2021 Code of Alabama
Title 8 - Commercial Law and Consumer Protection.
Chapter 19 - Deceptive Trade Practices.
Section 8-19-3 - Definitions.

Universal Citation: AL Code § 8-19-3 (2021)

Section 8-19-3


As used in this chapter, the following words and phrases shall have the meanings hereinafter ascribed to them:

(1) ATTORNEY GENERAL. The Attorney General of the State of Alabama or his or her duly designated representatives.

(2) BONA FIDE INVENTORY REPURCHASE PROGRAM. A program by which an entity repurchases from a salesperson current and marketable inventory in possession of the salesperson, on request and on commercially reasonable terms, when the salesperson's business relationship is terminated.

(3) COMMERCIALLY REASONABLE TERMS. The repurchase of current and marketable inventory within 12 months after the date of purchase at not less than 90 percent of the original net cost, less appropriate set-offs and legal claims, if any.

(4) CONSUMER. Any natural person who buys goods or services for personal, family, or household use.

(5) CURRENT AND MARKETABLE. The term does not include inventory to which any of the following apply:

a. Is no longer within its commercially reasonable use or shelf-life period.

b. Was clearly described to salespersons prior to purchase as seasonal, discontinued, or special promotion products not subject to the plan or organization's inventory repurpose program.

c. Has been used or opened.

(6) GOODS. Includes but is not limited to any property, tangible or intangible, real, personal, or any combination thereof, and any franchise, license, distributorship, or other similar right, privilege, or interest.

(7) INVENTORY. Includes both goods and services, including company-produced promotional materials, sales aids, and sales kits that an entity requires independent salespersons to purchase.

(8) INVENTORY LOADING. The requirement or encouragement by a plan or operation to have the independent salesperson of the plan or operation purchase inventory in an amount that exceeds the amount that the salesperson can expect to resell for ultimate consumption or to use or consume in a reasonable time period, or both.

(9) KNOW, KNOWING, KNOWINGLY, KNOWLEDGE, and KNEW. Either actual awareness or such awareness as a reasonable person should have considering all the surrounding circumstances.

(10) PERSON. Includes, but is not limited to, natural persons, corporations, trusts, partnerships, incorporated or unincorporated associations, and any other legal entity.

(11) PYRAMID PROMOTIONAL SCHEME. A plan or operation by which a person gives consideration for the opportunity to receive compensation that is derived primarily from the introduction of other persons into the plan or operation rather than from the sale or consumption of goods, services, or intangible property by a participant or other persons introduced into the plan or operation. The term includes any plan or operation under which the number of people who may participate is limited either expressly or by the application of conditions affecting the eligibility of a person to receive compensation under the plan or operation. The term also includes any plan or operation under which a person, on giving consideration, obtains goods, services, or intangible property in addition to the right to receive compensation.

(12) SALE, BUYING, and DISTRIBUTION. In addition to their ordinary meanings, include, but are not limited to, the act of leasing, renting, or consigning.

(13) SERVICES. Work, labor, and other services, including, but not limited to, services furnished in connection with the sale or repair of goods.

(14) TRADE or COMMERCE. Includes, but is not limited to, the advertising, buying, offering for sale, sale or distribution or performance of any service or goods, and any other article, commodity, or thing of value wherever situated and shall include any trade or commerce affecting the people of this state.

(Acts 1981, No. 81-355, p. 510, §3; Act 2021-349, §1.)

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