Houston Deceptive Trade Practices Defense Attorneys

Contact Our Experienced Team if Your Business Has Been Sued for DTPA Violations

(Note: We do not handle automobile-related claims or DTPA claims against auto dealers or manufacturers.)

Claims under the state Deceptive Trade Practices Act (DTPA) can range from a customer complaint about bait-and-switch marketing tactics to lawsuits relating to warranties and service agreements. If you have been sued for an alleged deceptive trade practice violation, you will need a knowledgeable DTPA attorney to protect your interests.

The attorneys at Hendershot Cowart P.C. have more than a century of collective experience providing legal counsel and aggressive defense for clients involved in commercial disputes or Texas Attorney General investigations.

If you are a business with a potential DTPA matter, call (713) 783-3110 to schedule a confidential consultation. We serve business clients throughout Texas.

What Is Texas' Deceptive Trade Practices Act?

The Deceptive Trade Practices Act prohibits false, misleading, or deceptive acts in trade and commerce. The law was enacted in 1973 and quickly became a powerful tool to combat many types of fraud and misrepresentation in Texas. 

In 1995, legislators revised the act to limit damages, exempt some larger transactions and limit the original act in other ways, making it easier for defendants to fight back against frivolous claims.

However, the DTPA remains a concern for businesses throughout Texas due to its complexity. The issue of who may sue under the act and what potential violations they may sue for is often clear cut – but not always.

What Texas Businesses Need to Know About DTPA Claims:

Understanding these aspects of the DTPA can help Texas businesses better understand what constitutes a violation and develop practices that minimize liability:

• No Transaction Is Required: A person, partnership, corporation, or governmental entity can qualify as a consumer if they seek to acquire goods or services, even if they never actually complete the transaction.
• Broad Consumer Protection: An extensive list of activities fall within the DTPA’s scope – the law lists 34 acts or practices it considers “false, misleading, or deceptive”. Examples range from failing to disclose information to induce a consumer into a transaction or making misleading statements about the reason for a price reduction to causing confusion about the geographic origin of goods or disparaging the goods or services of another business. 
• No Proof of Intent Required: The consumer does not need to prove that the defendant intended to deceive or mislead. The law focuses on whether the practice itself was deceptive or misleading, not whether the business intended it to be.
• Significant Potential for Damages: Consumers can recover economic damages, mental anguish damages, and in cases of knowing or intentional violations, up to three times their economic damages plus attorneys' fees.

Who Can Sue Under the DTPA?

A broad range of individuals and businesses can assert claims under the DTPA, including: 

• Consumers: The primary plaintiffs under the DTPA are "consumers," defined by the statute as individuals, partnerships, corporations, or governmental entities who seek or acquire goods or services by purchase or lease. Note: Businesses with assets of $25 million or more are generally excluded from consumer status.
• The Texas Attorney General: Can bring actions on behalf of the state and consumers for injunctive relief and civil penalties. 
• District and County Attorneys: Local prosecutors can also bring enforcement actions in their jurisdictions. 
• Beneficiaries in Certain Cases: In some situations, a person who benefits from goods or services purchased by another can qualify as a consumer, even if they weren't the direct purchaser (for example, family members in certain contexts). 
• Subsequent Purchasers: In limited circumstances, subsequent purchasers of goods may qualify as consumers for DTPA purposes (such as home buyers who purchase from the original buyer). 

If your business is being investigated by the Office of the Attorney General (OAG) for allegations of deceptive trade practices, our law firm can help. We routinely represent clients in administrative law matters with the OAG and other state and federal agencies.

Understanding the DTPA Pre-Suit Notice Requirement

Before a consumer can sue your business under the DTPA, they must send you a written notice at least 60 days before filing their lawsuit. This notice must: 

• Provide reasonable detail about their specific complaint
• State the amount they're seeking for economic damages, mental anguish, and expenses (including attorney fees)

During this 60-day period, you have the right to inspect any goods related to their complaint.

This notice requirement is designed to give your business an opportunity to resolve consumer complaints before litigation, potentially saving significant legal expenses and preserving your reputation. 

When You Might Not Receive Notice 

A consumer doesn't need to provide this notice if: 

• They need to file immediately to prevent the statute of limitations from expiring
• They're making a DTPA claim as a counterclaim in a lawsuit you filed against them

How to Respond If You Didn't Receive Required Notice 

Your attorney will likely recommend that you file a "plea in abatement" (a request to pause the case) within 30 days after filing your answer to the lawsuit. If the court agrees that proper notice was not given, the case will be paused. 

If you receive a DTPA notice, consult with the DTPA defense attorneys at Hendershot Cowart immediately to evaluate the claim and develop a strategic response during this critical pre-suit window.

Defending Against DTPA Lawsuits

If you've been sued in Texas for deceptive trade practices, the first step is to consult with a business litigation attorney. Your attorney will determine whether the specific actions of which you've been accused are actually prohibited by the DTPA, discuss your objectives, and develop a defense strategy.

The second step is to respond promptly – the deadline to file an answer to the lawsuit is typically 20 to 21 days after service. Missing this deadline can result in a default judgment. 

Under the DTPA, you face economic damages for the business's or consumer's losses, as well as the prospect of triple damages if you are found to have acted intentionally. You may also be held liable for attorney fees. An aggressive defense strategy based on experience is critical.

The Best Way to Beat a DTPA Lawsuit Is to Prepare Aggressively

Our lawyers use multiple approaches in defending deceptive trade practice claims, including asserting that:

• Statute of limitations has passed: DTPA actions must be brought within two years of the false, misleading, or deceptive act or practice, or within two years after the consumer discovered (or using reasonable diligence, should have discovered) the false, misleading, or deceptive act or practice.
• Claims are excluded from the DTPA: The DTPA is broad, but it does not apply to every transaction or service. Our attorneys can examine the claims to counter any that are not prohibited by the DTPA.
• The “consumer” is not a consumer as defined by the DTPA: Under the DTPA, consumers must have sought or acquired, by purchase or lease, goods or services, and the acquired goods or services must be the basis of the complaint. If the plaintiff never requested information or acquired the good or services for their own benefit, they may not qualify for the DTPA’s protection. Similarly, the DTPA does not apply to business consumers that have assets of $25 million or more, or that are owned or controlled by a corporation or entity with assets of $25 million or more.
• The alleged deceptive act did not cause injury or incur damages to the consumer. This defense seeks to prove that, even if a deceptive act occurred, the plaintiff's alleged damages were actually caused by unrelated factors such as the consumer's own actions, third-party interventions, or market conditions rather than the business's conduct, effectively breaking the required causal connection between the allegedly deceptive practice and any harm suffered.
• It was a bona fide error. You may be able to avoid liability by showing that the violation was an unintentional, good faith mistake.

Protecting your Texas Business Against DTPA Claims 

To protect against future claims, our attorneys recommend reviewing and revising your business policies and sales process to ensure compliance and discourage ambiguous representations of your products or services.

Consider these measures to minimize the risk of DTPA exposure:

• Written Warranties Matter: Any guarantees or warranties made in writing are enforceable under the DTPA. Businesses should be precise and accurate in their written promises. 
• Clear And Transparent Communication: Ambiguous statements or hidden terms can constitute deceptive practices. Communications should be clear, accurate, and thorough.
• Employee Training Is Important: Since businesses are responsible for employee actions, train staff to avoid potentially deceptive practices.
• Documentation Practices: Maintaining comprehensive records of all customer transactions, communications, and complaint resolutions can be crucial in defending DTPA claims.
• Prompt Complaint Handling: Addressing consumer complaints promptly and thoroughly can prevent escalation to DTPA claims.
• Industry-Specific Awareness: Certain industries (home improvement and construction, financial services, retail businesses, real estate, etc.) face more DTPA scrutiny and should implement stricter compliance measures.

Dealing with a DTPA matter? Contact our offices to arrange a consultation with an attorney on our business litigation team today. To schedule an appointment, call (713) 783-3110 or fill out an online form.