Unfairness in Consumer Protection Cases

 by Bob Lipson State and federal statutes prohibit unfair and deceptive business acts and practices.1 Washington’s Consumer Protection Act, R.C.W. 19.86 et seq., passed in 1961, can be enforced either by the attorney general acting on behalf of all state consumers, or by private counsel acting on behalf of individual or class clients.2 The Federal Trade Commission Act, 15 U.S.C.§ 41-58, passed in 1914, is enforced exclusively by the Federal Trade Commission (FTC).3 While unfair behavior and deceptive behavior are both prohibited, historically most consumer protection actions have focused on deception.4   Few unfairness cases are brought.  Although most complaints allege both unfair and deceptive business practices, despite this form of pleading, most cases are usually litigated as deception cases. What deception means is firmly rooted in case law.  Judges, juries and lawyers have little trouble understanding and applying it.  In contrast, the meaning of unfairness is less certain, although it is not so uncertain as to be unconstitutional.5 The purpose of this article is to explore what unfairness means in the context of consumer protection cases.  The article will look at historical development of the concept at the FTC, examine types of unfairness cases brought by the FTC over the years, review significant state and federal cases, and reflect on how related concepts might inform our understanding. The FTC’s First 50 Years: 1914-1964 Congress passed the Federal Trade Commission Act in 1914. The act’s original language outlawed “unfair methods of competition.”  Passed primarily due to Congress’s dissatisfaction with judicial interpretation of the anti-trust provisions in the Sherman Act, which Congress thought the courts were interpreting too restrictively, Congress wanted...