Marketing or Sales of Securities are Covered by the Tennessee Consumer Protection Act
The Middle Division of the Court of Appeals of Tennessee ruled late last week that acts or practices in connection with marketing or sales of securities are covered by the Tennessee Consumer Protection Act. In Johnson v. John Hancock Funds, the Court of Appeals reversed summary judgment for a financial advisor, deciding that the advisor could be liable under the TCPA for the marketing or sales of securities - in this case, mutual fund shares. Following the Supreme Court of Tennessee's former decision in Myint v. Allstate Co., the Court of Appeals applied a two-step test to determine whether a particular act or practice is covered by the TCPA. First, the Court looked to whether the statutes regulating the business indicate that they were intended to provide the exclusive remedy for unfair or deceptive acts or practices. Second, the Court examined the TCPA itself to determine whether the challenged conduct was beyond the scope of the TCPA.