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Pennsylvania UTPCPL can be used by non-Pennsylvania residents to bring suit against Pennsylvania businesses for out-of-state conduct.

October 1, 2018
Danganan v. Guardian Prot. Servs., 179 A.3d 9, 20-21 (Pa. 2018)

The Pennsylvania Supreme Court determined that a non-Pennsylvania resident can assert a lawsuit under the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL) against a business that is headquartered in Pennsylvania for conduct that occurs outside of the Commonwealth. A plaintiff can be awarded treble damages under the UTPCPL, thus making any broader interpretation of its applicability potentially problematic in the defense of those businesses that are routinely subject to claims under the UTPCPL – e.g. contractors, developers, real estate professionals, etc.

In Danganan, the plaintiff was a homeowner who utilized Pennsylvania-based defendant Guardian Protection Services for home security at his Washington, D.C., home. The plaintiff then moved to California prior to the expiration of his contract with Guardian. Despite the plaintiff’s cancellation request, the defendant kept billing him. The plaintiff filed suit against Guardian in Philadelphia County under the UTPCPL. The suit was removed to federal court, and ultimately, the Third Circuit sent a certified question to the Pennsylvania Supreme Court as to whether the UTPCPL applied to non-residents. The Supreme Court held that the text of the UTPCPL did not apply a geographical limit or residency requirement for potential plaintiffs to invoke its authority in suit. The act was to be construed broadly. That is, an out-of-state resident may bring claims under the UTPCPL against Pennsylvania businesses for conduct that occurred outside of Pennsylvania, consistent with “the statute’s broad underlying foundation of fraud prevention.”

This ruling has implications for Pennsylvania businesses that conduct themselves in other states as they may now be subject to the treble damages of the UTPCPL for business they conduct outside of the Commonwealth of Pennsylvania.

 

 

Case Law Alerts, 4th Quarter, October 2018

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