Opinion ID: 2081714
Heading Depth: 1
Heading Rank: 2

Heading: The Consumer Fraud Issue

Text: We next consider whether the appellate court erred in holding that the first count of the trustees' complaint was not sufficient to state a cause of action under section 2 of the Consumer Fraud and Deceptive Business Practices Act (Ill. Rev. Stat. 1987, ch. 121 1/2, par. 261 et seq. ) (the Consumer Fraud Act). (163 Ill. App.3d at 13.) Section 2 provides: Unfair methods of competition and unfair or deceptive acts or practices, including but not limited to the use or employment of any deception, fraud, false pretense, false promise, misrepresentation or the concealment, suppression or omission of any material fact, with intent that others rely upon the concealment, suppression or omission of such material fact, or the use or employment of any practice described in Section 2 of the `Uniform Deceptive Trade Practices Act',    in the conduct of any trade or commerce are hereby declared unlawful whether any person has in fact been misled, deceived or damaged thereby. In construing this section consideration shall be given to the interpretations of the Federal Trade Commission and the federal courts relating to Section 5(a) of the Federal Trade Commission Act. (Ill. Rev. Stat. 1987, ch. 121 1/2, par. 262.) The plaintiffs' contention is that price discrimination constitutes an unfair method of competition and that it is not necessary to allege deception in a case involving injury to competition in order to state a cause of action under the Consumer Fraud Act. The statute provides that in construing the Consumer Fraud Act, courts shall give consideration to Federal decisions interpreting section 5(a) of the Federal Trade Commission Act, on which our statute is patterned. Section 5(a) of the Federal Trade Commission Act provides: Unfair methods of competition in commerce, and unfair or deceptive acts or practices in or affecting commerce, are declared unlawful. (15 U.S.C. § 45 (a)(1) (1988).) The prohibition against unfair methods of competition in section 5(a) of the Federal Trade Commission Act has been interpreted to include anticompetitive price discrimination prohibited under Federal law by sections 2(a) and 2(c) of the Clayton Act. ( Federal Trade Comm'n v. Indiana Federation of Dentists (1986), 476 U.S. 447, 454, 90 L.Ed.2d 445, 454, 106 S.Ct. 2009, 2015-16; Times-Picayune Publishing Co. v. United States (1952), 354 U.S. 594, 609, 97 L.Ed.2d 1277, 1290, 73 S.Ct. 872, 880-81.) The plaintiffs contend that conduct violating sections 2(a) and 2(c) of the Clayton Act likewise constitutes a violation of the Consumer Fraud Act. The defendants, supported by the brief filed by the Illinois Hospital Association and the Metropolitan Chicago Healthcare Council, amici curiae, argue that the Consumer Fraud Act was not intended as an additional enforcement mechanism of the antitrust legislation and that the Federal interpretations of the Federal Trade Commission Act stating that price discrimination can be an unfair method of competition are irrelevant as beyond the legislative intendment of the Consumer Fraud Act. The defendants say that the dominating legislative intention was to protect consumers and others against various species of fraud and deceit. The defendants have the correct understanding of the Consumer Fraud Act's intendment. There is no indication that the legislature intended that the Consumer Fraud Act be an additional antitrust enforcement mechanism. The language of the Act shows that its reach was to be limited to conduct that defrauds or deceives consumers or others. The title of the Act is consistent with its content. The Consumer Fraud Act states it was enacted to protect consumers and borrowers and businessmen against fraud, unfair methods of competition and unfair or deceptive acts or practices. (Ill. Rev. Stat. 1987, ch. 121 1/2, par. 261.) Further indication that this is a statute directed against fraud and not one designed to be an additional antitrust enforcement mechanism is that every one of the specifically prohibited acts set out in the Act describes a situation where a buyer is being harmed by overreaching or fraudulent conduct. To illustrate, numerous sections of the Consumer Fraud and Deceptive Practices Act prohibit specified fraudulent conduct. They include frauds relating to chain referral sales techniques (section 2A), door-to-door sales (section 2B), return of downpayments (section 2C), advertisements of credit rates (section 2K), advertisement of factory authorized services (section 2M), non-English language transactions (section 2N), and free prize or gift offers (section 2P) (Ill. Rev. Stat. 1987, ch. 121 1/2, pars. 262A, 262B, 262C, 262K, 262M, 262N, 262P). The plaintiffs' citation of Fitzgerald v. Chicago Title & Trust Co. (1978), 72 Ill.2d 179, and Perrin v. Pioneer National Title Insurance Co. (1980), 83 Ill. App.3d 664, is not in point. Both Fitzgerald and Perrin involved complaints by third-party consumers alleging that the defendants had engaged in deceptive practices. Here third persons are not parties and the contracts were matters of public record. The plaintiffs have also abandoned their contention that the transactions were deceptive. It is significant too that interpreting the Consumer Fraud Act as the plaintiffs urge would not only conflict with the intendment of the Act itself, but would also conflict with what we have decided on this appeal was the legislative intention regarding prohibitions against Robinson-Patman-type activities. As discussed above, the legislature in the Antitrust Act declined to include provisions against price discrimination because the legislature found that inclusion of such prohibitions would be undesirable. To construe the Consumer Fraud Act to give a cause of action for discriminatory pricing that the legislature refused to give under the Antitrust Act would be incongruous. Legislation is designed to be consistent. It would be inconsistent to provide that the very conduct which is not sufficient to state a cause of action under the Antitrust Act is sufficient to state a cause of action under the Consumer Fraud Act. For the reasons given, the judgment of the appellate court is reversed in part and affirmed in part, and the judgment of the circuit court is affirmed. Appellate court judgment reversed in part and affirmed in part; circuit court judgment affirmed. JUSTICE CALVO took no part in the consideration or decision of this case.