Business torts are wrongful actions taken against businesses. Most business torts, which are also called economic torts, are intentional, though some are due to negligence. The types of harm caused by such torts include losing profits or a market share, damage to reputation, and losing a competitive advantage. Laws have been created to not only dissuade these damaging actions from taking place, but also to compensate the victim for losses caused by the tort. The business tort lawyers at Simms Showers LLP can help you pursue compensation if you have been harmed by a business tort, or help defend you in court if you have been wrongfully accused. Below are a few of the most common types of business torts we handle.
Breach of Fiduciary Duty
A fiduciary is legally obligated to act in the beneficiary’s best interest. If the fiduciary does not act in the beneficiary’s best interest, and the beneficiary suffers a monetary loss as a result, the fiduciary may be sued for damages. Situations of when a fiduciary can be held liable for damages include: trusts, shareholder and partnership agreements, and estate administrators.
Business Fraud Versus Negligent Misrepresentation
Business fraud occurs when a party intentionally makes a false statement or omits facts during a business transaction. If the other party suffers damages due to their reliance on the false information, fraud has occurred. If a party unintentionally makes a false statement, as opposed to intentionally making a false statement, fraud has not occurred. However, it may be a case of negligent misrepresentation. If the victim suffered damages, they may be entitled to compensation. Furthermore, the contract will likely be void.
False statements that cause damage to a business can be incredibly costly, as all businesses rely on their reputation. Damaging one’s reputation by making false statements, either orally or written, is considered defamation, and the victim can pursue damages to recover the losses. It should be noted that defamation only occurs when the statements are false and there is sufficient evidence that those false statements caused a loss in profits. One of the largest defamation claims settled for $1.9 billion, according to Cornerstone Research.
Civil Conspiracy is the act of two or more parties scheming to commit an unlawful act that has the intended purpose of causing financial harm to another party. For example, two competing businesses might conspire to harm a third business by illegal price fixing. Civil conspiracy must involve a separate crime, such as fraud or theft of trade secrets. Civil conspiracy is a Class 1 misdemeanor under § 18.2-499. In addition, victims can sue for damages.
If a party unlawfully interferes with another’s business relationships, the act of tortious interference has occurred. The party must 1) have had knowledge of the contract or business relationship, 2) had intent on harming that relationship, and 3) engaged in an unlawful act.
Our Leesburg Business Tort Attorneys Can Help You Today
Business torts have ruined countless companies. Do not assume that this will simply blow over. Take action today by calling the business tort attorneys at Simms Showers LLP to schedule a free consultation at your soonest convenience.