Businesses have flexibility when it comes to selling and marketing their products and services, but there are limits. You may push these limits without being aware of it and find yourself being sued for unfair competition. We can help your business if you’ve been accused of unfair, illegal competition.
An unfair business act or practice covers a very broad category of actions. To see if an act or practice is unfair involves looking at the impact on the alleged victim and the alleged wrongdoer’s reasons for the practice. A business practice could be considered unfair if it violates established public policy or if the practice is immoral, unethical, oppressive, unscrupulous or substantially injures consumers. Violating a business related law can be seen as violating unfair competition law. This includes breaking federal, state, or local law as well as standards of professional conduct.
If the public is likely to be deceived by a business practice it’s fraudulent. The company committing the practice doesn’t have to intend to deceive the public and its actions need not be relied upon by customers to be considered illegal. Unfair, deceptive, untrue or misleading advertising violates unfair competition law. This can include misstatements about the benefit of a product.
Examples of possible unfair competition include,
- Trademark infringement: Using another party’s trademark on a sign or on a product to confuse consumers into thinking they’re buying something of higher value made by a different company.
- Unauthorized substitution of one brand for another: Known as “bait and switch” a manufacturer or seller states a product is available for sale, using it as “bait,” but when the buyer tries to buy it, only a different product is available, creating a “switch.”
- Misappropriation of trade secrets: Stealing a competitor’s “secret recipe,” customer lists or marketing plans, then using them for monetary gain.
- False representation of products or services: Making any materially misleading product warranty or guarantee.
- False advertising: Making exaggerated claims about the quality or value of a product or service, above and beyond legitimate claims that help make sales.
Public prosecutors and private parties can sue to enforce California’s Unfair Competition law.
- Private attorneys can sue on behalf of the general public as well and may be awarded attorney’s fees.
- These legal actions are often proposed class actions because several to thousands of individuals may have been harmed and can receive restitution (you would have to pay whatever money you received because of your alleged, illegal practices) due to the unfair practices of your business.
- A judge could order the practice cease and never be used again and that the defendant pay civil penalties if a public attorney, such as the state’s Attorney General, is successful with a lawsuit.
Every business wants an advantage to succeed in the marketplace but violating boundaries, or even just coming close to them, may result in a lawsuit filed against your business claiming you’re engaged in unfair competition. If you have questions about unfair competition or because your business is accused of such actions or practices, contact Focus Law to schedule a consultation with an experienced business litigation attorney Law by calling (714) 415-2007 now.