Legal Question in Business Law in California

Theft of business

An employee of mine a con-man made a deal to purchase my business,before the deal went true this con-man figuired out how to get my business for free.By ''inducing'' all my employees to leave me,leaving me alone to handle all the work. I am in very rare trade and skilled employees couldn't be found in a hurry. In mean time the con man went door to door to my customers offering them a ''household'' items, then he would snick in a business card which describe exactly what business he is in. My customers welcomed him being in the same business as mine since I was ''lately'' slow on delivery.Is this legal?


Asked on 7/16/02, 1:06 am

6 Answers from Attorneys

Re: Theft of business

Yes, this is a real problem. Depending on how much money is involved for the loss of business that you have, you will likely want to pursue this matter against the former employee.

You have several possible causes of action against your former employee including but not limited to interference with contractual relations, unfair competition, possibly misappropriation of trade secrets, etc.

You should definitely contact an attorney to discuss your options. The problem with such a suit is that it is likely going to be expensive to pursue.

I would be happy to discuss this with you.

J. Caleb Donner

DONNER & DONNER

LEGAL WARRIORS (R)

805-494-6557

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Answered on 7/30/02, 2:14 am
Joel Selik www.SelikLaw.com

Re: Theft of business

While there are not criminal charges (based on what I have seen so far but there still might be) you have a lawsuit to recover against this man and perhaps stop his business.

Joel Selik

Attorney At Law

www.4thelaw.com

800-894-2889

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Answered on 7/16/02, 7:48 am
Ken Koenen Koenen & Tokunaga, P.C.

Re: Theft of business

It sounds as if you could have a number of claims ... defamation, interference of contract and business advantage, etc. You should get some professional help right away.

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Answered on 7/16/02, 1:50 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Theft of business

What you describe is not legal, but it is probably not criminal, either.

This is an instance of various business wrongs that come under the heading of 'torts' -- civil wrongs that can be addressed by a lawsuit and money damages as well as other remedies.

The most obvious wrong here seems to be improper use of your trade secrets and other business property, such as customer lists and knowledge of contracts and opportunities. The law encourages competition, but an employee leaving a former employer may not use specific customer information for any improper purpose.

I would be willing to give you a free consultation by phone, e-mail, mail or in person and, if your case seems solid, I could represent you in seeking damages from this traitor.

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Answered on 7/16/02, 2:23 pm
Chris Johnson Christopher B. Johnson, Attorney at Law

Re: Theft of business

The actions you describe are probably an illegal interference with your business, and perhaps unfair and deceptive trade practices. If you have actual damages (proveable loss of business), and the "con man" has assets you can recover from, you may want to pursue a lawsuit--have a business litigation attorney review the facts with you.

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Answered on 7/16/02, 1:23 am
David Pearson Law Offices of David S Pearson

Re: Theft of business

You should immediately speak with an attorney who can review the documents between the parties and see if you have a claim under the Business & Professions Code for unfair competition.

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Answered on 7/16/02, 1:39 am


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