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What To Do If You Have Received a Chapter 93A Consumer Protection Demand Letter

Massachusetts has a very powerful and comprehensive consumer protection statute that allows consumers to file a lawsuit against a business for unfair and deceptive trade practices. If you are a Massachusetts business you always run the risk of having an unhappy customer. Sometimes, that unhappy customer will send you a G.L c.93A letter informing your business that it is facing multiple damages. If you receive such a letter please contact the Katz Law Group immediately.

Here is a checklist for what to do and not to do when you are in receipt of a demand letter.

1. Do not be intimidated. Our many years of experience have taught us that not every consumer protection demand letter is meritorious. Quite often, these letters are not worth the paper they are printed on. Nonetheless, all letters should be treated as if they are meritorious in the first instance. Your first line of defense is always to conduct a thorough investigation into the facts alleged by a claimant. This means analyzing the strength and weaknesses of a claimant's assertions, defenses, and the applicable facts of each case. Although your immediate reaction may be to ignore this letter, please understand that by not responding to the letter or failing to provide a reasonable offer of settlement should one be required, you will do great damage to your own legal rights if the case goes to trial. The other thing to clearly understand is that the letter is, in fact, the very beginning of litigation. Having said this, businesses must treat the receipt of the demand letter in the same way they would if they received a summons and complaint in a civil case.

2. Evaluate the damages immediately. In the first instance, a business needs to figure out the extent of the actual damages alleged. Are the damages sought based on real or contrived facts? As a recipient of this letter, you may not be able to evaluate a claimant's allegations for a host of different reasons-the facts may not be accurate, the timeline provided is knowingly false or the letter is so poorly constructed that you are otherwise unable to file a response in the first place. A claimant is under an obligation to be straightforward with its claim. If this situation occurs, you may respond with specific questions within the time period allowed and ask the claimant for further specificity. 

3. You must respond in 30 days. There is no equivocation on this point. As a business, you absolutely, positively must respond to the demand letter by or within 30 days from the date of receipt of the consumer protection demand letter. If you have received this letter( which must be sent by either certified or registered mail) you should keep the envelope with the green card, if applicable. You may also access the date of service through the USPS website in order to confirm the date of receipt and then work from there.

When you become in receipt of a consumer protection demand letter, you should call the Katz Law Group to see what steps and strategies you should take. In order to know that this is an actual G.L.c.93A letter, the letter must: 1. Be sent by certified or registered mail; 2.Describe the unfair or deceptive act in detail; 3.Identify the damages suffered by the claimant; 4.Make a demand for relief. Most importantly, in order for the letter to be an effective demand letter, it must be entitled as a "Consumer Protection Demand letter sent pursuant to G.L.c.93A" in order to provide the recipient business with proper notice.

If a business fails to respond within the 30-day window, then it has lost its opportunity to limit its damages down the road. In some cases, a business may request an extension for different reasons. If so, make sure you get the written authorization of the claimant's counsel and that the newly agreed-upon response date is set forth in that writing. If a request is made for an extension and not provided, make sure that your business files an initial response within the 30-day window to be followed up by an amended response thereafter.

4. Consider making a reasonable settlement offerOnce you have evaluated the merits of the claim, it is incumbent upon you within the 30 day response period to tell a claimant whether you will or will not make a reasonable offer of settlement. The importance of making a reasonable offer of settlement is for your business to attempt to limit damages that might ultimately be awarded by the claimant by making a settlement offer. If the claimant accepts the offer of settlement that your business tenders, then the dispute is finalized. In these situations, once a case is resolved, we also prepare a release of the business which needs to be executed by the claimant in order for the settlement funds to be paid.

There are no exceptions to this rule. If for some reason, the claimant rejects the settlement offer and if a court later finds that the settlement offer was "reasonable" in relation to the injury/damages actually suffered by the claimant, then the statute specifically provides that a court can limit any recovery by a claimant to the settlement offer tendered by the business in its response. On the other hand, if a claimant rejects the offer of settlement as unreasonable and the court later agrees that the response was unreasonable under the circumstances, then a claimant may recover double or treble damages in the amount of the actual damages (or twenty-five dollars whichever is greater) plus reasonable attorney's fees, costs, and interest.

5Protect your business interests and file your response with the Court. As a means of "perfecting" your business's position that the response was reasonable, your business must formally file the written response with an affidavit concerning its rejection with the Court. This filing requirement prevents the response letter from being treated as a settlement communication otherwise protected from communication by discovery. Given this, a response should be written very carefully keeping in mind, at all times,  that somewhere down the road it may be treated as an admission against a business by a court or may be used in cross-examination by counsel at trial.

6Maintain all evidence when you receive the demand letter. After consulting with legal counsel, your business needs to put a hold on all information relating to this matter as the demand letter will trigger an affirmative duty to prevent spoliation or destruction of evidence by a business.

If your business receives a demand letter you must take it seriously. At the Katz Law Group, we have assisted many businesses in protecting their rights and limiting their liability in these cases through carefully created strategies and through the close cooperation of our clients.

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