A fine line continues to exist between free market solicitation of clients and being sued for Tortious Interference with Contract or Economic Relations. Whereas one might reap you profits the other threatens to to take them away …and much more. State laws are spilt when one becomes the other. It all began way back under Roman law and then was slightly modified and clarified under 19th century England Common Law, which is where we inherited most of our common law. As commerce has become more sophisticated, state courts have wrestled with the issue of whether a plaintiff could file an action to simply scare or prevent someone from conducting business that was neither interfering with another contractual relationship or impacting its economic relations.

The easiest interference to spot is interfering with an existing contract such as a Union demanding or enticing a supplier not to sell goods to a third party who does not not abide by the Union’s wishes. The more difficult determination is the interference with economic relations. An example is: 1) an economic relationship between broker and vendor or broker and vendee containing the probability of future economic benefit to the broker, (2) knowledge by the defendant of the existence of the relationship, (3) intentional acts on the part of the defendant designed to disrupt the relationship, (4) actual disruption of the relationship, (5) damages to the plaintiff proximately caused by the acts of the defendant.”

Concerned that lawsuits would be filed to spurn competition, the Court held that the plaintiff must show wrongfulness above and beyond the interference — akin to something unlawful or illegitimate. Offering a “better product” or a “less expensive” product is fair competition, but placing fictitious negative articles about a competitor’s products or services would likely fall on wrongful actions.

The moral of the story is to be competitive but play fair!