What are unfair business practices?

On Behalf of | May 27, 2018 | Firm News |

Making your business successful requires lots of effort, skill and ingenuity. If you do it right, you can build a strong company with a solid customer base and ample financial support. However, if you do things wrong, you can find a lawsuit in your hands.

One of the ways you may unintentionally mess up is through unfair business practices. This term is broad, so looking at it more closely can help you avoid getting into trouble from your own illegal activity or that of other companies.


According to the Federal Reserve, the basic definition of an unfair practice is one that hurts (or may hurt) a customer without outweighing benefits or a way to avoid the harm. A practice is deceptive if it misleads (or may mislead) customers in a way that is material and reasonable for the customer to fall for the deception.


Examples of violations of consumer protection laws include the following:

  • Misrepresentation of a product, such as making false or unproven health claims or using incorrect photos
  • Failure to provide products or services after receiving payment
  • Omission of important and influential information
  • Use of illegal contacting methods
  • Markup of prices for items supposed to be on sale
  • Advertisement of a product to attract customers but with no intention of actually selling that product
  • Hidden fees for services

Often these actions happen to vulnerable populations the most, such as senior citizens, immigrants and those in debt. However, consumers are not the only ones whom unfair business practices affect. Other businesses can receive harm, as well, through unfair competition such as trademark infringement, false advertisement, corporate raiding and theft of trade secrets. In these cases, you may find yourself as either the offender or the victim. Both require qualified legal defense to protect your rights.

The best way to avoid being the offender is to ensure you comply with all state and federal regulations, make communications and contracts clear and use legal counsel for guidance.