Responding to tortious interference with a business contract

Responding to tortious interference with a business contract

Discussions about contracted-related litigation often focus on contract breaches. Either party to a contract might fail to fulfill their obligations or might violate restrictive covenants prohibiting certain activities. Any breach of contract can cause business disruptions and economic losses to a party that has not violated the terms of the original agreement. Oftentimes, attempts to address those issues understandably focus on the party that breached the contract. However, sometimes the matter that forces one business to take a contract matter to court relates not to the actions of the other party but rather an outside, third party. The tortious interference of a third party with an existing contract could lead to complicated litigation in Texas. The plaintiff will need to prove several factors to prevail in court.

Texas has specific rules for tortious interference claims

The Texas Courts have ruled on numerous third-party contract lawsuits and therefore have very clear rules for such cases. Generally speaking, the plaintiff alleging tortious interference with a business contract will need to establish four main facts in the courts if they hope to prevail in their case. First and most importantly, they must establish that they and another party signed a legally valid contract. Next, they need to prove that an outside party directly interfered in the situation, possibly by pressuring or manipulating one of the parties to the contract. Third, they must prove that there are economic losses that the company experienced, such as liquidated damages for a subsequent breach of an agreement with another party. Finally, the company will need to submit evidence to the courts that the interference of the third party directly caused the economic losses. In some scenarios, the discovery process that gives the plaintiff access to certain financial and business records could help them validate their belief that tortious interference occurred. Such lawsuits are often very complex and can, therefore, require extensive research and preparation. Recognizing when a contract breach is actually a scenario involving tortious interference with a business contract might help an organization hold the right party accountable for the losses generated when a third party interferes in a contract between two other parties. Seeking legal guidance is an important early step in such matters, given the complexity of these legal cases and the potentially high-stakes nature of the outcome in question.