Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—8th Cir.: Tire store’s supply fee not unfair or deceptive, (May 14, 2014)

By Jody Coultas, J.D.

A trial court did not err in granting Bridgestone Retail Operations, LLC summary judgment of a customer’s Missouri Merchandising Practices Act (MMPA) claims based on Bridgestone’s allegedly unfair and deceptive service fee, the U.S. Court of Appeals in St. Louis has held (Toben v. Bridgestone Retail Operations, LLC, May 13, 2014, Benton, W.).

Bridgestone charged customers a “shop supply fee” that equaled 6% of the total labor charges. This fee purportedly covered supplies such as protective items for vehicles, solvents, cleaners, and rags. The customer argued that the fee was for profit and violated the MMPA.

Bridgestone was granted summary judgment by a trial court. The court also dismissed the customer’s Federal Rule of Civil Procedure 56(d) motion to stay briefing on summary judgment because the customer had not conducted merit discovery. It noted that Bridgestone’s disclosures concerning the shop fees confirmed that the fee resulted in profit, negating the requirement for additional discovery to prove as much.

Generally, summary judgment is proper only after the non-movant has had adequate time for discovery. If a non-movant shows that it cannot present facts essential to justify its opposition, the court may: (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order under Rule 56(d).

The district court did not abuse its discretion in denying the Rule 56(d) motion, according to the court. During class discovery, Bridgestone provided evidence about the purpose of the shop supply fee, what constituted a shop supply, and how Bridgestone used shop supplies. Bridgestone also conceded that the fee was intended to generate profit. The district court misconstrued the customer’s complaint as alleging only that the shop supply fee impermissibly generated profit, when the customer actually alleged that no part of the fee covered costs and was purely profit. However, the customer merely set forth some facts that could possibly be elicited from further discovery rather than showing that the facts sought existed. Bridgestone identified over 70 examples of shop supplies covered by the fee, and the customer was unable to identify documents or facts that would contradict this.

Bridgestone was properly granted summary judgment of the MMPA claim, according to the court. The MMPA prohibits “deception, fraud, false pretense, false promise, misrepresentation, unfair practice or the concealment, suppression, or omission of any material fact in connection with the sale or advertisement of any merchandise in trade or commerce.” The purchaser argued that the shop fees were misleading, deceptive, and unfair because the name suggested that the entire fee goes towards supplies used in servicing a consumer’s car when the whole fee was completely unrelated to any supplies or services Bridgestone provided. However, the evidence proved that the fee covered Bridgestone’s costs for a variety of shop supplies and that Bridgestone clearly disclosed that the fees were intended partly for profit. Therefore, the fee was not unfair or deceptive.

The case is No. 13-3329.

Attorneys: Alicia Anne Campbell (Campbell Law, LLC) for Patricia Toben. Simon B. Auerbach (Holland & Knight) and Kurt Andrew Schmid (Brown & James) for Bridgestone Retail Operations, LLC.

Companies: Bridgestone Retail Operations, LLC

Cases: StateUnfairTradePractices ArkansasNews IowaNews MinnesotaNews MissouriNews NebraskaNews NorthDakotaNews SouthDakotaNews