Court Dismisses CPA Claim Based Upon Litigation Threats
Parties in insurance litigation frequently allege Consumer Protection Act (CPA) claims despite the fact that their dispute stems from disagreement over the meaning and application of an insurance policy or other contract. Soundview Insurance Agency, Inc. v. Berjac Portland (.pdf) exemplifies this common litigation strategy. Berjac is a financing company that had financed insurance premiums for insureds identified by Soundview. After Berjac threatened to sue Soundview for unpaid premiums, Soundview asserted CPA violations along with a claim for declaratory relief.
In a short, bluntly worded summary judgment opinion, United States District Court Judge John Coughenour dismissed Soundview’s CPA claim:
This is a dispute over a contract entered into at arms' length by sophisticated commercial parties. The dispute, as countless commercial disputes are, was accompanied by threats of litigation. It is inconceivable that a party might have a claim for unfair or deceptive acts or practices every time an opponent expressed a disagreement over contractual interpretation, or resorted to the courts to settle a dispute. Soundview offers no authority or evidence for the contention that these two commonplace aspects of business negotiation are unfair or deceptive, and has failed to demonstrate a genuine issue of material fact.
