All too often, Georgia’s business professionals under appreciate the significance of the legal claim of tortious interference. While most
business litigation legal theories are straightforward, such as fraud and breach of contract, tortious interference claims are quite nebulous. Moreover, the differences between competitive business practices and illegal interference by a third party are difficult to recognize. This article examines the tortious interference aspect of business litigation, and highlights examples of what might be considered tortious interference in Georgia.
At the outset, it is important to note that there are two types of tortious interference claims: tortious interference with business relations, and tortious interference with contractual relations. Tortious interference with business relations involves the existence of a “business expectancy,” that is, an anticipated deal or relationship. In contrast, tortious interference with contractual relations involves an existing contractual relationship. Nonetheless, each involve the tortious interference by a third party, giving rise to a possible damages claim.
Tortious Interference Defined
What exactly is tortious interference? Under Georgia law, tortious interference occurs when:
- The defendant acted improperly or wrongful without privilege
- The defendant acted “malice with the intent to injure”
- The defendant induced a breach of a contract or caused a party to fail to enter into an anticipated business relationship with the plaintiff; and
- The conduct in question caused financial harm to the plaintiff
To be successful on a claim of tortious interference with business relations, the plaintiff must also show an independent improper or wrongful act, as well as injury and malice. Improper conduct means action that involves predatory tactics. Such tactics could include fraud or misrepresentation, defamation and other wrongful acts.
Tortious interference claims most often involve competing businesses. Some examples of actions which may give rise to liability for tortious interference include:
- Inducing customers or clients to breach a contract with a competitor
- Making false statements about a competitor to lure customers or employees away
- Spreading lies to prevent a business from retaining existing customers or obtaining new ones
If successful, a claim for tortious interference can recover damages for all financial harm caused by the misconduct. Unlike
breach of contract, the amount of damages available for tortious interference are not limited to only foreseeable damages. In addition, a successful claimant may recover attorney’s fees and, in the case of egregious wrongdoing or malicious intent, punitive damages. Because of the damages available, in some cases a successful claim of tortious interference can lead to a greater recovery than a breach of contract claim.
Questions? Contact Kaufman & Forman, P.C.
Tortious interference claims can be a complex area of the law. Businesses considering a claim of tortious interference with business relations or tortious interference of contractual relations should speak to the experienced business attorneys at Kaufman & Forman, P.C.