In Nemier v. Nationwide Mutual Insurance Company, the Sixth Circuit ruled that Karen Nemier, a former Nationwide Insurance Company agent, had not raised a genuine issue of material fact to prevent summary judgment on her fraud and breach-of contract claims, holding the general statements by Nationwide about potential returns were not promises to her, were not knowingly false when made, or were mere puffery. Nemier had sued Nationwide for fraudulently inducing her to take out loans from Nationwide to open a new office. Nationwide agreed to forgive the loan in full if her new office met specific growth rates . Nemier accepted a loan in the amount of $100,000 based on studies by a Nationwide consultant and Nationwide’s assurances that given Nemier’s past success she would likely meet the sales goals required to waive her loan payments. But Nationwide’s loan program allegedly drove insurance premiums up, causing Nationwide to lose customers. Nemier missed her loan forgiveness target by 7 percent.
Nemier raised three separate theories of fraud. First, she claimed that Nationwide fraudulently induced her to take out a loan by promising lower rates in the new office’s location. The Sixth Circuit , in reviewing the district court’s grant of summary judgment to Nationwide, held, however, that Nemier’s evidence that Nationwide identified the location as a “target expansion market” and that the loan program would spawn “competitive” rates were not promises to Nemier. Moreover, these alleged promises could only be fraudulent if Nationwide intended to break them, evidence which Nemier did not have.
Second, Nemier claimed that Nationwide’s business projections were so optimistic that they qualified as dishonest. The Court rejected this claim, stating that Nationwide warned her that sales may be difficult and, in any event, these types of projections are mere “puffery, not fraud.”
Finally, Nemier alleged “silent fraud” because Nationwide failed to disclose its plan to compete with its agents directly. The Court rejected Nemier’s competition theory on the basis that Nemier provided so little information about the competition from Nationwide and its affiliates that it is “impossible to gauge whether that competition constituted a change in Nationwide’s business plan upon which Nemier would have ‘ naturally relied ‘ when deciding whether to open the Hartland store.” Furthermore, Nemier, the Court held, signed a contract permitting Nationwide to “make business decisions adverse to her interests.”