Unfair and Deceptive Trade Practices Claims in North Carolina
North Carolina law provides that “[u]nfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are declared unlawful.” N.C.G.S. § 75-1.1(a).
Proving a ClaimLawsuits under Section 75-1.1 are commonly referred to as claims under the Unfair and Deceptive Trade Practices Act, or "UDTPA."
To establish a UDTPA claim, "a plaintiff must show that: (1) the defendant committed an unfair or deceptive act or practice; (2) the action in question was in or affecting commerce; and (3) the act proximately caused injury to the plaintiff." Wells Fargo Bank, N.A. v. Corneal, 767 S.E.2d 374 (N.C. App. 2014).
A practice is "unfair when it offends established public policy as well as when the practice is immoral, unethical, oppressive, unscrupulous, or substantially injurious to consumers or amounts to an inequitable assertion of power or position. To prove deception, while it is not necessary to show fraud, bad faith, deliberate or knowing acts of deception, or actual deception, a plaintiff must, nevertheless, show that the acts complained of possessed the tendency or capacity to mislead, or created the likelihood of deception." Id. (citation omitted).
Claims filed under the UDTPA can be very fact specific. While North Carolina courts hold that "a mere breach of contract" is not an unfair or deceptive act, "substantial aggravating circumstances attending the breach" may allow the plaintiff to recover under the UDTPA. See Ridley v. Wendel, No. COA16-363 (N.C. App. 2016).
Limits on ClaimsThere are limits on the scope of UDTPA claims. As just one example, "the General Assembly did not intend for the [UDTP] Act's protections to extend to a business's internal operations." White v. Thompson, 364 N.C. 47, 691 S.E.2d 676 (2010).
DamagesIf a plaintiff is successful in proving its UDTPA claim at trial, then N.C.G.S. Section 75-16 provides for treble damages.