Shaulis v. Nordstrom, Inc.
865 F.3d 1
1st Cir.2017Background
- Plaintiff Judith Shaulis bought a Nordstrom Rack cardigan in Boston for $49.97; the tag showed a higher "Compare At" price of $218 and advertised "77%" savings.
- Shaulis alleged the "Compare At" prices were deceptive because Nordstrom Rack sells items made exclusively for outlet channels that were never sold at the higher comparator prices.
- She sued in Massachusetts state court asserting Chapter 93A claims, fraud, breach of contract, and unjust enrichment, later removed to federal court; the district court dismissed all claims for failure to plead a legally cognizable injury.
- The district court found the pricing practice could be an unfair or deceptive practice under Chapter 93A but held Shaulis’s allegation of an "induced purchase" (i.e., loss equal to the purchase price) was merely a subjective disappointment and not an objective economic injury.
- The court also denied injunctive relief because Chapter 93A requires an injury for private suits, and dismissed common-law claims for lack of pecuniary loss or because adequate legal remedies existed.
- Plaintiff’s motion for reconsideration and leave to amend was denied; the First Circuit affirmed the dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Shaulis alleged a cognizable injury under Mass. Gen. Laws ch. 93A | Shaulis: she was induced to buy the sweater and thus lost $49.97 (would not have purchased absent deception) | Nordstrom: mere subjective disappointment or deception without objective economic loss is not an injury under SJC precedent | Held: dismissal affirmed — induced-purchase is insufficient; must allege a separate, identifiable economic or non‑economic harm beyond the deception itself |
| Availability of injunctive relief under Chapter 93A absent injury | Shaulis: injunctive relief should be available even if damages fail | Nordstrom: private injunctive relief also requires an injury; AG enforcement covers public interest | Held: private injunctive relief requires an injury; Chapter 93A private plaintiffs must allege injury for damages or injunction |
| Common-law claims (fraud, breach of contract, unjust enrichment) | Shaulis: fraud (pecuniary loss = purchase price), breach and unjust enrichment based on deceptive pricing | Nordstrom: no allegation that sweater was worth less, defective, or contractually breached; adequate remedy at law bars unjust enrichment | Held: dismissed — fraud needs pecuniary loss; no contract breach alleged; unjust enrichment unavailable when legal remedy exists |
| Motion to amend/reconsider based on new evidence (Nordstrom manual) | Shaulis: new manual shows intentional deceptive pricing; warrants amendment/reconsideration | Nordstrom: core deficiency is lack of pleaded injury; more evidence of deception won’t cure it | Held: denial affirmed — additional proof of deception doesn’t remedy failure to plead legally cognizable injury |
Key Cases Cited
- Rule v. Fort Dodge Animal Health, Inc., 607 F.3d 250 (1st Cir. 2010) (discussing limits of per se injury theory under Chapter 93A)
- Tyler v. Michaels Stores, Inc., 984 N.E.2d 737 (Mass. 2013) (a statutory violation must cause a separate, identifiable harm to satisfy Chapter 93A injury requirement)
- Bellermann v. Fitchburg Gas & Elec. Light Co., 54 N.E.3d 1106 (Mass. 2016) (reaffirming Tyler and rejecting overpayment claims based on speculative or non‑realized harms)
- Iannacchino v. Ford Motor Co., 888 N.E.2d 879 (Mass. 2008) (injury alleged where product failed to meet regulatory/safety standards—objective measure for damages)
- Hershenow v. Enterprise Rent‑A‑Car Co., 840 N.E.2d 526 (Mass. 2006) (no Chapter 93A injury where plaintiffs received the bargained-for benefit and suffered no loss)
- Twin Fires Inv., LLC v. Morgan Stanley Dean Witter & Co., 837 N.E.2d 1121 (Mass. 2005) (fraud requires pecuniary loss for recovery)