What are the elements of an unlawful act of unfair competition?

Unfair competition is an unfair business practice that involves one person or entity taking advantage of another. In Massachusetts, unfair competition is governed by the Massachusetts Unfair Trade Practices Act, which sets forth certain elements necessary for an act to be deemed unlawful. First, the act must be unfair and deceptive. To be deemed unfair, it must be shown that the act would cause harm to consumers or to other competitors in the market. The harm may be economic or non-economic in nature. To be considered deceptive, a party must have deliberately or recklessly misled another person or entity. Second, it must be shown that an actual or potential economic benefit was involved. This benefit may take the form of actual profits or prospective economic gain. It may also be considered a benefit if the party engaging in the unfair practice was able to preserve a business advantage. Third, it must be shown that the act was committed with the intent to gain an advantage. Intent to injure or defraud another party is not necessary to be deemed unlawful. The act must have been committed with the intent of gaining economic benefits or avoiding losses that would otherwise be incurred. Fourth, it must be shown that the act violated a legal duty. This could involve the breach of a contract or a violation of a statute. In some cases, unfair competition may even involve tortious conduct. Finally, it must be shown that the act caused actual or potential damage. This damage could come in the form of lost profits, damaged reputation, or other economic or non-economic losses. In sum, an act of unfair competition is unlawful in Massachusetts if it is shown to be unfair and deceptive, involve an economic benefit, be committed with intent to gain an advantage, violate a legal duty, and cause damage.

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