Interference of Business

Managers have a legitimate concern when it comes to the tortious interference of business. After all, everyone wants their company to be competitive, but they are naturally cautious about crossing that line from aggressive competition to unlawful and unfair business practice. Furthermore, business managers need to be able to recognize when their company is the victim of a competitor’s business maneuvers that are, in fact, tortious interferences of business.

In Texas, when one party convinces or coerces another to breach a contract, and that breach results in damages, it constitutes a tortious interference of business. Here are some examples:

  • A Texas architectural firm leases a floor of office space in downtown Houston. A realtor who rents space in another building convinces the management of the architectural firm to break its lease two years early and move to the other building.
  • A Houston retailer approaches a Dallas wholesaler with an offer to purchase all of their inventory—knowing that some of it has already been ordered by the retailer’s competitors. If the wholesaler fails to deliver the promised goods, the retailer could be guilty of interference of business.

Tortious interference can also occur in the absence of a contract. If a party utilizes nefarious tactics to prevent a contract from being formed, it may be considered tortious business interference. For instance:

A Houston, TX project manager lies to a potential client that his competitor is being sued for breach of contract to end negotiations between the two parties.

In order to prove tortious business interference in Texas, the plaintiff’s attorney must generally show:

  • That a contract existed (or was at least being negotiated)
  • That the breaching party _intentionally_ interfered with that contract
  • That the interference actually caused injury to the plaintiff’s business
  • That the injury caused damages to plaintiff

Another common tortious breach of contract occurs when a company attempts to coax a party into violating a non-disclosure agreement. Here the objective would be to steal intellectual properties or proprietary knowledge from the competitor. In cases like this, not only does the act constitute tortious interference of business, but could also violate other areas of the law. This is not uncommon with tortious interference of business claims.

The management of a company should always question any time that a stable business partner breaches a contract without offering a reason. If they believe that it’s due to interference from a competitor or third party, they should contact a Texas business litigation attorney to pursue their rights.

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