Summary
The Ninth Circuit certified a question to the Nevada Supreme Court regarding whether a plaintiff suffers damages for fraudulent concealment or consumer fraud under NRS § 41.600 when the defendant’s fraud caused the plaintiff to purchase a product or service they would not have otherwise purchased, even if the product or service was not worth less than what was paid. The case arose from hotel guests who paid a resort fee but were not informed of legionella contamination in the water system. The district court dismissed for lack of damages, and the Ninth Circuit found no controlling Nevada precedent, noting a split among other jurisdictions on this issue.
Topics
Practice areas
Questions Presented
- For purposes of a fraudulent concealment claim, and for purposes of a consumer fraud claim under NRS § 41.600, has a plaintiff suffered damages if the defendant's fraudulent actions caused the plaintiff to purchase a product or service that the plaintiff would not otherwise have purchased, even if the product or service was not worth less than what the plaintiff paid?
Key quotations
“For purposes of a fraudulent concealment claim, and for purposes of a consumer fraud claim under NRS § 41.600, has a plaintiff suffered damages if the defendant's fraudulent actions caused the plaintiff to purchase a product or service that the plaintiff would not otherwise have purchased, even if the product or service was not worth less than what the plaintiff paid?” (7-8)
Factual background
Plaintiffs Aaron Leigh-Pink and Tana Emerson stayed at the Rio All-Suite Hotel and Casino in Las Vegas. The rooms were complimentary, but they paid a $34.01 per day resort fee for internet, telephones, and fitness room. Unbeknownst to them, the Rio's water system had been contaminated with legionella bacteria, which can cause Legionnaires' disease. The Rio knew of the contamination from a health district letter and meetings, but did not disclose it to incoming guests. Plaintiffs did not contract Legionnaires' disease, but sought to recover the resort fee based on the nondisclosure.
Procedural history
Plaintiffs brought a putative class action in Clark County District Court. After removal, the district court dismissed for failure to state a claim. Plaintiffs appealed. The Ninth Circuit affirmed in part, reversed in part, and certified a question to the Nevada Supreme Court.