Consumer Protection Acts: What to Know for Businesses – Part One

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Every state has a consumer protection law that prohibits deceptive business practices, with many prohibiting unfair or unconscionable practices as well. These statutes, commonly known as Unfair and Deceptive Act and Practice (“UDAP”) statutes, are intended to provide specific protections and remedies for consumers in the marketplace. UDAP laws have very broad language and cover a wide variety of activities. A common theme among these statutes, however, is that they forbid any unfair business practice, whether such practice is fraudulent or deceptive, and whether or not it is intended to harm consumers. Many of the individual state statutes also prohibit unconscionable conduct. State courts traditionally construe these standards liberally for the purpose of protecting consumers. Additionally, these statutes contemplate a wide range of potential remedies including restitution, multiple damages, attorneys’ fees, and civil penalties, and many also provide for a private right of action. Accordingly, businesses should be aware of the hallmarks of the consumer protection acts in the states where they conduct business, particularly where such statutes may be subject to amendment.

Rhode Island

For example, a 2021 change to Rhode Island’s consumer protection act is expected to expose more businesses to liability that were previously exempt under the prior incarnation of the Rhode Island UDAP. The modification, which was signed into law by Governor Dan McKee last July, makes regulated businesses that were once immune from lawsuits for “unfair methods of competition and unfair or deceptive acts or practices” subject to actions brought by the State Attorney General.

Before the recent enactment, Rhode Island was labeled by the National Consumer Law Center as one of the “terrible two” states whose unfair and deceptive acts and practices protections had been “gutted by court decisions that interpret the statute as being applicable to almost no consumer transactions.” Rhode Island case law previously held that businesses regulated by a governmental body were immune from suit under the consumer protection statute.

Rhode Island’s consumer protection act now broadly prohibits unfair methods of competition and unfair or deceptive acts or practices in the conduct of trade or commerce. The act defines unfair methods of competition and unfair or deceptive acts or practices to include conduct likely to cause confusion as to the source of goods or services, as well as misrepresentations that goods have certain characteristics. Recent changes to the Rhode Island consumer protection action act also provide for an increase in the damages available to private litigants per violation and the potential for treble damages. These changes bring Rhode Island’s consumer protection act in line with most other states. Below is a select overview of a few noteworthy states (additional states will be discussed in future alerts within this series).


The Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”), Florida Statute §§501.201-501.213, expressly prohibits deceptive practices, unfair competition, and illegal or dishonest trade practices.  The FDUTPA is specifically intended to protect consumers from unconscionable, unfair, or deceptive business practices. A standard claim for damages under the FDUTPA has three main elements, including (1) a deceptive act or unfair practice, (2) causation, and (3) actual damages. A per se violation of the FDUTPA can also be established by a violation of any ordinance, regulation, rule, statute, or law that proscribes unfair acts, practices or methods of competition.

A claimant under the FDUTPA may bring an action to obtain (1) an order for actual damages suffered, plus court costs and attorney’s fees, (2) an order to force a party to stop their unlawful practices or acts, and/or (3) a court declaration that the practice is a violation of the statute.

The FDUTPA carves out some exceptions regarding where it does not apply.  These exceptions of the FDUTPA include the following:

  • Claims for death or personal injury.
  • Claims for property damage.
  • Practices or acts specifically permitted by state or federal law.
  • Printers, broadcasters, or publishers engaged in reproducing printed materials or distributing information, including pictures (provided they are being distributed without any knowledge of violation).
  • Activities or persons regulated by laws set by the Office of Insurance Regulation of the Financial Services Commission, Office of Financial Regulation of the Financial Services Commission, the Florida Public Services Commission, and/or the Department of Financial Services.


Massachusetts’ consumer protection statute is known as Chapter 93A. It states that “[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful.”  This broad language includes a variety of unfair and deceptive acts and practices.

An unfair or deceptive act is typically found when a seller deceives or acts unfairly towards a consumer.  The Massachusetts Attorney General has enacted certain regulations which define per se unfair or deceptive practices, but this list is not exhaustive.  In considering whether a specific act violates the statute, courts will consider whether it is unethical or immoral, whether it is dishonest, whether it violates the commonly accepted notions of fair dealing, and whether it is likely that substantial harm would occur.

Consumer vs. Business

Section 9 of Chapter 93A grants a right to any person injured by an unfair trade practice the right to bring suit against a business. A consumer’s first step in filing a Chapter 93A complaint is to serve a demand letter. The demand letter is intended to put the business on notice of the suit as well as encourage the out-of-court settlement of the issues. The recipient business has thirty (30) days to respond to the letter.  In that response, the business can make a settlement offer. If the offer is rejected, however, a court may later determine the settlement offer was reasonable. In that scenario, the consumer’s recovery may be limited to the amount offered in the settlement.

Business vs. Business

Chapter 93A also protects businesses from unfair trade practices.  If a business brings a civil action against another business under the statute, Section 11 of Chapter 93A applies. Under Section 11, there is no demand letter requirement as there is for consumer plaintiffs.  This section does permit the submission of a settlement offer before initiation of a lawsuit, which if later found reasonable may limit the plaintiff to single damages. An additional requirement on litigation under Section 11 is that the unfair or deceptive practices must have occurred primarily and substantially within Massachusetts. This requirement does not exist for consumer plaintiffs under Section 9 of the Act.


A plaintiff may first seek compensatory damages, i.e., the amount of money or other remedy required to compensate the plaintiff for their injury as a result of the defendant’s actions.  In certain cases, the amount of compensatory damages may be doubled or tripled if the plaintiff can prove (1) the defendant willfully and knowingly violated Chapter 93A or (2) the defendant refused to grant relief in bad faith with knowledge or reason to know that the underlying acts violated Chapter 93A. If these requirements are proven, plaintiffs may also be able to seek recovery of their reasonable attorney fees.

New York

In New York, consumer statutory fraud claims are governed by the Deceptive Practices Act, General Business Law Section 349 (“Section 349”).  Section 349 can be applied broadly to many different types of economic activity.  The New York State Attorney General may bring an enforcement action under the Act, but the statute also provides the right to sue any business engaging in fraud to enjoin the deceptive acts or practices or recover actual damages.

Both consumers and corporate competitors can sue under General Business Law Section 349.  A plaintiff will need to prove that:

  • The defendant business has engaged in a materially deceptive practice or act.
  • The practice or act was consumer-oriented.
  • The plaintiff was injured due to the deceptive practice or act.

Practices or acts are considered materially deceptive when they are likely to affect a consumer’s selection of goods or actions related to goods. The injury needs to be actual, but it does not need to be economic.

Section 349 generally provides a lower bar for a plaintiff to meet than common law fraudulent misrepresentation claims or claims under Section 350, which controls deceptive ads and product labels. The remedies available under Section 349 include injunctive relief or the recovery of actual damages. If the violation of the Deceptive Practices Act is deemed to be willful or knowing, the court has the discretion to award treble damages.

North Carolina

The North Carolina Unfair and Deceptive Trade Practices Act (“UDTPA”), G.S. § 75-1.1, can be broadly applied to anyone engaged in commerce within the state. The principal prohibition in the UDTPA states “[u]nfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are declared unlawful.” G.S. § 75-1.1. A knowing violation of the UDTPA subjects defendant businesses to potential treble damages, costs and attorney’s fees.

In determining whether an act or practice is “unfair,” courts will look at whether it:

  • Violates industry standards.
  • Violates established public policy.
  • Is immoral, unethical, or unscrupulous.
  • Substantially injures consumers.
  • Is an inequitable assertion of the party’s power or position.
  • Tends to deceive.

The UDTPA notably does not apply to “learned professionals.” The statute specifically states that the UDTPA “does not include professional services rendered by a member of a learned profession.” What exactly qualifies as a “learned” profession is a question that has evolved over the years. The UDTPA, however, has been held to include attorneys, doctors, ministers, hospital administrators, medical facility owners, infertility specialists, chiropractors, nurses, veterinarians, architects, and engineers, among others. As such, these professionals are not subject to liability under the UDTPA for conduct arising from the performance of their job duties.

South Carolina

Similar to the Federal Trade Commission (“FTC”) Act, the South Carolina Unfair Trade Practices Act (“UTPA”), § 39-5-10, et seq., prohibits “[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce” and addresses both consumer protection and anticompetitive behavior in the marketplace. Unlike the FTC Act, however, the UTPA provides for a private cause of action for consumers. In addition, a plaintiff may recover attorney fees and treble damages for a “willful” violation of the UTPA. The scope of the UTPA is not strictly tied to the FTC Act and South Carolina courts are free to find violations of the UTPA through methods, acts, or practices not specifically declared unlawful by the FTC or the Federal courts.

Unfair or Deceptive

South Carolina courts define the terms “unfair” and “deceptive” according to the facts of each case. Some practices are undeniably unfair, but in more questionable cases, courts will consider whether the trade practice is offensive to public policy, immoral, unethical, or oppressive. A plaintiff does not need to show that a claim or representation was intended to deceive, but rather need only demonstrate that it had the capacity, effect, or tendency to deceive. Moreover, the capacity to deceive can be found without a finding of actual deceit.

Public Impact

In addition to establishing that an act or practice is unfair or deceptive, a plaintiff must show the act or practice has an impact upon the public interest. Proving “public impact” is more difficult than proving deception or unfairness. Although courts have articulated broad standards by which a plaintiff may establish unfairness or deception, they also consistently reject speculative claims and require evidentiary proof of such effects. One way a plaintiff may establish an “impact on the public interest” is by showing that unfair or deceptive acts or practices have a potential for repetition. In an action between businesses, the potential for repetition must be shown to affect consumers and not just other businesses who are not parties to the suit. Further, a showing of public “impact” is necessary whether the claim is either for unfair or deceptive acts or unfair competition.

Trade or Commerce

For conduct to be actionable under the UTPA, it must occur “in the conduct of any trade or commerce.” Under the UTPA, trade and commerce “shall include the advertising, offering for sale, sale or distribution of any service and any property, tangible or intangible, real, personal, or mixed, and any other article, commodity or thing of value wherever situate, and shall include any trade or commerce directly or indirectly affecting the people of this state.”  These examples are illustrative and not exhaustive. Despite the broad scope of the UTPA’s definition of trade or commerce, a party’s noncommercial acts are not within the UTPA’s scope even though they may affect another’s trade or commerce.


Under the UTPA, a private party may recover damages for “any ascertainable loss of money or property . . . as a result of . . . an unfair or deceptive method, act or practice.” Additionally, a party may recover attorney fees. Actual damage is defined as “the difference in value between that with which the plaintiff parted and that which he received.” Where “the unfair or deceptive method, act or practice was a willful or knowing violation of [the UTPA], the court shall award three times the actual damages sustained.” “Willful” under the UTPA is found where a party should have known that the subject conduct violates the UTPA. The standard is not one of actual knowledge but of constructive knowledge. If in the exercise of due diligence, persons of ordinary prudence engaging in trade or commerce could have ascertained that their conduct violates the Act, then such conduct is “willful” within the meaning of the statute.


This alert is not to be construed as legal advice or a legal opinion on any specific facts or circumstances. This alert is not intended to create, and receipt of it does not constitute a lawyer-client relationship. The contents are intended for general informational purposes only, and you are urged to consult your attorney concerning any particular situation and any specific legal question you may have. We are working diligently to remain well informed and up to date on information and advisements as they become available. As such, please reach out to us if you need help addressing any of the issues discussed in this alert, or any other issues or concerns you may have relating to your business. We are ready to help guide you through these challenging times.

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