Missouri consumers who have been victimized by deceptive marketing practices are not limited to recovering only their out-of-pocket costs. Rather, they are entitled to receive the benefit of their bargain.
This benefit-of-the bargain measure is “part of [Missouri’s] standard instructions for damages in misrepresentation cases, and applies to claims asserting violation of the Missouri Merchandising Practices Act (“MMPA“). Plubell v. Merck & Co., Inc., 289 S.W.3d 707, 715 (Mo. App. 2009). MAI 4.03 is the mandatory instruction for benefit-of-the-bargain, measuring damages as “the difference between the actual value of the (describe property, such as “the furnace”) on the date it was sold to plaintiff and what its value would have been on that date had (describe property)been as represented by defendant.” MAI 4.03 (emphasis original).
Missouri law adheres to a “value” rule rather than an out-of-pocket rule. As one court explained:
Under the more narrow and restrictive out-of-pocket rule, a defrauded plaintiff, who does not rescind the transaction and return the property, is limited only to recovering an amount of money equal to the difference, if any, between the amount that he parted with (i.e., what he is ‘out-of-pocket’) and the actual value of what he received.
Craft v. Philip Morris Cos., No. 002-00406A, 2003 WL 23139381, at *6 (Mo. Cir. Ct. Dec. 31, 2003) (citing 37 Am Jur. 2d Fraud and Deceit §§ 387 and 420) (emphasis original).
In contrast, under the more liberal benefit-of-the-bargain rule, a defrauded plaintiff is allowed to recover – regardless of the actual price paid for the purchased item – the difference between the actual value of the property received and the value that it would have been in the state represented (i.e., ‘if the representations had been true.’).
Id. (citing Kendrick v. Ryus, 123 S.W. 937, 939 (Mo. 1909) 37 Am. Jur. 2d Fraud and Deceit §§ 385 and 416; 13 A.L.R.3d 875, § 3(a)) (emphasis original). A majority of jurisdictions, including Missouri, follow the more pro-consumer benefit of the bargain rule. Id. At *6. See, e.g., Kendrick v. Ryus, 123 S.W. 937, 940 (Mo. 1909) (Missouri law compensates for lost bargain not price paid); Kaufman v. Davis, 161 S.W. 1180, 1180 (Mo. App. 1913) (defrauded purchaser can recover “the benefits” of bargain). “An important aspect of the benefit-of-the-bargain rule . . . is that, although the price paid and the value the item would have been if it had been in the condition as represented are often one and the same . . . there is no such necessary relationship.” Craft, 2003 WL 23139381 at *8. While damages “cannot be less that the money . . . [plaintiff] parted with . . . [t]his is not a ceiling but a floor.” Crawford v. Smith, 470 S.W.2d 529, 532 (mo. 1971).