united states district court district of …...v. case no. 3:14‐cv‐1714 (vab) north american...

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UNITEDSTATESDISTRICTCOURT

DISTRICTOFCONNECTICUTPAULT.EDWARDS, Plaintiff, v. CASENO.3:14‐cv‐1714(VAB) NORTHAMERICANPOWERANDGAS,LLC, Defendant.

RULINGONDEFENDANT’SMOTIONTODISMISSPlaintiff,PaulT.Edwards,filedthisComplaintagainstDefendant,North

AmericanPowerandGasLLC(“NAPG”),assertingclaimsthatariseoutofNAPG’s

businessofsupplyingelectricitytoresidentialcustomers.Compl.¶¶2‐3,ECFNo.1.

Mr.EdwardsallegesthatNAPGattractednewcustomersbypromisinglowrateson

electricitytiedtothewholesalemarketrateandsubsequentlychargedexorbitant

prices,notreasonablyrelatedtothemarketrate.Id.¶¶2‐6.Heclaimsthat,indoing

so,NAPGengagedinunfairanddeceptivetradepractices,inviolationoftheunfair

tradepracticeslawsofConnecticut,ConnecticutUnfairTradePracticesAct

(“CUTPA”),Conn.Gen.Stat.§42‐110aetseq.,Maine,MaineUnfairTradePractices

Act(“UTPA”),Me.Rev.Stat.Ann.tit.5,§205‐Aetseq.,NewHampshire,theNew

HampshireConsumerProtectionAct,N.H.Rev.Stat.Ann.§358‐A:1etseq.,and

RhodeIsland,theRhodeIslandUnfairTradePracticeandConsumerProtectionAct,

R.I.Gen.Laws§6‐13.1‐1etseq.Compl.¶52,ECFNo.1.Healsomakesclaimsof

unjustenrichmentandbreachofthecovenantofgoodfaithandfairdealing.Id.¶55‐

61,63‐68.

Case 3:14-cv-01714-VAB Document 39 Filed 08/04/15 of 27

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NAPGseekstodismisstheentirecasewithprejudiceunderFederalRuleof

CivilProcedure12(b)(6).Mot.ToDismiss,ECFNo.17.Forthereasonsthatfollow,

theCourtDENIESthemotionwithrespecttotheCUTPAandbreachofthecovenant

ofgoodfaithandfairdealingclaims.TheCourtGRANTSthemotionwithout

prejudicewithrespecttotheclaimsunderMaine’sUTPA,theNewHampshire

ConsumerProtectionAct,andtheRhodeIslandUnfairTradePracticeandConsumer

ProtectionActaswellastheunjustenrichmentclaim.

I. FACTUALALLEGATIONS

Mr.Edwardsallegesthat,inthelate1990sandearly2000s,“manystates”

deregulatedtheirelectricitysupplymarkets.Compl.¶13,ECFNo.1.Before

deregulation,large,regulatedpublicutilitiesallegedlyadministeredbothelectricity

generationanddistribution.Id.AccordingtotheComplaint,afterderegulationthe

publicentitiescontinuedtodistributepowerthroughtransmissionlines,butthe

businessofpowergenerationandsupplywasopenedtocompetition.Id.¶¶13‐15.

Mr.Edwardsclaimsthattheelectricitymarketnowconsistsofthreegroupsof

companies:(1)thosethatgenerateorcreateelectricity,(2)thosethatdistributeit

viatransmissionlines,and(3)thosethatsupplyit,orsellittoretailcustomers.Id.

¶15.

Inthisderegulatedmarket,Mr.Edwardsallegesthatseveralcompanies,like

NAPG,operateas“middlemen,”purchasingpowerfromgenerationcompaniesand

sellingthatelectricitytoendusersata“mark‐up”oneitherfixedorvariablerate

terms.Id.¶¶17‐20.Thepricesthese“middlemen”charge,includingNAPG,arenot

regulatedbythestatesofConnecticut,RhodeIsland,MaineorNewHampshire.Id.


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¶18.Thesecompaniesalsoallegedlydonotactuallydistributetheelectricitythey

sell,whichremainstheroleofthelargepublicutilities,nordotheygeneratepower,

providecustomerbills,orotherwisemaintaininfrastructurefortheelectricity

business.Id.¶¶17,32.Becauseoftheirlimitedrole,Mr.Edwardsclaimsthatthese

so‐called“middlemen”companieslikeNAPGcharge“exorbitantpremiumswithout

addinganyvaluetotheconsumerwhatsoever.”Id.¶32.

Mr.EdwardsclaimsthatNAPGluredcustomerswitha“teaser”rate,which

waschargedfora“setnumberofmonths.”Id.¶¶3,21.Whenthe“teaser”rate

expired,customerswereautomatically“rolled”intoavariable‐rateplan.Id.Mr.

EdwardsallegesthatNAPGmarketsitsvariable‐rateplantoconsumersasbeing

“correlatedwiththeunderlyingwholesalemarketrate.”Id.¶¶23‐26.Inparticular,

hequotesportionsofNAPG’sinstructionstoitssalesrepresentativesthatexplain

theplanas“subjecttochangewithmarketpricing,whichmeanswhenmarket

pricesgodown,sodoesthevariablerate”andthatconsumers“willbepayinga

month‐to‐month,market‐basedvariableratethatcanfluctuatefromtimetotime.”

Id.¶¶23‐24.Consistentwiththesemarketingmaterials,Mr.Edwardsalsoclaims

thatNAPG’sTermsofServiceprovidedthat“[t]hevariableratemayincreaseor

decreasetoreflectthechangesinthewholesalepowermarket.”Id.¶25.

InMr.Edwards’sview,“areasonableconsumer”wouldinterpretNAPG’s

marketingrepresentationsandTermsofServicetomeanthattheNAPG’svariable

plan’srateswouldriseandfallwiththewholesalemarketrates.Id.¶26.Heclaims

thatNAPG’svariable‐rateplan,inreality,didtheopposite,resultinginartificially

highelectricitypricesthatdidnotdecreasewhenwholesalepricesfell.Id.¶¶27‐28,


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31.HealsoincludesachartinhisComplaintthatshowstheNAPGrateincreased

whenthe“averagewholesale”ratedecreasedandthatNAPGchargedasubstantial

marginabovetheaveragewholesaleratefromOctober2013toOctober2014.Id.

¶28.

Mr.EdwardsallegesthatheresidesinConnecticutandsubscribedtoNAPG’s

variable‐rateplanaroundAugust2013.Id.¶¶8,33.Heallegesthathesuffered

“monetarydamages”asaresultofNAPG’spricing.Id.¶35.Infilingthislawsuit,Mr.

Edwardsalsohasindicatedthathewillseektocertifyaclassthatasofthedateof

theComplaintconsistsof“[a]llpersonsenrolledina[NAPG]variablerateelectric

planinconnectionwithapropertylocatedwithinConnecticut,RhodeIsland,New

HampshireandMaine.”Id.¶36.

II. STANDARD

TosurviveamotiontodismissunderRule12(b)(6),aplaintiffmuststatea

claimforreliefthatisplausibleonitsface.Ashcroftv.Iqbal,556U.S.662,678

(2009)(citationomitted).Aclaimisfaciallyplausibleif“theplaintiffpleadsfactual

contentthatallowsthecourttodrawthereasonableinferencethatthedefendantis

liableforthemisconductalleged.”Id.Inotherwords,tostateaplausibleclaim,a

plaintiff’scomplaintmusthave“enoughfacttoraiseareasonableexpectationthat

discoverywillrevealevidence”supportingtheclaim.BellAtl.Corp.v.Twombly,550

U.S.544,556(2007).Although“detailedfactualallegations”arenotrequired,a

complaintmustoffermorethan“labelsandconclusions,”“aformulaicrecitationof

theelementsofacauseofaction,”or“nakedassertion[s]”devoidof“furtherfactual

enhancement.”Id.at555,557.


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“Theplausibilitystandardisnotakintoa‘probabilityrequirement,’butit

asksformorethanasheerpossibilitythatadefendanthasactedunlawfully.”Iqbal,

556U.S.at678(quotingTwombly,550U.S.at556).“[A]claimshouldonlybe

dismissedatthepleadingstagewheretheallegationsaresogeneral,andthe

alternativeexplanationssocompelling,thattheclaimnolongerappearsplausible.”

Ararv.Ashcroft,585F.3d559,617(2dCir.2009)(citingFed.R.Civ.P.8(a);

Twombly,550U.S.at556).

Indeterminingwhethertheplaintiffhasmetthisstandard,theCourtmust

accepttheallegationsinthecomplaintastrueanddrawallreasonableinferencesin

favoroftheplaintiff.InreNYSESpecialistsSec.Litig.,503F.3d89,95(2dCir.2007);

Newman&Schwartzv.AsplundhTreeExpertCo.,Inc.,102F.3d660,662(2dCir.

1996)(citationsomitted).Inconsideringamotiontodismiss,“adistrictcourtmust

limititselftofactsstatedinthecomplaintorindocumentsattachedtothecomplaint

asexhibitsorincorporatedinthecomplaintbyreference.”Newman&Schwartz,

102F.3dat662(citationandinternalquotationmarksomitted).

III. DISCUSSION

Mr.Edwardsallegesclaimsundertheunfairtradepracticestatutesofseveral

states,breachofthecovenantofgoodfaithandfairdealing,andunjustenrichment.

NAPG’sMotiontoDismisschallengesthesufficiencyofalloftheseclaimsunderRule

12(b)(6)andasksthatthelawsuitbedismissedinitsentiretywithprejudice.Mot.

ToDismiss1,ECFNo.17‐1;Fed.R.Civ.P.12(b)(6).TheCourtwilladdresseach

claiminturn.


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A. COUNTONE(UNFAIRTRADEPRACTICESSTATUTES)

Mr.Edwardsallegesclaimsundertheunfairtradepracticesstatutesof

Connecticut,RhodeIsland,NewHampshire,andMaine.NAPGraisestwoarguments

initsMotiontoDismisswithrespecttotheseclaims.First,itarguesthatMr.

Edwards,asaresidentofConnecticutonly,lacksstandingtoassertclaimsunderthe

otherstates’statutes.Mot.ToDismiss5‐8,ECFNo.17‐1.Second,NAPGarguesthat

Mr.EdwardshasfailedtostateaCUTPAclaimbecausehehasnotallegedanunfair

tradepracticeordeceptiveact.Id.at8‐12.

i.STANDING

NAPGarguesthatbecauseMr.Edwardshasonlypurchasedelectricityfrom

NAPGinConnecticut,heonlyhasstandingtobringclaimsunderCUTPA,andnot

underanyoftheotherstates’unfairtradepracticesstatutesincludedinthe

Complaint.Id.at6‐7.Mr.Edwardsrespondsthatthequestionofstandingcannotbe

considerednowandshouldbeconsideredattheclasscertificationstage.OppBr.

20,ECFNo.24.Forthereasonsthatfollow,theCourtagreeswithNAPGandgrants

itsMotiontoDismissontheclaimsundertheMaine,NewHampshire,andRhode

Islandunfairtradepracticesstatutes.

ArticleIII,Section2oftheU.S.Constitutionlimitsthejurisdictionofthe

federalcourtstotheresolutionofcasesandcontroversies.Mahonv.TicorTitleIns.

Co.,683F.3d59,62(2dCir.2012)(citationomitted).“Inordertoensurethatthis

‘bedrock’case‐or‐controversyrequirementismet,courtsrequirethatplaintiffs

establishtheir‘standing’as‘theproperpart[ies]tobring’suit.”W.R.HuffAsset

Mgmt.Co.,LLCv.Deloitte&ToucheLLP,549F.3d100,106(2dCir.2008)(citation


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omitted)(alterationinoriginal).Tohavestanding,“aplaintiffmustdemonstrate(1)

apersonalinjuryinfact(2)thatthechallengedconductofthedefendantcausedand

(3)whichafavorabledecisionwilllikelyredress.”Mahon,683F.3dat62(citation

omitted);Warthv.Seldin,422U.S.490,498‐99(1975)(“Asanaspectof

justiciability,thestandingquestioniswhethertheplaintiffhas‘allegedsucha

personalstakeintheoutcomeofthecontroversy’astowarranthisinvocationof

federal‐courtjurisdictionandtojustifyexerciseofthecourt’sremedialpowerson

hisbehalf.”)(citationomitted).“Itiswellestablishedthat‘aplaintiffmust

demonstratestandingforeachclaim[]heseekstopress.’Thus,withrespecttoeach

assertedclaim,‘[a]plaintiffmustalwayshavesufferedadistinctandpalpableinjury

to[him]self.’”Mahon,683F.3dat64(citationsomitted)(emphasisinoriginal).

ConsistentwiththeSecondCircuit’sreasoninginMahon,Mr.Edwardsmust

showthathehasstandingpersonallytoassertalloftheclaimsintheComplaintat

thecase’sinception,regardlessofifandwhenaclassiscertified.Warth,422U.S.at

498(“[S]tandingimportsjusticiability…[it]isthethresholdquestioninevery

federalcase,determiningthepowerofthecourttoentertainthesuit.”);Inre

AppointmentofIndep.Counsel,766F.2d70,73(2dCir.1985)(“Sincethestanding

requirementisderivedfromArticleIIIlimitationsonthefederalcourts’powers,itis

thethresholdissueineverycase.”);seealsoInreAggrenoxAntitrustLitig.,No.3:14‐

md‐2516(SRU),‐‐‐F.Supp.3d‐‐‐,2015WL1311352,at*18‐19(D.Conn.Mar.23,

2015)(findingthatMahonreaffirmedtheneedtoanalyzestandingclaimbyclaim

beforeclasscertification,unlesstheissueofclasscertificationwasdispositive,


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because“‘[a]federalrulecannotalteraconstitutionalrequirement’”)(alterationin

original)(quotingMahon,683F.3dat64).

Thatstandinganalysismustproceedonaclaim‐by‐claimbasis.SeeDavisv.

Fed.ElectionComm’n,554U.S.724,734(2008)(“[A]plaintiffmustdemonstrate

standingforeachclaimheseekstopressandforeachformofreliefthatissought.”)

(internalquotationmarksandcitationomitted);Lewisv.Casey,518U.S.343,358n.6

(1996)(“[S]tandingisnotdispensedingross…‘nordoesaplaintiffwhohasbeen

subjecttoinjuriousconductofonekindpossessbyvirtueofthatinjurythe

necessarystakeinlitigatingconductofanotherkind,althoughsimilar,towhichhe

hasnotbeensubject.’”)(citationomitted);seealsoKingCnty.,Wash.v.IKBDeutsche

IndustriebankAG,Nos.09Civ8387(SAS),09Civ.8822(SAS),2010WL2010943,at

*1(S.D.N.Y.May18,2010)(“Aputativeclassrepresentativelacksstandingtobringa

claimif[he]didnotsuffertheinjurythatgivesrisetothatclaim,[and][w]here

multipleclaimsarebrought,at‘leastonenamedplaintiffmusthavestandingto

pursueeachclaimalleged.’”)(citationsomitted)(emphasisinoriginal).Thus,the

factthatMr.EdwardssufferedaninjuryduetoNAPG’sactionsinthestateof

Connecticut,andthereforehasstandinginConnecticut,isnotdispositiveofwhether

hehasstandingundertheunfairtradepracticestatutesoftheotherstates.

Mr.EdwardsonlyallegesthathehaspurchasedelectricityfromNAPGin

Connecticut.Compl.¶¶8,33‐35,ECFNo.1.Thus,theCourtmustdecidewhether

thisallegationgiveshimstandingtostateclaimsundertheNewHampshire,Maine


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andRhodeIslandunfairtradepracticesstatutes.1TheCourtconcludesthatitdoes

not.AlthoughMr.EdwardsdoesallegethatNAPGoperateditsvariable‐rateplanin

NewHampshire,Maine,andRhodeIsland,hedoesnotclaimthathesubscribed

personallytotheplaninanyofthosestates.Absentthisallegation,hehasfailedto

pleadthatNAPG’sconductinanystateotherthanConnecticutimpactedhim“ina

personalandindividualway,”whichisrequiredfortheinjury‐in‐factaspectof

standing.SeeLujanv.Defs.ofWildlife,504U.S.555,560&n.1(1992)(definingthe

injuryinfactaspectofstandingtorequireaparticularizedinjuryoronethat“affects

theplaintiffinapersonalandindividualway.”)(citationsomitted);Mahon,683F.3d

at64(“withrespecttoeachassertedclaim,‘[a]plaintiffmustalwayshavesuffereda

distinctandpalpableinjuryto[him]self.’”)(emphasisinoriginal)(citations

omitted).

1Asanaside,neitherpartyclaimsthatthesestatutesapplyextraterritoriallytoconductinConnecticut.TheNewHampshirestatuterequiresthatthe“offendingconduct”occurwithinthestate’sborders.Cf.PacamorBearings,Inc.v.MinebeaCo.,918F.Supp.491,504(D.N.H.1996)(notingthattheNewHampshireConsumerProtectionActonlycreatesliabilityforoffendingconductthattookplacewithinthebordersofNewHampshire).ThequestionofwhethertheRhodeIslandandMainestatutesrequireoffendingconductorinjurywithintheirboundariesissomewhatlessclear,butthepartiesdonotidentifyanycaseapplyingthemtopurelyextraterritorialconductandneitherhastheCourt.SeeFarrellv.Employers’LiabilityAssur.Corp.,168A.911,912(R.I.1933)(“Wehaveheldthatextraterritorialforcecannotbegiventoastatuteofthisstate.”)(citationomitted);Marshallv.ScotiaPrinceCruisesLtd.,AdoptingRecommendedRuling,No.03‐26‐P‐H,2003WL22709076,at*7(D.Me.Nov.17,2003)(findingthattheMaineDeceptivePracticesActdoesnotapplyextra‐territoriallyforreasonsapplicabletoMaine’sUTPA,namelybecausenothingintheActindicatesitwasintendedtobesoapplied);seeIMSHealth,Inc.v.Mills,616F.3d7,28(1stCir.2010),abrogatedonothergroundsbySorrellv.IMSHealth,Inc.,131S.Ct.2653(2011)(“Maine,likeotherstates,generallypresumesitsstatutesdonotapplyextraterritoriallyintheabsenceofcontraryindicationsoflegislativeintent.”)(citingHolbrookv.Libby,113Me.389(1915)).Moreover,bothRhodeIsland’slawandMaine’sUTPAdefine“tradeandcommerce”asincluding“anytradeorcommercedirectlyorindirectlyaffectingthepeopleofthisState,”indicatingthatsomeimpactineachrespectivestateisrequired.Me.Rev.Stat.Ann.tit.5,§206(3);R.I.Gen.Laws§6‐13.1‐1.


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Withoutanallegationthathewaspersonallyinjuredinotherstates,Mr.

Edwards’sclaimisessentiallythatun‐namedNAPGcustomersinRhodeIsland,New

Hampshire,andMainesufferedharmfromitsvariable‐rateplan.“Suchagrievance,

‘suffer[ed]insomeindefinitewayincommonwithpeoplegenerally,’cannot

demonstrateaninjury‐in‐fact.”Karimv.AWB,Ltd.,347F.App’x714,715(2dCir.

2009)(affirmingdismissalofaclaimforlackofstandingbecauseplaintifffailedto

allegeparticularizedinjury‐in‐factand,instead,allegedinjurytothepopulationof

anentirecountry)(quotingDaimlerChryslerCorp.v.Cuno,547U.S.332,344(2006)).

Accordingly,Mr.Edwardshasnotallegedthathesufferedaninjury‐in‐factin

NewHampshire,MaineandRhodeIsland,becausehehasnotsubscribedtoNAPG’s

energyplaninthosestates.Thus,hehasfailedtopleadthathehasstandingtobring

claimsundertheunfairtradepracticestatutesofthosestates.SeeInreHSBCBank,

USA,N.A.,DebitCardOverdraftFeeLitig.,1F.Supp.3d34,50(E.D.N.Y.2014)(finding

thataplaintifflacksstandingtobringclaimsonbehalfofaclass“underthelawsof

stateswherethenamedplaintiffshaveneverlivedorresided”)(citationsomitted),

reconsideredonothergrounds,14F.Supp.3d99(E.D.N.Y.2014);Simingtonv.Lease

Fin.Grp.,LLC,No.10Civ.6052(KBF),2012WL651130,at*9(S.D.N.Y.Feb.28,

2012)(notingthateveninthecontextofaproposedclassaction“[p]laintiffsdonot

haveaninjurytraceabletoconductthatoccurredinanyotherstatethanthosein

whichtheyconductbusinessandthus,theycannotassertaclaimunderthosestates’

consumerfraudstatutes”)(citationsomitted).

Mr.Edwards’splantoseekclasscertificationatsomepointduringthis

lawsuitdoesnotrelievehimoftheburdenofpleadingfactsthatshowstandingwith


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respecttoallclaimsinhisComplaint.SeeLewis,518U.S.at357(“Thatasuitmaybe

aclassaction…addsnothingtothequestionofstanding,forevennamedplaintiffs

whorepresentaclassmustallegeandshowthattheypersonallyhavebeeninjured,

notthatinjuryhasbeensufferedbyother,unidentifiedmembersoftheclassto

whichtheybelongandwhichtheypurporttorepresent.”)(citationandinternal

quotationmarksomitted);seealsoPlumbersPipefitters&MESLocalUnionNo.392

PensionFundv.FairfaxFin.Hldgs.Ltd.,886F.Supp.2d328,339‐340(S.D.N.Y.2012)

(dismissingaclaimbecauseaplaintiffdidnothavestandingpersonallytoassertit,

eventhoughhehadstandingtoassertotherclaimsallegedinthecomplaintand

plannedtorepresentaclass,themembersofwhichwouldhavestandingonthis

particularclaim)(citingW.R.HuffAssetMgmt.Co.,549F.3dat106).Becausehefails

tomeetthatburdenatthistime,theclaimsunderNewHampshire,Maine,and

RhodeIslandlawmustbedismissed.

Insupportofitsstandingargument,NAPGalsoclaimsthatitsTermsof

ServicevariedacrossthestatesmentionedintheComplaint.Mot.toDismiss7,ECF

No.17‐1.Putanotherway,NAPGisessentiallyarguingthattheallegationsinthe

ComplaintarefalseorthattherearefactsomittedfromtheComplaintthatare

germanetothelawsuit’sresolution.TheCourtdoesnotandcannotgrantthe

motionbasedonthisreasoning.Toprevailonamotiontodismiss,NAPGcannot

introducefactsoutsideofthecomplaintbutrathermustarguethat,takingthe

allegationsintheComplaintastrue,Mr.Edwardshasfailedtostateaclaimasa

matteroflaw.NewYorkStateCourtClerksAss’nv.UnifiedCourtSystemoftheState

ofNewYork,25F.Supp.3d459,464(S.D.N.Y.2014)(“Onamotiontodismiss…‘[t]he


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issueisnotwhetheraplaintiffwillultimatelyprevailbutwhethertheclaimantis

entitledtoofferevidencetosupporttheclaims…’”)(quotingVillagerPond,Inc.v.

TownofDarien,56F.3d375,378(2dCir.1995));seealsoNewman&Schwartz,102

F.3dat662(notingthattheCourtmayonlyconsiderallegationsintheComplaint

anddocumentsincorporatedthereininevaluatingamotiontodismiss).NAPG’s

argumentthatthetermsofthecontractsintheotherstatesaredifferentisnot

relevanttowhetherMr.Edwardshasstatedaclaim.SeeIqbal,556U.S.at679

(findingthattosurviveaRule12(b)(6)motion,aclaimmustbefaciallyplausible,

meaning“theplaintiffpleadsfactualcontentthatallowsthecourttodrawthe

reasonableinferencethatthedefendantisliableforthemisconductalleged.”).

Notably,NAPGdoesnotarguethatanyofthetermsofservicearedifferentsuchthat

Mr.Edwardshasfailedtostateclaimsundertheotherstateunfairtradepractice

statutes.2

TheCourt,therefore,grantsNAPG’sMotiontoDismissinpartanddismisses

theunfairtradepracticesclaimsbasedontheNewHampshire,RhodeIslandand

Mainestatuteswithoutprejudice.3

2NAPG’sargumentaboutthedifferencesintermsofservicesacrossdifferentstatesmayalsobearontheappropriatenessofthiscaseforclasscertificationiftheclassinvolvesplaintiffsfrommultiplestates,butthatisnotthetaskbeforetheCourtasthistime.Seee.g.,SacredHeartHealthySys.,Inc.v.HumanaMilitaryHealthcareServs.,Inc.,601F.3d1159,1171,1175‐76,1180,1183(11thCir.2010)(notingthat“commonquestionsrarelywillpredominateiftherelevanttermsvaryinsubstanceamongthecontracts”andconcludingthatadistrictcourt’sdecisiontocertifyaclasswasanabuseofdiscretionbecausedisputesofthevariousmembersoftheclassinvolveddifferentcontracts,whichwereinterpretedaccordingtodifferentstatelaws);Morangelliv.ChemedCorp.,275F.R.D.99,109(E.D.N.Y.2011)(notingthatthe“necessityofapplyingdifferentstatelawscansometimesdefeatclasscertification”)(citationomitted).3TheCourtnotes,however,thatitwillnotlikelybeappropriatetoapplyonlyConnecticutlawtotheclass,ifaclaimisre‐filedwithplaintiffswithproperstandingandaclassiscertified.SeePhillipsPetroleum,Co.v.Shutts,472U.S.797,814‐15,821‐22(1985)(finding


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ii.CUTPA

CUTPAprovidesthat“[n]opersonshallengageinunfairmethodsof

competitionandunfairordeceptiveactsorpracticesintheconductofanytradeor

commerce.”Conn.Gen.Stat.§42‐110b(a).TostateaclaimunderCUTPA,Mr.

Edwardsmustpleadthathe(1)sufferedanascertainablelossofmoneyorproperty,

(2)thatwascausedby,(3)anunfairmethodofcompetitionoranunfairor

deceptiveactintheconductofanytradeorcommerce.Seeid;Conn.Gen.Stat.§42‐

110g(a).Mr.EdwardsallegesthatNAPG’sconductisbothunfairanddeceptive.

Compl.¶¶49‐50,ECFNo.1.

TodeterminewhetherconductisunfairunderCUTPA,Connecticutcourts

applythecigaretteruleandlookto“(1)[w]hetherthepractice,withoutnecessarily

havingbeenpreviouslyconsideredunlawful,offendspublicpolicyasithasbeen

establishedbystatutes,thecommonlaw,orotherwise–inotherwords,isitwithin

atleastthepenumbraofsomecommonlaw,statutoryorotherestablishedconcept

ofunfairness;(2)whetheritisimmoral,unethical,oppressiveorunscrupulous;(3)

whetheritcausessubstantialinjurytoconsumers,[competitorsorother

businesspersons].”Naplesv.KeystoneBldg.&Dev.Corp.,295Conn.214,227‐28

(2010)(citationandinternalquotationmarksomitted)(alterationsinoriginal).A

practiceneednotmeetallthreecriteriatoconstituteanunfairpracticeunder

CUTPA,and“[a]practicemaybeunfairbecauseofthedegreetowhichitmeetsone

thatitwasinappropriatetoapplyonlyKansaslawtoallmembersofaclass,where97%ofthemhadnoconnectiontoKansaswhatsoeverandnotingthat“Kansasmusthavea‘significantcontactorsignificantaggregationofcontacts’totheclaimsassertedbyeachmemberoftheplaintiffclass,contacts‘creatingstateinterests,’inordertoensurethatthechoiceofKansaslawisnotarbitraryorunfair.”)(citationomitted).


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ofthecriteriaorbecausetoalesserextentitmeetsallthree.”Id.(citationand

internalquotationmarksomitted).

Foranactorpracticetobedeceptive4(1)“theremustbearepresentation,

omissionorotherpracticelikelytomisleadconsumers,”(2)“consumersmust

interpretthemessagereasonablyunderthecircumstances,”and(3)“themisleading

representation,omissionorpracticemustbematerial–thatis,likelytoaffect

consumerdecisionsorconduct.”BankofNewYorkv.Nat’lFunding,No.

X01CV000171525S,2005WL527749,at*5(Conn.Super.Ct.2005)(citing

SouthingtonSavingsBankv.Rodgers,40Conn.App.23,28(Conn.App.Ct.1995));

seealsoCaldor,Inc.v.Heslin,215Conn.590,597(1990)(citationomitted).

DeceptionunderCUTPAincludesabroaderrangeofconductthancommon‐law

claimsforfraudormisrepresentationanddoesnotrequireproofofintent.Wilkins

v.YaleUniv.,No.CV106014646S,2011WL1087144,at*4(Conn.Super.Ct.Feb.25,

2011)(citingMunizv.Kravis,59Conn.App.704,713(Conn.App.Ct.2000)).Mr.

Edwardsalso“neednotprove[andthereforeneednotplead]relianceorthatthe

representationbecamepartofthebasisofthebargain.”Hinchliffev.Am.Motors

Corp.,184Conn.607,617(1981).

NAPGarguesthatMr.EdwardshasfailedtoallegeaCUTPAclaimbecausehe

hasnotstatedfactsfromwhichaplausibleinferencemaybedrawnthatNAPG

engagedinanunfairordeceptivebusinesspractice.Mot.ToDismiss8,10,ECFNo.

4Becausedeceptionisasubcategoryofunfairness,ifMr.Edwardshassuccessfullyallegedanunfairpractice,healsohasalsosuccessfullyallegedadeceptiveone.SeeWilkinsv.YaleUniv.,No.CV106014646S,2011WL1087144,at*4(Conn.Super.Ct.Feb.25,2011)(“Asubsetofunfairpractices,recognizedbyourSupremeCourt,isdeceptivepractices”)(citingDaddonav.LibertyMobileHomeSales,Inc.,209Conn.243,254(1988)).


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17‐1.Instead,NAPGreasonsthatMr.Edwardshasallegedthathegotthebenefithe

bargainedforasdescribedbythecontract,avariablerateforelectricity.Id.at1‐2,

8,10‐12.Consequently,NAPGbelievesthatfindingavalidCUTPAclaimherewould

requireeitherrewritingthecontractorimproperlyfindingthatbuyer’sremorse

statesaCUTPAclaim.Id.NAPGalsoarguesthatthestatementsmadeinits

marketingmaterials,whichdonotappearinthecontract,cannotsavetheclaim

fromdismissalbecauseanyreasonablereadingofthecontractiscontrollingand

clarifiesthattherelationshipbetweenNAPGpricingandwholesalemarketpricingis

notdirect.Id.at8,10‐12.Focusingonthegraphavailableatparagraph29ofthe

Complaint,NAPGalsoarguesthatMr.EdwardshimselfallegesthatNAPG’sprices

movedroughlyintandemwiththewholesalemarketprice,evenwhenbycontract

theywerenotrequiredtodoso.NAPGalsomentionsinafootnotethatitfindsthe

Complaint’spleadingsontherelationshipbetweenMr.EdwardsandConnecticutto

besparse.Id.5n.1.TheCourtdisagreesanddeniesthemotiontodismissMr.

Edwards’sCUTPAclaim.Basedonthefactsallegedandmakingallinferencesin

favorofMr.Edwards,astheCourtmustatthisstage,theCourtcannotfindthatMr.

Edwards’sCUTPAclaimisentirelyimplausible.

WhetherNAPG’svariableranplanwasanunfairordeceptivemarket

practiceis“aquestionoffactthatisnotreadilysusceptibletoresolutionona

motiontodismiss.”Langanv.Johnson&JohnsonConsumerCos.,Inc.,No.3:13‐cv‐

01470(JAM),‐‐‐F.Supp.3d‐‐‐,2015WL1476400,at*3(D.Conn.Mar.31,2015)

(denyingamotiontodismissaCUTPAclaimbecausetheCourtcouldnotdetermine

asamatteroflawthatthedefendant’slabelswerenotdeceptive);Naples,295Conn.


16

at228(“Itiswellsettledthatwhetheradefendant’sactsconstitute…deceptiveor

unfairtradepracticesunderCUTPA…isaquestionoffact.”)(internalquotation

marksandcitationomitted)(alterationsinoriginal).Thus,theCourtneednotand

shouldnotdetermineasamatteroflawwhetherNAPG’sconduct,asalleged,

actuallyviolatedCUTPA.Instead,theproperinquiryiswhetherMr.Edwardshas

allegedsufficientfactsto“raiseareasonableexpectationthatdiscoverywillreveal

evidence”supportingtheclaim.Twombly,550U.S.at556.Whilethequestionisa

closeone,theCourtfindsthatMr.Edwardshaspledsufficientfactsshowingthathe

isentitledtodiscoveryandmustdenyNAPG’smotiontodismisstheCUTPAclaim.

Mr.Edwardshasclaimedthatonepossibleandreasonableunderstandingof

bothNAPG’smarketingmaterialsandcontractwasthatNAPG’senergypriceswould

reflectthewholesalemarketratestosomeunknownextent.Compl.¶¶4,25,28,31,

ECFNo.1.TheComplaintalsoplausiblystatesthattheratesNAPGchargedwere

significantlyhigherthanthewholesalemarketrateanddidnotalwaysincreaseor

decreasewhenthewholesalemarketratesdid.Id.Theseallegationsaresufficient

atthemotiontodismissstagetoshowthatMr.Edwardsisentitledtomore

discoveryonwhetherNAPGwasengagedinanunfairordeceptivebusiness

practice,becausethesearethekindsofbehaviorsthatmayfallunderCUTPA.Cf.A‐

GFoods,Inc.v.PepperidgeFarm,Inc.,216Conn.200,216n.9(1990)(observingthat

theFederalTradeCommissionhasidentifiedasthreeofthefourprimary,butnot

exclusive,unfairpracticesas“withholdingmaterialinformation,[]making

unsubstantiatedadvertisingclaims,[and]usinghigh‐pressuresalestechniques.”)

(quotingAm.Fin.Servs.v.F.T.C.,767F.2d957,979(D.C.Cir.1985));seeSanbornv.


17

ViridianEnergy,Inc.,No.3:14‐cv‐1731(SRU),Mot.toDismissHr’gTr.37:16‐25(D.

Conn.Apr.1,2015),availableatPl.’sNoticeofSuppl.Authority,Ex.A,ECFNo.26‐1

(findingthatplaintiffstatedaCUTPAclaimonverysimilarfactstothiscase

regardinga“middleman”providerofenergywhosecontractstated“[y]ourratemay

fluctuatemonthtomonthbasedonwholesalemarketconditions”).Atthisstage,the

Courtsimplydoesnothaveenoughfactsbeforeittoknowhowpricesweresetby

NAPG.Theiractionsmaynothavebeenunfairordeceptive,butthatconclusion

cannotbereachedbeforethecloseofdiscovery.

WhilethetextofthecontractitselfdoesnotindicatethatNAPGpriceswould

definitivelyorpreciselybelinkedwiththewholesalemarketprice,withorwithout

themarketingmaterials,itisplausiblethatareasonableconsumerwouldinfera

directlinkbetweenthetwo.Indeed,therewouldbenoconceivablereasonfora

consumertosignupforNAPG’senergyplanifhedidnotbelievehewouldreceivea

betteroveralldealonhiselectricity,basedonitscompetitiveadvantageinobtaining

pricesintheenergymarketplace.SeeCompl.¶3,ECFNo.1(notingthatNAPGlures

itsconsumerswith“teaserrates”).Accordingly,Mr.EdwardsComplaintraisesa

plausibleinferencethatNAPG’sbusinesspracticescouldhavebeendeceptiveand,

therefore,couldhaveruncounterto“someestablishedconceptofunfairness”and

hassatisfiedthefirstprongofthecigaretteruleatthisstage.Seee.g.,JamesF.

CanningAgcy.v.NationwideIns.Co.ofAm.,No.3:09‐cv‐1413(MRK),2010WL

2698292,at*4(D.Conn.Mar.10,2010)(findingthatnegligentmisrepresentations

runcontrarytopublicpolicyandthereforesatisfythefirstprongofthecigarette

rule)(citationomitted);Urichv.Fish,No.360659,2000WL1835382,at*2(Conn.


18

Super.Ct.Nov.27,2000)(observingthat“aclassic‘switch’technique,wherebya

consumerispromised(andpaysfor)onething,andisgivenquiteanother”

constitutesanexampleofanunfairactunderCUTPA)(citationsomitted);D’Amicov.

LAFitness,No.FSTCV126013564S,2013WL6912912,at*5(Conn.Super.Ct.Dec.2,

2013)(findingthataclaimbyafitnessproviderthattheyhad“expertiseand

experience”inoperatingasafefitnessclubwhentheyhiredinexperienced

employeeswasadeceptiveactunderthethree‐prongCaldortestand,therefore,

violatedpublicpolicyandsatisfiedthefirstprongofthecigaretterule).

Mr.Edwardsalsohassatisfiedthesecondprongofthecigaretteruleatthis

stage.Dependingonthecontext,tellingcustomersonethinganddoinganother

couldwellbeunethical,immoralorunscrupulousbusinessbehavior.SeePusztayv.

AllstateIns.Co.,No.FSTCV065002425S,2009WL2357958,at*10(Conn.Super.Ct.

June30,2009)(“[A]llegationsthatthedefendant[]intentionallymade

misrepresentations…satisfythesecondprongofthecigaretterule,inthattheyare

arguablyindicativeof‘immoral,unethical,oppressive,orunscrupulous’behaviors.”)

(citationsomitted);D’Amico,2013WL612912,at*6(“Theweightofauthorityin

Connecticutholdsthatmisrepresentationsintheformationofacontractcanbe

sufficientlyaggravatingcircumstancestosatisfytherequirementthatsuchactions

oromissionsareimmoral,unethical,oppressiveorunscrupulous.”)(citations

omitted).Whiletheremaybereasons(tobeuncoveredlaterduringdiscovery)that

NAPG’sbehaviorwasnotimmoral,unethical,oppressiveorunscrupulous,theCourt

cannotfindasamatteroflawthatitisnotnow.


19

NAPGarguesthatthelanguageofcontractprecludesthefindingofaCUTPA

violation,becauseitdidnotrepresentthattherewouldbeanexactorpreciselink

betweenthewholesalemarketpriceandNAPG’spricesbyusingtheterm“may”in

itscontract.Whileliterallytrue,theCourtcannotfindatthisstageintheproceeding

thatuseofthisoneterminitscontractcanabsolutelyshieldNAPGfromCUTPA

liability.SeeLangan,2015WL1476400,at*3(rejectingdefendant’sargumentsthat

therepresentationsmadeonasunscreenlabelwereliterallytrueand,therefore,not

deceptiveunderCUTPAasamatteroflawbecausetheyrestedononlyoneofmany

possibleinterpretationsofthelanguageatissue)(citationomitted);seealso

CantonburyHeightsCondominiumAss’n,Inc.v.LocalLandDev.,LLC,273Conn.724,

742(2005)(“[W]herethe[contractual]languageisambiguouswemustconstrue

thoseambiguitiesagainstthedrafter.”)(citationomitted).Thelanguageofthe

contractledconsumerstobelievereasonablythatwholesalemarketpricingwould

beatleastonefactorthatdeterminedtheirpricing.Moreover,asmentionedabove,

otherthanthebeliefthatpricingwouldbebetteroverall,therewasnoreasonfora

consumertosignuptoreceiveelectricityfromNAPG.DependingonhowNAPGwas

actuallysettingitsprices,itsconductmaywellhavebeenunethical,immoral,or

unscrupulous.

Mr.Edwardsalsohasmadesufficientallegationstosatisfythethird,

substantialinjuryprong.Topleadthatanactioncaused“substantialinjury,”in

satisfactionofthethirdprong,Mr.Edwardsmustshowthattheinjurywas

substantial,thatitwasnotoutweighedby“anycountervailingbenefitstoconsumers

orcompetitionthatthepracticeproduces”;andthatitisaninjurythe“consumers


20

themselvescouldnothavereasonablyavoided.“A‐GFoods,Inc.,216Conn.at216

(citationomitted).HeallegesthatNAPGchargedbetweentwoandfourtimesthe

averagewholesalerateandthathepaidtheserates.Compl.¶¶31,35,ECFNo.1.

WhiletheComplaintdoesnotprovideaspecificdollaramountthatMr.Edwards

paid,itdidprovideanexamplethatanaveragefamilywouldhavepaid$65morein

agivenmonthifsubscribedtoNAPG’svariable‐rateplan,whichwouldhave

amountedtoanextra$780inthecourseofayear.Compl.¶32n.2,ECFNo.1.This

amountofmonetarylossconstitutessubstantialinjuryunderCUTPA,particularlyif

itoccurredonamassscale,astheComplaintalleges.Seee.g.,ChesireMortg.Serv.,

Inc.v.Montes,223Conn.80,113(1992)(findingthatachargeof$490didamountto

“substantialinjury”andnotingthatCUTPAmustbeconstruedconsistentwithits

broadscopeandremedialpurpose);seealsoLarsenChelseyRealtyCo.,232Conn.at

492(“CUTPA…andmustbeliberallyconstruedinfavorofthosewhomthe

legislatureintendedtobenefit.”)(citationsandinternalquotationmarksomitted).

NAPGdoesnotdirectlysuggestthattheselosseswereoutweighedbya

countervailingbenefittotheconsumer.NAPG’sargumentthatMr.Edwards

receivedonlywhathebargainedfor(andessentiallythatheshouldhavereadthe

contractmorecarefullybecauseitincludeda“slewofcaveats”)implicitlysuggests

thathecouldhaveavoidedinjury.Mot.toDismiss11,ECFNo.17‐1.However,the

Courtfindsthatthereasonableinferenceforaconsumertomakeinreadingthe

contractand/orthemarketingmaterialsisthatNAPG’spricewouldbecorrelatedto

someextentwiththewholesalemarketprice.Accordingly,Mr.Edwardscouldnot

haveavoidedinjury,andhehassuccessfullypledsubstantialinjury.


21

Mr.Edwardsalsohasallegedasufficientlinkbetweenhimselfand

ConnecticuttostateaplausibleclaimforreliefunderCUTPA.TheComplaintstates

thathesignedacontractwithNAPGforthevariable‐rateplanandthathewasa

residentofConnecticut.Compl.¶¶8,33‐35,ECFNo.1.Anallegationhasa

sufficientconnectiontoConnecticutforaclaimtolieunderCUTPAwheneitherthe

violation“‘istiedtoaformoftradeorcommerceintimatelyassociatedwith

Connecticut,’”orwherechoiceoflawprinciplesdictatethatConnecticutlawapplies.

Cf.VictorG.ReilingAssocs.AndDesignInnovation,Inc.v.Fisher‐Price,Inc.,406F.

Supp.2d175,200(D.Conn.2005)(citationsomitted),aff’donreconsideration,409F.

Supp.2d112(D.Conn.2006).Althoughtheallegationscouldadmittedlybeclearer,

theyraiseaplausibleinferencethatMr.Edwardssubscribedtotheplanwith

respecttopropertyhelivedin,inthestateofConnecticutand,therefore,that

NAPG’sallegedlydeceptivetradeorbusinesspracticeoccurredinthestateof

Connecticut.SeeTitanSports,Inc.v.TurnerBroadcastingSys.,Inc.981F.Supp.65,

71‐72(D.Conn.1997)(denyingamotiontodismissaCUTPAclaimandfindingthat

thefactsunderlyingtheclaimweresufficientlyrelatedtoConnecticutbecausewhile

thedefendant’sprincipalplaceofbusinesswasinGeorgia,itairedallegedly

deceptivetelevisionprogramsinConnecticutandtheplaintiffwhoallegedly

sufferedharmfromthisactionwasdoingbusinessinConnecticut).

Finally,atoralargumentonitsMotiontoDismiss,NAPG’scounselprovided

detailsabouthowitsbusinessoperatesand,inparticular,thatthenatureofthe

businessmadeitimpossibleforitspricestomoveexactlyintandemwiththe

wholesalemarketprice,giventherelativelysmallsizeofitscustomerbase,theneed


22

forNAPGtopurchaseenoughenergyfortheircustomersfromthewholesale

market,andthefluctuatingrateonthewholesalemarket.5Thisargument,however,

doesnotbearonwhetherMr.Edwardshasstatedaclaim,becauseitreliesonfacts

outsideoftheComplaint.SeeNewman&Schwartz,102F.3dat662(citationand

internalquotationmarksomitted)(notingthatindecidingamotiontodismiss,a

districtcourtmustlimititselftofactsalleged,attachedorincorporatedintothe

complaint).Indeed,thisargumentsuggeststhatfactualdiscoveryisnecessaryto

understandthenatureofthisbusinessindeterminingwhetherNAPG’spricingwas

trulyanunfairtradepractice.

Accordingly,foralloftheaforementionedreasons,theCourtfindsthatMr.

EdwardshassufficientlyallegedaCUTPAclaimanddeniesNAPG’sMotionto

Dismisswithrespecttothisclaim.

B. COUNTTWO(BREACHOFCOVENANTOFGOODFAITHANDFAIRDEALING)

NAPGarguesthatMr.Edwards’sallegationsofbadfaitharetooconclusoryto

sustainaclaimofbreachofthecovenantofgoodfaithandfairdealingunderFederal

RuleofCivilProcedure12(b)(6).Mot.ToDismiss12‐15,ECFNo.17‐1.Itreasons

thatnobadfaithhasbeenalleged,asthepricingthatMr.Edwardsandotherenergy

purchasersreceivedisexactlywhattheybargainedfor.Id.at13‐14.TheCourt

disagreesandfindsthatMr.Edwardshassufficientlypledacauseofactionfor

breachofthecovenantofgoodfaithandfairdealing.

5NAPG’scounselalsonotedthatthepublicutilitieswithlargercustomerbaseshaveabusinessadvantagebecausetheycanpurchaselargequantitiesofelectricityfromthewholesalemarketfarinadvanceofthetimesuchelectricitywillactuallybeneededbytheirconsumers.Thisstrategyinsulatesthemsomewhatfromtheriskofpricefluctuationsinthewholesalemarket.


23

Thevastmajorityofcontractsincludeanimpliedcovenantofgoodfaithand

fairdealing,whichoperatesasaruleofinterpretationtoensurethatrightsunder

thecontractarenotunfairlyimpeded.Magnanv.AnacondaIndus.,Inc.,193Conn.

558,566(1984)(notingthattheRestatement(Second)ofContractsrecognizesthis

covenantineverycontract“withoutlimitation”)(citingRestatement(Second)of

Contracts§205(1979));Guptav.NewBritainGeneralHosp.,239Conn.574,598

(1996)(“Everycontractcarriesanimpliedcovenantofgoodfaithandfairdealing

requiringthatneitherpartydoanythingthatwillinjuretherightoftheotherto

receivethebenefitsoftheagreement.”)(citationandinternalquotationmarks

omitted);DeLaConchaofHarford,Inc.v.AetnaLifeIns.Co.,269Conn.424,433

(2004)(“Thecovenantofgoodfaithandfairdealingpresupposesthatthetermsand

purposeofthecontractareagreeduponbythepartiesandthatwhatisindisputeis

aparty’sdiscretionaryapplicationorinterpretationofacontractterm.”)(citation

andinternalquotationmarksomitted).TheCourtfindsnoreasonwhythecovenant

wouldnotapplytoMr.Edwards’sagreementwithNAPG.

“Toconstituteabreachof[thiscovenant],theactsbywhichadefendant

allegedlyimpedestheplaintiff’srighttoreceivebenefitsthatheorshereasonably

expectedtoreceiveunderthecontractmusthavebeentakeninbadfaith.”Colonv.

CommonwealthAnnuityandLifeIns.Co.,No.3:08‐CV‐00079(PCD),2008WL

2185923,at*2(D.Conn.May22,2008)(internalquotationmarksomitted)(quoting

DeLaConchaofHartford,Inc.,269Conn.at433);seealsoMagnan,193Conn.at567

(describingthecovenantasa“ruleofconstructiondesignedtofulfillthereasonable

expectationsofthecontractingpartiesastheypresumablyintended.”);Landryv.


24

Spitz,102Conn.App.34,43(Conn.App.Ct.2007)(“‘apartywhoevadesthespiritof

thecontract…maybeliableforbreachoftheimpliedcovenantofgoodfaithandfair

dealing’”)(quotingWilliston,Contracts§63.22,p.508(4thed.Lord2002)(alteration

inoriginal)).Mr.EdwardsneednotallegeabreachofhisagreementwithNAPGin

the“technicalsense,”butratheradeprivationofthebenefitofhisbargainthrough

othermeans.SeeN.Am.Tech.Servs.,Inc.v.VJTechs.,Inc.,CivilActionNo.10CV

1384(AWT),2011WL4538069,at*4(D.Conn.Sept.29,2011)(citationand

internalquotationmarksomitted).Badfaithrequiresfraud,a“‘designtomisleador

deceiveanother,’”or“‘aneglectorrefusaltofulfillsomedutyorsomecontractual

obligation,notpromptedbyanhonestmistakeastoone’sduties,butbysome

interestedorsinistermotive.’”DelaConchaofHartford,Inc.,269Conn.at433

(quotingHabetzv.Condon,224Conn.231,237‐38(1992)).

Asdiscussedabove,Mr.Edwardsplausiblyallegesthatconsumers

reasonablyunderstoodthatNAPG’svariable‐rateplanpriceswouldreflectinsome

waythewholesalemarketprice.Byfailingtoactuallydothisinpractice,NAPG

possiblydeniedMr.Edwardswhat“he[]reasonablyexpectedtoreceiveunderthe

contract.”Colon,2008WL2185923,at*2.Mr.Edwardsalsoallegesthatby

chargingapricebetweentwoandfourtimeshigherthanandinfact,innoway

relatedtothewholesalemarketprice,NAPGsoughttooperatea“pureprofitcenter”

andactedinbadfaith.Compl.¶¶27,57‐59,ECFNo.1;Opp.Br.15,ECFNo.24.He

alsoarguesthatNAPG’s“onlyvariablecost”wasthewholesalecostofpower,

becauseitsoperatingcostswere“relativelyfixedstandardbusinessexpenses.”Id.

(citingCompl.¶¶17‐19,32,ECFNo.1).TheCourtfindsthatthisisaplausible


25

allegationofbadfaith.SeeColon,2008WL2185923,at*2(denyingamotionto

dismissbecause“[i]tisnotclearfromthecomplaintthattherearenocircumstances

fitting[the]description[offactsallegedinthecomplaint]thatwouldbeso

egregiousanddemonstrativeofdishonestpurposeastoshowbadfaithonthepart

ofDefendants.”);seealsoSanborn,Mot.toDismissHr’gTr.39:7‐12(D.Conn.Apr.1,

2015)(findingthat“pricegouging”satisfiesthebadfaithrequirementforaclaimof

breachofthecovenantofgoodfaithandfairdealing).

WhilethecontractleftthepriceopentobesetatNAPG’sdiscretionwith

certainlimitations,thecovenantofgoodfaithandfairdealingmandatesthatNAPG

exercisethatdiscretionreasonablybychargingacommerciallyreasonableprice.

SeeEconomosv.LiljedahlBros.,Inc.,279Conn.300,307(2006)(“[M]oderncontract

principlesofgoodfaithandfairdealingrecognizethatevencontractualdiscretion

mustbeexercisedforpurposesreasonablywithinthecontemplationofthe

contractingparties…”);Warnerv.Konover,210Conn.150,154‐55(1989)(observing

thatapartywithcontractuallyprovideddiscretionmustexercisethatdiscretion“in

amannerconsistentwithgoodfaithandfairdealing.”);Artmanv.OutputTechs.

SolutionsE.Region,Inc.,No.CV000595362S,2000WL992166,at*2(Conn.Super.

Ct.June30,2000)(notingthatifacontractgivesapartydiscretion,thatdiscretion

mustbeexercised“fairlyinordertocomplywiththeimpliedcovenantofgoodfaith

andfairdealing”);seealsoMarcusDairy,Inc.v.RollinDairyCorp.,CivilNo.

3:05cv589(PCD),2008WL4425954,at*7(D.Conn.Sept.24,2008)(findingthat

undertheUCC,goodfaithrequireschargingacommerciallyreasonablepriceinan

openpricecontract)(citingUCC§2‐305,Cmt.3,adoptedbyConnecticutinConn.


26

Gen.Stat.§42a‐2‐305).InpleadingthatNAPG’spriceswerearbitrarilyhighand

unreasonable,Mr.Edwardshas,therefore,sufficientlyallegedaclaimofbreachof

thecovenantofgoodfaithandfairdealing.

C. COUNTTHREE(UNJUSTENRICHMENT)

NAPGarguesthatMr.Edwardshasfailedtopleadaplausibleunjust

enrichmentclaimbecausehehasallegedtheexistenceofavalid,enforceable

contract.Mot.ToDismiss15‐16,ECFNo.17‐1.Itreasonsthatunjustenrichmentis

notavailableasaremedywherethereisanenforceableexpresscontract.Id.Mr.

Edwardscountersthathemadehisclaiminthealternative,incasetheCourtvoids

orotherwisefindsthecontractbetweenNAPGanditssubscribersinvalid.Opp.Br.

19,ECFNo.24.

“‘[L]ackofaremedyunder[a]contractisapreconditionforrecoverybased

uponunjustenrichment.’”AlstomPower,Inc.v.SchwingAm.,Inc.,CivilNo.

3:04cv1311(JBA),2006WL2642412,at*5(D.Conn.Sept.14,2006)(quotingGagne

v.Vaccaro,255Conn.390,401(2001)).Aplaintiff,therefore,cannotpleadaclaim

ofunjustenrichmentifhealsopleadstheexistenceofanexpresscontract.Seeid.at

*5‐6;Levyv.WorldWrestlingEntm’t,Inc.,CivilActionNo.3:08‐01289(PCD),2009

WL455258,at*2‐3(D.Conn.Feb.23,2009)(grantingamotiontodismissonan

unjustenrichmentclaimandfindingthatanunjustenrichmentclaimcouldnotbe

pledsimultaneouslywithallegationsindicatingtheexistenceofavalid,express

contract)(citationomitted);seealsoMeaneyv.Conn.Hosp.Ass’n,Inc.,250Conn.

500,517‐18(1999)(“Itisoftensaidthatanexpresscontractbetweenparties

precludesrecognitionofanimplied‐in‐lawcontractgoverningthesamesubject


27

matter.”)(citationsandinternalquotationmarksomitted).Mr.Edwardshasnot

claimedthatthecontractisvoid,illusoryorotherwiseunenforceable;healsohas

notallegedfactsinsupportoftheselegalconclusions.Thus,hehasfailedtoallege

factsnecessaryforanunjustenrichmentclaimandtheclaimmustbedismissed

withoutprejudice.

IV. CONCLUSION

Fortheforegoingreasons,theCourtGRANTStheDefendant’sMotionto

Dismissontheunjustenrichmentclaimandtheunfairtradepracticesclaims

broughtundertheMaine,NewHampshire,andRhodeIslandstatutes,without

prejudice.TherestofDefendant’sMotionisDENIED.

SOORDEREDthis4thdayofAugust2015,atBridgeport,Connecticut.

/s/VictorA.Bolden VictorA.BoldenUnitedStatesDistrictJudge


united states district court district of …...v. case no. 3:14‐cv‐1714 (vab) north american...

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