You worked hard to build your business, and if someone else misappropriates your labors and expenditures in bad faith, it’s essential to take action to protect your interests. Unfair competition is a business tort that involves a competitor engaging in unfair, fraudulent, or deceptive practices in order to gain an advantage over a rival. If you’re an entrepreneur, it’s important to be aware of what constitutes unfair competition — and what your rights are if you’ve been affected by it.
What is Unfair Competition?
New York’s business landscape is highly competitive. While a competitor’s actions may sometimes seem unfair, such conduct may constitute “unfair competition” under the law when it is wrongful, deceptive, or fraudulent. Not only can unfair competition disrupt the market, but it can also cause significant economic harm to the impacted business.
Unfair competition is an intentional tort — there is no claim for negligent unfair competition in New York. Two common types of unfair competition include “palming off” and misappropriation. Palming off is a form of misrepresentation that involves a company selling the goods of another as if the product was their own. Misappropriation involves the exploitation of trade secrets, proprietary information, or intellectual property.
Steps to Take if Your Business is Facing Unfair Competition
Unfair competition can cause significant damage to your company’s profit margin, longevity, and reputation. If you believe a business is engaging in unfair competition and harming your company, there are several steps you should take to ensure your claim is preserved and your legal rights are protected, including the following:
- Document the competitor’s unfair practices — Gather all evidence of the competitor’s conduct, including correspondence, advertisements, marketing materials, and other documentation of the unfair practices. You should also collect consumer testimonials that show harm or confusion caused by the defendant’s wrongful conduct.
- Send a cease-and-desist letter — Send a cease-and-desist letter to the defendant requesting they stop the unfair conduct. In some cases, this can resolve the matter without the need for litigation.
- Consult with a business attorney — If your company has been impacted by unfair competition, it’s vital to consult with a business attorney who can best advise you regarding your legal rights and options.
In the event you are unable to resolve the dispute outside of court, litigation may be your only recourse. Depending on the facts of the case, a plaintiff who prevails in an unfair competition claim may be eligible to recover their monetary damages — including lost profits, loss of sales, damage to reputation, and other financial losses. Equitable remedies may also be available, including injunctive relief to stop the defendant’s wrongful conduct.
Contact an Experienced New York Business Attorney
Unfair competition claims are complex — and it’s crucial to have an experienced attorney by your side who understands the nuances of these types of cases. At Barnes & Barnes, P.C., our knowledgeable business attorneys are adept at handling a wide range of commercial matters, including those involving unfair competition. We are committed to helping ensure your business and its bottom line are protected. Contact us at (516) 673-0674 to schedule a consultation.
