374 F. Supp. 3d 445
W.D. Pa.2019Background
- Plaintiffs Corsale and Taylor (Pennsylvania residents) contracted with Sperian Energy, an electric generation supplier (EGS), under three-month fixed-rate offers that rolled into month-to-month variable-rate contracts.
- Sperian sent updated Terms and Conditions before the rollover stating the variable price "may change each month in response to market fluctuations and conditions at the discretion of Sperian Energy," and compared EGS and utility rates on monthly bills.
- After rollover, Plaintiffs paid variable rates that at times exceeded their utilities’ rates (Corsale: 13%–102% higher; Taylor: 6%–135% higher) and sued under Pennsylvania law for breach of contract, unjust enrichment, and violations of the UTPCPL (catch‑all deceptive-practices provision).
- Sperian moved to dismiss under Rule 12(b)(6); the court considered whether the Updated Terms were enforceable and whether Plaintiffs pleaded contractual breaches or actionable deception.
- Court found Updated Terms were the governing contracts (modification supported by consideration via notice and silence), dismissed breach and unjust‑enrichment claims with prejudice, and dismissed the UTPCPL claim without prejudice (leave to amend limited aspects).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Which terms govern after rollover (Initial vs Updated T&Cs)? | Initial terms controlled; Updated terms unenforceable for lack of consideration. | Updated Terms were effective; notice and silence created acceptance. | Updated Terms govern; court finds consideration via notice/acceptance. |
| Breach of contract — did Sperian breach pricing obligation? | Sperian charged "exorbitant" rates not tied to wholesale/market conditions, breaching contract. | Contracts permitted discretionary monthly pricing; deviation from utility/wholesale rates alone does not show breach. | Dismissed: Updated Terms give Sperian discretionary pricing; allegations of higher rates do not plausibly show breach. |
| Unjust enrichment (alternative remedy) | Plaintiffs may plead unjust enrichment alternatively for overcharges. | Enforceable written contract governs; unjust enrichment inappropriate. | Dismissed with prejudice: written contracts control, unjust enrichment unavailable. |
| UTPCPL deceptive-practices claim | Sperian failed to disclose higher-than-market rates, hid monthly energy service fee, and engaged in bait-and-switch. | Fees and variability were disclosed; monthly comparisons provided; no actionable deception. | Dismissed without prejudice as pleaded; failure-to-disclose fees and rate-disclosure theories fail, but court grants limited leave to amend for bait-and-switch theory. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (establishes plausibility standard for pleadings)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading must be plausible, not merely speculative)
- Orange v. Starion Energy PA, Inc., [citation="711 F. App'x 681"] (difference from utility rates insufficient to show breach where contract allows discretion)
- Brown v. Agway Energy Servs., LLC, 328 F. Supp. 3d 464 (similar dismissal where contract permits discretionary rate-setting)
- Gorecki v. Clearview Elec., Inc., 338 F. Supp. 3d 470 (discusses scope of EGS discretion in pricing)
- Cook v. General Nutrition Corp., [citation="749 F. App'x 126"] (unjust enrichment unavailable when enforceable written contract governs)
- Toy v. Metropolitan Life Ins. Co., 593 Pa. 20 (justifiable reliance is fact question in consumer-deception claims)
- Haywood v. Univ. of Pittsburgh, 976 F. Supp. 2d 606 (elements of breach of contract under Pennsylvania law)