Does a Connecticut Business Have to Respond to a Massachusetts Chapter 93A Demand Letter?
Yes, Connecticut businesses have to comply with a demand letter received pursuant to Massachusetts Chapter 93A, or else face what could be expensive consequences. Businesses that regularly sell goods or provide services in Massachusetts—whether physically located in the state or not—should be familiar with the Chapter 93A demand letter process. These pre-litigation letters, under Section 9(3) of Chapter 93A, are a critical part of Massachusetts’ consumer protection laws, and understanding how to respond can be essential to minimizing legal and financial exposure. These demand letters have a positive aspect because they encourage settlement negotiations. Our firm has responded to hundreds of Massachusetts General Laws Chapter 93A demand letters, and approximately 75% of them end in a negotiated settlement without litigation. Avoiding litigation is a good thing for a business, and anyone for that matter.
This post covers the basics of Chapter 93A demand letters and is the first in a series addressing key aspects of Massachusetts’ unfair and deceptive trade practices statute. The Massachusetts statute differs in a material respect from Connecticut’s Unfair Trade Practices Statute, which you can read about here, here and here. It differs in a material way because consumers must send a pre-suit demand letter under Massachusetts law in order to be able to recover enhanced damages. Connecticut’s law does not contain this requirement.
What Is a Chapter 93A Demand Letter?
A Chapter 93A demand letter is a mandatory pre-litigation notice required under Massachusetts General Laws Chapter 93A. A consumer sends it alleging that a business (often a retailer, contractor or manufacturer of consumer goods, like appliances) has engaged in unfair or deceptive trade practices. Massachusetts General Laws Chapter 93A governs conduct involving the sale or provision of goods or services. So a consumer might be upset that an appliance they purchased isn’t working properly, or believe that your business misrepresented the quality of the goods or services it sells.
Although senders commonly direct these letters to Massachusetts businesses, they can also send them to out-of-state businesses. Connecticut’s proximity to Massachusetts means your business may receive one of these letters. If the alleged unfair conduct occurred “primarily and substantially” in Massachusetts, and the business has sufficient contacts with the state, Massachusetts courts may assert jurisdiction under Massachusetts General Laws Chapter 93A. This means your business could be sued in Massachusetts under its unfair trade practice law.
Have You Received a 93A Demand Letter?
You may have received a 93A demand letter if:
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You operate a business, sell products, or provide services in Massachusetts;
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You received a written demand for a settlement payment from a Massachusetts customer or business;
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The letter alleges unfair or deceptive conduct in connection with commerce and references Massachusetts General Laws Chapter 93A in some fashion.
- The letter has to describe the actions and conduct by your business and the injury the consumer claims to have suffered in a way that allows you to review the facts and the law to determine a reasonable settlement offer.
Do not ignore the letter. Just like receiving a lawsuit, ignoring a 93A demand letter can trigger serious consequences. If the sender prevails in court, the judge can award up to three times the actual damages—plus attorney’s fees.
For example:
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A $500 judgment could become $1,500;
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A $10,000 judgment could increase to $30,000;
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Legal fees could easily exceed the damages award.
Why Legal Counsel Is Critical
If you receive a 93A demand letter, the law requires you to respond in writing with a reasonable settlement offer within 30 days. Failing to make a reasonable offer—or making none at all—can expose your business to enhanced damages and the opposing party’s attorney’s fees if they prevail.
To illustrate the risk: in Twin Fires Investment, LLC v. Morgan Stanley Dean Witter & Co., 837 N.E.2d 1121 (Mass. 2005), the Massachusetts Supreme Judicial Court upheld an award of over $1 million in attorney’s fees—even though the underlying damages were just $39,650 (which were then tripled to $118,950 under Chapter 93A).
Next Steps if You Receive a 93A Demand Letter
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Contact experienced counsel immediately—preferably one familiar with Massachusetts Chapter 93A claims and jurisdictional issues affecting out-of-state businesses.
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Work with your attorney to prepare a timely, reasonable written response. Failure to do so can significantly increase your exposure. Based on the law and facts, your offer may be zero, and still be reasonable if the law does not support what the consumer demands.
Coming Up Next
In future posts, we’ll break down:
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What constitutes an “unfair or deceptive” trade practice under Chapter 93A;
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How to evaluate and craft a reasonable settlement offer;
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What businesses can do to minimize exposure and avoid common pitfalls.
Stay tuned!
