FORT LAUDERDALE NON-COMPETE AGREEMENT: COMPETITION PRIVILEGE

Tortious interference is a common business tort. The tort is comprised of four elements. A litigant must prove the existence of a business relationship or contractual relationship under which the plaintiff has legal rights; the defendant’s knowledge of the business relationship or contractual relationship; (3) an act of the defendant amounting to an intentional and unjustified interference with the relationship; and (4) damage resulting from the interference. Salit v. Ruden, McClosky, Smith, Schuster & Russell, P.A., 742 So. 2d 381 (Fla. 4th DCA 1999). Tortious interference can be used against an adversary that unlawfully competes when a non-compete agreement or non-solicitation agreement does not exist because a court can issue an injunction prohibiting the unlawful competition. Unistar Corp. v. Child, 415 So. 2d 733 (Fla. 3d DCA 1982) (holding that injunction was appropriate relief in cases involving tortious interference). A court can even issue an injunction in a tortious interference case without proof of the irreparable harm element, which is normally required to obtain an injunction, because the element is presumed in a tortious interference lawsuit. UBS Fin. Services, Inc. v. Bounty Gain Enterprises, Inc., No. 2016 WL 1541438 (S.D. Fla. Apr. 11, 2016) (itemizing the elements needed to prove an injunction, which includes irreparable harm); Unistar Corp., 415 So. 2d 733 (holding that irreparable harm is presumed in a tortious interference lawsuit). The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

A tortious interference claim can be defeated by the competition privilege. Johnson Enters. v. FPL Group, Inc., 162 F.3d 1290 (11th Cir.1998) (“Florida law recognizes the principle that actions taken to safeguard or protect one’s financial interest…”). A defendant the privilege must show the plaintiff and defendant were in competition with one another, the defendant did not employ improper means when competing, the defendant did not intend to create or continue an illegal restraint of competition, and the competitive act advances the defendant’s interest in competing against the plaintiff. Restatement (Second) of Torts § 768(1) (1977). Whether interference with a business relationship is privileged “depends upon a balancing of the importance … of the objective advanced by the interference against the importance of the interest interfered with, considering all circumstances among which the methods and means used and the relation of the parties are important.” Heavener, Ogier Servs., Inc. v. R.W. Florida Region, Inc., 418 So. 2d 1074 (Fla. 5th DCA 1982).

The competition privilege was analyzed in Royal Typewriter Co. v. Xerographic Supplies Corp., and the court’s ruling may surprise some because it shows that improper means is construed narrowly. 719 F.2d 1092 (11th Cir.1983). The defendant assured the plaintiff it would not compete against the plaintiff. The defendant subsequently sent several letters to the plaintiff’s customers, inviting them to do business with the defendant on a “straight purchase” basis and suggested it would be better to do business with the defendant directly rather than with through a local dealer such as the plaintiff. The plaintiff lost at least one customer after the letters were sent. The plaintiff filed a lawsuit alleging tortious interference and lost based on the competition privilege. Johnson Enters. therefore demonstrates a defendant may be able to misrepresent his competitive intentions to a competitor and still defeat a tortious interference claim.

The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.