The standard for a statement of fact may be strengthened
Philadelphia, Penn.—A case in front of the Pennsylvania Supreme Court could prompt assisted skilled nursing facilities and other organizations that offer personal services to the public to review the accuracy of their marketing materials, warns Brandon Sher, an attorney in national law firm LeClairRyan’s Philadelphia office.
“Regardless of the outcome, skilled nursing facilities and the like should be put on notice about the representations made in their marketing materials,” writes Sher in a recent blog, Risky Business – Skilled Nursing Facilities Under Attack. His post appears in the firm’s Long Term Counsel blog, which focuses on management and legal issues for long term care providers.
The matter, Commonwealth of Pennsylvania v. Golden Gate National Senior Care LLC, et al., 16 MAP 2017, focuses on a series of claims that a skilled nursing facility, Golden Gate National Senior Care, made in its marketing materials and documents. Pennsylvania’s Office of Attorney General (OAG) disputed some of the facility’s marketing statements, including assertions that it has “licensed nurses and nursing assistants available to provide nursing care and help with activities of daily living (ADLs),” and that “Snacks and beverages of various types and consistencies are available at any time from your nurse or nursing assistant.”
In fact, the OAG alleged, Golden Gate did not have sufficient staff to render care, and it did not have enough staff to timely respond to requests for snacks and beverages, in violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL), 73 Pa C.S.A. § 201-1, et seq.
But the appellate court, the Commonwealth Court of Pennsylvania, ruled that “the Marketing Statements were offered and understood as an expression of the seller’s opinion only, which is to be discounted as such by the buyer, and on which no reasonable person would rely, they are puffery, and may not form the basis for a UTPCPL action.”
In its decision, the court said the facility’s marketing statement about the availability of licensed nurses and nursing assistants contains a “subjective analysis” and does not contain a false representation of specific characteristics of the services offered. It also said the statement about snacks and beverages used “broad, vague and commendatory language” that also qualified as non-actionable puffery.
The OAG had asserted additional claims about unjust enrichment in connection with billings submitted to the Pennsylvania Medical Assistance Program, but the appellate court said a different, mandated system is already in place to pursue those allegations.
The OAG appealed the appellate court’s decision, arguing that the UTPCPL covers not only advertising, but also representations made about goods and services that create a likelihood of confusion or misunderstanding.
“Pennsylvania has the fifth highest percentage of elderly residents in the country, and the Pennsylvania Supreme Court’s future holding can have national implications, as it would provide a roadmap for other states to prosecute under their respective UTPCPL,” writes Sher. “No matter in what state the facility is situated, the statements in marketing materials should always be accurate.”
As a trusted advisor, LeClairRyan provides business counsel and client representation in corporate law and litigation. In this role, the firm applies its knowledge, insight and skill to help clients achieve their business objectives while managing and minimizing their legal risks, difficulties and expenses. With offices from coast to coast, the firm represents a wide variety of clients nationwide. For more information about LeClairRyan, visit www.leclairryan.com.
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