PRINTER'S NO. 681
No. 638 Session of 1989
INTRODUCED BY GREENLEAF, BELL, AFFLERBACH AND RHOADES,
MARCH 2, 1989
REFERRED TO CONSUMER PROTECTION AND PROFESSIONAL LICENSURE,
MARCH 2, 1989
AN ACT
1 Amending the act of December 17, 1968 (P.L.1224, No.387),
2 entitled "An act prohibiting unfair methods of competition
3 and unfair or deceptive acts or practices in the conduct of
4 any trade or commerce, giving the Attorney General and
5 District Attorneys certain powers and duties and providing
6 penalties," prohibiting certain unfair or deceptive acts in
7 connection with advertisements offering prizes; and further
8 providing for the right to rescind contracts.
9 The General Assembly of the Commonwealth of Pennsylvania
10 hereby enacts as follows:
11 Section 1. Sections 2 and 3 of the act of December 17, 1968
12 (P.L.1224, No.387), known as the Unfair Trade Practices and
13 Consumer Protection Law, reenacted and amended November 24, 1976
14 (P.L.1166, No.260), are amended to read:
15 Section 2. Definitions.--As used in this act[.] :
16 "Advertisement" means any attempt, directly or indirectly, by
17 publication, dissemination, oral solicitation, endorsement or
18 circulation or by any other means, to induce, directly or
19 indirectly, any person to enter into any obligation to purchase
20 goods or services or an interest in real property, including,
1 but not limited to, time share interest or arrangement for the
2 use of any lot, residence, campground site or other
3 accommodation on a periodic basis.
4 [(1)] "Documentary material" means the original or a copy of
5 any book, record, report, memorandum, paper, communication,
6 tabulation, map, chart, photograph, mechanical transcription or
7 other tangible document or recording, wherever situate.
8 [(2)] "Person" means natural persons, corporations, trusts,
9 partnerships, incorporated or unincorporated associations, and
10 any other legal entities.
11 "Sales promotion" means an advertising activity or plan that
12 attempts to induce a sale in part by offering prizes.
13 [(3)] "Trade" and "commerce" mean the advertising, offering
14 for sale, sale or distribution of any services and any property,
15 tangible or intangible, real, personal or mixed, and any other
16 article, commodity, or thing of value wherever situate, and
17 includes any trade or commerce directly or indirectly affecting
18 the people of this Commonwealth.
19 [(4)] "Unfair methods of competition" and "unfair or
20 deceptive acts or practices" mean any one or more of the
21 following:
22 [(i)] (1) Passing off goods or services as those of another;
23 [(ii)] (2) Causing likelihood of confusion or of
24 misunderstanding as to the source, sponsorship, approval or
25 certification of goods or services;
26 [(iii)] (3) Causing likelihood of confusion or of
27 misunderstanding as to affiliation, connection or association
28 with, or certification by, another;
29 [(iv)] (4) Using deceptive representations or designations
30 of geographic origin in connection with goods or services;
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1 [(v)] (5) Representing that goods or services have
2 sponsorship, approval, characteristics, ingredients, uses,
3 benefits or quantities that they do not have or that a person
4 has a sponsorship, approval, status, affiliation or connection
5 that he does not have;
6 [(vi)] (6) Representing that goods are original or new if
7 they are deteriorated, altered, reconditioned, reclaimed, used
8 or secondhand;
9 [(vii)] (7) Representing that goods or services are of a
10 particular standard, quality or grade, or that goods are of a
11 particular style or model, if they are of another;
12 [(viii)] (8) Disparaging the goods, services or business of
13 another by false or misleading representation of fact;
14 [(ix)] (9) Advertising goods or services with intent not to
15 sell them as advertised;
16 [(x)] (10) Advertising goods or services with intent not to
17 supply reasonably expectable public demand, unless the
18 advertisement discloses a limitation of quantity;
19 [(xi)] (11) Making false or misleading statements of fact
20 concerning the reasons for, existence of, or amounts of price
21 reductions;
22 [(xii)] (12) Promising or offering prior to time of sale to
23 pay, credit or allow to any buyer, any compensation or reward
24 for the procurement of a contract for purchase of goods or
25 services with another or others, or for the referral of the name
26 or names of another or others for the purpose of attempting to
27 procure or procuring such a contract of purchase with such other
28 person or persons when such payment, credit, compensation or
29 reward is contingent upon the occurrence of an event subsequent
30 to the time of the signing of a contract to purchase;
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1 [(xiii)] (13) Promoting or engaging in any plan by which
2 goods or services are sold to a person for a consideration and
3 upon the further consideration that the purchaser secure or
4 attempt to secure one or more persons likewise to join the said
5 plan; each purchaser to be given the right to secure money,
6 goods or services depending upon the number of persons joining
7 the plan. In addition, promoting or engaging in any plan,
8 commonly known as or similar to the so-called "Chain-Letter
9 Plan" or "Pyramid Club." The terms "Chain-Letter Plan" or
10 "Pyramid Club" mean any scheme for the disposal or distribution
11 of property, services or anything of value whereby a participant
12 pays valuable consideration, in whole or in part, for an
13 opportunity to receive compensation for introducing or
14 attempting to introduce one or more additional persons to
15 participate in the scheme or for the opportunity to receive
16 compensation when a person introduced by the participant
17 introduces a new participant. As used in this subclause the term
18 "consideration" means an investment of cash or the purchase of
19 goods, other property, training or services, but does not
20 include payments made for sales demonstration equipment and
21 materials for use in making sales and not for resale furnished
22 at no profit to any person in the program or to the company or
23 corporation, nor does the term apply to a minimal initial
24 payment of twenty-five dollars ($25) or less;
25 [(xiv)] (14) Failing to comply with the terms of any written
26 guarantee or warranty given to the buyer at, prior to or after a
27 contract for the purchase of goods or services is made;
28 [(xv)] (15) Knowingly misrepresenting that services,
29 replacements or repairs are needed if they are not needed;
30 [(xvi)] (16) Making repairs, improvements or replacements on
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1 tangible, real or personal property, of a nature or quality
2 inferior to or below the standard of that agreed to in writing;
3 (17) Failing, in connection with any advertisement
4 indicating that a prize has been won:
5 (i) To indicate clearly and conspicuously at the beginning
6 of any advertisement the name and address of the person on whose
7 behalf the advertisement has been conducted. If the
8 advertisement is written, the information shall appear in bold
9 type at least two points larger than that used for the major
10 portion of the advertisement.
11 (ii) To indicate clearly in an advertisement that the
12 advertisement is a sales promotion.
13 (iii) To indicate clearly, conspicuously and proximately to
14 the prize being offered the usual selling price or price range
15 for the identical merchandise or for comparable merchandise of
16 like grade of quality.
17 (iv) To provide a full and accurate description of any prize
18 offered. In the event the advertising premium consists of a
19 vacation or trip, the advertiser or the advertiser's agent shall
20 indicate clearly and conspicuously the name and location of
21 accommodations and whether transportation to and from the
22 vacation site or point of departure is included. No vacation or
23 trip shall be offered for which a deposit by the recipient is
24 required.
25 (v) To indicate clearly, if receipt of a prize is
26 conditional, the conditions that must be met before the prize
27 will be delivered.
28 (vi) To indicate to the recipient clearly and conspicuously
29 that a prize is no longer manufactured, is damaged or is less
30 than first quality.
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1 (vii) To indicate, at the recipient's request, specifically
2 which prize will be received. To indicate clearly and
3 conspicuously the probability that the recipient will receive
4 each prize mentioned in an advertisement. The probability shall
5 be indicated proximately to the first mention of each prize and
6 shall be expressed in whole numbers, such as 1,000,000 to 1. If
7 the advertisement is written, the probability and any rules or
8 conditions, including eligibility, shall appear in bold type the
9 same size as that used for the major portion of the
10 advertisement.
11 (viii) To deliver, postage or delivery charges prepaid, an
12 unconditionally offered prize when requested by the recipient
13 within seven days of request unless the failure to deliver is
14 caused by reason beyond the control of the advertiser.
15 (18) Failing to include in a contract signed during a sales
16 promotion effort a cancellation clause in bold print which will
17 allow the consumer to cancel the contract, in writing, within
18 one hundred twenty hours and provide for a refund of any payment
19 made within thirty days of the cancellation. A copy of the
20 contract shall be given to the consumer at the time of signing.
21 [(xvii)] (19) Engaging in any other fraudulent conduct which
22 creates a likelihood of confusion or of misunderstanding.
23 Section 3. Unlawful Acts or Practices; Exclusions.--Unfair
24 methods of competition and unfair or deceptive acts or practices
25 in the conduct of any trade or commerce as defined by
26 [subclauses (i) through (xvii) of clause (4) of] section 2 of
27 this act and regulations promulgated under section 3.1 of this
28 act are hereby declared unlawful. The provisions of this act
29 shall not apply to any owner, agent or employe of any radio or
30 television station, or to any owner, publisher, printer, agent
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1 or employe of a newspaper or other publication, periodical or
2 circular, who, in good faith and without knowledge of the
3 falsity or deceptive character thereof, publishes, causes to be
4 published or takes part in the publication of such
5 advertisement.
6 Section 2. This act shall take effect in 60 days.
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