Michigan's Unfair, Deceptive, and Abusive Practice (UDAP) Laws Have No Way to Protect Consumers

Across our work with Protect MI Families, a clear trend of abuse and exploitation by corporations and large businesses is clear. Insurance companies act in bad faith to make an extra buck off their policyholders, workplaces limit the compensation that injured workers are owed, toxic chemicals in Michigan's waters from corporations polluting without consequence, and much more. These dangers for the Michigan consumer are not distinctly separate, but demonstrate the failure of Michigan's policy standards to hold corporations accountable for acting deceptively or without regard for the wellbeing of Michigan's communities.

Every state has some standard they set to protect consumers from businesses engaging in deceptive practices. These laws banning Unfair, Deceptive, and Abusive Practices (UDAP) vary from state to state, but are largely the first and primary piece of protection consumers have from businesses that exploit consumers. These laws are typically used by consumer protection advocates and legal advocates to hold businesses accountable. Michigan's specific UDAP laws are part of the Michigan Consumer Protection Act (MCPA).

With these laws holding so much importance placed on UDAP laws in keeping consumers safe, Michiganders should expect their first line of defense to be strong in the face of corporate abuse. Unfortunately, the MCPA is in a state of disrepair. According to a report by the National Consumer Law Center, multiple rulings from the Michigan Supreme Court have severely narrowed the ability for the Act to properly protect consumers.

First, any business in Michigan is now exempt from the provisions of the MCPA if they are sufficiently regulated by state or federal agencies. Such regulations can include the simple ownership of a occupational license, so barely any businesses in Michigan are even covered by the MCPA's consumer protection provisions. Even though Michigan has protections written in the MCPA that could reasonably protect consumers, including strong enforcement methods and a limited set of procedural hurdles for consumers to find compensation, these protections cannot be properly applied.

This single barrier for the MCPA leaves most consumers in Michigan without a blueprint to find justice for corporate abuse. That is why we need expansive reform for the MCPA that can properly cover consumers, including specific provisions that restrict insurance companies from acting in bad faith, even if they are otherwise regulated by other agencies. Michigan's lack of consumer protections are not a singular failure within its statues, but a disastrous oversight in the manner its policies are applied to bad actors.