What is Deception and When Does It Cause Injury?

The Washington Consumer Protection Act (“CPA”) was enacted to protect consumers from “unfair and deceptive acts or practices” occurring in trade or commerce. While a plaintiff does not have to prove an act or practice was intended to deceive, only merely that it has the capacity to deceive, a CPA claim isn’t always easy to prove.

Claims Pointer: This unpublished opinion by the Washington Court of Appeals outlines the elements a plaintiff must prove to be successful in a CPA claim, shows what the Court considers to be deceptive, and also highlights how a defendant can establish that a CPA claim lacks causation.

Axon v. Freedom R.V., Inc., 38068-8-III (Wash. Ct. App. May 3. 2022).

Facts:

           In June 2018, the Axons purchased a used RV with the intent to live in it full time. They bought the slightly used 2018 Fuzion fifth-wheel RV from Freedom RV. The RV was manufactured by Keystone RV Company. While living in their RV, the Axons developed cold and flu symptoms that they believe were a result of mold caused by living in the RV.

           The Keystone owner’s manual cautions against living in the RV for a prolonged period of time, but the Axons never read the owner’s manual because they thought it was too long to read. The Axons brought a Consumer Protection Act (“CPA”) claim against Keystone RV. Keystone motioned for summary judgment alleging that the Axons lacked evidence that it engaged in unfair or deceptive practices or that its alleged unfair or deceptive practices caused the Axons’ damages. The trial court granted Keystone’s motion for summary judgment and the Axons appealed. It is noted that the allegations in the Axons’ complaint were not sworn to under oath by the Plaintiff; thus they were not considered “facts” for purposes of opposing summary judgment.

Law: 

           Washington’s CPA was enacted to “protect the public and foster fair and honest competition.” RCW 19.86.920. It is not intended to prohibit acts or practices that are reasonable to the development and preservation of business. Id. To bring a claim under the CPA a party must prove (1) an unfair or deceptive act or practice, (2) occurring in trade or commerce, (3) affecting the public interest, (4) injury to a person’s business or property, and (5) causation. Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105 Wn.2d 778, 784-85, 719 P.2d 531 (1986).

           A plaintiff only needs to show that an act or practice had the capacity to deceive the public, not that it was intended to deceive the public. Panag v. Farmers Ins. Co. of Wash., 166 Wn.2d 27, 47, 204 P.3d 885 (2009). Deception exists when there is a representation, practice, or omission that is likely to mislead a reasonable consumer. Id. Something can be accurate and still be deceptive if it conveys a deceptive net impression. Id. Further, a warning that is merely insufficient is not the type of conduct the CPA intends to address. For something to be “deceptive,” it must mislead or misrepresent something of material importance. Holiday Resort Cmty. Ass’n v. Echo Lake Assocs., LLC, 134 Wn. App 210, 226, 135 P.3d 499 (2006).

Analysis:  

           On appeal, the Axons raised two arguments: (1) Keystone’s marketing brochure creates a deceptive net impression that their RV is designed and suitable for full-time living, and (2) the warnings contained in the owner’s manual are deceptive because they minimize the risks associated with living in an RV full-time.

           The Washington Court of Appeals began to address the Axons’ first argument by examining Keystone’s marketing brochure. The Axons pointed to several features of the Fuzion RV that were advertised as “residential.” The Court found that reference to certain features of the RV as being “residential” was not sufficient to create a net impression that the Fuzion RV was suitable for full-time living. The Court stated that inherent in the phrase “recreational vehicle” is that an RV is for recreation. In addition, the Fuzion RV’s recreational character was more apparent in the marketing brochure when it was described as a “toy hauler”. The Court found that the imagery used throughout the brochure focused on the outdoors, and while the residential features of the RV were a selling point, they were not utilized to the extent that the brochure suggests the RV was a residence on wheels. Thus, the Court stated, the minor residential features mentioned in the brochure did not create a net impression that the Fuzion RV “toy hauler” was intended for residential living.

           In addressing the Axons’ second argument, the Court of Appeals examined the owner’s manual. The Axons contended that while the owner’s manual disclosed information about the risks of prolonged occupancy, they were insufficient. The owner’s manual mentions that mold can easily develop in an RV and the risk posed by mold. It also encourages RV owners to properly vent their RVs and use dehumidifiers. The Court did not think that the manual tried to minimize or hide the possible negative consequences of living in an RV, and thus, held that the owner’s manual was not deceptive because it did not mislead or misrepresent the dangers of mold.

           The Court then stated that even if it were to conclude otherwise, the Axons would still not prevail because they failed to present facts sufficient to establish causation. The Axons repeatedly stated in discovery that they did not read the owner’s manual before purchasing the RV, therefore their decision to purchase and live in the RV would not have changed had the owner’s manual provided more detail on the risks of mold. The fact that the Plaintiffs had not relied on the owners manual when deciding to purchase the RV eliminated any possibility that a “deceptive” description of the risks of developing mold led the Plaintiff to purchase the RV.

The Big Picture 

           To be successful in a CPA claim, the plaintiff must not only have solid evidence that shows that a defendant’s act or practice can deceive, but also that the alleged deceptive act or practice did indeed cause the plaintiff’s injuries. In this case, the materials the Plaintiffs pointed to as being deceptive were not found to be deceptive by the Court. Even if the Court found the materials to be deceptive, however, the Court went further and stated the Plaintiffs failed to show causation because there was no evidence that any extra warnings in the materials would have resulted in the Plaintiff’s refusing to purchase the RV.

            One of the benefits to plaintiffs in asserting a CPA claim is the possibility of an award of “treble damages” and attorney fees. Attorney fees and treble damages are often not considered covered under a standard commercial insurance policy. For the most part, however, CPA claims are alleged by attorneys wishing to line their pocket with fees that a defendant may end up paying out of pocket. CPA claims also drive a wedge between a defendant and their insurance carrier on issues regarding what is, and is not, covered on the plaintiff’s claim. Prosecuting Consumer Protection Act lawsuits is also very difficult for plaintiffs. There are five different elements they must prove, and with each element a Court is analyzing the case with the understanding that the CPA is not intended to prohibit acts or practices that are reasonable to the development and preservation of business.