District of Columbia Court of Appeals Confirms the Need for Plaintiffs to have Traditional Standing

The District of Columbia's Consumer Protection Procedures Act ("CPPA"), primarily codified at D.C. Code sec. 28-3904 and sec. 28-3905, provides for sweeping protection against any trade practice deemed "unlawful" in the District of Columbia. The CPPA provides a wide variety of remedies, including injunctive relieve, treble damages, and the ability to recover attorneys fees incurred in brining an action under the Act.

Prior to the year 2000, the CPPA provided that "any consumer who suffers any damage as a result of the use or employment by any person of a trade practice in violation of a law of the District of Columbia" could bring an action in the Superior Court to enforce the CPPA. The District of Columbia Council amended the CPPA in 2000 to provide that "a person, whether acting for the interests of itself, its members, or the general public, may bring an action under this chapter in the Superior Court of the District of Columbia seeking relief from the use by any person of a trade practice in violation of a law of the District of Columbia . . . ." This amendment, which substituted the phrase "a person" for the phrase "any consumer who suffers any damage" created substantial conflict as to whether the Council had waived the traditional standing requirement that a plaintiff must suffer an actual injury before pursuing an action for actions brought in Superior Court under the CPPA.

In Grayson v. AT&T Corp., 980 A.2d 1137 (D.C. 2009), a panel of the court considered the standing question and concluded that the 2000 amendments to the CPPA waived the standing requirement and permitted individuals "to pursue [their] CPPA claim on behalf of [themselves] and the general public regardless of whether [they have] experienced an injury in fact as a result of [unlawful] trade practices." In other words, the panel concluded that the Council had altered the traditional standing principles in the District for CPPA claims so that persons pursuing a CPPA claim would not have to show any injury in fact caused by the violation of the CPPA to bring an action in Superior Court. Given the magnitude of this holding, the full court decided to hear Grayson, and a related case, en banc. Grayson v. AT&T, Corp, No. 07-CV-1264 (D.C. Jan. 20, 2011)(en banc). The en banc court reversed, concluding that the statutory amendments were not sufficiently clear to conclude that the Council intended to exempt CPPA suits from the District's usual standing principles. Instead, the court concluded that, in amending the statute, the Council had only intended to enlarge the remedies and enforcement procedures available to combat violations of the CPPA. The court confirmed that any person wishing to bring a CPPA action, either on their own behalf or in a representative action, must show that they suffered actual injury as a result of the unlawful trade practice in question to have standing to maintain the suit.

Additionally, although unrelated to the questions presented under the CPPA, the court also had the opportunity to address the standard of review for motions to dismiss presented under Superior Court Rule of Civil Procedure 12(b)(6). While some of the court's recent panel decisions, including the panel decision in Grayson, cited with apparent approval the pleading standard set forth by the Supreme Court in Bell Atlantic, Corp. v. Twombly, 550 U.S. 544 (2007) and its progeny, the court confirmed that it had not yet decided whether to adopt the new federal pleading standard. See e.g. Murray v. Motorola, Inc., 982 A.2d 764, 783 fn 32 (D.C. 2009). While acknowledging, in general, that the court usually follows the Supreme Court and other federal courts' interpretations of the federal rules in interpreting the District's own Rule 12, the court held that it had "not yet decided whether it will follow the facial plausibility standard enunciated in Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009)." Given the Court of Appeals preference for deciding cases on the merits, Grayson, without deciding the question, calls into serious doubt what persuasive effect the new federal pleading standard will have in cases brought in the Superior Court. It is likely that the Superior Court will continue to follow the older more permissive pleading standard pending further clarification from the Court of Appeals.