FORT LAUDERDALE BUSINESS LITIGATION: SAFE HARBOR DEFENSE TO FLORIDA’S DECEPTIVE AND UNFAIR TRADE PRACTICES ACT

The Florida Deceptive and Unfair Trade Practices Act (FDUTPA) broadly prohibits businesses from engaging in deceptive practices and unfair methods of competition. Deceptive practices and unfair methods of competition can cover a wide variety of claims because unfair practices as defined broadly. “An unfair practice is one that offends established public policy and one that is immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers.” PNR, Inc. v. Beacon Property Management, Inc., 842 So. 2d 773 (Fla. 2003). Persons aggrieved by a violation of FDUTPA can file a lawsuit under FDUTPA and must establish the following elements to prevail: (1) a deceptive or unfair practice, (2) causation, and (3) actual damages. Baptist Hosp., Inc. v. Baker, 84 So. 3d 1200 (Fla. 1st DCA 2012). However, even if a plaintiff establishes each element, FDUTPA provides defenses known as the “safe harbor provision.” If a business is sued under FDUTPA, the business could have a complete defense to the lawsuit assuming the safe harbor provision applies. The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

FDUTPA’s safe harbor provision can be found at Florida Statutes § 501.212. This statute contains a list of practices and industries exempt from FDUTPA. These exemptions include the following:

• An act or practice required or specifically permitted by federal or state law;
• A media source engaged in the dissemination of information of printed or pictorial matter;
• A claim for personal injury or death or a claim for damage to property other than the property that is the subject of the consumer transaction on which the alleged FDUTPA violation is based;
• Banks and insurance companies regulated by state or federal agencies;
• An activity regulated by the Florida Public Service Commission;
• Acts or practices involving the sale, lease, rental, or appraisal of real estate by a licensed person and which act violates certain real estate statutes;
• Certain causes of action regarding the failure to maintain real property.

FDUTPA defendants commonly raise the first safe harbor defense, an act or practice that is required or specifically permitted by federal or state law. The purpose of this safe harbor defense is to prohibit “a plaintiff from using FDUTPA to create new obligations, or to broaden existing obligations, when a defendant’s conduct is already in compliance with federal law or regulations.” Young v. Community Health Systems, Inc., 2023 WL 6121795 (11th Cir. 2023). “The relevant question for purposes of the… safe harbor is whether a specific federal or state law affirmatively authorized the conduct alleged.” Clear Spring Property & Casualty Co. v. Viking Power, LLC, 2022 WL 17987099 (S.D. Fla., May 10, 2022).

Young v. Community Health Systems, Inc., 2023 WL 6121795 (11th Cir. 2023) is an example of a FDUTPA defendant successfully asserting the federal law safe harbor defense to defeat a FDUTPA claim. The plaintiff in Young went to the emergency room after a bicycle accident and was charged $4,000 for a visitation fee. During her emergency room visit, the plaintiff signed an agreement specifying her financial obligations. However, the plaintiff sued the hospital under FDUPTA claiming she had no knowledge of the visitation fee prior to signing the agreement and receiving treatment. The court dismissed the case because the plaintiff’s claim was barred under FDUTPA’s safe harbor provision for practices permitted by federal law. Federal law governed the disclosures of costs associated with medical treatment and the hospital complied with the federal law by publishing an online list of services and the costs of such services.

If a business is sued for under FDUTPA, the business should carefully review the FDUTPA safe harbor defenses because it is possible one or more might apply. If a defense applies, such as if the business complied with federal or state law in conducting the alleged deceptive or unfair activity, the business could successfully defend against the FDUTPA claim.

The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.