An oft litigated issue in business disputes among owners, shareholders or partners is whether the defendant(s) violated the North Carolina Unfair and Deceptive Trade Practices Act. As the Court of Appeals recently reiterated, the answer is no.
In White v. Thompson (decided by the State Supreme Court in April), the rule was reiterated: when the issues involve only the internal governance of a business, regardless of how unfair or deceptive the actions may be, those are not "in or affecting commerce" within the meaning of the UDTPA.
The rationale is that the legislature, in passing the act, intended it to apply in the following situations: (1) where businesses deal with consumers, and (2) when businesses deal with one another.
Because the internal management struggles and conflicts that occur inside a company do not fall into either of those two categories, the UDTPA does not apply. However, if the accused defendant is operating an outside company (or multiple companies) and the outside company is involved in the conduct giving rise to the case, the UDTPA may still apply, as the presence of the additional company or companies could place the case back into the scope of the act.