Business Torts (Fraud and Tortious Interference)

Simply put, business torts are wrongs suffered that lead to an injury or loss – in the business context, this means economic loss. There exists a wide variety of business torts, and those at fault may be acting intentionally or recklessly. If your business has suffered financial losses, or will suffer loss, due to the actions of another business or person(s), please contact us. Our attorneys have experience in dealing with these types of cases, as well as the experience needed to help minimize your damages and maximize recovery both in and out of the courtroom.

As a primer, here are some potential business tort claims:

• Tortious interference: This is when a person intentionally damages another’s business relationship with someone else, leading to loss. This can occur in various ways, but the most common tortious interference claims involve a wrongdoer encouraging another to break a contract with you. For example, if a wrongdoer has caused someone else to breach their contract with you (maybe so that the wrongdoer could enter into a new contract with that someone) that is a tortious interference of contract claim. In this example, if the wrongdoer knew about the contract between the other parties and deliberately interfered, leading to a breach, they can be held liable for the breach. Tortious interference claims can also be brought when a wrongdoer interferes with someone else’s potential business relationship. In other words, if you have been working on a deal with a potential customer and a wrongdoer interferes with that deal by, say, making false accusations about you and your business leading to the breakup of the potential deal, you could hold that wrongdoer liable.
• Theft of trade secrets: As the name suggests, another common business tort is when trade secrets – confidential industry information belonging to businesses, which gives them an “edge” over their competition in one way or another – are stolen or used without permission by another who has had access to them. For more information about trade secret claims, please read our page here (link).
• Fraud: There are a variety of business fraud claims, which all boil down to deceptive business practices used by others for their own gain. Business fraud consists of deceptive activities perpetrated by wrongdoers to provide an advantageous financial outcome to those wrongdoers. These wrongdoers pretend they are engaged in legitimate business activities. But these wrongdoers cheat others by not delivering the services or products that they promised. Business fraud can come from both outside and inside your business. Payroll fraud, for instance, is a common inside fraud. One major type of fraud in the business context is fraudulent representation made by a customer or vendor. This is when someone makes false representations in connection with engaging your services or buying your products. After you deliver your products or services, the person who engaged your service has vanished. Business fraud typically comes by many sophisticated means. But, in essence, it all involves the perpetrator’s engaging deceptive behavior designed to trick you.
• Trade libel (commercial disparagement): Trade libel or commercial disparagement is similar to regular libel but applied in the business context. In other words, it is when someone makes untrue statements about your business, its goods, or its services, which causes injury. Although the traditional claim of libel implies that the statement was written, spoken slander can also be a valid basis for a claim, as long as it is communicated to a third-party (or parties). There are some important considerations to take into account when taking on a trade libel case. Was the statement a statement of fact or merely an opinion? Was the statement true? Financial harm, directly suffered by the plaintiff, has to be shown as a result of the defamatory statement.
• Conspiracy: This claim arises when two or more parties act together with the intent of acting in an illegal way, which economically hurts another party (i.e., your business). Often, this is related to fraud. If, for instance, two or more persons conspire to carry out fraud, they could be held liable for conspiracy.

By no means are the above examples exhaustive – but are meant to show a few of the various claims that can constitute a business tort. As one can see, there are many ways a person and their business can suffer damages due to the actions of others. If you believe your business has suffered losses in this context, contact us. Our experienced and detail-oriented attorneys will help you recover damages, depending on your situation.