Federal Courts Refine When Chapter 93A Applies Over Out-of-State Laws
Recent federal rulings clarify when Massachusetts Chapter 93A applies despite out-of-state contract law.
Why it matters: This impacts how in-house counsel and legal ops teams draft contracts, manage compliance, and assess consumer protection exposure for businesses tied to Massachusetts. The guidance also affects contract management and future litigation risk strategy for companies operating nationally.
- Massachusetts' Chapter 93A bars unfair trade practices but only if misconduct is centered in-state.
- A federal court allowed a Chapter 93A claim despite a Florida law clause, since the conduct involved Massachusetts (Aiello v. Signature, Feb. 2024).
- In Callahan v. Arch Specialty, a broad New York law clause helped defeat a Massachusetts claim (D. Mass., Mar. 2024).
- Another case, Mulani v. Peter Pan Bus Lines, found the claim failed where the main events occurred in New York (D. Mass., Apr. 2024).
Massachusetts Chapter 93A lets consumers and businesses sue over unfair or deceptive acts. Yet its jurisdiction turns on whether alleged misconduct happened 'primarily and substantially' in Massachusetts—often intersecting with choice-of-law clauses, which specify which state's rules govern any disputes.
- In Aiello v. Signature Commercial Solutions, LLC (D. Mass., Feb. 2024), the court let a Chapter 93A claim move forward despite a Florida law clause, because the conduct in question—including refusal to release collateral—connected to Massachusetts.
- By contrast, Callahan, Inc. v. Arch Specialty Insurance Co. (D. Mass., Mar. 2024), found a broad clause referencing New York law for "any controversy... arising out of or relating to" the contract was enough to shut down a Chapter 93A claim.
- And in Mulani v. Peter Pan Bus Lines, Inc. (D. Mass., Apr. 2024), the court emphasized the location of the transaction and parties, ruling Massachusetts law did not apply even though the defendant was based there.
David G. Thomas and Angela C. Bunnell of Greenberg Traurig caution, "Companies doing business in Massachusetts should not assume that an out-of-state choice-of-law provision will immunize them from Chapter 93A exposure." Still, these cases show that clear contract drafting and careful attention to factual connections can reduce risk.
For legal departments, these decisions underscore the need for ongoing contract review and jurisdiction-specific risk modeling—not just during litigation, but also as part of standard legal operations and compliance efforts.
By the numbers:
- 3 recent District of Massachusetts rulings — clarify how courts weigh Chapter 93A’s reach
- 1,317 — number of federal consumer cases citing Chapter 93A since 2020
Yes, but: Some choice-of-law clauses still leave room for Chapter 93A claims if Massachusetts links are strong.
What's next: Ongoing appeals may further refine the boundaries of state law application in multi-jurisdiction contracts.