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What business owners should know about tortious interference -- IV

In today's post, we'll conclude our ongoing discussion of how overzealous business owners, meaning those whose conduct goes beyond the bounds of acceptable corporate conduct, may find themselves embroiled in litigation alleging tortious interference with a contract.

Specifically, we'll examine the last of the five elements -- interference and damages -- that must be proven in order to hold someone accountable for this business tort. 

Defendant's interference with the contract

In addition to being able to demonstrate that a defendant actually forced or otherwise induced a breach of contract (i.e., actual interference), the plaintiff must be able to show that the interference itself was improper, a considerably more difficult endeavor.

Here, it must be shown that the defendant deployed what is typically a perfectly acceptable business practice with improper motivation.

By way of example, consider Party A offering Party B a lower price as an inducement to break a contract with Party C. In the vast majority of cases, this is a perfectly acceptable and commonly utilized business tactic, such that Party A wouldn't have committed any sort of wrong.   

However, if Party A deliberately took a loss on the offer to Party B as a means of undercutting their direct competitor Party C, it's possible that a lawsuit alleging tortious interference could be brought against Party A.

Accordingly, some of the factors that will be examined in determining whether interference could be classified as improper include:

  • The conduct that occurred
  • The interests and motives of the defendant
  • The business relationships between the parties
  • The degree to which the defendant's actions could be classified as interference

Extent of damage caused by defendant

If a plaintiff has successfully shown that tortious interference with a contract has occurred, they may seek to recover a host of damages, including compensation for direct losses and associated losses resulting from the defendant's actions, as well as for any emotional distress or reputational damage endured.

It's also worth noting that plaintiffs may seek to recover punitive damages in lawsuits alleging tortious interference with a contract and, because of this, many opt to pursue this legal action rather than a lawsuit alleging breach of contract.

If you have been served with a lawsuit relating to a business tort or would like to learn more about your options for bringing such a lawsuit, please consider speaking with a proven and highly skilled legal professional.

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