Source: http://www.jdporterlaw.com/285-2/private-claims-unfair-deceptive-trade-practices-colorado-consumer-protection-act/
Timestamp: 2019-04-21 02:10:03+00:00

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The Colorado Consumer Protection Act is a statutory scheme adopted by the Colorado legislature intended to deter and punish businesses that engage in unfair or deceptive trade practices with the public. In particular, the Colorado Consumer Protection Act is codified at Colorado Revised Statutes (“C.R.S.”) § 6-1-101, et seq.
Importantly, the statutory scheme provides for both public and private rights of action. That is, both public entities, such as the Colorado Attorney General’s Office, and private citizens may bring actions to enforce the Colorado Consumer Protection Act.
Public actions are typically oriented more towards stopping deceptive business practices and, if brought by a law enforcement agency, can include criminal punishments as well. In contrast, private rights of actions are typically brought by consumers and focus more on obtaining compensation, also known as damages, that the consumer incurred as a result of the unfair or deceptive acts.
This article primarily discusses private rights of action under the Colorado Consumer Protection Act but is generally applicable to public actions as well.
(5) The deceptive or unfair trade practice caused actual damages or losses to the plaintiff.
See Rees v. Unleaded Software, Inc., 383 P.3d 20 (Colo. App. 2013).
Notably, because Colorado Consumer Protection Act claims inherently require the existence of fraudulent or deceptive practices, there is authority out there indicating that claims brought under the act must be plead with particularity, similar to general fraud claims or claims based on misrepresentation. See e.g., C.R.C.P. 9(b).
That is, specifics of the alleged deceptive or unfair business practice should be plead in the complaint as opposed to generally asserting that deceptive or unfair business practices occurred. While no Colorado state courts have explicitly adopted this requirement, the federal District of Colorado has consistently applied and upheld this requirement. See Pertile v. General Motors, LLC, No. 15-cv-0518-WJM-NYW (D. Colo. Sep. 22, 2017).
Additionally, for statute of limitations purposes, Colorado Consumer Protection Act claims must be brought within 3 years after the consumer discovered or reasonably should have discovered the occurrence of the false, misleading, or deceptive act or practice. See C.R.S. § 6-1-115.
– Knowingly represents that hemp, hemp oil, or any derivative of a hemp plant constitutes retail marijuana or medical marijuana unless it fully satisfies the definition of such products pursuant to Colorado statutes.
Importantly, the Colorado Supreme Court has held that unfair or deceptive trade practices must be intentional in order to establish liability. That is, negligent actions do not amount to unfair or deceptive trade practices under the act. See Crowe v. Tull, 126 P.3d 196 (Colo. 2006).
An important element for establishing liability under the Colorado Consumer Protection Act is the requirement that the unfair or deceptive trade practice has a significant impact on the public. Indeed, this is an element where many claims fail.
– Evidence that the trade practice has previously impacted consumers or has significant potential to do so in the future.
The public interest requirement reflects the intention of the Colorado Consumer Protection Act to deter and punish businesses that commit deceptive practices in dealing with the broader public. Accordingly, the Colorado Consumer Protection Act cannot be used to remedy a purely private wrong.
A purely private wrong is one that does not have a significant enough on the public such that only the parties to the transaction are affected by the alleged unfair or deceptive business practice. In such circumstances, while a Colorado Consumer Protection Act claim may not be available, the consumer will usually have a breach of contract claim or other claim that is more specific to the transaction that occurred between the parties. See Rhino Linings USA, Inc. v. Rocky Mountain Rhino Lining, Inc., 62 P.3d 142 (Colo. 2003); Crowe v. Tull, 126 P.3d 196 (Colo. 2006).
– One Creative Place, LLC v. Jet Center Partners, LLC, 259 P.3d 1287 (Colo. App. 2011), where the public impact requirement was not met in relation to the selling and refueling of jets based on pilots being sophisticated, having sufficient bargaining power, and where no deception to actual purchasers or consumers had been shown.
– Vista Resorts, Inc. v. Goodyear Tire & Rubber Co., 117 P.3d 60 (Colo. App. 2004), where a verdict under the Colorado Consumer Protection Act was affirmed and, thus, inherently affirming that the public impact requirement had been met, where approximately 950 consumer complaints had been filed in relation to rubber hose used in floor heating systems.
– Rhino Linings USA, Inc. v. Rocky Mountain Rhino Lining, Inc., 62 P.3d 142 (Colo. 2003), where it was found that the public impact requirement was not met in relation to a dealer contract for supplying polyurethane linings where the only dealer contracts affected were 3 out of 550 and the plaintiff had been represented by counsel in negotiating those contracts.
– Hall v. Walter, 969 P.2d 224 (Colo. 1998), where the Colorado Supreme Court affirmed a jury verdict under the Colorado Consumer Protection Act and, thus, inherently affirmed that the public impact element had been met where subdivision developers had advertised and sold subdivision lots to the general public on the basis that a private road provided proper access to the lots when, in fact, it did not.
Notably, whether a particular trade practice has a significant impact on the public is a question of fact as opposed to a question of law and, accordingly, is one reserved to the finder of fact. See One Creative Place, LLC v. Jet Center Partners, LLC, 259 P.3d 1287 (Colo. App. 2011).
While the public impact requirement is the hardest to meet, with many cases having been dismissed for failing to satisfy it, generally the more consumers that are affected by the deceptive or unfair trade practice the more likely a case will survive dismissal.
That is, if the relative number of consumers affected by the alleged deceptive or unfair trade practice is low, then the action looks more like a purely private wrong that is not addressable under the Colorado Consumer Protection. See Coors v. Security Life of Denver Insurance Co., 91 P.3d 393 (Colo. App. 2003), rev’d in part on other grounds, 112 P.3d 59 (Colo. 2005).
Further, actual injury caused by the unfair or deceptive trade practice is also an important consideration. While more than one consumer may have used or purchased a business’s services or product, that does not necessarily mean all of them were adversely affected by the alleged unfair or deceptive business practice. Accordingly, establishing a connection between the unfair or deceptive trade practice and the injuries actually incurred by consumers is also important for surviving dismissal. See Hildebrand v. New Vista Homes II, LLC, 252 P.3d 1159, 1169 (Colo. App. 2010).
– If the defendant acted in bad faith as established by clear and convincing evidence, then three times the amount of actual damages incurred.
That is, if the plaintiff is successful, the defendant will be liable for a minimum of $500. However, if actual damages are greater than $500, the defendant will be liable for actual damages or three times actual damages if the defendant’s conduct was done in bad faith; that is, the conduct was fraudulent, willful, knowing, or intentional. See also Vista Resorts, Inc. v. Goodyear Tire & Rubber Co. 117 P.3d 60 (Colo. App. 2004).
Since the Colorado Consumer Protection Act provides the opportunity for treble damages, being found liable under the act for engaging in unfair or deceptive trade practices can have significant repercussions. Indeed, many plaintiffs bringing claims under the act push for treble damages as a modest amount of damages can quickly become considerable. Moreover, because unfair or deceptive trade practices are almost inherently done intentionally or fraudulently, often times the facts that support a judgment under the Colorado Consumer Protection Act will also support trebling of damages under the bad faith requirement.
Lastly, in addition to damages as discussed above, a successful plaintiff will also be entitled to costs and attorneys’ fees in litigating the action as determined by the court. See C.R.C. § 6-1-113(2)(b).

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