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Business restraint of trade: What does that mean and entail?

You manage a southern California business and believe that your company's profits and prospects have been undermined by actions taken by a business rival that have adversely affected you.

Do you have a civil claim for damages based on a legal theory grounded on restraint of trade?


But then again, maybe not. Although some competitor behaviors clearly cross a legal line that renders them unlawful business torts, other actions engaged in by rivals are legally permissible, even if they qualify as hard-ball tactics in your view.

As with many other matters in life, judicial findings regarding things like tortuous interference and restraint of trade are heavily influenced by whether a third party's acts were reasonable.

And that can give rise heightened complexity in a hurry.

To wit: Multiple business rivals price their goods quite similarly, yet in a manner that varies materially from your pricing model. As a result, you're hurting and they're thriving. Are they unlawfully restraining trade?

Maybe you're a departing employee planning on independently starting up a business, but your ex-employer is waving a non-compete agreement in your face that you executed long ago and that now restrains you from competing in any manner with your former boss. Is that legal or an illegal restraint of trade?

A restraint-of-trade outcome in a court of law will always depend on the court's evaluation of key facts in the case before it.

And, again, that parades the concept of "reasonableness" front and center.

Whether you are bringing a legal claim based on restraint of trade or, alternatively, defending against one, you might reasonably want to timely contact a proven business litigation attorney. A lawyer well experienced representing clients in business torts cases can examine your claim and, when necessary, provide diligent legal representation aimed at fully promoting your legal rights.

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