Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—D. Ore.: Condo association’s deceptive trade practices claims against plumbing manufacturer fail, (May 29, 2014)

By Linda O’Brien, J.D., LL.M.

A condominium association failed to state deceptive trade practices claims against a manufacturer of plumbing products for the alleged premature deterioration of the plumbing piping installed in the condominium building, the federal district court in Portland has ruled (Benson Tower Condominium Owners Assn. v. Victaulic Co., May 27, 2014, Simon, M.).

Benson Tower Condominium Owners Association is a condominium association and governing body of the Benson Tower Condominium. The Association is responsible for the maintenance, repair, and replacement of the common elements of Benson Tower, which includes the pipes, ducts, conduits, wires, and other utility installations to each individual condominium unit. The Victaulic Company is a manufacturer and supplier of materials for piping systems. The Association filed suit against Victaulic, alleging that the potable water piping system installed throughout Benson Tower included Victaulic products that prematurely deteriorated and failed to properly perform, in violation of Oregon’s Unlawful Trade Practices Act (UTPA), among other claims. The Association contended that Victaulic was aware that its products were susceptible to failure when exposed to certain disinfectants, failed to disclosure the information to consumers, and the failure of the Victaulic products caused damage to the common elements and individual units of Benson Tower. Victaulic moved to dismiss the Association’s UTPA claims.

The court found that the Association failed to state a cognizable claim under the UTPA. The UTPA protects consumers in consumer transactions, according to the court. The Association did not allege that it was a consumer of Victaulic’s products or that it purchased any products from Victaulic. Victaulic products were sold through a distributor to plumbing companies that installed the products in structures, such as Benson Tower, under commercial contracts with a general contractor or developer, which were not consumer transactions. Moreover, the individual unit owners, who were members of the Association, purchased their condominiums that contained plumbing components, but did not purchase those plumbing components. Thus, the Association and individual unit owners were not consumers for purposes of the UTPA, the court concluded.

The case is No. 3-13-cv-01010-SI.

Attorneys: Michelle K. McClure and Stuart K. Cohen (Landye Bennett Blumstein, LLP) and Jennifer L. Snodgrass and Richard N. Sieving (Sieving Law Firm, P.C.) for Benson Tower Condominium Owners Assn. Anne Cohen and Sharlei C. Hsu (Smith Freed & Eberhard) for Victaulic Co.

Companies: Victaulic Co.; Benson Tower Condominium Owners Assn.

Cases: StateUnfairTradePractices OregonNews