OPINION
delivered the opinion of the court,
Plaintiffs’ action charged defendants with violation of the Tennessee Trade Practices Act, the Tennessee Consumer Protection Act, and unjust enrichment for monies had and received. Responding to Motions to Dismiss, the Trial Court dismissed the statutory violations claims, but retained jurisdiction over the common law violation claims. We granted the parties’ interlocutory appeals and dismiss the action.
BACKGROUND
In October of 1996, Wal-Mart and other merchants asserted claims under federal anti-trust law against Visa U.S.A. аnd MasterCard International (the “Defendants”) in federal court. The merchants alleged that the Defendants’ requirement that merchants who accepted the Defendants’ credit cards to also accept the Defendants’ debit cards was an illegal “tying arrangement” and an attempt to monopolize the debit card market. On February 22, 2000, the federal court certified a class of roughly four million merchants.
In re Visa Check/MasterMoney Antitrust Litigation,
PLEADINGS
This action began on May 20, 2003, when plaintiffs filed a Class Action Complaint against the defendants in the Chancery Court for Washington County. Plaintiffs filed individually and on behalf of Tennessee consumers similarly situated. The Complaint averred that thousands of merchants throughout Tennessee accept Visa and MasterCard credit cards as a form of payment, and that defendants had effectively forced these merchants to accept debit cards issued by the defendants’ bankcard associations as a condition of accepting defendants’ credit cards. The Complaint asserted that this “tying arrangement” increased the merchants’ operating costs and that these increased costs were passed on to all consumers in the form of inflated prices.
Plaintiffs averred that they are debit card holders who hаve used such cards to purchase goods from merchants located throughout Tennessee, and sought “to represent a Class of all Tennessee consumers who have purchased goods from [m]er-chants who accept Visa and MasterCard credit cards as a form of payment, and have been forced to accept debit cards issued by members of the Visa and MasterCard bankcard associations as a condi
The Complaint concluded that the defendants’ conduct violated the Tennessee Trade Practices Act (“TTPA”) and the Tennessee Consumer Protection Act (“TCPA”), and that the defendants’ conduct supports claims for unjust enrichment and money had and received.
On May 11, 2004, the defendants filed a Motion to Dismiss pursuant to Rule 12.02(6) of the Tennessee Rules of Civil Procedure requesting that the Chancery Court dismiss all of the plaintiffs’ claims. The Chancery Court then entered an Opinion and Order dismissing the plaintiffs’ claims under the TTPA and TCPA, and denied defendants’ Motion to Dismiss the common law claims. The Trial Court then granted both рarties interlocutory appeals pursuant to Rule 9, Tenn. R.App. P.
This Court granted both applications.
THE APPEALS
The issues on appeal are:
1. Whether the trial court erred in dismissing the Plaintiffs’ TTPA claim pursuant to Tenn. R. Civ. P. 12.02(6).
2. Whether the trial court erred in dismissing the Plaintiffs’ TCPA claim pursuant to Tenn. R. Civ. P. 12.02(6).
3. Whether the trial court erred in not dismissing the Plaintiffs’ claims for Unjust Enrichment and Money Had and Received pursuant to Tenn. R. Civ. P. 12.02(6).
4. Whether the trial court erred in not dismissing the Plaintiffs’ claims for injunctive relief as moot.
5. Whether the trial court erred in not transferring this action to Circuit Court.
A Motion to Dismiss filed pursuant to Tennessee Rule of Civil Procedure 12.02 tests the legаl sufficiency of the complaint, not the quality of plaintiffs proof.
Willis v. Tenn. Dep’t of Corr.,
The Tennessee Trade Practices Act, Tenn.Code Ann. § 47-25-101 to -115, prohibits anti-competitive conduct affecting the price of products to producers and consumers. The Act provides:
All arrangements, contracts, agreements, trusts, or combinations between persons or corporations made with a view to lessen, or which tend to lessen, full and free competition in the importation or sale of articles imported into this state, or in the manufacture or sale of articles of domestic growth or of domestic raw material, and all arrangements, contracts, agreements, trusts, or combinations between persons or corporations designed, or which tend, to advance, reduce, or control the price or the cost to the producer or the consumer of any such product or article, are declared to be against public policy, unlawful, and void.
Tenn.Code Ann. § 47-25-101 (2005). Additionally, the TTPA provides a private right of action to aggrieved consumers against those who violate its provisions.
Any person who may be injured or damaged by any such arrangement, contract, agreement, trust, or cоmbination described in this part may sue for and recover, in any court of competent jurisdiction, from any person operating such trust or combination, the full consideration or sum paid by the person for any goods, wares, merchandise, or articles, the sale of which is controlled by such combination or trust.
Tenn.Code Ann. § 47-25-106 (2005).
The Complaint charges that defendants entered into an “arrangement” or “combination” in which they required retail merchants who accepted their credit cards to also accept their debit cards. This “tying arrangement” increased the cost to merchants of the Defendants’ payment card processing services which in turn tended to advance the price of “products” or “articles” sold by those merchants to consumers in Tennessee. Plaintiffs do not allege that the defendants’ conduct directly affected Tennessee’s market for tangible goods. Rather, the plaintiffs allege that the defendants’ conduct directly affected the market for payment card processing services which incidentally affected the market for tangible goods.
The Chancery Court, in dismissing Plaintiffs’ claims under the TTPA, reasoned that the defendants’ alleged conduct did not involve a “product or article” within the intent of the TTPA. The Court’s other reason was that the TTPA was inapplicable because the plaintiffs did not allege sufficient facts to show the defendants “controlled” the “sale” of “goods, wares, merchandise, or articles” as required by the TTPA.
The law is well settled that the TTPA applies only to tangible goods, not intangible services. This principle was established by the Tennessee Supreme Court in
McAdoo Contractors, Inc. v. Harris,
In McAdoo, the trial court dismissed the claim, and on appeal to the Tennessee Supreme Court, the Court said:
We think it clear upon reading T.C.A. § 69-101 that it has no application under the facts and circumstances of this case. The statute in express terms applies to articles of foreign and domestic origin, so that it would be virtually impossible to bring under the statute a case involving only the award of a building construction contract. It would seem the statute would in such casе apply only to an unlawful effort to control the price of the budding material, and not to the award of the contract where control of cost of articles was not a factor.
On the basis of the well pleaded facts, the sole reason McAdoo did not get the contract, was not because of arrangements or agreements with respect to competition in articles of foreign or domestic origin, but because Carroll County had reserved to itself the right to award it to any bidder it might choose. And acting under this reservation, the contract was awarded by Carroll County to Forcum-Lannom, which its responsible advisers thought to be more experienced.
Before this statute could apply, it would be necessary to find and hold that this kind of contract provision has been outlawed by this Code section. But this is so obviously not the case that evencomplainant does not make this contention.
Id. at 597-98.
The
McAdoo
Court distinguished between a contract for tangible goods, where the TTPA would apply, and a contract for intangible services, to which the TTPA would not apply. Sincе that case, our courts have consistently followed this distinction and held that the TTPA only prohibits “arrangements” or “combinations” which involve products, not those that involve services.
Beaudreau v. Larry Hill Pontiac/Oldsmobile/GMC, Inc.,
Defendants’ conduct involved payment card processing services, not products. Plaintiffs attempt to avoid this by asserting that defendants’ conduct not only involved payment card prоcessing services, but also indirectly affected product prices and thus, implicated the TTPA. Essentially, plaintiffs attempt to avoid
McAdoo, Forman,
and
Beaudreau
and use an incidental effect upon products as a backdoor to state a cause of action. “It is a well settled principle of law that one cannot do indirectly what cannot be done directly.”
Haynes v. City of Pigeon Forge,
The Tennessee Consumer Protection Act, Tenn.Code Ann. §§ 47-18-101 to -126, prohibits “[u]nfair or deceрtive acts or practices affecting the conduct of any trade or commerce.” Tenn.Code Ann. § 47-18-104(a) (2005). The TCPA also creates a private right of action:
Any person who suffers an ascertainable loss of money or property, real, personal, or mixed, or any other article, commodity, or thing of value wherever situated, as a result of the use or employment by another person of an unfair or deceptive act or practice declared to be unlawful by this part, may bring аn action individually to recover actual damages.
Tenn.Code Ann. § 47 — 18—109(a)(1) (2005). We are required to liberally construe the TCPA to promote certain expressed policies, which include the protection of “consumers and legitimate business enterprises from those who engage in unfair or decep-five acts or practices in the conduct of any trade or commerce in part or wholly within this state” and “the development of fair consumer practices.” Tenn.Code Ann. § 47-18-102 (2005). The General Assembly directed that the TCPA “be interpreted and construed consistently with the interpretations given by the federal trade commission and the federal courts pursuant to § 5(A)(1) of the Federal Trade Commission Act (15 U.S.C. § 45(a)(1)).” Tenn.Code Ann. § 47-18-115 (2005). 4
The Complaint asserts that the defendants’ “tying arrangement” constitutes an unfair or deceptive act or practice affecting the conduct of trade or commerce in Tennessee. Further, that this arrangement inflated the price of consumer goods, causing the plaintiffs to suffer ascertainable losses. The Trial Court concluded that “unfair or deceptive acts or practices” do not include anti-competitive conduct in dismissing the plaintiffs’ TCPA claim. The plaintiffs argue the Trial Court’s interpretation of “unfair or deceptive acts or practices” is too narrow, and the insists the phrase includes anti-competitive conduct.
The Plaintiffs rely on
Blake v. Abbott Labs., Inc.,
No. 03A01-9509-CV-00307,
Thus, the Blake Court held thаt anti-competitive conduct which forms .the basis for a TTPA claim necessarily forms a valid basis for a TCPA claim. Anti-competitive conduct which falls outside the scope of the TTPA cannot be used to form the basis for a TCPA claim. Rather than supporting plaintiff’s argument, Blake would bar the plaintiffs’ TCPA claim because plaintiffs allegations of anti-competitive conduct failed to form the basis of a valid TTPA claim.
The dismissal of plaintiffs’ TCPA claim is further supported by
Sherwood v. Microsoft Corp.,
No. M2000-01850-COA-R9-CV,
Based upon its reading of 15 U.S.C. § 45(a)(1), the Sherwood court stated:
The federal provision referred to, unlike the TCPA, declares two types of offenses unlawful: (1) unfair methods of competition in or affecting commerce; and (2) unfair or deceptive acts or practices in or affecting commerce. While the Tennessee General Assembly has chosen to include in the TCPA’s prohibitions “unfair or deceptive acts or practices affecting the conduct of any trade or commerce,” Tenn.Code Ann. § 47-18-104(a), it did not includе unfair competition or anticompetitive acts. That choice is significant.
Sherwood, at *31.
The choice was significant because federal courts “interpreted the ‘unfair methods of competition’ language as applying to violations of the Sherman Act and other antitrust statutes and to actions raising antitrust issues or concerns.” Id. at *31 n. 35. “Apparently in reaction to judicial interpretation requiring a showing of injury to competition, not just to consumers, ... the Act was amended in 1938 to add to the FTC’s enforcement jurisdiction ‘unfаir or deceptive acts or practices.’ ” Id. at 31. Finally, the Sherwood Court stated, “We cannot presume other than that the Tennessee General Assembly knowingly chose not to include antitrust or anticompetitive conduct as actionable under the TCPA.” Id. at *32.
Finally, on this issue, plaintiffs argue the defendants’ anti-competitive conduct falls within the definition of “unfair” as expressed in
Tucker v. Sierra Builders,
Next defendants argue that the Trial Court erred in not dismissing plaintiffs’ claim for unjust enrichment and money had and received.
Both unjust enrichment and money had and received are essentially the same cause of action, being both quasi-contractual actions. 7 The Tennessee Supreme Court recently discussed the elements of an unjust enrichment claim as follows:
The elements of аn unjust enrichment claim are: 1) “[a] benefit conferred upon the defendant by the plaintiff”; 2) “appreciation by the defendant of such benefit”; and 3) “acceptance of such benefit under such circumstances that it would be inequitable for him to retain the benefit without payment of the value thereof.” The most significant requirement of an unjust enrichment claim is that the benefit to the defendant be unjust. The plaintiff must further demonstrate that he or she has exhausted all remedies against the person with whom the plaintiff enjoyed privity of contract.
A plaintiff need not be in privity with a defendant to recover under a claim of unjust enrichment.... [A] plaintiff need not establish that the defendant receiveda direct benefit from the plaintiff. Rather, a plaintiff may recover for unjust enrichment against a defendant who receives any benefit from the plaintiff if the defendant’s retention of the benefit would be unjust.
Freeman Indus. v. Eastman Chem. Co., 172
S.W.3d 512, 525 (Tenn.2005) (citations omitted) (quoting
Paschall’s, Inc. v. Dozier,
The Chancery Court found that plaintiffs’ Complaint sufficiently alleged that (1) the plaintiffs conferred a benefit upon the defendants, (2) the defendants appreciated this benefit, and (3) allowing the defendants to retain this benefit would be inequitable. Regarding the “exhaustion of remedies” element, the Chancery Court held that the plaintiffs had not yet exhausted their remedies, but that they did not have to do so at that point in the proceedings, and the Chancery Court held that while the “exhaustion of remеdies” element was a prerequisite to recovery it was not a prerequisite to proceeding against a third party defendant.
Defendants counter that plaintiffs cannot allege that the defendants retained any unjust enrichment or money had and received, because the defendants are “paying to a nationwide class of merchants — including the Tennessee merchants that accepted MasterCard or Visa — more than $3 billion to settle claims alleging overcharges from the same ‘tying’ assеrted in this case.” They further argue that the “exhaustion of remedies” element must be satisfied prior to proceeding against a third party defendant.
“The most significant requirement for a recovery on quasi contract is that the enrichment to the defendant be unjust.”
Paschall’s,
at 155. If a , third-party defendant “has given any consideration to any person” for the benefits received from the plaintiff, there is no injustice in allowing the defendant to retain those benefits without paying the plaintiff.
Id.
This principle is commonly applied to unjust еnrichment claims based upon improvements to real estate.
See e.g., Venture Const. Co. v. Apple Music City, Inc.,
Plaintiffs’ Complaint alleges the defendants’ “tying arrangement” forced Tennessee merchants to pay an artificially inflated price for defendants’ services and that these inflated costs were passed on to consumers in the form of higher product prices. Plaintiffs charge that the defendants indirectly received benefits from plaintiffs and that retention of those benefits by the defendants would be unjust. The Complaint also states, however, thаt a nation-wide class of merchants filed suit against the defendants in federal court alleging violation of federal anti-trust law, and that defendants have entered into two settlement agreements with these merchants and that, pursuant to these settlement agreements, the defendants will pay $3.05 billion into two settlement funds from which merchants’ claims for damages will be satisfied.
8
Thus, the Complaint
We pretermit the issue of whether plaintiff satisfied the “exhaustion of the remedies” requirement, because, based on the pleadings the plaintiffs cannot establish that defendants were unjustly enriched or retained any money had and received.
The Court has considered the remаining issues and find them to either be moot or without merit. The Judgment of the Chancery Court is affirmed in part, reversed in part, and the plaintiffs’ action upon remand will be dismissed. The costs of the appeal are assessed to plaintiffs Roger Bennett and Richard Allen Combs.
Notes
. In
Forman,
the Court also noted that, after the
McAdoo
decision, the General Assembly made numerous unsuccessful attempts to amend the TTPA in order to expand its scope, including one bill which would have expressly added "services” to § 47-25-101.
Jo Ann Forman, Inc.
. Two of the Plaintiffs' cases pre-date
McAdoo
and do not discuss the application of the TTPA to services.
Greene County Tire & Supply, Inc. v. Spurlin,
Four of the Plaintiffs' more recent cases did not address whether the TTPA applies to services because the restraint at issue involved tangible goods or the TTPA claim was dismissed on other grounds.
Piccadilly Square v. Int’l Constr. Co.,
The Plaintiffs also cited a federal decision,
Bloom v. General Elec. Supply Co.,
. The Plaintiffs’ alternative argument that the credit cards and debit cards issued by the Defendants are "products” allowing application of the TTPA to the Defendants’ conduct is not persuasive. These cards serve no function other than to identify their holders as individuals entitled to use the Defendants’ services. Cardholders do not pay the Defendants in order to obtain the cards; they pay the Defendants in order to use their payment processing services.
. 15 U.S.C.A. § 45(a)(1) provides: "Unfair methods оf competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful.”
. Specifically, the
Blake
court was concerned that there might be a later determination that the defendants' conduct predominately affected interstate commerce rather than intrastate commerce.
Blake,
. In
Tucker,
the plaintiff asserted that the defendant’s practice of selling its products exclusively through distributors was unfair and that the defendant deceptively misled the plaintiff regarding the quality of the distributor’s services.
Tucker,
. "Unjust enrichment is a quasi-contractual theory or is a contract implied-in-law in which a court may impose a contractual obligation where one does not exist.”
Whitehaven Community Baptist Church v. Holloway,
Actions brought upon theories of unjust enrichment, quasi contract, contracts implied in law, and quantum meruit are essentially the same. Courts frequently employ the various terminology interchangeably to describe that class of implied obligations where, on the basis of justice and equity, the law will impose a contractual relationship between parties, regardless of their assent thereto.
Paschall's, Inc.
v.
Dozier,
. The Federal District Court for thfe Eastern District of New York approved these settlement agreements in 2003, and all appeals of this ruling have been exhausted.
In re Visa Check/Mastermoney Antitrust Litigation,