Opinion ID: 2379970
Heading Depth: 3
Heading Rank: 2

Heading: Unfair or Deceptive Acts or Practices

Text: [¶ 15] Weinschenk and RWB contend that they did not engage in unfair or deceptive acts or practices in violation of the UTPA. The UTPA does not contain a definition of either the term unfair or deceptive. Shattuck, 2000 ME 38, ¶ 13, 747 A.2d at 178. Determination of whether an act or practice is unfair or deceptive in violation of the UTPA must be made by the fact-finder on a case-by-case basis. Binette, 688 A.2d at 906. In determining what constitutes an unfair or deceptive act pursuant to the UTPA, we are guided by the interpretations given by the Federal Trade Commission (FTC) and the federal courts. 5 M.R.S.A. § 207(1); Suminski v. Maine Appliance Warehouse, Inc., 602 A.2d 1173, 1174-75 n. 1 (Me.1992). [¶ 16] To justify a finding of unfairness, the act or practice: (1) must cause, or be likely to cause, substantial injury to consumers; (2) that is not reasonably avoidable by consumers; and (3) that is not outweighed by any countervailing benefits to consumers or competition. Tungate v. MacLean-Stevens Studios, Inc., 1998 ME 162, ¶ 9, 714 A.2d 792, 797; FTC v. Crescent Publ'g Group, Inc., 129 F.Supp.2d 311, 322 (S.D.N.Y.2001); 15 U.S.C.A. § 45(n) (West 1997). The trial court essentially concluded that: (1) leaking roofs and windows and a pattern of other substandard construction practices are serious defects; (2) Weinschenk and RWB engaged in a pattern or practice of marketing houses with such defects, although they obviously know about these problems; (3) these defects have caused substantial injury to consumers who purchased houses designed by Weinschenk and constructed by RWB; (4) the direct owners of these houses could not have reasonably avoided purchasing them without the defects because of misrepresentations about the quality of construction; and (5) no countervailing benefit to consumers or competition would result by permitting Weinschenk and RWB to continue to market and produce houses that have serious defects. [¶ 17] To determine whether Weinschenk and RWB engaged in a deceptive act or practice, within the meaning of the UTPA, we are guided by the clear and understandable standard articulated by the FTC and the federal courts. In re Cliffdale Assocs., Inc., 103 F.T.C. 110, 164 (1984). An act or practice is deceptive if it is a material representation, omission, act or practice that is likely to mislead consumers acting reasonably under the circumstances. Id. at 164-65; Novartis Corp. v. FTC, 223 F.3d 783, 786 (D.C.Cir.2000). A material representation, omission, act or practice involves information that is important to consumers and, hence, likely to affect their choice of, or conduct regarding, a product. Cliffdale Assocs., Inc., 103 F.T.C. at 165. An act or practice may be deceptive, within the meaning of Maine's UTPA, regardless of a defendant's good faith or lack of intent to deceive. Binette, 688 A.2d at 906. [¶ 18] The record supports the conclusion that through advertisements and personal contacts with consumers, Weinschenk and RWB made material representations to consumers who purchased new houses. Because these representations provided consumers with information that likely affected their decision to purchase houses designed by Weinschenk and constructed by RWB, they are material. The Superior Court properly found that Weinschenk and RWB's design and construction practices were unfair trade practices and that material representations, made by Weinschenk and RWB, were deceptive acts, in violation of the UTPA, because the representations were likely to mislead reasonable consumers as to the quality of the houses sold.