A recent post on this blog talked about tortious interference with a contract, which is a type of claim that a New York business can make, usually against another business, when the other business has engaged in some underhanded behavior in order to disrupt the first business contracts, either with a customer or a supplier.
A related type of claim is “tortious interference with pre-contractual relations.” As the name implies, this form of tortious interference does not actually require a contract between two businesses. In other words, in New York, competitors are limited in what they can do with respect to preventing a rival from forming a favorable agreement with another party, even if the prospective agreement is still under negotiation.
In many respects, this type of tortious interference claim works the same way as if there were a contract in place. However, perhaps precisely because there is not yet a binding contract, it takes a little bit more for a business to prove a “pre-contractual” tortious interference claim. Usually, the person or business being accused must have done something actually wrong beyond simply trying to interfere with negotiations, such as engaging in an act of fraud or some sort of dishonesty.
A malicious act — that is, an act committed to hurt another business — can also lead to this type of tortious interference claim. However, merely trying to persuade someone to abandon negotiations or even making a better offer in an attempt to undercut a possible bargain will not be considered malicious.
As is the case with a business’ existing contracts, a business often has a lot wrapped up in its negotiations with other vendors and prospective customers. Having a favorable deal get unlawfully derailed by a competitor or even just a spiteful third party can be economically devastating. When this sort of conduct happens and a business suffers, that business may want to evaluate its legal options.