General

What constitutes a business tort and what are the affects?

Business torts, also referred to as economic torts, are unlawful business practices committed by an individual or body against business organizations. The intention is mostly to harm the credibility or gain an unfair advantage over the affected party.

The insult more often affects the intangible assets of the organization, such as loss of business relationships or contracts, damaged reputation and inability to operate the business. These will project as financial losses in the future. For example, a damaged reputation may result in an inability to attract more clients, or a lost contract will mean lost earnings. Businesses affected by tortious conducts of another may choose to file a case in court and demand a claim to their losses. For this, the plaintiff must be able to convert their economic losses into monetary figures. This may often be hard, and it mostly includes projections and estimates. In cases where reasonable estimates have been made, the court may order the defendant to reimburse the plaintiff’s loss.  In other cases, a ruling may be passed against the defendant to immediately stop the tortious conducts.

Understanding common business torts will not only help you discern when a business tort has been committed against you and make a valid claim, but also help your organization avoid committing such acts. Some common examples include:

• Tortious Interference: This is when one party intentionally interferes with the plaintiff’s contracts or dealings resulting in losses.
• Restraint of trade: This refers to when the defendant’s actions impede the plaintiff’s ability to conduct business in the market.
• Theft of trade secrets: When the accused party wrongfully obtains trade or ownership information of a competitive business brand to gain an unfair advantage. This is similar to trademark or copyright violations.
• Fraudulent misrepresentation: Both parties entering into an agreement must maintain their position in the contract. Any misrepresentation of position, which causes harm to the other party, may lead to a civil claim.

If you find yourself having committed a business tort or if one is committed against you, it would be wise to hire a business torts law attorney at the earliest. An attorney will guide you towards making a claim or proactive defense so that you can achieve the most beneficial outcome of your particular situation.

Tue Aug 28, 6:02pm