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Consumer Rights & Class Actions

 

What are consumer rights and why are they important?

 

          Consumer rights law is the body of state and federal laws designed to protect people when they buy goods, services, or financial products for personal, family, or household use.  At its core, consumer rights law is about fairness and honesty in the marketplace. Consumer rights address issues like: (1) How businesses advertise and market their goods and services; (2) What amounts businesses can charge and how fees are disclosed; (3) How debts are collected; (4) How consumer contracts are written and enforced; and (5) Preventing bad businesses from misleading, pressuring, and/or exploiting consumers. 

 

          Consumer rights laws level the playing field between consumers and businesses.  Consumer rights are important whenever there’s an imbalance of power or information—which is most business-to-consumer transactions.  Without consumer rights, companies could otherwise hide fees, misrepresent service terms, and design traps and scams for consumers.   Consumer rights law deters abusive business practices and encourages corporate transparency, giving ordinary people leverage against large corporate institutions. 

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          Oftentimes, consumers don’t even discover consumer rights violations until they’re widespread.  With many consumer rights violations, the individual consumer losses may be small, but the total systemic marketplace harm is massive.  And big businesses profit from their wrongdoing until someone challenges them.

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          Some industries are especially prone to consumer rights violations because they involve money, complexity, and/or vulnerable consumer populations.  Wherever consumers can’t easily comparison-shop or fully understand service terms, consumer abuse tends to show up.  These at-risk business industries include:

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Finance & Lending

  • Predatory lending

  • Payday loans

  • Auto loans

  • Mortgage servicing

  • Credit cards

  • Bank fees and overdraft practices

 

Debt & Credit

  • Debt collection

  • Credit reporting

  • Medical debt

  • Student loan servicing

 

Healthcare

  • Hospital billing

  • Surprise medical bills

  • Inflated or misleading charges

  • Aggressive collection of disputed bills

 

Telecom & Utilities

  • Hidden fees

  • ​Slamming/cramming

  • Misleading contracts

 

Retail & Services

 

Insurance

  • Bad faith claim denials

  • Misrepresentation of coverage

 

          In North Carolina, one very important legal tool for enforcing consumer rights is North Carolina’s Unfair and Deceptive Trade Practices Act (the “UDTPA”).  See N.C. Gen. Stat. § 75-1.1, et seq.  The UDPTA is one of the strongest consumer protection statutes in the country.  It prohibits “[u]nfair or deceptive acts or practices in or affecting commerce.”   The UDTPA is broadly-written and applies to many types of bad business conduct.  Importantly, the UDTPA focuses on business conduct, not intent. 

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          The UDTPA’s remedies are powerful.  If you prove UDTPA violations, you could get treble damages, plus your attorneys’ fees.  So hypothetically, if you had $10,000 in actual damages, you could potentially recover $30,000 plus your attorneys’ fees under the UDTPA.  This makes the UDPTA a serious deterrent against bad business practices.  The UDTPA is frequently used in cases like deceptive marketing, hidden fees, and business bait-and-switch practices.

What is a class action case?

          A class action is a lawsuit where one or more people sue on behalf of a larger group.  An important part of consumer class actions is that everyone in the group was harmed by the same bad business practice in the same basic way.  Class actions are very effective against big businesses when it otherwise wouldn’t be practical to bring a single lawsuit.  For instance, you could easily raise 10,000 claims or more in a single class action lawsuit, as opposed to 10,000 separate individual lawsuits.

         

          If you’re the first plaintiff raising a particular class action against a business, then you’re called the “lead plaintiff.”  Lead plaintiffs often get extra benefits in class actions.  For instance, the Court can approve a monetary “lead plaintiff award” in recognition of the lead plaintiff’s efforts and risks.  Lead plaintiffs also have influence over litigation decisions, and direct involvement in settlement discussions.  But lead plaintiffs also take on the responsibility to participate in the discovery process and represent other class members’ interests. 

 

          Generally, consumer class actions promote efficiency and consistency by deterring corporate misconduct and preventing companies from avoiding accountability through scale.  Consumer class actions make small consumer claims economically viable, and without class actions, many widespread consumer harms would never be challenged.   Class actions protect consumers who don’t even know they’ve been harmed by bad business practices, and can provide compensation to large groups of consumers.  Class actions allow consumers to enforce laws when regulators can’t or won’t, creating systemic market-wide change.  In this way, class actions are some of the most powerful consumer protection tools available.

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            Consumer class actions are very complicated cases.  They follow strict procedural rules and class certification requirements.  Class action litigation often utilizes complex discovery procedures and expert testimony.  Class actions have substantial appeals risk, and class action settlement administration is technically-complicated.  Class actions aren’t just “bigger lawsuits”—they’re a unique, complicated practice area.

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Why you need a skilled lawyer to help enforce your consumer rights

         

          Realistically, fighting consumer rights cases against big businesses is challenging.  Consumer rights laws are technical and fast-changing.  Damages and remedies are often hidden in undecipherable consumer statutes.  Big companies fight aggressively, and even small procedural mistakes can kill valid claims.  Corporate defendants have in-house counsel and outside law firms ready to defend them.  They know their procedural advantages and how to employ delay and obfuscation strategies.  Unrepresented consumers are at a major disadvantage.

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           However, having a good consumer rights lawyer on your side makes your consumer rights case viable by leveling the playing field with big businesses.  A good consumer rights lawyer navigates complex consumer statutes, identifies your leverage, and utilizes consumer class action potential. With class actions, strategy matters from “day one,” because class certification is a highly-technical legal bar to meet and mistakes can block other class members from recovering later.  Settlements must be designed to protect other class members.  Skilled class action lawyers know how to build representative claims, get class certification, preserve class members’ rights, and negotiate fair, enforceable solutions.

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            Even among civil litigators, not many lawyers practice class action law.  Most lawyers never even handle a single class action case in their careers.  Class action law is a small, unique subset of the legal profession because class action cases are risky, very complex, expensive to litigate, and can take years.  For these reasons, class action litigation requires advanced procedural expertise. 

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          Attorney Peter Isakoff has successfully handled numerous putative consumer class action cases, frequently as the sole lead plaintiff’s counsel.  At The Law Offices of Peter D. Isakoff, we stand up to bad business practices, and we have the skills and expertise to litigate your consumer class action case.  If you have a consumer rights dispute, please contact The Law Offices of Peter Isakoff anytime, day or night, at (336) 863-8348 (Main) or (336) 864-9115 (Español).

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          DISCLAIMER: The information in this article is provided for informational purposes only. It is not offered as and does not constitute legal advice. The accuracy of the information may change pending changes in applicable law. If you have questions about a specific matter, you should contact a lawyer. The use of this article or any information provided in it does not establish any lawyer/client relationship.

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