Wednesday, July 22, 2015

BBB claims about its own ratings process not protected by First Amendment

Caribbean Cruise Line, Inc. v. Better Business Bureau of Palm Beach County, Inc., No. 4D13-3916 (Fla. Ct. App. June 3, 2015)

Expect more detailed analysis from Ann Lipton soon.
CC received an F grade from BBB and sued for defamation and violation of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA).  The trial court granted BBB’s motion to dismiss, and the court of appeals reversed on the FDUTPA claim.
CC alleged that the BBB website was “often considered the ‘go-to’ source for consumers seeking to investigate businesses,” and that BBB portrayed itself “as [an] unbiased, public-interest organization[], that the consuming public relies on . . . in selecting businesses to utilize and employ.”  For its FDUTPA claim, CC alleged that BBB deceptively claimed to have an unbiased rating system and to conduct an adequate investigation into the businesses for which it rates.  BBB allegedly falsely represented that it based its grade on sixteen specifically-enumerated factors, but didn’t inform the public that it partially relied on whether a business paid BBB to become “accredited” in grading that business.
BBB argued that its statements were pure opinion protected by the First Amendment.  The court of appeals disagreed: the challenged statements were factual representations or omissions—that BBB conducts an investigation into graded businesses; that BBB used sixteen factors; and that paying BBB makes a difference to the grade.
In addition, the court of appeals held that a non-consumer had standing to bring a FDUTPA claim.  Prior to 2001 the relevant provision said that “[i]n any individual action brought by a consumer who has suffered a loss as a result of a violation of this part, such consumer may recover [enumerated items].”  The legislature amended it to read: “In any action brought by a person who has suffered a loss as a result of a violation of this part, such person may recover [enumerated items].”  In addition, the legislature amended a related section to change the definition of “consumer” to include a “business” and “commercial entity.”  
Lower state court and federal district court cases were divided in whether only consumers could be plaintiffs; the court of appeals agreed that the 2001 amendment “served to broaden the reach of the statute so that more than just consumers could avail themselves of the protection of this statute.”  After all, courts presume that the legislature intends to change the law when it amends a statute. “Therefore, the legislative change regarding the claimant able to recover under FDUTPA from a ‘consumer’ to a ‘person’ must be afforded significant meaning. This change indicates that the legislature no longer intended FDUTPA to apply to only consumers, but to other entities able to prove the remaining elements of the claim as well.”

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