts have interpreted the CPA to apply to business transactions that do not directly affect "consumers" as we commonly think of that term.

Federal courts led the way in interpreting the CPA to apply to business-to-business transactions. The first clear proclamation came from the Court of Appeals for the First Circuit in Eastern Mountain Platform Tennis, Inc. v. The Sherwin Williams Company, which stated that "[t]he Act regulates 'Business Transactions.'" 40 F.3d 492, 499-500 (1st Cir. 1994).

Eastern Mountain complained that the defendant violated the CPA and common law by recommending a tennis-court-painting system that failed to perform as represented. Affirming the judge's double damages award based on a jury's finding that the defendant willfully violated the CPA, the Court of Appeals stated that "[t]he unfair and deceptive practices prohibited by the CPA appear to include transactions between business competitors as well as those involving ultimate consumers." The court reached that result by interpreting the "plain meaning" of the Act's broad terms, "any person" and "any trade or commerce within the state." Id. at 498 (quoting RSA 358-A:2)(emphasis in original).

The New Hampshire Supreme Court followed suit in 2001, affirming a superior court ruling that a commercial seller of lumber was entitled to recover under the CPA against a developer who deceptively eluded payment for the lumber. Milford Lumber Co., Inc. v. RCB Realty, Inc., 147 NH 15 (2001). Like the Eastern Mountain court, the Supreme Court relied on the CPA's broad language, "any person" and "any trade or commerce." Noting that the defendants did not simply fail to pay for the lumber, but made intentionally vague representations to procure the lumber and later used those representations to disclaim liability, the majority explained: "It would be harmful for commerce in New Hampshire to allow such unethical and unscrupulous activity to occur. The legislature promulgated the Act to protect citizens engaged in commerce from this type of activity." Id. at 20-21. But, please note the dissent in Milford Lumber, which is soundly...