Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—E.D. Mo.: Loss of business data was not a consumer protection law violation, (Apr 4, 2014)

By Jody Coultas, J.D.

The Missouri Merchandising Practices Act (MMPA) was not applicable to a dispute between a Best Buy customer and Best Buy Companies, Inc. and Best Buy Stores, LP because the dispute did not involve the purchaser of personal, family, or household goods or services, the federal district court in St. Louis has held (McNeil v. Best Buy Company, Inc., April 2, 2014, Hamilton, J.).

The customer used a Best Buy store to transfer and recover his personal, family, and business information in order to switch from his old computer to a new Apple computer. In the course of the data transfer and recovery process, Best Buy allegedly inadvertently and negligently lost the old computer, information, and data, and then failed timely to notify the customer of the loss.

On or about July 31, 2013, the customer filed the MMPA claim against Best Buy Company. A district court granted Best Buy Company’s motion to dismiss, finding the customer had shown no reason to hold it liable for Best Buy Stores’ alleged actions under an agency theory, nor had he established cause to pierce the corporate veil between the two entities. The customer filed an amended complaint on November 25, 2013, naming Best Buy Company and Best Buy Stores.

Statute of limitations. It was possible that, through discovery, the customer could meet the requirements for relation back to avoid dismissal based on the statute of limitations, according to the court. Best Buy Stores argued that the claims were barred by the statute of limitations as the complaint was filed more than five years after the events and interactions at issue. The customer countered that the claims related back to the timely-filed original complaint. Best Buy Stores maintained that neither the subsidiary-parent relationship between it and Best Buy Company, nor the fact that the two entities now share counsel, was sufficient to impute the required notice to Best Buy Stores.

MMPA. Best Buy Stores was granted dismissal of the MMPA claims by the court. In order to state a MMPA claim, the consumer was required to prove that Best Buy Stores engaged in a deception, fraud, false pretense, false promise, misrepresentation, unfair practice, or a concealment, suppression, or omission of a material fact in the course of trade or commerce that resulted in an ascertainable loss of money or real or personal property by the customer. The customer was also required to show that the purchaser was for personal, family, or household purposes. Best Buy Stores alleged that the MMPA claims failed because the transaction at issue was commercial in nature, and did not involve merchandise purchased primarily for personal, family or household purposes. Most of the data at issue was related to the customer’s business, rather than household or personal use. Also, the consumer specifically alleged he was a consumer, who purchased goods and services from Best Buy primarily for business and personal purposes. Therefore, the MMPA did not apply.

The case is No. 4:13CV1742 JCH.

Attorneys: Randall C. Cahill (Cahill Partnership, LLC) for Eric McNeil. Beth C. Boggs (Boggs and Avellino, LLC) for Best Buy Stores, LP.

Companies: Best Buy Company, Inc.

Cases: StateUnfairTradePractices MissouriNews