In this case the Massachusetts Supreme Judicial Court entertained an interlocutory appeal from a preliminary injunction issued by Judge Ralph D. Gants, Presiding Justice of the Business Litigation Session of the Superior Court. Judge Gants had enjoined Fremont from foreclosing on certain subprime home mortgage loans that he found to be in violation of G. L. c. 93A, the Massachusetts Consumer Protection Act. Judge Gants’s decision below had relied, in part, on retroactive application to the time of the issuance of the loans of what he perceived to be a current-day concept of unfairness in mortgage lending.
In an amicus brief filed in support of Fremont on behalf of itself and the Associated Industries of Massachusetts, NELF explained that amici’s interest in the case was not specific to mortgage lending and that amici were not without sympathy for the affected homeowners. As NELF indicated, amici’s concern was instead with the trial court’s retroactive application of a current-day concept of unfairness to the time of the challenged conduct. NELF argued that this was inconsistent with the fundamental principle of our common law that conduct must be judged by the standards in place when it occurs, raised constitutional concerns under the doctrines of void for vagueness and unlawful delegation of legislative power, and would impermissibly deprive businesses of certainty and predictability with respect to the conduct proscribed by Chapter 93A.
The Court, apparently heeding NELF’s warnings, upheld the preliminary injunction on grounds that did not rely on retroactive application of a new standard of unfairness. NELF’s brief had further argued that the Court’s standard for consumer unfairness decisions – whether the conduct runs afoul of “at least the penumbra of some common-law, statutory, or other established concept of unfairness” – is itself vague and unpredictable, providing insufficient guidance to trial courts and businesses alike, and should be replaced with the federal standard requiring violation of a “clear and well-established” public policy. The SJC’s decision did not address this argument, and Massachusetts law therefore continues to rely on “penumbras” of “concepts” for consumer unfairness determinations.