DTPA waiver

We conclude that the basis for invalidating the class action waiver propounded by Kelly based on the facts of this case is foreclosed by Concepcion. CONCLUSION In light of the United States Supreme Court’s recent decision in Concepcion, we conclude that the FAA preempts invalidating the class action waiver in this case on the basis of the waiver being void as against public policy. Accordingly, we quash the Fourth District’s decision below and decline to answer the certified question as it is now moot. It is so ordered. QUINCE, CANADY, LABARGA, and PERRY, JJ., concur. POLSTON, C.J, and LEWIS, J., concur in result.

The plaintiffs asserted claims based on the Florida lending practices statute (chapter 687), Florida Consumer Finance Act (chapter 516), Florida Deceptive and Unfair Trade Practices Act (chapter 501) (FDUTPA), and the Florida Civil Remedies for Criminal Practices Act (chapter 772) (FCRCPA).

In other words, even if the Fourth District is correct that the class action waiver in this case is void under state public policy, this Court is without authority to invalidate the class action waiver on that basis because federal law and the authoritative decision of the United States Supreme Court in Concepcion preclude us from doing so.

The Fourth District recognized that the contract “preserved [Kelly’s] substantive rights,” id. at 619 , but reasoned that the class action waiver violated the public policy of FDUTPA and FCRCPA because the inability to bring a class action suit against MCA would “eviscerate the remedial purposes of the relied-upon statutes. Only with the availability of class representation would consumers’ rights in these payday loan transactions be vindicated.” Id. at 623 .

The rule suggested by Kelly and the Fourth District would encompass all cases in which a plaintiff presented expert testimony from attorneys that they “would not represent consumers in individual small claims suits.” McKenzie, 55 So.3d at 623 . This would be, in effect, based on whether the claims were too small for attorneys to accept on an individual basis — an argument squarely rejected in Concepcion as a basis on which to require class procedures.

Any waiver or modification of the rights, provisions, or remedies of this Act shall be void and unenforceable.

(a) Any person who suffers actual damage as a result of a violation of this Act committed by any other person may bring an action against such person. The court, in its discretion may award actual economic damages or any other relief which the court deems proper; provided, however, that no award of punitive damages may be assessed under this Section against a party defendant who is a new vehicle dealer or used vehicle dealer within the meaning of Chapter 5 of the Illinois Vehicle Code or who is the holder of a retail installment contract within the meaning of Section 2.12 of the Motor Vehicle Retail Installment Sales Act, unless the conduct engaged in was willful or intentional and done with evil motive or reckless indifference to the rights of others.

Proof of a public injury, a pattern, or an effect on consumers and the public interest generally shall be required in order to state a cause of action under this Section against a party defendant who is a new vehicle dealer or used vehicle dealer within the meaning of Chapter 5 of the Illinois Vehicle Code or who is the holder of a retail installment contract within the meaning of Section 2.12 of the Motor Vehicle Retail Installment Sales Act. Proof of such public injury may be shown by any one of the following factors: (1) Violation of a statute that has a public interest impact. (2) Repeated acts prior to the act involving the plaintiff. (3) Potential for repetition.

(c) Except as provided in subsections (f), (g), and (h) of this Section, in any action brought by a person under this Section, the Court may grant injunctive relief where appropriate and may award, in addition to the relief provided in this Section, reasonable attorney's fees and costs to the prevailing party.

(e) Any action for damages under this Section shall be forever barred unless commenced within 3 years after the cause of action accrued; provided that, whenever any action is brought by the Attorney General or a State's Attorney for a violation of this Act, the running of the foregoing statute of limitations, with respect to every private right of action for damages which is based in whole or in part on any matter complained of in said action by the Attorney General or State's Attorney, shall be suspended during the pendency thereof, and for one year thereafter.

(e) The term "consumer" means any person who purchases or contracts for the purchase of merchandise not for resale in the ordinary course of his trade or business but for his use or that of a member of his household.

Sec. 10b. Nothing in this Act shall apply to any of the following: (1) Actions or transactions specifically authorized by laws administered by any regulatory body or officer acting under statutory authority of this State or the United States; however, notwithstanding any action or approval by a regulatory body or officer acting under statutory authority of this State or the United States, the manufacture, distribution, or sale of a product or service that causes or contributes to cause bodily injury, death, or property damage is not an action or transaction "specifically authorized" within the meaning of this item (1).

Section 10c of the Consumer Fraud Act (815 ILCS 505/10c (West 2004)) provides: “Any waiver or modification of the rights, provisions, or remedies of this Act shall be void and unenforceable.” As an attempt to categorically exclude a form of relief authorized by the Consumer Fraud Act, the punitive damages disclaimer in the arbitration clause is void and unenforceable.

The arbitration clause is not, however, void in its entirety, for the punitive damages disclaimer is severable from the remainder of the clause.

we reverse the judgment of the circuit court of Kane County denying defendants’ motions to stay proceedings and compel arbitration, and we remand this cause for further proceedings consistent with this disposition.

As the circuit court appears to have recognized, in striking the agreement’s ban on punitive damages as unconscionable, Illinois law precludes limiting remedies available under the 10 No. 1-21-1001 Consumer Fraud Act.

For the same reasons that barring recovery of punitive damages is impermissible, the ban on attorney fees violates Illinois law. And its impact on a consumer’s ability to pursue a claim is even more tangible.

the modifications necessary to render the agreement enforceable cannot be considered minor. The arbitration agreement is unenforceable, and its unconscionable provisions cannot be severed.

(f) At any time more than 30 days before the commencement of trial, a party, who is a new vehicle dealer or used vehicle dealer within the meaning of Chapter 5 of the Illinois Vehicle Code or who is the holder of a retail installment contract within the meaning of Section 2.12 of the Motor Vehicle Retail Installment Sales Act and who is defending a claim under this Act, may serve upon the party seeking relief under this Act an offer to allow judgment to be taken against the defending party to the effect specified in the offer with costs then accrued. If within 10 days after service of the offer, the offeree serves written notice that the offer is accepted, either party may then file the offer and notice of acceptance together with proof of service of the notice; the court shall then enter judgment. An offer not accepted shall be deemed withdrawn and evidence of the offer is not admissible except in a proceeding to determine costs. When a party seeking relief under this Act does not accept an offer filed with the clerk and served upon the attorney for that party more than 30 days before the commencement of trial and when that party fails to obtain a judgment in an amount more than the total offer of settlement, that party shall forfeit and the court may not award any compensation for attorney's fees and costs incurred after the date of the offer.

(h) At least 30 days prior to the filing of an action under this Section, a party who is seeking relief shall serve a written notice of the nature of the alleged violation and demand for relief upon the prospective party, who is a new vehicle dealer or used vehicle dealer within the meaning of Chapter 5 of the Illinois Vehicle Code or who is the holder of a retail installment contract within the meaning of Section 2.12 of the Motor Vehicle Retail Installment Sales Act, against whom such action will be commenced. Any person receiving such a demand for relief may, within 30 days of service of the demand for relief, submit a written offer of settlement, which offer is to be exclusive of attorney's fees, to the party serving the notice and demand. The party who is seeking relief must certify in any cause of action that the notice and demand was served upon the named defendants and the substance of their response, if any. If the offer of settlement is rejected in writing by the party who is seeking relief, then, in any subsequent action, the court shall deny any award of attorney's fees and costs requested by the party seeking relief under this Act incurred after the rejection of the written offer of settlement, if the judgment is less than the amount contained within the offer of settlement. All written offers of settlement under this subsection shall be presumed to be offered without prejudice in compromise of a disputed matter.

For all of the above reasons, the circuit court’s order compelling arbitration is reversed, Ms. Bain’s complaint is reinstated, and this matter is remanded for further proceedings consistent with this opinion. ¶ 57 Reversed and remanded.

(h) In addition to the right of action granted to the attorney general pursuant to this section, any person who has been injured by reason of any deceptive act or deceptive practice made unlawful by this section may bring an action in such person's own name to enjoin such deceptive act or deceptive practice, an action to recover such person's actual damages or fifty dollars, whichever is greater, or both such actions.

2. a. Prohibition. No written contract for the sale or purchase of consumer goods, entered into on or after the effective date of this section, to which a consumer is a party, shall contain a mandatory arbitration clause. Nothing contained herein shall be construed to prohibit a non-consumer party from incorporating a provision within such contract that such non-consumer party agrees that the decision of the arbitrator or panel of arbitrators shall be final in its application to such non-consumer party and not subject to court review. b. Mandatory arbitration clause null and void. The provisions of a mandatory arbitration clause shall be null and void. The inclusion of such clause in a written contract for the sale or purchase of consumer goods shall not serve to impair the enforceability of any other provision of such contract.

§ 399-c. Mandatory arbitration clauses in certain consumer contracts prohibited. 1. Definitions. a. The term "consumer" shall mean a natural person residing in this state. b. The term "consumer goods" shall mean goods, wares, paid merchandise or services purchased or paid for by a consumer, the intended use or benefit of which is intended for the personal, family or household purposes of such consumer. c. The term "mandatory arbitration clause" shall mean a term or provision contained in a written contract for the sale or purchase of consumer goods which requires the parties to such contract to submit any controversy thereafter arising under such contract to arbitration prior to the commencement of any legal action to enforce the provisions of such contract and which also further provides language to the effect that the decision of the arbitrator or panel of arbitrators in its application to the consumer party shall be final and not subject to court review. d. The term "arbitration" shall mean the use of a decision making forum conducted by an arbitrator or panel of arbitrators within the meaning and subject to the provisions of article seventy-five of the civil practice law and rules.

(e) Nothing in this section shall apply to any television or radio broadcasting station or to any publisher or printer of a newspaper, magazine or other form of printed advertising, who broadcasts, publishes, or prints the advertisement.

(a) Unfair, deceptive, or abusive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in this state are hereby declared unlawful. For the purposes of this section: (1) An act or practice is unfair when it causes or is likely to cause substantial injury which is not reasonably avoidable and is not outweighed by countervailing benefits to consumers or to competition. The term "substantial injury" as used in this subdivision shall have the same meaning as the term "substantial injury" in the federal trade commission act, 15 U.S.C. Section 41 et seq.

(2) An act or practice is abusive when: (i) it materially interferes with the ability of a person to understand a term or condition of a product or service; or (ii) it takes unreasonable advantage of: (A) a lack of understanding on the part of a person of the material risks, costs, or conditions of a product or service; (B) the inability of a person to protect such person's interests in selecting or using a product or service; or (C) the reasonable reliance by a person on a person engaging in the act or practice to act in the relying person's interests.

(d) In any action or proceeding brought pursuant to this section it shall be a complete defense that the act or practice is, or if in interstate commerce would be, subject to and complies with the rules and regulations of, and the statutes administered by, the federal trade commission or any official department, division, commission or agency of the United States as such rules, regulations or statutes are interpreted by the federal trade commission or such department, division, commission or agency or the federal courts.

(g) This section shall apply to all unfair, deceptive, or abusive acts or practices, whether or not subject to any other law of this state, and shall not supersede, amend or repeal any other law of this state under which the attorney general or any other party is authorized to take any action or conduct any inquiry.

The court may, in its discretion, increase the award of damages to an amount not to exceed three times the actual damages up to one thousand dollars, if the court finds the defendant willfully or knowingly violated this section. The court may award reasonable attorney's fees to a prevailing plaintiff.

The requisite elements of the cause of action are well established. A plaintiff must allege that: (1) the defendant’s conduct was consumer-oriented; (2) the defendant’s act or practice was deceptive or misleading in a material way; and (3) the plaintiff suffered an injury as a result of the deception (GBL § 349 [h]; Plavin v Group Health Inc., 35 NY3d 1, 10 [2020]).

First, there is no textual support in GBL § 349 for a limitation on the definition of “consumer” based on use. Indeed, any such narrowing of the term “consumer” would be contrary to the legislative intent to protect the public against all forms of deceptive business practices (see GBL § 349 [a]; Karlin, 93 NY2d at 290). To the extent the First Department’s analysis has relied on other statutory definitions of “consumer” or “consumer good” (see Cruz v NYNEX Info. Resources, 263 AD2d 285, 289 [1st Dept 2000]), such reliance is misplaced. The text and purpose of GBL § 349 does not support the importation of other statutory definitions because, unlike other provisions, section 349 broadly prohibits “[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in this state” (GBL § 349).

Second, given the text and purpose of GBL § 349, the Court has explained that an act or practice is consumer-oriented when it has “a broader impact on consumers at large” (Oswego Laborers’ Local 214 Pension Fund v Marine Midland Bank, 85 NY2d 20, 25-27 [1995]; New York Univ. v Continental Ins. Co., 87 NY2d 308, 320 [1995]). For example, the consumer-oriented element precludes a GBL § 349 claim based on “[p]rivate contract disputes, unique to the parties” (Oswego, 85 NY2d at 25).

However, the amended complaint was properly dismissed because plaintiffs cannot plead the materially misleading element of a GBL § 349 cause of action. A defendant’s actions are materially misleading when they are “likely to mislead a reasonable consumer acting reasonably under the circumstances” (Gaidon v Guardian Life Ins. Co. of Am., 94 NY2d 330, 344 [1999]).

Order affirmed, with costs. Opinion by Judge Rivera. Chief Judge DiFiore and Judges Stein, Garcia and Wilson concur. Judge Fahey dissents in part in an opinion.

(a) Any waiver by a consumer of the provisions of this subchapter is contrary to public policy and is unenforceable and void; provided, however, that a waiver is valid and enforceable if: (1) the waiver is in writing and is signed by the consumer; (2) the consumer is not in a significantly disparate bargaining position; and (3) the consumer is represented by legal counsel in seeking or acquiring the goods or services. (b) A waiver under Subsection (a) is not effective if the consumer's legal counsel was directly or indirectly identified, suggested, or selected by a defendant or an agent of the defendant. (c) A waiver under this section must be: (1) conspicuous and in bold-face type of at least 10 points in size; (2) identified by the heading "Waiver of Consumer Rights," or words of similar meaning; and (3) in substantially the following form: "I waive my rights under the Deceptive Trade Practices-Consumer Protection Act, Section 17.41 et seq., Business & Commerce Code, a law that gives consumers special rights and protections. After consultation with an attorney of my own selection, I voluntarily consent to this waiver." (d) The waiver required by Subsection (c) may be modified to waive only specified rights under this subchapter. (e) The fact that a consumer has signed a waiver under this section is not a defense to an action brought by the attorney general under Section 17.47 .

(4) "Consumer" means 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, except that 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.

(10) "Business consumer" means an individual, partnership, or corporation who seeks or acquires by purchase or lease, any goods or services for commercial or business use. The term does not include this state or a subdivision or agency of this state.

(f) Nothing in the subchapter shall apply to a claim arising out of a written contract if: (1) the contract relates to a transaction, a project, or a set of transactions related to the same project involving total consideration by the consumer of more than $100,000; (2) in negotiating the contract the consumer is represented by legal counsel who is not directly or indirectly identified, suggested, or selected by the defendant or an agent of the defendant; and (3) the contract does not involve the consumer's residence. (g) Nothing in this subchapter shall apply to a cause of action arising from a transaction, a project, or a set of transactions relating to the same project, involving total consideration by the consumer of more than $500,000, other than a cause of action involving a consumer's residence.