The full case caption appears at the
end of this opinion. OPINION I Pursuant to Tennessee Supreme Court Rule 23,
[FOOTNOTE 1] this Court accepted certification of thefollowing question from the United States District Court for the Middle District of Tennessee:
Does a corporation have standing to bring a private cause of actionfor treble damages pursuant to Tenn. Code Ann. � 47-18-109(a)? [FOOTNOTE 2]
Because the Tennessee Consumer Protection Act (the Act) clearly contemplates that corporationsinjured by a violation of the statute should be granted such standing, we conclude that corporationsdo, indeed, have standing [FOOTNOTE 3] to bring a private cause of action for treble damages under Tenn. CodeAnn. � 47-18-109(a). II Petitioner ATS Southeast, Inc. (ATS) filed a breach of contract action against CarrierCorporation (Carrier) in the United States District Court for the Middle District of Tennessee.Carrier filed a counterclaim against ATS and a separate suit against ATS’s predecessors, Rent-A-Driver, Inc. and Wood Transportation, Inc.,[FOOTNOTE 4] seeking treble damages pursuant to Tenn. Code Ann.� 47-18-109(a). The court consolidated the two lawsuits. Carrier alleged that ATS (and its predecessors), in selling services to Carrier, had engagedin “unfair and deceptive acts or practices affecting the conduct of trade and commerce” in violationof Tenn. Code Ann. � 47-18-104(a). On February 24, 1999, the United States District Court for theMiddle District of Tennessee filed an order with the Tennessee Supreme Court certifying the above-quotedquestion of law. III When the Tennessee Consumer Protection Act was enacted in 1977, one of its statedpurposes was “[t]o protect consumers and legitimate business enterprises from those who engage inunfair or deceptive acts or practices in the conduct of any trade or commerce in part or wholly withinthis state.” Tenn. Code Ann. � 47-18-102(b) (1979) (codifying 1977 Tenn. Pub. Acts ch. 438, � 2).Protecting both consumers and legitimate business enterprises from unfair or deceptive acts orpractices remains a purpose of the Act today. See Tenn. Code Ann. � 47-18-102(2) (1995 & Supp.1999). A violation of the Tennessee Consumer Protection Act may result in several differentsanctions. First, “[u]nfair or deceptive acts or practices affecting the conduct of any trade orcommerce” are designated Class B misdemeanors. Tenn. Code Ann. � 47-18-104(a) (1995).Additionally, as provided by the original version of the Act:
[a]ny person who suffers an ascertainable loss of money or property. . . as a result of the use or employment by another person of anunfair or deceptive act or practice declared to be unlawful by thischapter may bring an action individually . . . to recover actualdamages. . . . If the court finds that the use or employment of theunfair or deceptive act or practice was a willful or knowing violationof this chapter, the court may award three (3) times the actualdamages sustained and may provide such other relief as it considersnecessary and proper. In determining whether treble damages shouldbe awarded, the trial court may consider, among other things: (1)[t]he competence of the consumer, (2) [t]he nature of the deceptionor coercion practiced upon the consumer, (3) [t]he damage to theconsumer, and (4) [t]he good faith of the person found to haveviolated the provisions of this chapter.
Tenn. Code Ann. � 47-18-109(a) (1979) (codifying 1977 Tenn. Pub. Acts ch. 438, � 10) (emphasesadded). Following the 1977 codification of the Act, corporations began asserting that they should bepermitted to sue for treble damages under Tenn. Code Ann. � 47-18-109(a). These suits wereunsuccessful because the term “consumer,” as used in the original version of the Act, was definedas a “natural person” who sought or acquired “goods, services, or property . . . .” Tenn. Code Ann.� 47-18-103(a) (1979)(codifying 1977 Tenn. Pub. Acts ch. 438, � 3).[FOOTNOTE 5] Thus, prior to the time thatthe Act was amended in 1989, corporations were disallowed from pursuing treble damages underTenn. Code Ann. � 47-18-109(a) because recovery under Tenn. Code Ann. � 47-18-109(a)(1-4) waslimited to “consumer[s],” and the term “consumer,” for purposes of the Act, was not defined toinclude corporations. See American Bldgs. Co. v. White, 640 S.W.2d 569, 575 (Tenn. Ct. App.1982); Grantham and Mann, Inc. v. American Safety Products, Inc., 831 F.2d 596, 608 (6th Cir.1987). IV In 1989, however, Tenn. Code Ann. � 47-18-109(a)(4) was amended. It now reads asfollows, with changes to the original Act noted in bold type:
[i]n determining whether treble damages should be awarded, the trialcourt may consider, among other things: (A) [t]he competence of theconsumer or other person; (B) [t]he nature of the deception orcoercion practiced upon the consumer or other person; (C) [t]hedamage to the consumer or other person; and (D) [t]he good faith ofthe person found to have violated the provisions of this chapter.
Tenn. Code Ann. � 47-18-109(a)(4) (1995 & Supp. 1999) (codifying 1989 Tenn. Pub. Acts ch. 498,� 3) (emphases added). The inclusion, in 1989, of the “or other person” language is significant. As has been the caseever since the Act was codified in 1977, “person” is defined to include “a natural person, individual,governmental agency, partnership, corporation, trust, estate, incorporated or unincorporatedassociation, and any other legal or commercial entity however organized . . . .” Tenn. Code Ann. �47-18-103(7) (1995 & Supp. 1999) (emphasis added); Tenn. Code Ann. � 47-18-103(f) (1979)(codifying 1977 Tenn. Pub. Acts ch. 438, � 3). Several courts recognized the significance of the 1989 amendment. Indeed, in 1992, theUnited States District Court for the Middle District of Tennessee stated that:
in 1989, the Tennessee legislature inserted the phrase ‘or otherperson’ after the word ‘consumer’ in � 47-18-109(a)(4)(A), (B), and(C) . . . . While Tenn. Code Ann. � 47-18-103(2) defines a’consumer’ as ‘any natural person,’ � 47-18-103(7) defines ‘person’to include ‘partnership[s], corporation[s], trust[s], . . . and any otherlegal or commercial entit[ies] however organized,’ in addition to’natural person[s].’ Thus, because the Tennessee ConsumerProtection Act affords a private right of action to ‘[a]ny person,’[under] Tenn. Code Ann. � 47-18-109(a)(1), and a trial court isrequired to consider specifically ‘[t]he damage to the consumer orother person,’ [under] Tenn. Code Ann. � 47-18-109(a)(4)(C)[], whenconsidering the issue of treble damages, the Court finds thatcorporations may recover [treble] damages under the Act . . . .’
Smith Corona Corp. v. Pelikan, Inc., 784 F.Supp 452, 483 (M.D. Tenn. 1992) (emphases added); seeOlin Corp. v. Lambda Electronics, Inc., 39 F.Supp.2d 912, 914 (E.D. Tenn. 1998); Operations Mgmt.Int’l, Inc. v. Tengasco, Inc., 35 F.Supp.2d 1052, 1058 (E.D. Tenn. 1999); see also Jeffrey L. Reed,The Tennessee Consumer Protection Act: An Overview, 58 Tenn. L. Rev. 455, 478-79 (1991). Despite the seemingly clear language of the amended statute, several courts have continuedto hold that corporations lack standing to sue under the Act. See Syncor Int’l Corp. v. Newbaker,12 F.Supp.2d 781, 783 (E.D. Tenn. 1999); LIC Corp. v. Baskin-Robbins Ice Cream Co., Nos.03A01-9207-CV-242, 03A01-9207-CV-243, 1993 WL 2796, at *3 (Tenn. Ct. App. Jan. 8, 1993).In Syncor, a case decided after the 1989 amendment, the United States District Court for the EasternDistrict of Tennessee improperly analyzed the issue of corporate standing under Tenn. Code Ann.� 47-18-109(a), focusing on “the question of whether corporations are considered ‘consumers’ forpurposes of the Act.” Syncor, 12 F.Supp.2d at 783. As previously implied, it is irrelevant whethera corporation is a “consumer” under the Act because the right of action is given to “person[s],” aterm that is specifically defined to include corporations. See Tenn. Code Ann. � 47-18-109(a)(4)(1995 & Supp. 1999); Tenn. Code Ann. � 47-18-103(7) (1995 & Supp. 1999). In Baskin-Robbins, the Tennessee Court of Appeals reached an erroneous result whenconsidering whether corporations had standing to sue under the Act. See Baskin Robbins, 1993 WL2796, at *3. In that case, the court relied on the Court of Appeals’s pre-1989 decision in AmericanBuildings Co. v. White, and did not discuss the 1989 amendment to Tenn. Code Ann. � 47-18-109(a)(4).[FOOTNOTE 6] See id. Finally, the petitioners argue that the legislative history of the 1989 amendment, specificallythe caption to the 1989 amendment that is found in Tennessee Public Acts, 1989, Chapter No. 498,indicates that the legislature did not intend to amend the Act to provide corporations with a privatecause of action for treble damages.[FOOTNOTE 7] Instead, argue the petitioners, the purpose of the 1989amendment was to regulate “certain promotional schemes” relative to telemarketing scams. We need not reach the question of the 1989 amendment’s legislative history. “When thelanguage contained within the four corners of a statute is plain, clear, and unambiguous, the duty ofthe courts is simple and obvious, ‘to say sic lex scripta, and obey it.’” Hawks v. City ofWestmoreland, 960 S.W.2d 10, 16 (Tenn. 1997) (quoting Miller v. Childress, 21 Tenn. (2 Hum.)320, 321-22 (1841)). In instances when the language of the statute is clear on its face, we need notreach the question of the legislature’s intent in enacting the law; “[w]here there is no ambiguity inthe language of an act, comments of legislators, or even sponsors of the legislation, before its passageare not effective to change the clear meaning of the act.” D. Canale & Co. v. Celauro, 765 S.W.2d736, 738 (Tenn. 1989). The language of Tenn. Code Ann. � 47-10-109(a) and Tenn. Code Ann. �47-18-103(7) is clear and unambiguous. Read together, the two statutes indicate that corporations(and other entities included within the Act’s definition of a “person”) have standing to bring a privatecause of action for treble damages under the Tennessee Consumer Protection Act. V We answer the question certified by the United States District Court for the Middle Districtof Tennessee as follows:
Under Tenn. Code Ann. � 47-18-103(7) of the Tennessee ConsumerProtection Act, a “person” is clearly defined to include corporations.Because the remedy of treble damages available under Tenn. CodeAnn. � 47-18-109(a) is available to “person[s],” it is, thus, availableto corporations. As such, corporations have standing to bring aprivate cause of action for treble damages under Tenn. Code Ann. �47-18-109(a).
The clerk will transmit this opinion to the United States District Court for the Middle Districtof Tennessee and to the parties in accordance with Rule 23, � 8 of the Tennessee Supreme CourtRules. The costs in this Court will be taxed to the petitioners, ATS, Rent-A-Driver, Inc., and WoodTransportation, Inc. :::FOOTNOTES::: FN1The Supreme Court may, at its discretion, answer questions of lawcertified to it by the Supreme Court of the United States, a Court ofAppeals of the United States, a District Court of the United States inTennessee, or a United States Bankruptcy Court in Tennessee. Thisrule may be invoked when the certifying court determines that, in aproceeding before it, there are questions of law of this state whichwill be determinative of the cause and as to which it appears to thecertifying court there is no controlling precedent in the decisions ofthe Supreme Court of Tennessee. Tenn. Sup. Ct. R. 23, � 1. FN2Tennessee Code Annotated � 47-18-109(a) is part of the Tennessee Consumer ProtectionAct. FN3In cases involving an alleged violation of statutory law, the question of whether a party has”standing” to initiate a cause of action requires a determination of whether the statutory provisionon which the claim rests grants persons in the plaintiff’s position a right to seek judicial relief. SeeMetropolitan Air Research Testing Auth., Inc. v. Metropolitan Gov’t of Nashville and DavidsonCounty, 842 S.W.2d 611, 615 (Tenn. Ct. App. 1992). FN4In its order certifying the previously quoted question, the District Court noted that becauseATS, Rent-A-Driver, Inc., and Wood Transportation, Inc. were collectively the “moving party”within the meaning of Rule 23, � 6 of the Tennessee Supreme Court Rules, they would be designatedthe “petitioners” in this case. FN5The full definition of the term “consumer” is
any natural person who seeks or acquires by purchase, rent, lease, assignment, awardby chance, or other disposition, any goods, services, or property, tangible orintangible, real, personal or mixed, and any other article, commodity, or thing ofvalue wherever situated or any person who purchases or to whom is offered for salea franchise or distributorship agreement or any similar type of business opportunity.
Tenn. Code Ann. � 47-18-103 (a) (1979) (codifying 1977 Tenn. Pub. Acts ch. 438, � 3). Currently, the term “consumer” is defined in exactly the same way that it has been definedever since the Tennessee Consumer Protection Act was enacted in 1977. Compare Tenn. Code Ann.� 47-18-103(2) (1995 & Supp. 1999) with Tenn. Code Ann. � 47-18-103(a) (1979) (codifying 1977Tenn. Pub. Acts ch. 438, � 3). FN6The petitioners’ reliance on our decisions in Quality Auto Parts v. Bluff City Buick, 876S.W.2d 818 (Tenn. 1994); Pursell v. First American Nat’l Bank, 937 S.W.2d 838 (Tenn. 1996); andGanzevoort v. Russell, 949 S.W.2d 293 (Tenn. 1997) is similarly misplaced. In each of those casesthere was a determination that the Act did not apply; however, in each instance that determinationwas based on the lack of “unfair or deceptive acts or practices affecting the conduct of any trade orcommerce” under Tenn. Code Ann. � 47-18-104, and not on the corporate status of the party makingthe claim. FN7Any constitutional defect caused by the limited nature of the caption was cured when thebill was codified. See Tenn. Const. art II, � 17; State v. Chastain, 871 S.W.2d 661, 666 (Tenn.1994); Harmon v. Angus R. Jessup Assoc., Inc., 619 S.W.2d 522, 523 (Tenn. 1981). This is,essentially, the position of the Attorney General in response to claims of unconstitutionality basedon the Act being broader than its caption.
ATS Southeast, Inc. v. Carrier Corp. IN THE SUPREME COURT OF TENNESSEE AT NASHVILLE ATS SOUTHEAST, INC., ET AL. v. CARRIER CORPORATION Certified Question from the United States District Court for theMiddle District of Tennessee No. 3:96-0796 Aleta A. Trauger, Judge No. M1999-02658-SC-R23-CQ – Decided May 12, 2000 Pursuant to Tenn. Sup. Ct. R. 23, we accepted the following question from the United States DistrictCourt for the Middle District of Tennessee: Under the Tennessee Consumer Protection Act, “[d]oesa corporation have standing to bring a private cause of action for treble damages pursuant to Tenn.Code Ann. � 47-18-109(a)?” We answer that it does. The Tennessee Consumer Protection Actdefines, in Tenn. Code Ann. � 47-18-103(7), “person” to include corporations, and “persons” canseek treble damages available under Tenn. Code Ann. � 47-18-109(a). Therefore, we opine that acorporation has standing to bring a private cause of action for treble damages under Tenn. Code Ann.� 47-18-109(a). Tenn. Sup. Ct. R. 23 Certification of Questions of State Law from Federal Court BIRCH, J., delivered the opinion of the court, in which ANDERSON, C.J., and DROWOTA, HOLDER,and BARKER, JJ., joined. Fred C. Dance, Nashville, Tennessee, for the petitioners, ATS Southeast, Inc., Rent-A-Driver, Inc.,and Wood Transportation, Inc. James A. Delanis, Jonathan J. Cole, Richard A. Stout, Nashville, Tennessee, for the respondent,Carrier Corporation.
