UNFAIR BUSINESS PRACTICES
Unfair business practices in San Diego cause substantial legal issues for every party involved. What constitutes an unfair business practice under California law? Why is unfair business practice a component in the majority of business disputes and lawsuits?
Unfair business practices are covered by California’s Unfair Competition Laws as established in our Business and Professions code. These laws provide specific legal business protections for owners, shareholders, members, employees and all of those with whom you conduct business.
They also apply to deceptive, misleading or false advertising. Unlike California’s Unfair Competition laws, unfair business practices are often applied to individuals within a business relationship such as:
- Fellow members, shareholders or partners
- Executives or officers
- Board of Directors or an individual director
- Employees and former employees
- Majority interests
The primary ingredient in an unfair business practice is fraud or deception. Another important element exists when one individual is in some form of authority over another or is in a position of power or trust.
At the Watkins Firm, we protect our clients from the unfair business practices of others. We represent employers against employees who have misappropriated trade secrets and provide the information to a competitor or who are using that information to compete against our client.
We also advise companies on steps they can take to protect corporate trade secrets and strengthen corporate documents such as an LLC operating agreement or corporate shareholders’ agreement and bylaws, employee handbooks, policies and procedures and business contracts across the board in order to avoid potential conflicts.
Ask about our unique approach to business disputes and litigation which is specifically designed to resolve an unfair business practice dispute in a timely and cost-efficient manner.
Here at the Watkins Firm, we often warn our clients: “Beware of little disputes; Little disputes become BIG disputes.” This is especially true in the area of an unfair business practice. Any element of fraud or deception can open the door to punitive damages including attorneys fees. It is important to take prompt action to protect your interests.
If you are concerned about an unfair business practice or believe you are the victim of a civil business deception or fraud we invite you to listen to our podcast Unfair Business Practice Overview, review the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
What are Some Examples of Unfair Business Practices?
Generally speaking, unfair business practices involve wrongful actions during every aspect of conducting business. This can be associated with a transaction such a sale or rental of services or goods, or based upon wrongful conduct or attempts to defraud fellow stakeholders, owners or investors.
Some of the more common elements of an unfair business practice allegation include, but are not limited to:
- Misappropriation of trade secrets
- Breach of fiduciary duty
- Breach of contract
- Business conspiracies
- Self dealing
- Minority shareholders or investors attempting to cut out the company’s majority stakeholders
- Majority stakeholders’ efforts to dilute or eliminate minority shareholders or investors
- Attempts to gain a substantial interest in a business and then encourage or promote actions which are against the company’s best interests and/or the desire of managing stakeholders to increase the value of that investment, also known as a “corporate raid” or “corporate raiding”
- Collusion, fraud and other forms of unfair competition
- Embezzlement, commingling, bribery or theft
- Tortious interference
- Unethical accounting, financial reporting or “cooking the books”
In most lawsuits, unfair business practices are associated with business fraud, an unlawful action, misrepresentation, misappropriation or other behaviors which are not in the best interests of a company and those who own an interest in it.
Fraud is one of the largest contributory factors to most of these cases. Any act of business related fraud between those conducting business together can become part of a legal action for unfair business practices.
Some of the most common acts of fraud involve the transfer of company assets for personal gain, falsifying company records and tax returns, accounting and reporting misrepresentations or any attempts to “doctor” them, conducting false transactions or purchases through another (fake) entity or individual, or converting business loans for personal use.
Unfair business practices can also be applied to an employee. While non-compete strategies are very challenging to enforce in California, the proper implementation of a strategy based upon the protection of trade secrets is a powerful and valid legal issue.
For example, if an employee takes trade secrets or trade secret materials such as a recipe, process or even customer list to a competitor or for their own independent business use it can create substantial legal and financial liability as an unfair business practice.
How do Unfair Business Practices in San Diego Cause Substantial Legal and Financial Issues?
Any time a San Diego business litigation attorney is brought into a dispute between principles such as business owners, shareholders, partners, or members it is quite likely one or both of the parties will include “unfair business practices” as one of the causes of action under the complaint.
California’s unfair business practice laws can allow a seemingly minor or small dispute to accelerate into a case involving attorneys fees into six or seven figures. Therefore, one of the first points of focus for a business defense counsel would be to challenge any issue which might open the door to substantial remedies which include attorneys fees.
In addition, any successful allegation of fraud can lead to an exposure for punitive damages. These are but a few of the ways unfair business practices in San Diego cause substantial legal and financial issues.
Proven Attorneys for San Diego Unfair Business Practices
The Watkins Firm has more than four decades of experience in these legally and financially complex cases, often on the side of the defense. Unfair business practices in San Diego require extensive experience, legal skill and business savvy.