What are considered unfair business practices in San Diego and across the State of California?  Why is the allegation of unfair business practices so common in business disputes and litigation?  How can the San Diego business lawyers and corporate attorneys at the Watkins Firm protect your interests?

3 Things You Need to Know About Unfair Business Practices in San Diego:

• Unfair business practices is one of the most common issues raised in business lawsuits here in San Diego and throughout California.
• Unfair business practices are established under California’s Unfair Competition Laws within the California Business and Professional Code.
• Unfair business practices usually involve some level of misrepresentation, deception, or fraud.

What Are Unfair Business Practices?

What are considered to be unfair business practices in San Diego and throughout California?  Unfair business practices are established within the California Unfair Competition Law (UCL) as part of the California Business and Professions code.  Unfair business practices are usually rooted in some form of fraud, deception, misrepresentation or manipulation and often involve those who have breached a fiduciary duty.  It is common for assertions of unfair business practices to be levied against business partners, fellow shareholders, officers or board members, members in an LLC or even employees.

The legal implication of unfair business practices extends to embezzlement, the misappropriation of assets/money or trade secrets, or actions taken against the interests of the business or corporation that an officer, shareholder, member, employee, investor or board member has a duty to protect and serve. It is often the basis of lawsuits associated with merging a company with another business to reduce or eliminate the value or power of minority interests, the theft of information and even business assets such as a website, URL, intellectual property or trade secret.

What are the Remedies for Those Actions Considered Unfair Business Practices in San Diego?

Remedies for actions considered unfair business practices in San Diego and across California include an immediate injunction (known as “injunctive relief”) to stop associated activities as well as financial damages associated with the impact of the unfair business practices.  The Watkins Firm has more than 40 years of experience managing business disputes including civil allegations of unfair business practices. Our Founder, Dan Watkins, noted in a recent podcast that the legal implication of unfair business practices extends financial risks in these cases.

Pro-Tip: “Beware of seemingly small disputes.  While the initial exposure may seem to be a small and manageable figure, the exposure to the recovery of attorneys fees can take any small dispute and turn it into a major financial challenge. Omission, yes. Deception. Overt misrepresentation. Any deceptive practice can be considered of evidence of a fraud. And the reason everyone tries to reach that fraud standard is just like some other statutory claims, they introduce punitive damages, treble damages, damages in addition to your regular damages, to really entice somebody to punish you for being a fraudster.

Look at it from two perspectives. If you are being sued by someone you’re dealing directly with and they say, well, what you’re doing is gaining an unfair business practice over me, you’re violating my rights. That’s a direct unfair business practice. If the person across the street is in business and it’s similar to yours and they’re doing things that are affecting your business to their advantage and your detriment, that could be an unfair business practice. So as broad as it is, and as big many large examples as it is, it’s important to see your lawyer.

When you’re in business and you have contracts, this is a big way people get in trouble. They put things in their contracts that are deemed to be an unfair business practice. And those can be anything from how they price, how they pay their employees, how they advertise, how they labeled their products. All those things can turn into unfair business practices and a cause of action. And you’re getting sued.

I have literally seen one company take the actual products of another company, relabel them and sell them. I’ve seen other cases where they’ll be an insider in one company, invested in another company and they’ll steal intellectual property and they’ll steal physical property and bring it over to the other company that are also invested in because they have a partnership dispute with their partner. And so they figure I’m going to steal it before I fight it out in court or before I do all the other things. And so that’s crazy in and of itself. And then your general business to business fraud, where you defame the other company, you go out and steal their intellectual property, you steal their customer list, you advertise fraudulently about them. Business is brutal. And so we see a lot of that.

How extensive of a bucket is that fraud and unethical conduct?  More widespread than most of us think. I mean, those are strong words for describing it. I don’t think you have to use unethical or those are words we use for an actual fraud cause of action in unfair business practices. It’s more about what was the effect of your action? Were you accurate in your representations? Did someone detrimentally rely on something you did say or said to their detriment? And were there any other statutory violations that you committed in the context of whatever contractor agreement you have that would make it unfair to whoever you’re dealing with or to your competitors? And the way you do business, if you don’t pay your employees their legal employment taxes and you don’t take out withholdings and your competitor does, they’re going to say it’s not fair. Right? You don’t have to follow the law. And I do. So how do I compete? Unfair competition,

Misuse of power is another example of I have power over you in one form or another and I’ve abused that privilege. How does that come into play in these types of actions?  It’s a great question, a central question. When you have superior negotiating position and you enter into an agreement or a relationship in business and it turns out that you’re getting an unfair advantage over it, in addition to the unconscionable, unfair fraud cause of action, you’re going to get this unfair business practice cause of action. And it’s going to say that the terms of the contract should not be held against me. And you’re going to get a list of about 12 causes of action and one will be unfair business practices. And if they can make that stick, then they get all their attorneys’ fees.” – Dan Watkins, Founding Partner

There is a statute of limitations or time limit associated with unfair business practices.  Generally speaking, an aggrieved party has four years from the date of discovery of the unfair practice or the date when the issue should have been uncovered by reasonable diligence.

The Watkins Firm Helps You to Manage the Legal Implications of Actions Considered Unfair Business Practices

If you are involved in a business dispute or lawsuit with a partner, fellow shareholder, business associate or another company the issue of actions considered unfair business practices is likely to be an issue.  The Watkins Firm helps you to manage the legal implication of unfair business practices to assert and protect your interests.  Ask about our 40+ years of experience in these cases and why it is important to consider the potential impact of the addition of a claim of unfair business practices in any business-related dispute.  Small matters and business disputes can become financially significant in a hurry.  You need the sound advice and counsel of our experienced business and corporate dispute attorneys.

We invite you to review our Podcast Episode 25 – Unfair Business Practice Overview, the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.