Tuesday, February 20, 2007, 4:48 PM

COA Rejects Chapter 75 Claim As Not "Affecting Commerce"

Today in Esposito v. Talbert & Bright, Inc. the COA held that the defendant was entitled to summary judgment on plaintiff's Chapter 75 (UTPA) claim because plaintiff couldn't satisfy the second element of a Chapter 75 claim: showing that the alleged unfair/deceptive act was "in or affecting commerce." See G.S. 75-1.1.

This "in or affecting commerce" element usually doesn't receive much attention. Most folks just assume it's satisfied whenever the defendant engages in commerce, i.e., in business. But in recent years, particularly in cases involving disputes by employees, the courts have inquired whether the challenged conduct had an impact beyond the parties to the case, an impact on commerce.

The key cases in this line are Dalton v. Camp, 353 N.C. 647, 548 S.E.2d 704 (2001), and Durling v. King, 146 N.C.App. 483, 554 S.E.2d 1 (2001). The latter was a dispute over the amount of commissions the defendant owed the plaintiff. The COA affirmed summary judgment because "no evidence was presented that the subject transactions had any impact beyond the parties' employment relationships."

The controversy in today's case arose from a contention that defendants, through statements and actions, interfered with plaintiff's employment relationship with his employer, resulting in disciplinary action and termination. The COA relied on Durling, emphasizing that whether an act affected commerce usually depends on the facts of each case and the impact in the marketplace. The COA held that even assuming defendant's acts were unfair or deceptive acts that injured the plaintiff, he "has forecast no evidence that defendant's statements and actions had any impact beyond his employment relationship" and therefore he "failed to show that defendants' statements and actions were 'in or affecting commerce'" as required to prevail on a Chapter 75 claim.

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