Class Rreflection 2
ACC 150
THE LEGAL ENVIRONMENT OF BUSINESS
With Doreen Smith, Esquire
Chapter 32
*
CONSUMER PROTECTION LAWS
- Consumer
- Any buyer afforded special protections by statute or regulation
- Who Can Be Liable?
- Persons or enterprises that regularly enter into the type of transaction that the injured consumer was involved.
*
GENERAL PRINCIPLES
Who can sue under consumer protection laws?
- Lawsuits by the government
- Lawsuits by consumers.
What Types of Damages are Available?
- Replacement or Refund.
- Invalidation of Consumer’s Contract.
Compensatory damages, punitive damages.
*
AREAS OF CONSUMER PROTECTION
Advertising (Deceptive Ads)
- Federal Trade Commission (FTC)
- Corrective Advertising: may be required
Labeling.
Labeling that exaggerates or misleads a consumer is not allowed.
*
AREAS OF CONSUMER PROTECTION
Selling Methods.
- Home-Solicited Sales: over $25 may be set aside within 3 business days (rescission)
- Telemarketing Fraud.
- National Do Not Call registry
- Allows consumers to opt out of telemarketing phone calls.
*
AREAS OF CONSUMER PROTECTION
- The Consumer Contract.
Form of Contract (ex. font size cannot be too small)
Two-Sided Contract (need notice that info. is on other side of page).
Disclosures requirements for many transactions.
*
UNCONSCIONABLE CONTRACTS
Uniform Commercial Code (UCC)
The UCC provides laws for certain contracts
Unconscionability
Protection of consumer when a contract term is oppressive to the consumer (makes contract void).
- Contracts that are grossly unfair to one party because of the superior bargaining power of the other party.
- Example:
- During a hurricane, businesses inflate the cost of bottled water because it is scarce. Consumer protection laws would prevent this type of price gouging.
AREAS OF CONSUMER PROTECTION
Credit, Collection, and Billing.
Equal Credit Opportunity Act:
Prevents discrimination in extending credit
Fair Credit Billing Act
Allows consumers to correct mistakes on bills.
*
CREDIT CARDS
- Federal regulations prevents giving out unsolicited distribution of credit cards.
- CARD (law relating to credit cards)
- Restricts the solicitation of credit cards for those under 21.
- Regulates late payment fees
- Limits fees on balance transfers
- Regulates the payment of credit card bills
FAIR DEBT COLLECTION ACT
- Federal law that prohibits improper methods of collecting debt.
- Can’t send a notice of debt to a debtor’s place of employment that reveals the debt.
- It is no defense to a creditor that the improper conduct was by a third party collection agency.
FAIR CREDIT REPORTING ACT
- Protects consumers from abuses that may arise when information is recorded and revealed.
- Credit reporting agencies cannot reveal private information to those who do not have a legitimate need for that information.
PENNSYLVANIA LAW
- Pennsylvania Unfair Trade Practices and Consumer Protection Law
- Lists 21 different acts that violate the law.
- Actions can be brought by the Attorney General, District Attorney or a private citizen.
- A private citizen can receive actual damages and the court can award 3 times damages and attorneys fees.