PHILADELPHIA (CN) - A tobacco company is not liable in a class action because the plaintiffs did not rely on the company's allegedly deceptive conduct, the 3rd Circuit ruled.
Gregory Hunt sued the U.S. Tobacco Co., alleging that it engaged in anticompetitive conduct that artificially inflated its prices by 7 cents per can.
Hunt alleged that the company stole or concealed its competitor's distribution racks and made false, disparaging statements about its competitor's products.
In order to prevail, Judge Ambo ruled, Hunt would have to prove that he suffered an "ascertainable loss" as a result of the tobacco company's actions. Hunt argues that he should only have to prove that in a case of fraud, not merely deception.
"The Pennsylvania Supreme Court has applied a broad rule that private plaintiffs must prove justifiable reliance under the Consumer Protection Law," Ambro wrote. "We thus think it is imprudent to create an exception for (deception)."
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