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Understanding deceptive trade practices

On Behalf of | Apr 22, 2019 | Business Litigation

At Wang IP Law Group, P.C., we represent numerous entrepreneurs and companies start, grow, maintain and protect their businesses in California and abroad. We therefore know that one of the vulnerabilities businesses face is that of being sued, either civilly or criminally, for deceptive trade practices.

As FindLaw explains, a deceptive trade practice is any means by which you and/or your company falsely lures the public into buying your product or service. While deceptive trade practices can and do take many forms, the vast majority of civil lawsuits and criminal prosecutions arise because of alleged false advertising, specifically the following three types:

  1. Bait and switch: offering your product(s) for sale at a very good price, but claiming unavailability of it/them when the customers get there and offering to sell them a similar but higher priced substitute product instead
  2. Deceptive pricing: holding a false sale of your product(s) by raising their original price(s) in advance of the “sale,” only to go back to the original price(s) during the “sale”
  3. Low stock: deliberately having a low inventory of the product(s) you offer for sale, but a large inventory of similar, higher priced product(s); similar to a bait and switch

California law

While California has never adopted the Uniform Deceptive Trade Practices Act, our state laws specifically prohibit them, especially for any type of false advertising or odometer tampering. Disgruntled customers can sue you for damages if they believe you victimized them with deceptive trade practices. The State of California can likewise criminally prosecute you for allegedly engaging in deceptive trade practices.

For more information, please visit this page on our website.