Discretionary Treble Damages and Fee Awards in Michigan Consumer Protection Cases

Introduction

In Tina McPherson v. Suburban Ann Arbor, LLC, 25-a0099 (6th Cir. Apr. 21, 2025), the Sixth Circuit reviewed a jury verdict and district-court orders arising from a “yo-yo financing” dispute between a Michigan car buyer and a local dealership. Plaintiff McPherson alleged that Suburban Ann Arbor misled her into believing she had secured financing, extorted a larger down payment, then repossessed her Dodge Durango without warning. She sued under federal consumer statutes (the Fair Credit Reporting Act and the Equal Credit Opportunity Act) and Michigan state laws (the Regulation of Collection Practices Act and the conversion statute). After a jury awarded nearly $388,000 in actual and conversion damages plus $350,000 in punitive damages, the district court awarded prejudgment interest, costs, and roughly $419,000 in attorneys’ fees—but declined to “treble” the state-law awards. McPherson appealed the treble-damage and fee rulings; Suburban cross-appealed the attorney-fee award. The Sixth Circuit affirmed in full.

Summary of the Judgment

1. The court held that Michigan’s collection-practices statute (Mich. Comp. Laws § 445.257) and conversion statute (Mich. Comp. Laws § 600.2919a) grant trial courts permissive—rather than mandatory—authority to treble actual damages.

2. It found no abuse of discretion in the district court’s decision to forgo treble damages when a substantial $350,000 punitive award already served the goals of punishment and deterrence—especially under Supreme Court limits on punitive awards relative to actual damages.

3. On attorneys’ fees, the court upheld the district court’s reasoned lodestar calculation ($418,995) based on prevailing market rates, hours expended, and voluntary reductions, rejecting both McPherson’s bid for higher rates and Suburban’s contention that clerical work was over-billed.

Analysis

Precedents Cited

Manuel v. Gill, 753 N.W.2d 48 (Mich. 2008) – interpreting “may assess” as discretionary under the Collection Practices Act.
Aroma Wines & Equip., Inc. v. Columbian Distrib. Servs., Inc., 844 N.W.2d 727 (Mich. Ct. App. 2013) – confirming trial courts’ discretion to treble under the conversion statute.
Cultrona v. Nationwide Life Ins., 748 F.3d 698 (6th Cir. 2014) – applying abuse-of-discretion review to discretionary statutory awards.
Jackson v. Bulk AG Innovations, LLC, 993 N.W.2d 11 (Mich. Ct. App. 2022) – same principle.
State Farm Mut. Auto. Ins. v. Campbell, 538 U.S. 408 (2003) & BMW of N. Am., Inc. v. Gore, 517 U.S. 559 (1996) – due-process constraints on punitive awards.
Hensley v. Eckerhart, 461 U.S. 424 (1983) & Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542 (2010) – guiding fee-award methodology.

Legal Reasoning

• Treble Damages Discretion: The two Michigan statutes employ permissive language—“may assess” and “may recover”—connoting judicial discretion, not an automatic multiplier. The Sixth Circuit emphasized that actual damages must be calculated first, and the trial court may then decide whether trebling is necessary to achieve justice.

• Punitive-Award Consideration: Although the statutes do not enumerate other damages as factors, discretion inherently permits holistic evaluation. The district court, having presided over trial and sentencing, was best positioned to judge whether the $350,000 punitive award sufficiently punished Suburban’s willful misconduct.

• Constitutional Bounds: The Supreme Court advises restraint in punitive awards, warning that ratios above single-digit multipliers risk due-process violation. Denying treble damages avoided pushing the punitive-to-actual ratio beyond 10:1—a figure the Supreme Court deems close to the constitutional brink.

• Attorney’s Fees: Applying the lodestar method, the district court surveyed Michigan market rates, compared past awards for McPherson’s counsel, and vetted hours billed. It then trimmed the requested fees with voluntary write-offs and rate adjustments, arriving at a reasonable number. The Sixth Circuit declined to micromanage or demand “audit perfection.”

Impact

This decision clarifies several key points for future consumer-protection litigation in Michigan and the Sixth Circuit:

Trial courts retain broad discretion whether to treble damages under Michigan’s collection and conversion laws, even after a plaintiff satisfies statutory prerequisites.
Punitive-damages awards bear directly on the analysis, ensuring that treble multipliers are not employed to create excessive total awards contrary to due process.
District courts need not confine themselves to statutory enumerations when exercising discretion; they may consider the “total remedial package” to achieve fair and constitutional results.
Fee awards calculated under the lodestar framework will be upheld when grounded in market data, counsel experience, and reasonable billing judgments.

Complex Concepts Simplified

Treble Damages: A multiplier (3×) of actual damages permitted—but not required—by certain statutes to enhance deterrence and punishment.
Punitive vs. Statutory Damages:
- Punitive damages punish wrongdoing and deter repetition; subject to constitutional ratio limits.
- Statutory damages are fixed amounts prescribed by law when actual loss is hard to prove; here, treble damages are not “statutory” in that sense.
Yo-Yo Financing: A sales practice where dealers deliver vehicles on “spot delivery” pending financing approval, then cancel financing and repossess—even after collecting a down payment and fees.
Abuse of Discretion Review: Appellate courts defer to trial judges’ reasoned choices absent clear error, especially in setting multipliers and fee awards.

Conclusion

Tina McPherson v. Suburban Ann Arbor, LLC establishes that Michigan’s discretionary treble-damages statutes do not mandate triple recovery when punitive awards already achieve the twin aims of punishment and deterrence—and that trial courts enjoy wide latitude in fine-tuning relief. It reinforces the principle that district courts, armed with firsthand insights into the evidence and counsel performance, govern fee awards under the lodestar standard without burdensome, line-by-line audits. Together, these holdings equip practitioners and judges with clear guidance on balancing statutory remedies, constitutional constraints, and fair compensation in consumer-protection litigation.