Defending Unfair and Deceptive Trade Practices Claims
Business owners have a duty to run their operation with fairness and honesty. This means that the business delivers what it promises and acts in the interest of their customers and patrons. Businesses who run afoul of this are subject to claims and lawsuits from the people they serve. They also subject themselves to government intervention in the form of investigations and fines. Businesses who believe that they have been wrongfully accused by a customer should advance their best defense with a few considerations as discussed below.
What are Unfair and Defective Trade Practices?
Unfair and Deceptive Trade Practices are activities in which a business engages that is seen as “unfair” or “deceptive” as defined in the Federal Trade Commission Act (FTCA). The Federal Trade Commission, the governmental agency, administers and enforces the Act and oversees the activities of for-profit businesses. The federal government is not the only level of oversight. States have also passed laws that mirror the regulations set out in the Federal Trade Commission Act. These state-based laws are enforced by state consumer protection agencies and other bodies. According to the FTCA, an unfair practice is one that is injurious to the consumer, substantial, unavoidable by the consumer, and not outweighed by offsetting consumer benefits. Further, the FTCA determines “deception” by looking at whether a representation or omission has occurred that presents a practice to mislead, and the materiality of the act as well as the reasonableness.
Examples of Unfair and Deceptive Trade Practices
There are many ways a business can be charged as an unfair and deceptive business. In turn, there are also a number of ways a business can unknowingly fall into these categories. One major way companies get in trouble is through advertising. Making false claims about products or services can land a business under the radar. Some ads are misleading while others are entirely false. Another example of these practices can take the form of tampering to get a consumer to pay more for services or products. This example is best discussed in the industry of car servicing where a mechanic will feign a defect to convince a consumer to purchase a service. Another example is making certain representations that goods or services as having the sponsorship of a popular entity to bolster desirability. All of these examples can raise the interest of state and federal consumer agencies.
Defense Strategies for Businesses
Some consumers use claim of unfair and deceptive practices to overburden businesses that have not engaged in the alleged behavior. Other strategies include providing evidence to show truthfulness as well a history of good-dealing within the given community. This is where emails, documentary records, and customer testimonials come in handy.
Fort Lauderdale Business Law Attorney
Hiring an attorney for an FTC investigation ensures that you have a legal advantage. If a claim arises, an experienced and knowledgeable attorney can guide you through your options and keep you informed of your rights and defense strategies. Attorney Brendan A. Sweeney is a Fort Lauderdale business law attorney with years of experience advising on unfair and deceptive trade practices issues. Contact us for a consultation.