COMPLEX BUSINESS & COMMERCIAL LITIGATION

In the commercial world, it’s not unusual for businesses to suddenly find themselves in a dispute with partners, contractors, or others, or to be challenged by competitors who may use tactics that result in a civil tort. 

From breach of contract, to trade secret theft, to restraint of trade, and to tortious interference, challenges to one’s business can lead to drawn-out legal challenges that can sometimes only be resolved in court proceedings. These challenges can be complex, time-consuming, and dangerous to your bottom line.  

If your business in or around the Greater San Francisco Bay Area is experiencing a dispute or actions by a competitor that threaten your operations, contact the Law Offices of David H. Schwartz, INC. immediately.  

Business litigation attorney David Schwartz has more than 45 years of experience helping clients resolve complex disputes and external threats to their businesses. He is a skilled litigator, so if your case ends up in the courtroom, he will develop a comprehensive strategy and fight aggressively for your interests and continued success. 

The Law Offices of David H. Schwartz, INC proudly serves clients in the San Francisco Bay Area and the surrounding areas, such as Santa Rosa, Santa Clara, San Mateo, and Oakland, and throughout Alameda County. 

Common Causes of Complex Business and Commercial Disputes 

In the course of operating a business, disputes can erupt on a variety of fronts, often out of the blue. The following depicts some common causes of conflicts that could result in complex lawsuits and litigation: 

• Employees are one common source of disputes. They may feel you have violated their rights or somehow discriminated against them in one way or another. Soon, you can have government inspectors breathing down your neck to find out what’s going on. Lawsuits are one possible result. 

• Partners can also present unanticipated problems. One partner or co-owner might not like the direction of the company, or worse, accuse another partner of a breach of fiduciary duty or a conflict of interest. Negotiations may sort out matters to a certain incomplete degree, while the only step remaining might be a lawsuit. 

• Vendors and other service providers who have contracts with your business may suddenly breach their contract, and you’re left without the products or services your business depends on. Negotiations, mediation or arbitration may or may not settle the dispute. In fact, you may not have time to pursue those options if your bottom line is threatened. 

• Competitors may also pose challenges by trying to strip away your suppliers with better offers, hiring your former employees to misappropriate your trade secrets, or using advertising, social media, and other tools to disparage your business. This is where tort law comes into focus (more on this below).

Contract Disputes 

Many commercial litigation cases are rooted in a contract breach or dispute. Defined as a legally binding agreement, contracts can be created orally or in writing.  

Some business owners or managers will engage in handshake agreements with a vendor or service provider and perhaps not realize that they are thereby entering into a legal agreement. The problem with an oral contract is that, if disputes arise, each side may have a different memory of what they agreed to.  

It is also possible to have an “implied” contract, which generally means that certain actions have been repeated long enough and routinely enough that they amount to a contract. You may have started your business and turned to your personal tax accountant to handle your books and taxes while you establish your operations. Perhaps in the future, you’ll revisit the issue of who should do your accounting, but for now, your personal tax person is routinely handling your books. This is a version of an implied contract. 

If you need to enter into agreements with others to provide goods or services for your business, it's important that you get everything in writing. The basics of a contract involve an offer, an agreement, and a consideration, though other elements such as legality and legal competence are also necessary. 

Say you offer “Company A” a certain monthly fee for doing your accounting and paying your taxes. Company A agrees, so you now have the offer and acceptance. Consideration means that Company A will be compensated, and you will be provided the services you requested. 

Now, if a few weeks or months later, you discover that your payroll taxes are in arrears, then you have what is termed a breach of contract. There are four elements to a breach of contract: 

• A valid contract existed; 

• You honored your part of the contract, or had a valid reason not to; 

• The defendant failed to honor their part of the contract; and  

• The defendant’s actions or inactions led to damages on your part.  

If your contract is precise and spelled out fully in an express document, then a court case will rely on what was agreed upon. If there are any ambiguities, you could have a hard time proving your case, though taxes not being paid are a pretty blatant example of a breach. 

Business Torts 

Torts refer to ‘civil’ actions between or amongst individuals or entities that result in harm to someone, often physically or financially. Unlike criminal offenses, torts are actions initiated by one person or entity against another. Personal injury lawsuits are a common form of tortious litigation.  

On the business front, actions that harm one business that can be traced to another business, person, or entity can result in claims of torts. Several actions can lead to business tort claims, including but not limited to:  

• Tortious interference: Meddling with the contractual dealings of another business, for instance, by trying to steal away a needed contractor. 

• Restraint of trade: Taking actions or entering into agreements to harm the economic prospects of another company. 

• Theft of trade secrets or trademark infringement: Obtaining access to a competitor’s trade secrets to use for one’s own advantage; using another’s trademark without their permission. 

• Fraudulent misrepresentation: Using fraud to get another party to enter into an agreement or contract. 

• Trade libel: Publishing false information about a rival’s products or services with the intent to harm. 

• Commercial disparagement: The intentional defamation of a business’s reputation. 

Similar to a breach of contract action, three elements must be established in a tort claim: 

• The defendant had a legal duty to act, or not act, in a certain way 

• The defendant breached this duty 

• As a result, you the plaintiff suffered damages or losses