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Chapter 47     Entire Code
‹ Chapter 46B  |  Chapter 47A › Printer Friendly Versions
Chapter 47  |  Article 47 - 11A  |  Section 4
WVC 47 - CHAPTER 47. REGULATION OF TRADE.
WVC 47 - 11 A- ARTICLE 11A. UNFAIR TRADE PRACTICES.

WVC 47 - 11 A- 1 §47-11A-1. Legislative findings; designation of article.
The sale of goods at less than the cost thereof results in economic maladjustments and tends toward the creation of monopolies, thereby destroying fair and healthy competition and tending toward bankruptcy among merchants who maintain a fair price policy, and is, therefore, an unfair trade practice. It is hereby declared that any advertisement, offer to sell, or sale of any merchandise, either by retailers or wholesalers, at less than cost, as defined in this article, or any advertisement of an intent to give, any offer to give, or gift of any merchandise, either by retailers or wholesalers, for the purposes of unfairly diverting trade from or otherwise injuring competitors and destroying competition, is an unfair method of competition contrary to public policy and in contravention of the policy of this article, which shall be known and designated as the "Unfair Practices Act."

WVC 47 - 11 A- 2 §47-11A-2. When selling below cost or giving away of merchandise prohibited; penalty.
It shall be unlawful for any person, partnership, firm, corporation, joint-stock company, or other association engaged in business as a retailer or wholesaler within this state, to sell, offer for sale or advertise for sale any article, product or item of merchandise at less than the cost thereof to the vendor, or give, offer to give or advertise the intent to give away any article, product or item of merchandise for the purposes of unfairly diverting trade from or otherwise injuring one or more competitors, and destroying competition. Each violation shall constitute a misdemeanor, and upon conviction thereof, any person, partnership, firm, corporation, joint-stock company, or other association violating this section shall be subject to the penalty set out in section eleven hereof.

WVC 47 - 11 A- 3 §47-11A-3. When rebates and special privileges prohibited; penalty.
The secret payment or allowance of rebates, refunds, commissions, or unearned discounts, whether in the form of money or otherwise, or secretly extending to certain purchasers special services or privileges not extended to all purchasers purchasing upon like terms and conditions, to the injury of a competitor and where such payment or allowance tends to destroy competition, is an unfair trade practice and any person, partnership, firm, corporation, joint-stock company, or other association resorting to such trade practice shall be deemed guilty of a misdemeanor and on conviction thereof shall be subject to the penalties set out in section eleven of this article.

WVC 47 - 11 A- 4 §47-11A-4. Personal responsibility of directors, officers or agents.
Any person who, either as director, officer or agent of any firm or corporation or as agent of any person violating the provisions of this article, assists or aids, directly or indirectly, in such violation shall be responsible therefor equally with the person, firm or corporation for whom or for which he acts.

WVC 47 - 11 A- 5 §47-11A-5. "Retailer" and "wholesaler" defined; sales and transfers subject to article.
(a) The term "retailer" shall mean and include every person, partnership, firm, corporation, joint-stock company or other association engaged in the business of making sales at retail within this state: Provided, however, That in the case of a person, partnership, firm, corporation, joint-stock company or other association engaged in the business of making sales both at retail and at wholesale, such term shall be applied only to the retail portion of such business.

(b) The term "wholesaler" shall mean and include every person, partnership, firm, corporation, joint-stock company, or other association engaged in the business of making sales at wholesale within this state: Provided, That in the case of a person, partnership, firm, corporation, joint-stock company, or other association engaged in the business of making sales both at retail and wholesale, such term shall be applied only to the wholesale portion of such business.

(c) The provisions of this article shall be applicable to all sales at retail made by a retailer as herein defined, and shall be applicable to any transfer for a valuable consideration made in the ordinary course of trade, or the usual prosecution of the retailer's business, of title to tangible personal property to the purchaser for consumption or use other than resale or further proceedings or manufacturing, and shall be applicable also to any transfer of such property where title is retained by the retailer as security for the payment of such purchase price.

(d) The provisions of this article shall be applicable to all sales at wholesale, and shall be applicable to any transfer for a valuable consideration made in the ordinary course of trade or in the usual prosecution of the wholesaler's business, of title to tangible personal property to the purchaser for purposes of resale or further proceedings or manufacturing, and shall be applicable also to any such transfer of property where title is retained by the seller as security for the payment of the purchase price.

WVC 47 - 11 A- 6 §47-11A-6. How cost determined.
(a) The term "cost" when applicable to the business of retailer shall mean bona fide cost and shall mean (i) the invoice cost of the article, product or item of merchandise to the retailer or the replacement cost thereof to the retailer within thirty days prior to the date of sale, offer for sale or advertisement for sale, as the case may be, in the quantity last purchased, whichever is lower, from either of which there shall be deducted all trade discounts, except customary discounts for cash, and (ii) to either of which there shall be added the following items of expense:

(1) Freight charges not otherwise included in the cost of the article, product or item of merchandise, but which freight charges shall not be construed as including cartage to retail outlet if done or paid for by the retailer;

(2) A markup to cover, in part, the cost of doing business, which markup, in the absence of proof of a lesser cost, shall be seven percent of the aggregate of invoice cost or replacement cost (whichever is used), less trade discounts as aforesaid, and plus said freight charges.

(b) The term "cost" when applicable to the business of a wholesaler shall mean bona fide cost and shall mean (i) the invoice cost of the merchandise to the wholesaler plus applicable taxes, or the replacement cost of the merchandise to the wholesaler within thirty days prior to the date of sale, offer for sale or advertisement for sale, as the case may be, in the quantity last purchased, whichever is lower, from either of which there shall be deducted all trade discounts except customary discounts for cash and (ii) to either of which there shall be added the following items of expense:

(1) Freight charges not otherwise included in the cost of the article, product or item of merchandise, but which freight charges shall not be construed as including cartage to the retail outlet if done or paid for by the wholesaler;

(2) A markup to cover, in part, the cost of doing business, which markup in the absence of proof of a lesser cost, shall be four percent of the aggregate of invoice cost or replacement cost (whichever is used), less trade discounts as aforesaid, and plus said freight charges.

WVC 47 - 11 A- 7 §47-11A-7. When invoice cost of goods purchased at forced, etc., sale may be used.
In establishing the "cost" of a given article, product or item of merchandise to the vendor, the invoice cost of any article, product or item of merchandise purchased at a forced, bankrupt, close-out sale, or other sale outside of the ordinary channels of trade may not be used as a basis for justifying a price lower than one based upon the replacement cost as of the date of said sale of said article, product or item of merchandise replaced through the ordinary channels of trade, unless said article, product or merchandise is kept separate from goods purchased in the ordinary channels of trade and unless said article, product or item of merchandise is advertised and sold as merchandise purchased at a forced, bankrupt, close-out sale, or by means other than through the ordinary channels of trade, and said advertising shall state the conditions under which said goods were so purchased, and the quantity of such merchandise to be sold or offered for sale.

WVC 47 - 11 A- 8 §47-11A-8. Sales exempt.
The provisions of this article shall not apply to any sale made:

(a) In closing out in good faith the owner's stock or any part thereof for the purpose of discontinuing his trade in any such stock or commodity, and in the case of the sale of seasonal goods or to the bona fide sale of perishable goods to prevent loss to the vendor by spoilage or depreciation;

(b) When the goods are damaged or deteriorated in quality or where merchandise is sold in bona fide clearance sales, and, in each case, merchandise is advertised, marked and sold as such;

(c) By an officer acting under the orders of any court;

(d) In an endeavor in good faith to meet the legal prices of a competitor as herein defined selling the same article, product or item of merchandise, in the same locality or trade area;

(e) For charitable purposes or to relief agencies;

(f) Where merchandise is sold on contract to departments of the government or governmental institutions.

WVC 47 - 11 A- 9 §47-11A-9. Injunctions and damage suits.
Any person, firm, partnership, corporation, joint-stock company, or trade association may maintain a proceeding to enjoin a continuance of any act or acts in violation of the provisions of this article and, if injured thereby, for the recovery of damages in the circuit court of the county wherein said article is alleged to have been or is being violated. If, in such proceeding, the court shall find that the defendant is violating or has violated any of the provisions of this article, it shall enjoin such defendant from a continuance thereof. It shall not be necessary that actual damages to the plaintiff be alleged or proved. In addition to such injunctive relief, the plaintiff in said action shall be entitled to recover from the defendant three times the amount of the actual damages, if any, sustained.

WVC 47 - 11 A- 10 §47-11A-10. Certifications to and duty of attorney general as to companies convicted or enjoined; suits to forfeit charters and privileges and enjoin business permanently; jurisdiction.
Whenever any corporation or joint-stock company shall be convicted of, or shall be enjoined from violating any of the provisions of this article, it shall be the duty of the clerk of the court wherein said corporation or joint-stock company has been convicted or enjoined to certify said conviction or injunction decree, as the case may be, to the attorney general of this state. Upon the third conviction for the violation of this article by any corporation or joint-stock company, or whenever any corporation or joint-stock company shall have been enjoined three times from violating this article, it shall be the duty of the attorney general to institute proper suits in any circuit court in this state for the forfeiture of its charter, rights, franchises or privileges and powers exercised by such corporation or joint-stock company, and to enjoin permanently such violator from transacting business within this state; and if in such suit the court shall find that the party defendant is guilty of violating said article as aforesaid, it shall enjoin said party defendant from doing business in this state, permanently or for such time as the court, in its discretion, shall order, and if the order be for permanent injunction against the transaction of business, the court shall order the forfeiture of the charter, rights, franchises or privileges and powers exercised by such party defendant.

Jurisdiction is hereby vested in the circuit courts of this state to carry into effect the provisions of sections nine and ten hereof.

WVC 47 - 11 A- 11 §47-11A-11. Penalties for violations.
Any person, firm, partnership, corporation, joint-stock company or other association, whether as principal, agent, officer or director, for himself, or itself, or for another person, or for any person, firm, partnership, corporation, joint- stock company or other association, who or which shall violate any of the provisions of this article, is guilty of a misdemeanor for each single violation and upon conviction thereof, shall be punished by a fine of not less than one hundred dollars nor more than one thousand dollars, or by imprisonment not exceeding ninety days or by both said fine and imprisonment, in the discretion of the court.

WVC 47 - 11 A- 12 §47-11A-12. Contracts violating article illegal and unenforceable.
Any contract, express or implied, made by any person, firm, partnership, corporation, joint-stock company or other association, in violation of any of the provisions of this article, is hereby declared to be an illegal contract and no recovery thereon shall be had.

WVC 47 - 11 A- 12 A §47-11A-12a. Unsolicited goods.

No person, firm, partnership, association or corporation, or agent or employee thereof, shall, in any manner, or by any means, offer for sale goods, wares or merchandise, where the offer includes the voluntary and unsolicited sending of goods, wares or merchandise not actually ordered or requested by the recipient, either orally or in writing. The receipt of any such unsolicited goods, wares or merchandise shall for all purposes be deemed an unconditional gift to the recipient who may use or dispose of the same in any manner he sees fit without any obligation on his part to the sender.

WVC 47 - 11 A- 13 §47-11A-13. Prima facie evidence of violation.
In any injunction proceeding or in any prosecution for a misdemeanor under the provisions of this article, proof of any advertisement, offer to sell, or sale of any merchandise by a retailer or wholesaler, at less than cost, or any advertisement of an intent to give, offer to give, or gift of any merchandise by a retailer or wholesaler, or any secret payment, allowance of rebates, refunds, commissions, or unearned discounts, whether in the form of money or otherwise, or secretly extending to certain purchasers special services or privileges not extended to all purchasers purchasing upon like terms and conditions, shall be prima facie evidence of a violation of this article, and proof of a violation of this article by any person as officer, director or agent shall be sufficient proof of a violation of this article by the person, firm or corporation for whom or for which he acts.

WVC 47 - 11 A- 14 §47-11A-14. Purpose and construction of article.
The Legislature declares that the purpose of this article is to safeguard the public against the creation or perpetuation of monopolies and to foster and encourage competition, by prohibiting unfair and discriminatory practices by which fair and honest competition is destroyed or prevented. This article shall be liberally construed that its beneficial purposes may be subserved.

Note: WV Code updated with legislation passed through the 2014 1st Special Session
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