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Legal Services Business Litigation
BREACH OF CONTRACT, BUSINESS TORTS, TORTIOUS INTERFERENCE, FRAUD, FRAUD IN THE INDUCEMENT, FRAUDULENT CONCEALMENT, NON-COMPETE AGREEMENTS, NON-DISCLOSURE AGREEMENTS.
DISPUTES BETWEEN OWNERS
A relationship between business owners is very much like a marriage. And as in marriage, conflicts in the relationship often center on issues of trust, control, and finances. To carry this analogy one step further — most business owners who experience problems with business partners are not interested in talking to a divorce lawyer at the first sign of trouble. They are interested in working out their problems.
At JWE we understand the complex relationship dynamics involved in ownership conflicts within closely-held companies and business partnerships, and our attorneys have extensive experience in this area. In previous cases, our firm has helped owners of professional practices, small manufacturing companies, service companies, retail stores, family businesses and other enterprises resolve internal and external disputes both inside and outside of the courtroom.
BREACH of CONTRACT
When a material term of a contract is unfulfilled by one or more parties that contract is said to be “breached.” Unless both parties have agreed to the change in the term of the contract in writing, or the actions of one party have implicitly been accepted by the action or non-action of the other party, all material terms of the contract must be honored. Obvious non-performance is a simple matter. An issue involving the quality of the contract performance can be more complicated especially when the terms of the written contract are not specific.
In Texas, contract breach leaves the nonperforming or improperly performing party open to a claim for damages by the other party including a claim for recovery of attorneys’ fees and costs. In most situations, the non-breaching party can be relieved of their obligations under the contract by the other party’s breach. If you feel you’ve been the victim or accused of non-performance or breach of contract contact us immediately.
Business torts are a subclass of claims that can be brought for wrong-doing in a business relationship that are not a breach of contract. One major difference between business torts and claims for breach of contract is that punitive damages are available for torts, but not for a breach of contract. Often a business tort claim may be brought regardless of whether a breach of contract has occurred or exists. A claim for a business tort can be brought by either an individual or a business entity such as a corporation or a limited liability company. There are several different theories for business torts and a suit may be brought under one or more tort theories at the same time.
This business tort allows a party to bring a suit when they believe another party has intentionally interfered with an existing business contract, or interfered with their ability to enter into a contract. A cause of action exists for intentional interference with another’s prospective business advantage if the party intentionally disrupts or diverts the business relationship of another by improper methods which fall outside the boundaries of fair competition. To state a cause of action for interference with prospective business advantage, the plaintiff must show an existing business relationship or the existence of a prospective business relationship that is more than just speculative.
JWE represents individuals and businesses in cases involving intentional or negligent misrepresentation, including unfair business practices. These claims can involve products that did not perform as promised, the use of a different manufacturer or shipper than agreed upon, or a promise that was made, but not fulfilled. Frequently, business fraud involves the exploitation or unfair treatment of smaller businesses by larger businesses that simply don't want to compete fairly in the marketplace.
Fraud in the inducement occurs when a fact “outside of the document” is intentionally misrepresented and, without such misrepresentation, the party would not have entered into the contract. Fraud in the inducement can include promissory misrepresentation as well as misrepresentation of an existing fact. A word of caution is in order, however: this type of claim is particularly challenging because, in addition to the traditional elements of proof, contracts often include "boilerplate" disclaimers stating there are no other representations or terms that the parties have relied upon that are not included within the contract.
Under Texas law, fraudulent concealment generally occurs when a contracting party deliberately withholds information that is critical to the other party’s decision to enter into the contract or not. The central component to a claim under this business tort is that the contracting party would not have entered into this contract if the term or condition had not been deliberately withheld.
Many employers require employees to enter into a non-compete agreement upon being hired. However, enforceable non-compete agreements are not limitless. The two major limitations are that non-competes must be reasonable as to time and geographic location. Generally a non-compete is reasonable if it last between two and five years and does not extend beyond fifty miles. Texas courts have recently held that if an employer is successful in defending its non-compete agreement it cannot recover attorneys’ fees, unlike other contract claims. Conversely, nondisclosure agreements, which do not constitute restraints upon trade, are not analyzed in the same way as non-compete agreements.
Texas business nondisclosure agreements are contracts where one or more parties agree to keep certain information secret. A nondisclosure agreement can be an independent contract or a provision of a larger agreement, such as an employment contract or an agreement to buy a company.
Under Texas law, a non-disclosure agreement can be enforceable even when the underlying employment contact or non compete agreement is held to be unenforceable. To protect the economic health of your business it is essential to protect your trade secrets, business model, and customer base. If you believe an individual has infringed upon trade secrets for the benefit other than your business our attorneys can help minimize the damage and prevent the continued theft of your valuable business information.