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Unfair and Deceptive Acts and Practices: 1.3 Nature and Strengths of UDAP Statutes

UDAP statutes apply to most consumer transactions and provide a flexible and practical consumer remedy for many abuses. These statutes are particularly important because, while the Federal Trade Commission Act is often viewed as sharply limiting the doctrine of caveat emptor,4 the Act provides only FTC enforcement and not state or private enforcement.

Unfair and Deceptive Acts and Practices: 1.5.1 Federal Deception Law As a Companion Volume

NCLC’s Federal Deception Law is a companion volume to this treatise. Unfair and Deceptive Acts and Practices focuses on state UDAP claims. Federal Deception Law concentrates on federal and state statutes and regulations that, while often related to UDAP litigation, establish distinct requirements and remedies. It is strongly recommended that readers subscribe to both treatises.

Unfair and Deceptive Acts and Practices: 1.6 Attorney Advance Preparation for UDAP Clients

There are a number of steps attorneys can take, before the client appears, to prepare themselves to press UDAP claims successfully. To stay abreast of the law, in addition to referring to this treatise, the attorney should keep a file of the most current version of the state’s UDAP statute(s)23 and previous versions for the past five or so years, indicating when versions were superseded.

Unfair and Deceptive Acts and Practices: 1.9 Alternatives to a UDAP Action

While a practitioner’s first instinct should always be to look for a UDAP approach to a case, do not neglect alternative claims. Such claims may provide superior remedies or federal court jurisdiction. In other cases, when a UDAP statute’s scope, statute of limitations, or other limitation may prevent a UDAP claim, alternative claims are a necessity.

Collection Actions: 9.4.3.5 Colorado

In 2023, Colorado enacted a law that prohibits the credit reporting of medical debt, or the consideration of medical debt in a consumer’s credit score. Debt collectors may not misrepresent that a medical debt will be included on a credit report.651

Consumer Arbitration Agreements: 7.2.2 Two Separate TILA Requirements Limit Arbitration

In mortgage loans, TILA section 1639c(e)(1)—the “(e)(1) provision”—prohibits any terms that require arbitration or any other nonjudicial procedure as the method for resolving any controversy or settling any claims arising out of the transaction.45 The parties can agree to arbitration or a similar procedure at any time after a dispute or claim under the transaction arises.46

Truth in Lending: 12.7.3.1 Limits on Arbitration Involving Military Personnel

Federal law prohibits arbitration clauses in consumer credit agreements with military personnel or their dependents, or the enforcement of such a consumer credit agreement.1084 In determining if a borrower is a covered servicemember, a safe harbor is provided if the creditor looks up the borrower in a specified military database or uses a credit report.1085 An arbitration requirement though is unenforceable even after the consumer is no longer a servicemember or a dependent of a servicemembe

Consumer Arbitration Agreements: 10.7.1 Acknowledgments

This section discusses the advantages and disadvantages of mass arbitration, includes numerous practice tips in conducting a mass arbitration. It also discusses existing case law challenging business attempts to thwart mass arbitration. The practice tips were provided by Ray Gallo, a San Francisco attorney at Gallo LLP. He has extensive experience in handling mass arbitrations and other complex litigation.

Truth in Lending: 12.7.11 Mass Arbitration

Because of difficulties engaging in class arbitration or individual arbitration on behalf of many individual consumers, an increasingly utilized option is a procedure sometimes called “mass arbitration.” The practice takes its name from “mass torts,” which involves the filing of many individual personal injury complaints, often for product liability, toxic tort, or similar cases that involve factually similar predicates but do not lend themselves to class treatment. Another name for mass arbitration is an “arbitration swarm.”

Truth in Lending: 13.3.6.9.2 Disclosure of the purchase option price

If the option exists before the end of term, the lease must indicate, outside the segregated disclosures in the same place as disclosure of the right to purchase early, when this option can be exercised, and the price or method of determining the price.340 If a purchase option exists at lease end, the purchase price must be disclosed in the segregated portion of the disclosure form, in a form that is substantially similar to the model forms.341 A purchase option disclosure for

Consumer Arbitration Agreements: 3.3.2.2 Lower Court Rulings Finding Preemption

Relying on Supreme Court precedent,51 state courts and lower federal courts consistently find to be preempted state laws that—either expressly or by implication—place special burdens on the formation or enforcement of arbitration clauses in particular,52 or that require that certain types of claims or arguments be adjudicated by judicial or administrative bodies.53 The Ninth Circuit concluded tha