The law of unfair competition is mainly governed by state common law (state unfair competition). A few states, including Illinois, have enacted legislation dealing with types of state unfair competition, such as the Uniform Deceptive Trade Practices Act (UDTPA) and the Consumer Fraud & Deceptive Practices Act (CFA).
Consumer Fraud & Deceptive Practices Act (CFA)
Several states have codified some form of Consumer Fraud Act. Illinois is one state that has done so, codified at 815 ILCS 505/1 as the Consumer Fraud & Deceptive Practices Act (CFA). The CFA make unlawful unfair or deceptive acts or practices which take place “in the conduct of any trade or commerce” The act is defined broadly, covering transactions in services, goods & property.
Unlawful practices are defined in the code as deception, fraud, false pretense, false promise, misrepresentation, concealment, omission of material fact, with intent that others rely on the concealment or omission. A material fact is one where a person would have acted differently knowing the correct information or which concerns the type of information upon which a person would be expected to rely on making a decision.
Consumers do not need to show intent to deceive; a violation may be based on innocent or negligent misrepresentation. However, only people who suffer actual damages as a result of the misappropriation can bring an action under the act. Thus, to state a claim, a consumer must prove reliance on the misrepresentation.
Uniform Deceptive Trade Practices Act (UDTPA)
The purpose of the UDTPA is to prevent dishonest businesses from doing injury to those honest businesses competing in their markets. Injunctive relief is available to protect individual consumers, where they are likely to be damaged in the future by a deceptive trade practice of another. No damages remedy is available under the UDTPA, but damages for violations of the UDTPA are available under the CFA. To prevail under the UDTPA, a plaintiff need not prove monetary damage, intent to deceive, or even actual confusion or misunderstanding. The prevailing plaintiff may be awarded costs and attorneys fees, but only if the court finds that the defendant willfully engaged in a deceptive trade practice.
A person engages in a deceptive trade practice (trademark infringement) when, in the course of his business, he: