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Deceptive Trade Practices Act: Protections for Consumers

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This article provides information on the Deceptive Trade Practices Act.

This article provides information on the Texas Deceptive Trade Practices Act (“DTPA”). The Act gives consumers a way to sue sellers for false, misleading and deceptive business practices.

Special thanks to the Houston Bar Association. This article excerpts from and summarizes the Deceptive Trade Practices Act section of the Consumer Law Handbook.

Who does the DTPA protect?

To be able to sue under the DTPA, you must be a “consumer.”

A “consumer” is defined as any individual, partnership, corporation, or governmental entity that seeks to acquire, by purchase or lease, any goods or services.

Does the DTPA let consumers sue as soon as they know there's a problem?

No. When you are ready to file a DTPA lawsuit, you cannot go straight to court and file your claim. The DTPA requires that you give written notice of your problem to the merchant or seller at least 60 days before you can file suit in court. 

What does the DTPA prohibit? 

Generally, DTPA violations include deceptive or fraudulent business practices, including passing off goods or services as those of another, causing confusion about the source or sponsorship of goods or services, using false or misleading statements to sell goods or services, and taking advantage of disasters by charging exorbitant prices for necessities. 

See Texas Business and Commerce Code 17.46(b) for a complete list of DTPA violations. 

Who can be sued under the DTPA?

The DTPA is a broad consumer protection law that allows individuals to sue anyone who makes false, misleading, or deceptive statements in the course of business. This includes partnerships and corporations, as well as individuals. It is a violation of the DTPA to not disclose known defects if the reason for failing to disclose was to lure the consumer into the transaction. In this situation, silence can result in a violation of the DTPA.

What is an "unconscionable" act under the DTPA?

The DTPA also protects against any act that would be considered unconscionable. Bear in mind that “unconscionability” is a difficult standard to meet. It is defined as an act or practice that, to a consumer’s detriment, takes advantage of a person's lack of knowledge, ability, experience, or capacity to a grossly unfair degree. Unconscionability sometimes arises when a savvy seller manipulates an unsophisticated buyer into purchasing an item the buyer does not really want or need. 

Can you sue for breach of warranty under the DTPA?

The breach of an express or implied warranty is actionable under the DTPA. Warranties include:

  • Express Warranty. This is an affirmation of fact or promise that the goods or services conform to a particular description. It does not include statements purporting to be mere opinions of the seller. The express warranty is sometimes in writing, but it can also be a verbal statement;
  • Implied Warranty of Merchantability. This warranty guarantees that goods shall be merchantable, meaning they would pass without objection in the trade, are fit for the ordinary purpose for 18 which the goods are used, and they conform to the promises of fact made on the label or container;
  • Implied Warranty of Fitness for Purpose. This warranty is created when a buyer informs the seller that they wish to buy a good for a special purpose and the buyer then relies on the seller’s skills or judgment in selecting the good;
  • Implied Warranty of Good and Workmanlike Manner. For work performed by one who has the knowledge, training, or experience necessary for the successful practice of a trade or occupation, this warranty requires that the person perform the work in a manner generally considered proficient by those capable of judging such work;
  • Implied Warranty of Suitability. This warranty is mostly used for commercial leases. It requires that a leased property be free from latent physical or structural defects or inadequate or defective air conditioning, electric, or other building services. (Note, for residential leases, see Texas Property Code 92.056.)

Do you need a lawyer for a DTPA suit?

You do not necessarily need a lawyer to use the Deceptive Trade Practices Act. If your damages are less than $20,000.00, you may represent yourself in justice court. However, suppose the damages you claim (up to three times your economic damages and court costs plus attorney’s fees) are greater than $20,000. In that case, the suit will go to district or county court, where a lawyer’s expertise will probably be needed.

Do you have to send the seller notice before suing them

You cannot go straight to court and file your claim. The DTPA requires that you give written notice of your problem to the merchant or seller at least 60 days before you can file suit in court.

Basically, this entails writing the seller specifying the situation and how you were damaged. Many times, once sellers are reminded that ultimately they may be liable for three times economic damages, court costs, and attorney’s fees for their misrepresentations, they will move very quickly to resolve the complaint. Thus, the written notice gives the consumer and the seller a chance to resolve the dispute without expensive and time-consuming litigation. Furthermore, be sure to send this written notice of claim by certified mail, return receipt requested. By sending it this way, you will have proof that you sent it and exactly who received it.

What goes into a DTPA demand letter?

The written notice letter should include the following:

  • the factual background regarding the transaction (very specific details of your claim);
  • what you think the merchant or seller did or said that gives rise to a claim under the Act; and
  • the specific sections of 17.46(b) of the Texas Business and Commerce Act that apply; 
  • the amount of economic damages sought,
  • any special damages sought such as mental anguish (if applicable) and attorney’s fees.
  • A statement that your letter serves as the prerequisite notice before filing suit; that if the claim is not resolved within this 60-day period, you will sue, and that if win in court, you may be entitled to three times your damages.

Consider making a settlement offer in the letter, or you can request that they fix the problem.

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