The Maryland Consumer Protection Act (CPA) is codified at Md. Code, Com. Law § 13-101 et seq. The CPA is very broad, and covers virtually any form of fraud that a business might commit or attempt against a consumer. The main differences between the CPA and a common law fraud claim are:
- The CPA does not require any reliance by the consumer on the business’ misrepresentation, as it makes a false or misleading statement actionable “whether or not any consumer in fact has been misled, deceived, or damaged as a result of that practice”, § 13-302;
- The CPA generally does not require proof that the business knew its representation was false or misleading, or that the business had any intent to deceive or mislead the consumer, see § 13-303(1-4), (6), (8), (10-14) (no knowledge or intent requirements);
- Business transactions are not covered under the CPA, as the Act only applies to consumer transactions, § 13-303, and
- A consumer who prevails under the CPA may seek reimbursement of their attorney’s fees from the business, § 13-408(b).
The first thing that the consumer lawyer should confirm at the initial consultation is that the potential client’s case involves a transaction covered by the CPA. The CPA only applies to consumer transactions. § 13-303. Consumer transactions only include “credit, debts or obligations, goods, real property, and services which are primarily for personal, household, family, or agricultural purposes.” § 13-101(d). In other words, the CPA would not cover, for example, a small business owner in a dispute concerning a credit card used primarily for the small business.
The next issue to confirm at the initial consultation is that the potential defendant is not exempted from the CPA. The CPA does not apply to most “professional services”, such as advice rendered to the potential client from a lawyer or accountant, nor does the CPA cover transactions with public service companies regulated by the Public Service Commission. § 13-104. Finally, although advertisers may be held liable for false advertisements under the CPA, the Act does not apply to the publishers (television or radio station, newspaper, etc.) of such an advertisement. Id.
The final substantive issue for the consumer lawyer to address is whether the alleged wrongful conduct falls into one or more of the categories of conduct outlined in §§ 13-301 through 13-319. The section that will most often apply is the broadly worded § 13-301(1), which covers any:
False, falsely disparaging, or misleading oral or written statement, visual description, or other representation of any kind which has the capacity, tendency, or effect of deceiving or misleading consumers[.]
In a nutshell, the CPA covers virtually any false or misleading statement or practice. The potential client need not have actually relied on the representation, § 13-302, and the CPA usually applies even if the business did not know the representation was false or misleading, see § 13-303(1-4), (6), (8), (10-14) (no knowledge or intent requirements).
Before deciding whether to represent the potential client and on what terms, the lawyer should research whether Maryland appellate courts have addressed any similar CPA cases. In the absence of case law suggesting the claim is not actionable, the lawyer should have a proper basis to bring the claim, given the legislature’s instruction that “[t]his title shall be construed and applied liberally to promote its purpose.” § 13-105.