Frequently Asked Questions: Business Torts

Business torts refer to disputes that happen when different companies (or people within the same company) have major disputes. This area of the law encompasses things like breach of contract, interference with a business relationship, and fiduciary litigation. Many other claims can arise as well depending on the facts, such as those based on defamation, deceptive trade practices, or bad faith against insurance companies.

We get this question a lot. The first thing to know is these claims are rare. Texas fiercely protects capitalism, the open market, and competition. So claiming another business tortiously (i.e., illegally) interfered is difficult to prove. But these claims do occasionally occur. 

To prove this claim, it requires the plaintiff to show that (1) there was a reasonable probability that the plaintiff would have entered into a business relationship with a third party; (2) the defendant either acted with a conscious desire to prevent the relationship from occurring or knew the interference was certain or substantially certain to occur as a result of the conduct; (3) the defendant's conduct was independently tortious or unlawful; (4) the interference proximately caused the plaintiff injury; and (5) the plaintiff suffered actual damage or loss as a result. Coinmach Corp. v. Aspenwood Apartment Corp., 417 S.W.3d 909, 923 (Tex. 2013).

Yes. While most contracts include a provision along these lines, Texas also allows this type of recovery by law. It is found at Civil Practice and Remedies Code, Chapter 38.

Yes. The law envisions this situation and allows parties to go to court, before actually breaching a contract (or risking a breach of contract), and seek a declaratory judgment. Both Texas law and federal law provide this option.