Can Courts Double Or Triple 'Nominal Damages' For Willful Chapter 93A, Section 9 Violations?

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No. Although a consumer-plaintiff may seek to double or treble actual damages for willful or knowing Chapter 93A violations, a court should not multiply Section 9's $25 nominal damages award...
United States Litigation, Mediation & Arbitration

No. Although a consumer-plaintiff may seek to double or treble actual damages for willful or knowing Chapter 93A violations, a court should not multiply Section 9's $25 nominal damages award if actual damages do not exceed that amount. As explained by the Supreme Judicial Court (SJC) in Leardi v. Brown, that is because (1) the multiple damages provision in Section 9 reflects the "Legislature's displeasure with the proscribed conduct and its desire to deter such conduct" and (2) "the award of statutory damages, in circumstances where there is no actual harm, adequately fulfills" that purpose.

According to the SJC, the inability to multiply statutory damages also arises from the common law rule that punitive damages may not be awarded when a plaintiff cannot prove actual harm. As the SJC explained in Leardi, because "the Legislature has determined that an award of $25 suffices as nominal damages, it would be incongruous and inconsistent with that determination to infer that in any circumstances the Legislature intended that the nominal sum should be multiplied."

The Appeals Court recognized the SJC's rationale in Lord v. Commercial Union by highlighting that the trial court judge reduced originally multiplied nominal damages to $25 dollars based on Leardi and Gallant v. Cariglia (unpublished) by citing Leardi when agreeing with defendants that "the $25 nominal damages award should not have been multiplied. Therefore, the judgment itself will be reduced to the statutory maximum amount of $25 from the $75 awarded below." The Superior Court also has recognized this aspect of Leardi in Aspinall v. Philip Morris Companies, Inc. (2013 WL 7863290), where the court cited Leardi when explaining that the court's only discretion to multiply damages related to actual damages.

The ability to seek double or treble damages has implications when actual damages are excessive or when dealing with a putative class action. In the latter case, multiplying nominal damages on a class-wide basis may provide plaintiff's class counsel with greater leverage for settlement. Despite the case law above, the plaintiffs' bar continues demanding multiple nominal damages and attempting to distinguish their claims from Leardi and its progeny.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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