The Louisiana Unfair Trade Practices Act (“LUTPA”) found in La. R.S. 51:1401 et seq. dictates that persons subject to unfair and/or deceptive business practices have a civil action and can recover treble damages and attorney’s fees against the opposing party.
Until recently, one of the biggest hurdles a claimant had to get over was one of standing: only “consumers and competitors” had standing to bring an action under LUTPA.
The Courts of Appeal have been split on this issue for some time, but the Louisiana Supreme Court recently decided that a claim under LUTPA is NOT limited strictly to consumers and competitors, stating that a service provider had standing against a former client. Cheramie Services, Inc. . Shell Deepwater Production, Inc., 09-C-1633 (La. 4/23/10).
Additionally, the Fifth Circuit Court of Appeal of Louisiana recently held that a member of an LLC who subsequently formed another LLC and attempted to secure the first LLC’s clients for his other LLC was found to be laible for unfair trade practices. Risk Management Services, LLC v. Moss, 09-CA-632 (La. APpp. 5 Cir. 4/13/10).
So what does this mean?
The courts are still developing what are and what are not unfair trade practices and who can bring an action. Clearly, the trend is towards an expansive reading of the law, and actions that may have been previously thought of as kosher in a free market and the land of opportunity are now being scrutinized by the courts.