Unfair Competition

Orange County Unfair Competition Attorney

What is California Unfair Competition Law?

There are four basic types of unfair competition:

Unlawful Business Act or Practice

A business act that violates any law violates unfair competition law. These can include violation of federal, state, or local law as well as standards of professional conduct.

Unfair Business Act or Practice

This is a very broad category of actions. The legal test for determining whether a business practice is unfair involves the examination of the impact on the alleged victim balanced against the alleged wrongdoer’s reasons. A business practice is also unfair if it “offends established public policy or when the practice is immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers.” Community Assisting Recovery, Inc. v. Aegis Sec. Ins. Co., (2001). Compliance with law is a defense to a claim for unfair business acts.

Fraudulent Business Act or Practice

If members of the public are likely to be deceived by a business practice it is fraudulent. Further, the business need not have the motive or intent to deceive and the actions need not cause actual reliance by customers. However, if a claim is not likely to mislead anyone it will not be violate California unfair competition law.

Unfair, Deceptive, Untrue or Misleading Advertising

False advertising violates unfair competition law. This can include misstatements about the benefit of a product.

Who Can Bring a Claim for Unfair Competition?

Both public prosecutors and private attorneys can sue to enforce California’s Unfair Competition law. These lawsuits are often brought as class actions where several to thousands of individuals can recover for the unfair practices of a business. Private attorneys can sue on behalf of the general public as well.

Common Examples of Unfair Competition

Unfair competition can occur in any business, claims have been successfully asserted in the following contexts:

  • Charging hidden fees to credit card customers.
  • Advertising a specific type of coverage for insurance and not providing it in the actual policy.
  • Abusing debt collection practices by filing lawsuits against California debtors in other states.
  • Marketing cigarettes to children.
  • Violating the conditions of an environmental use permit.
  • Distributing obscene materials.
  • Pressure and deceit in requiring cosigners before providing health care services.
  • Deducting employee’s commission according to unidentified sales returns.

Remedies for Unfair Competition

Restitution and injunctive relief are available to remedy violations of California unfair competition law. Restitution damages are designed to return the benefit that was wrongly received by the business, this is also known as disgorgement of illegal profits. The damages from the disgorgement of profits need not go back specifically to all those who originally provided money to the organization. An injunction, by contrast, is non monetary relief that orders a practice to stop. Civil penalties against the business are only allowable where a public attorney such as the California Attorney General brings the lawsuit.

Unlike with other claims such as those for breach of contract or common fraud, compensatory damages are not available. However, attorney’s fees can be recovered in some cases if the lawsuit affects the public interest and confers benefit on the public and private enforcement of this law can be shown to be necessary.

Orange County Unfair Competition Lawyer

If you suspect you have been the victim of unfair business practices contact the Law Offices of Tony T. Liu. To schedule a consultation with an experienced California business law attorney call (714) 415-2007 today.

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