Court Opinion

ID: 4391317
Source: CourtListenerOpinion
Date Created: 2019-04-26 18:02:20.800166+00
Date Added: 2024-06-11T14:23:46.541071
License: Public Domain

The summaries of the Colorado Court of Appeals published opinions
  constitute no part of the opinion of the division but have been prepared by
  the division for the convenience of the reader. The summaries may not be
    cited or relied upon as they are not the official language of the division.
  Any discrepancy between the language in the summary and in the opinion
           should be resolved in favor of the language in the opinion.

                                                                   SUMMARY
                                                                April 25, 2019

                                2019COA60

No. 18CA0321, Shekarchian v. Maxx Auto — Consumers —
Colorado Consumer Protection Act — Deceptive Trade Practices
— Damages

     The plaintiff, a car owner whose car had been towed and

impounded, brought a private action under the Colorado Consumer

Protection Act (CCPA) against the towing company, alleging that the

company’s practice of requiring car owners to sign a release of

claims before having an opportunity to inspect their vehicles

constituted an unfair or deceptive trade practice. The district court

agreed, entered judgment for the plaintiff, and imposed treble

damages against the towing company.

     A division of the court of appeals first determines that the

company’s practice of refusing to release vehicles from the impound

lot until car owners sign a release that contains false statements
concerning their ability to inspect their cars amounts to an unfair

or deceptive trade practice under the CCPA. Next, the division

concludes that the practice significantly impacts the public, as

potential consumers, because hundreds of vehicle owners were

subjected to the practice and the vehicle owners are parties to a

financial and legal transaction with the towing company.

     However, because the district court applied the incorrect legal

standard in awarding treble damages, the division reverses and

remands for further findings on damages.
COLORADO COURT OF APPEALS                                        2019COA60

Court of Appeals No. 18CA0321
City and County of Denver District Court No. 17CV30557
Honorable Elizabeth A. Starrs, Judge

Omid Shekarchian and Nationwide Telecom US Corp, a Colorado corporation,

Plaintiffs-Appellees,

v.

Maxx Auto Recovery, Inc.,

Defendant-Appellant.

            JUDGMENT AFFIRMED IN PART, REVERSED IN PART,
                AND CASE REMANDED WITH DIRECTIONS

                                 Division IV
                         Opinion by JUDGE HARRIS
                        Hawthorne and Fox, JJ., concur

                            Announced April 25, 2019

DLG Law Group LLC, Michael J. Davis, Cassandra S. Wich, Denver, Colorado,
for Plaintiffs-Appellees

Elkus & Sisson, P.C., Reid J. Elkus, Lucas Lorenz, Denver, Colorado, for
Defendant-Appellant
¶1    Defendant, Maxx Auto Recovery, Inc., appeals from a

 judgment entered in favor of plaintiffs, Omid Shekarchian and his

 company, Nationwide Telecom US Corp, 1 on their claim under the

 Colorado Consumer Protection Act (CCPA).

¶2    Maxx Auto runs a repossession service and impound lot. It

 repossessed and impounded Shekarchian’s car, then refused to

 return it unless Shekarchian agreed to sign a form release — before

 seeing the car — representing that he had “carefully examined” the

 car and had “made sure that there [was] no damage” and releasing

 Maxx Auto from any claims. The district court found that Maxx

 Auto routinely required car owners to sign the release without an

 opportunity to inspect their vehicles and determined that the

 practice violated the CCPA.

¶3    On appeal, Maxx Auto contends that the district court clearly

 erred in finding that it had engaged in the challenged conduct, and

 that, even if it had, the conduct did not violate the CCPA.

 Furthermore, it says, the court applied an incorrect standard in

 1 Shekarchian and his company jointly owned the car in question.
 For ease of reference, we generally refer to the plaintiffs, in the
 singular, as Shekarchian.

                                   1
 determining that it had acted in bad faith and awarding treble

 damages.

¶4    We conclude that Maxx Auto’s standard practice of demanding

 that car owners execute a release containing misrepresentations to

 avoid potential liability constitutes an unfair or deceptive trade

 practice under the CCPA and that the practice significantly

 impacted the public. But we agree with Maxx Auto that the court

 misapplied the standard of proof in awarding treble damages.

¶5    Accordingly, we reverse the damages award and remand for

 reconsideration under the proper standard. In all other respects,

 we affirm the judgment.

                           I.    Background

¶6    Shekarchian bought the car under a retail installment

 agreement with BMW Financial Services (BMW FS). He later failed

 to make payments in accordance with the agreement, and BMW FS

 hired Maxx Auto to repossess the car. Maxx Auto towed the car to

 its secure impound lot.

¶7    About a month later, Shekarchian paid off the loan and BMW

 FS released its lien. But when Shekarchian appeared at the

 impound lot to recover his car, Maxx Auto refused to release it

                                    2
 unless Shekarchian signed a form release, prior to any inspection,

 representing that he had carefully inspected the car and its

 contents, agreeing that there was no damage, and releasing Maxx

 Auto from any claims:

           In sole consideration of the delivery to me of
           the above described vehicle and personal
           property, I agree that I have carefully examined
           the above described vehicle and made sure
           that there is no damage, other than any
           pre-existing damage marked and accounted for
           on the vehicle condition report. I further agree
           that I have examined all personal belongings
           that were left in the above vehicle and that
           everything is accounted for and has no
           damage.

           By signing this Release, I fully understand the
           above statements and do agree to Release and
           Hold Harmless Maxx Auto Recovery . . . from
           all claims, demands and or actions, which
           I . . . may have against Maxx Auto
           Recovery . . . .

¶8    Shekarchian noted that the release contemplated a prior

 examination and asked to see his car, but Maxx Auto’s employee

 refused to retrieve it until he obtained a signed release. Eventually,

 Shekarchian left the lot without his car.

¶9    Shekarchian then filed this lawsuit, asserting, as relevant

 here, a claim under the CCPA and a claim for replevin. After a

                                   3
  hearing on the replevin claim, the district court ordered Maxx Auto

  to return the car to Shekarchian. By that time, though, the car had

  been parked in the impound lot for more than seven months, and it

  needed repairs because of the protracted storage.

¶ 10   The case proceeded to a bench trial on Shekarchian’s CCPA

  claim and Maxx Auto’s counterclaim for additional storage fees. In

  a well-reasoned written order, the district court found that Maxx

  Auto routinely forced vehicle owners to “endorse a false statement

  on a release so that [it] could escape liability for harms it may have

  caused” its customers and that this practice was “plainly unfair and

  deceptive” within the meaning of the CCPA. The court entered

  judgment in favor of Shekarchian on his claim and Maxx Auto’s

  counterclaim, awarded damages in the amount of the cost of

  repairs, and then trebled the damages upon a finding, “by a

  preponderance of the evidence,” that Maxx Auto had engaged in bad

  faith conduct pursuant to section 6-1-113(2)(a)(III), C.R.S. 2018.

¶ 11   On appeal, Maxx Auto first argues that neither Shekarchian

  nor his company has standing to bring a CCPA claim. As for the

  merits, Maxx Auto contends that it did not engage in the conduct

  forming the basis of the court’s finding of a CCPA violation, and

                                     4
  that, in any event, the conduct is not an unfair or deceptive trade

  practice that significantly impacts the public, as required by the

  CCPA. Maxx Auto also contends that the court erred in awarding

  treble damages.

                      II.   Standing Under the CCPA

¶ 12   At trial, Shekarchian testified that the cost of repairs to his car

  was paid by a nonparty company of which he was the owner. Maxx

  Auto contends that because a nonparty incurred the cost of repairs,

  neither Shekarchian nor Nationwide Telecom US Corp is the real

  party in interest under C.R.C.P. 17(a) and, therefore, neither

  plaintiff has standing to bring a CCPA claim. We disagree.

                A.    Preservation and Standard of Review

¶ 13   Maxx Auto appears to conflate the real party in interest

  doctrine with the concept of standing. To the extent it presents an

  independent argument under Rule 17, we conclude that it has

  waived the argument, and so we address only its claim challenging

  plaintiffs’ standing.

¶ 14   At trial, Shekarchian testified about the somewhat

  complicated ownership status of the car. Upon learning that the

  car was partly owned by a subsidiary of the named plaintiff

                                     5
  company, rather than the named company itself, Maxx Auto

  initially moved to dismiss on the grounds that “the proper party”

  had not been named and that Shekarchian did not have standing.

  But after further explanation by Shekarchian, Maxx Auto’s counsel

  appeared to agree that the issue had been sufficiently clarified and

  resolved, prompting Shekarchian’s counsel to ask, “[S]o is he

  withdrawing his motion to dismiss?” The court responded, “Well,

  I’m denying the motion to dismiss,” to which Maxx Auto’s counsel

  added, “Yeah. I – I think that ship has sailed. I – I think it’s a little

  clearer.”

¶ 15   We construe Maxx Auto’s counsel’s comments as a withdrawal

  of its claim that neither plaintiff was a “proper party.” Therefore,

  Maxx Auto has waived review of that claim on appeal. See, e.g.,

  Marriage of Corak, 2014 COA 147, ¶ 23 (“A litigant who abandons

  an argument in the trial court likewise abandons it for the purposes

  of appeal.”); see also Ajay Sports, Inc. v. Casazza, 1 P.3d 267, 272

  (Colo. App. 2000) (party waives real party in interest claim if it fails

  to raise the claim “in a timely manner” in the district court).

¶ 16   Later, Shekarchian testified that a nonparty company had

  paid the cost of repairs. But this time, Maxx Auto argued only that,

                                      6
  as a consequence of the nonparty’s payment, neither Shekarchian

  nor the named company had standing to pursue a claim under the

  CCPA. The court did not separately address standing in its written

  order, and, while we generally require a party to request a ruling in

  order to preserve an issue for appeal, see Herrera v. Anderson, 736
P.2d 416, 418 (Colo. App. 1987), the rule does not apply to a claim

  challenging standing, which may be raised at any time, Anson v.

  Trujillo, 56 P.3d 114, 117 (Colo. App. 2002).

¶ 17   Whether a plaintiff has standing to sue is a question of law

  that we review de novo. Ainscough v. Owens, 90 P.3d 851, 856

  (Colo. 2004).

                              B.   Analysis

¶ 18   The CCPA incorporates as elements of a claim the traditional

  standing requirements: an injury in fact to a legally protected

  interest. See Hall v. Walter, 969 P.2d 224, 235 (Colo. 1998).

¶ 19   In reviewing the elements of the claim, the district court found

  that Shekarchian had suffered injuries to a legally protected

  interest, as he was deprived of the use of his car for more than

  seven months and the car was damaged from being left in the

  impound lot. Maxx Auto says that because Shekarchian was able

                                    7
  to borrow a vehicle and another company paid the cost of repairs,

  Shekarchian did not suffer an injury in fact.

¶ 20   But the injury-in-fact inquiry turns on whether the plaintiff

  suffered an injury, not whether the injury caused the plaintiff to

  incur out-of-pocket losses. In Hall, for example, the supreme court

  concluded that “injury to property . . . lies squarely within the

  interests that the CCPA is intended to protect” and constitutes an

  injury in fact for standing purposes. 969 P.2d at 236. The court’s

  conclusion did not depend on whether the landowners as opposed

  to a third party — an insurance company, for example — paid to

  repair the damaged fences and broken locks on their land; rather, it

  was sufficient that the plaintiffs had shown an injury to “property

  [or] property value.” Id. at 237.

¶ 21   As a general matter, we are not ordinarily concerned, when it

  comes to determining a party’s right to sue, with the precise

  financial arrangement under which the party has covered its losses.

  Cf. Mullins v. Kessler, 83 P.3d 1203, 1204-05 (Colo. App. 2003) (the

  defendant had the right to be reimbursed for costs of the litigation

  even though a third party may have covered those costs). That

  principle is particularly relevant in the context of a CCPA claim,

                                      8
  because the primary purpose of the statute is “not to make an

  injured party whole, but to punish wrongdoers for illegal acts.” May

  Dep’t Stores Co. v. State ex rel. Woodard, 863 P.2d 967, 972 (Colo.

  1993); see also Hall, 969 P.2d at 231 (“[T]he CCPA serves more than

  a merely restitutionary function.”).

¶ 22        Accordingly, we agree with the district court that Shekarchian

  suffered an injury in fact to a legally protected interest, and we

  conclude that plaintiffs had standing to sue under the CCPA.

                                III.   CCPA Claim

       A.     The District Court Did Not Err in Finding That Maxx Auto
                                  Violated the CCPA

¶ 23        The CCPA was enacted to regulate commercial activities and

  practices which, because of their nature, “may prove injurious,

  offensive, or dangerous to the public.” Rhino Linings USA, Inc. v.

  Rocky Mountain Rhino Lining, Inc., 62 P.3d 142, 146 (Colo. 2003)

  (citation omitted). The CCPA deters and punishes businesses that

  commit unfair or deceptive practices in their dealings with the

                                         9
  public by providing prompt, economical, and readily available

  remedies against consumer fraud. Id. 2

¶ 24   To prevail on a CCPA claim, a plaintiff must prove that (1) the

  defendant engaged in an unfair or deceptive trade practice; (2) the

  challenged practice occurred in the course of the defendant’s

  business, vocation, or occupation; (3) the practice significantly

  impacts the public as actual or potential consumers of the

  defendant’s goods, services, or property; (4) the plaintiff suffered an

  injury in fact to a legally protected interest; and (5) the challenged

  practice caused the plaintiff’s injury. Id. at 146-47.

¶ 25   Maxx Auto challenges the district court’s findings only with

  respect to the first and third elements of the claim.

                 1.   Unfair or Deceptive Trade Practice

¶ 26   Maxx Auto maintains that the court clearly erred in finding

  that it refused to return owners’ vehicles unless they signed a

  release before they had an opportunity to inspect their vehicles.

  But, even if it did engage in such conduct, Maxx Auto argues, its

  2 The CCPA does not supplant or preempt other causes of action or
  remedies available to a plaintiff under the common law or other
  statutes. See § 6-1-105(3), C.R.S. 2018.

                                     10
  mere use of an exculpatory agreement “that is later held to be

  invalid” does not amount to an unfair or deceptive trade practice

  within the meaning of the CCPA. We are not persuaded.

   a.    The Record Supports the Court’s Factual Finding That Maxx
                  Auto Engaged in the Challenged Conduct

¶ 27    The district court’s determination that Maxx Auto had engaged

  in an unfair or deceptive trade practice by “forcing consumers to

  endorse a false statement on a release” was based on its factual

  finding that Maxx Auto required vehicle owners to sign the release

  “without being able to inspect the vehicle.” Maxx Auto challenges

  that factual finding.

¶ 28    Where, as here, the district court acts as the factfinder, we

  defer to its credibility determinations and will not disturb its

  findings of fact unless they are clearly erroneous — that is, lack any

  support in the record. Jehly v. Brown, 2014 COA 39, ¶ 8.

¶ 29    The district court acknowledged that, in some circumstances

  — though not in Shekarchian’s case — a Maxx Auto employee

  might move a vehicle to give the owner a cursory view of it. Still,

  the district court found that, despite the release’s contemplation of

  a “careful examination,” under no circumstances could owners

                                     11
  conduct a “meaningful inspection” of their vehicles before signing

  the release. This finding is supported by the record.

¶ 30   At trial, a Maxx Auto employee testified to the following:

         • The impound lot is “completely secured.” There are two

            fences, each with a gate, surrounding the lot. The first

            fence is a corrugated metal fence with barbed wire on

            top. A gate in that fence leads to a “middle section,” and

            then to a second fence and gate that allows access to the

            inner lot. The second fence is a chain link fence, also

            with barbed wire on top.

         • Vehicle owners are not permitted to enter the secured lot.

         • At best, Maxx Auto will give the vehicle owner an

            opportunity to view his or her vehicle by pulling the car

            up “between the gates” so that the car is between the

            inner and outer fences.

         • From that vantage point, the owner cannot “walk[]

            around the vehicle” or “do[] a close inspection” because

            the owner is separated from the car by the outer fence.

            The owner can only “see the outside of” the car, “see

            [that] it runs,” and see that it is “intact.”

                                     12
          • He did not offer to pull Shekarchian’s car up to the inner

            fence. Instead, he asked Shekarchian to sign the release

            “prior to any inspection.”

          • Even though Shekarchian had signed a receipt and paid

            the $1000 in storage fees, Maxx Auto would not let him

            into the lot to inspect his car because he might have

            “driv[en] off” without signing the release.

          • The lenders who contract with Maxx Auto are aware that

            it “ask[s] [the vehicle owner] to release the vehicle without

            a full inspection,” but the lenders have “never had a

            problem with it.”

          • Maxx Auto’s “standard operating procedure” is to require

            vehicle owners to sign the release “without having a full

            inspection.”

¶ 31   We conclude that the evidence amply supports the court’s

  finding that Maxx Auto requires vehicle owners to sign the release

  without giving them an opportunity to carefully examine the vehicle

  and its contents, contrary to the representations in the release

  itself. And, as a result, the court’s conclusion that Maxx Auto

                                   13
  “force[d] consumers to endorse a false statement on a release” is

  likewise supported by the evidence.

  b.   Maxx Auto’s Conduct Constitutes an Unfair or Deceptive Trade
                                Practice

¶ 32   Next, Maxx Auto says that even if it required owners to sign

  the release without an opportunity to carefully examine their

  vehicles, that conduct does not amount to an unfair or deceptive

  trade practice under the CCPA.

¶ 33   While the occurrence of challenged conduct is a factual

  question on which we defer to the district court, whether the

  challenged conduct constitutes an unfair or deceptive trade practice

  is a question of law that we review de novo. See S. Atl. Ltd. P’ship of

  Tenn., L.P. v. Riese, 284 F.3d 518, 534 (4th Cir. 2002).

¶ 34   A business’s conduct in making false representations about its

  services may constitute an unfair or deceptive trade practice. See

  Rhino Linings, 62 P.3d at 147-48. In the release, Maxx Auto

  represented that vehicle owners would have an opportunity to

  carefully examine their cars before releasing any claims for

  damages. But in practice, Maxx Auto refused to return the owners’

  vehicles unless they signed the release without examining their

                                    14
  cars. The fact that owners eventually became aware of (and were

  forced to agree to) the false representations does not eliminate the

  underlying deception. See State ex rel. Coffman v. Castle Law Grp.,

  LLC, 2016 CO 54, ¶ 28 (the fact that the defendant disclosed its

  deceptively high prices to consumers did not render the prices fair

  and nondeceptive).

¶ 35   We are not persuaded by Maxx Auto’s argument that because

  its conduct in forcing customers to sign the release is not expressly

  included in the statutory list of prohibited practices, the conduct

  cannot qualify as an unfair or deceptive trade practice. As Maxx

  Auto concedes, the statutory list is not exhaustive. See Showpiece

  Homes Corp. v. Assurance Co. of Am., 38 P.3d 47, 54 (Colo. 2001).

  The CCPA does not — and could not — list “all, or even most, of the

  practices that the CCPA was intended to cover.” Id.

¶ 36   Nor are we convinced that characterizing Maxx Auto’s conduct

  as an unfair or deceptive trade practice would impermissibly

  expand the scope of the CCPA. Contrary to Maxx Auto’s assertion,

  the conduct at issue is not merely “employing an exculpatory

  agreement that is later held to be invalid.” Rather, as we have

  described, Maxx Auto refused to return owners’ cars unless the

                                    15
  owners agreed — prior to conducting a meaningful inspection — to

  sign a release representing that they had conducted a meaningful

  inspection and releasing Maxx Auto from all claims. A division of

  this court has determined that fraudulently inducing consumers to

  sign a release constitutes a deceptive trade practice. See Dodds v.

  Frontier Chevrolet Sales & Serv., Inc., 676 P.2d 1237, 1238 (Colo.

  App. 1983). We therefore have no difficulty concluding that Maxx

  Auto’s conduct falls squarely within the CCPA’s broad prohibition

  on practices that are “injurious” or “offensive” to consumers. Rhino

  Linings, 62 P.3d at 146.

¶ 37   But even if we perceived the question as a close call, we would

  have to err on Shekarchian’s side: the supreme court has directed

  that, “in determining whether conduct falls within the purview of

  the CCPA, it should ordinarily be assumed that the CCPA applies to

  the conduct.” Showpiece Homes, 38 P.3d at 53.

¶ 38   We conclude, therefore, that Maxx Auto engaged in the

  challenged conduct and that the conduct amounts to an unfair or

  deceptive trade practice within the meaning of the CCPA.

                             2.   Public Impact

                                    16
¶ 39     To prove a violation of the CCPA, a plaintiff must show not

  only an unfair or deceptive trade practice, but also that the practice

  “significantly impacts the public as actual or potential consumers of

  the defendant’s goods, services, or property.” Hall, 969 P.2d at 235.

  Thus, if a wrong is private in nature and does not affect the public,

  a claim is not actionable under the CCPA. Rhino Linings, 62 P.3d at

  149.

¶ 40     Maxx Auto contends that its practice of forcing vehicle owners

  to sign the release as a condition of obtaining their vehicles did not

  impact the public as consumers because the lenders, not the

  vehicle owners, are the consumers of its repossession and impound

  services. And, Maxx Auto says, there was otherwise no evidence of

  a significant impact on the public. We disagree.

¶ 41     When the controlling facts are in dispute, as here, the

  existence or lack of public impact is a question of fact that we

  review under the clear error standard. One Creative Place, LLC v.

  Jet Ctr. Partners, LLC, 259 P.3d 1287, 1289 (Colo. App. 2011).

  Accordingly, we must accept the district court’s public impact

  finding unless it is so clearly erroneous as to find no support in the

  record. Id. at 1290.

                                     17
¶ 42   Some of the factors relevant to whether a challenged practice

  significantly impacts the public are the number of consumers

  directly affected by the challenged practice, the relative

  sophistication and bargaining power of the affected consumers, and

  evidence that the challenged practice has impacted other

  consumers or has a significant potential to do so in the future.

  Martinez v. Lewis, 969 P.2d 213, 222 (Colo. 1998). No single factor

  is determinative, One Creative Place, 259 P.3d at 1290, “nor is it

  necessary that all be present,” Rush v. Blackburn, 361 P.3d 217,

  228 (Wash. Ct. App. 2015) (citation omitted). Instead, the factors

  “represent indicia of an effect on public interest from which a trier

  of fact could reasonably find public interest impact.” Id. (citation

  omitted).

¶ 43   We turn first to Maxx Auto’s argument that the vehicle owners

  are not consumers of its services and therefore the challenged

  practice does not significantly impact the public as consumers. A

  case from Washington, a state that has consumer protection

  legislation similar to the CCPA, see Hall, 969 P.2d at 233-34

  (recognizing the similarity in the states’ legislation and relying on

  case law from Washington to interpret the CCPA), is instructive. In

                                     18
  Rush, a car owner sued a towing company under Washington’s

  consumer protection statute. The towing company sought

  summary judgment, arguing — as Maxx Auto does here — that the

  plaintiff had failed to establish a public impact because the towing

  services were solicited not by the plaintiff but by a third party. 361
P.3d at 228. The court of appeals rejected that argument. It

  concluded that, by towing and impounding the plaintiff’s car, the

  towing company had “in effect, forced [the plaintiff] into a consumer

  relationship” with it. Id. Once the towing company had possession

  of the car, the court reasoned, the plaintiff “had no choice but to

  interact with” the company. Id.

¶ 44   The same is true in this case. While the lender generally

  initiates repossession and impoundment services, every owner

  whose vehicle is towed to the secure impound lot becomes, as the

  district court aptly described it, an “unwitting customer” of Maxx

  Auto’s services. The owner pays Maxx Auto to retrieve his or her

  vehicle and executes a series of releases for its benefit.

¶ 45   The parties’ direct financial and legal relationship distinguish

  this case from State ex rel. Weiser v. Castle Law Group, LLC, 2019
COA 49, in which a division of this court concluded that the law

                                     19
  firm’s deceptive practice did not have a significant impact on the

  public. In Castle Law Group, the trial court found that the law firm

  had engaged in a deceptive practice by failing to disclose certain

  information to two mortgage servicers, Fannie Mae and Freddie

  Mac, for which it had provided foreclosure services. Id. at ¶ 102. 3

  The court also found that the deceptive practice significantly

  impacted the public because the two mortgage servicers are

  partially funded by taxpayers. Id. at ¶ 103.

¶ 46   On appeal, the division reversed the judgment against the law

  firm on the CCPA claim, concluding that the deceptive practice

  “directly affected” only the two mortgage servicers. Id. at ¶¶ 116-

  122. The division reasoned that the law firm made

  misrepresentations through retainer agreements to the mortgage

  servicers, not to members of the public, and therefore the public

  had not been “exposed to” the firm’s CCPA violations and had not

  “undertake[n] other activities in reliance on the” violations. Id. at ¶

  124 (citing May Dep’t Stores Co., 863 P.2d at 973-74).

  3 Fannie Mae and Freddie Mac are the commonly used monikers for
  the Federal National Mortgage Association and the Federal Home
  Loan Mortgage Corporation.

                                    20
¶ 47   In contrast, the impact to the vehicle owners from Maxx Auto’s

  unfair trade practice is neither derivative nor attenuated. The

  vehicle owners pay storage fees directly to Maxx Auto and are

  parties to the coercive release agreement that constitutes the unfair

  trade practice. Thus, the vehicle owners are all “directly affected”

  by Maxx Auto’s CCPA violations.

¶ 48   We turn next to the issue of whether Maxx Auto’s practice has

  affected, or will affect, a sufficient number of consumers, and in the

  requisite manner, to establish a public impact.

¶ 49   The evidence showed that, at any given time, Maxx Auto has

  between 300 and 500 vehicles parked in its lot. And according to

  Maxx Auto’s employee, the company’s “standard operating

  procedure” is to refuse to return the owner’s car unless he or she

  signs the release prior to an inspection of the vehicle. Thus, the

  evidence supported a reasonable inference that Maxx Auto engages

  in the unfair or deceptive practice in virtually every interaction with

  consumers. See Crowe v. Tull, 126 P.3d 196, 209 (Colo. 2006)

  (finding a public impact where lawyer advertising “potentially affects

  a large swath of the public”).

                                    21
¶ 50   And, as the district court found, those consumers have only

  “two options: take [it] or leave it.” The inequality in bargaining

  power between a towing company and vehicle owners can prove

  particularly problematic. Many adults depend on their cars as their

  primary mode of transportation. See Crane Towing, Inc. v. Gorton,

  570 P.2d 428, 433 (Wash. 1977). Thus, “[i]t cannot be doubted that

  the unexpected loss of the use of one’s vehicle directly affects the

  safety and welfare of vehicle operators and owners.” Id. at 434.

¶ 51   Given the relatively “coercive” nature of the relationship

  between towing companies and car owners, the owners are “likely

  more vulnerable to abuse.” Rush, 361 P.3d at 228. Indeed, the

  evidence at trial showed that when Shekarchian balked at signing

  the release before inspecting his car, the Maxx Auto employee told

  him that, even if he stayed at the lot “all day,” he would not get his

  car unless he signed the release — “end of story.”

¶ 52   Still, Maxx Auto contends that there is a relevant “distinction

  between something happening to a consumer, and whether that has

  any impact on the consumer.” Relying on Hildebrand v. New Vista

  Homes II, LLC, 252 P.3d 1159 (Colo. App. 2010), Maxx Auto appears

  to argue that Shekarchian failed to prove that the challenged

                                    22
  practice adversely affected other vehicle owners, who might simply

  have signed the releases with no qualms.

¶ 53   In Hildebrand, after shifting soils caused their basement

  flooring to fail, the owners of a home sued the builder under the

  CCPA, asserting that the builder had misrepresented information

  about soil composition and various flooring options. Id. at 1167-68.

  A division of this court concluded that the homeowners had failed

  to establish that the builder’s misrepresentations impacted the

  public because, although other homes were constructed similarly,

  the plaintiffs did not present any evidence that the basement

  flooring in other homes had failed or was likely to fail, or that the

  same misrepresentations had been made to other homeowners, or

  that the parties had unequal bargaining power. Id. at 1169-70.

¶ 54   Hildebrand does not support Maxx Auto’s position. The

  problem in Hildebrand was the absence of evidence of any exposure

  to, or an adverse effect from, the builder’s misrepresentations with

  respect to anyone other than the plaintiffs. But here, the vehicle

  owners are necessarily exposed to the challenged practice — as a

  routine matter, owners must sign the false release in order to

  recover their vehicles — and the adverse effect is inherent in the

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  release itself — the owners must release claims against Maxx Auto

  without knowing whether they have any claims. We therefore reject

  the argument that the challenged practice did not affect other

  consumers.

¶ 55    Accordingly, because the district court’s public impact finding

  is supported by the record, we will not disturb it on appeal.

¶ 56    In sum, then, we conclude that the district court did not err in

  finding that Maxx Auto engaged in an unfair or deceptive trade

  practice that significantly impacted the public, in violation of the

  CCPA.

   B.     The District Court Applied the Wrong Standard in Awarding
                               Treble Damages

¶ 57    A private plaintiff who prevails on his CCPA claim is entitled to

  damages in the amount of his actual loss or, if greater, $500. § 6-

  1-113(2)(a)(I)-(II). But, “if it is established by clear and convincing

  evidence that [the defendant] engaged in bad faith conduct,” the

  court must award the plaintiff three times the amount of actual

  damages sustained. § 6-1-113(2)(a)(III). “Bad faith conduct” means

  “fraudulent, willful, knowing, or intentional conduct that causes

  injury.” § 6-1-113(2.3).

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¶ 58   The court made the following finding with respect to bad faith

  conduct:

             The Court also finds that Plaintiffs proved by a
             preponderance of the evidence this business
             practice was conducted by Defendant in bad
             faith. Maxx Auto conducted this practice
             when it knew that it was forcing customers to
             sign a document saying they had inspected
             their vehicle, without actually giving them a
             chance to do so.

¶ 59   Maxx Auto asserts, Shekarchian acknowledges, and we agree

  that the district court applied an incorrect standard of proof in

  determining that Maxx Auto had engaged in bad faith conduct.

¶ 60   Shekarchian urges us to disregard the error, while Maxx Auto

  asks that we either reverse the judgment because the district court

  applied the incorrect standard of proof or make a factual finding,

  based on a defense never presented to the district court, that it did

  not act in bad faith. We decline to take any of these approaches.

¶ 61   Instead, because we cannot say with certainty whether the

  district court would have found bad faith conduct under the clear

  and convincing standard of proof, we must reverse the damages

  award and remand to the district court for reconsideration of treble

  damages under the proper standard. See People v. Shifrin, 2014

                                    25
COA 14, ¶¶ 134-35 (where district court applied the wrong

  standard in ruling on a motion for directed verdict on a CCPA claim,

  appellate court would not decide, in the first instance, the

  discretionary issue of whether motion should have been denied, but

  instead remanded for district court to consider motion under proper

  standard).

                            IV.   Conclusion

¶ 62   The treble damages award is reversed, and the case is

  remanded to the district court for reconsideration, on the existing

  record, of treble damages under the proper standard. In all other

  respects, the judgment is affirmed. 4

       JUDGE HAWTHORNE and JUDGE FOX concur.

  4 Maxx Auto says that if we reverse the judgment in favor of
  Shekarchian on the CCPA claim, “[t]his will necessitate vacating the
  District Court’s judgment as to the unjust enrichment claim.” But
  because we have affirmed the judgment with respect to the CCPA
  claim, we do not address the unjust enrichment claim.

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