3 Things to Know About the Texas Deceptive Trade Practices Act

No consumer wants to be the victim of a fraudulent transaction. Unfortunately, businesses often attempt to engage in deceptive or misleading acts. The Texas Legislature enacted the Texas Deceptive Trade Practices Act, also known as the DTPA, in 1979 to protect individuals and companies from commercial scams. The DTPA empowers consumers and businesses to pursue legal action against deceptive companies and individuals as a consumer protection statute. While consumers in Texas are encouraged to be mindful of their financial and commercial activity, many consumers are unaware of the nuances of the DTPA. Read below to learn important information about the DTPA and how the Dallas law firm of Ritter Spencer Cheng PLLC can help protect businesses and consumers. 

Define “Consumer:” Who is Protected by the Texas Deceptive Trade Practices Act?

The Texas Deceptive Trade Practices Act (“DTPA”) protects consumers from deceptive business practices. However, the definition of consumer is diverse in meaning and is not limited only to individual consumers. 

The DTPA protects various businesses and individual consumers from fraudulent and deceptive practices. According to the DTPA, a “consumer” is defined as an “individual, partnership, corporation, this state, or a subdivision or agency of this state who seeks or acquires by purchase or lease, any goods or services.” Moreover, “the term does not include a business consumer that has assets of $25 million or more, or that is owned or controlled by a corporation or entity with assets of $25 million or more.” Therefore, the DTPA protects both individual consumers and smaller businesses. 

Understand Consumer Rights & Responsibilities

Consumers have the right to sue for damages (even up to treble damages) when they are the victim of a financial or business scam as provided under the Texas Deceptive Trade Practices Act. However, potential plaintiffs should know their legal responsibilities, as well as their rights, to avoid delays or case dismissals. 

A consumer who has been the victim of a financial or business scam should take specific steps before filing a complaint or lawsuit. Before filing suit in court, consumers should address their concerns to management and attempt to resolve the matter outside of the court system. If the involved parties cannot reach an agreement, the DTPA requires a party to file a formal, written notice of the complaint to the business at least sixty (60) days before filing suit in court. 

If the business has closed, the consumer must contact the office of the Texas Secretary of State, who can help locate the organization’s registered address and agent. 

Know When to Consult an Attorney 

Being the victim of a fraudulent transaction can feel overwhelming. Not only are there many steps to take before filing suit in court, but consumers may also have to cope with financial losses until the case or concerns are addressed. Consulting with experienced business attorneys, like the team at Ritter Spencer Cheng, will alleviate some of the stress associated with cases that fall under the Texas Deceptive Trade Practices Act. 

It is important to know when to consult an attorney if you have been the victim of fraudulent business practices, either as an individual consumer, a business owner, or a representative. If attempts to resolve the concerns through negotiation with management are unsuccessful, a consumer may consider hiring an experienced commercial litigation attorney. Those interested in pursuing a claim in court should work with a legal team with extensive knowledge of commercial litigation. The right commercial litigation attorneys can discuss options, handle disputes, and ensure that the Texas Deceptive Trade Practices Act adequately protects a consumer.

Although some businesses may engage in fraudulent practices, an experienced attorney will ensure that your commercial interests are defended. The team at Ritter Spencer Cheng PLLC will work with you to ensure that your damages are addressed and your rights as a consumer are protected. Our team has unrivaled experience in various practice areas, including commercial litigation, trademark law, business and corporate law, and more. Contact us today to learn more.