Legal Question in Business Law in South Dakota

False Allegations by New Business Owners

My family sold a small business in July 2004. We recently received a letter from the attorney of the person who bought the business claiming we had damaged the name of the business and broken the non-compete terms of the businesses purchase agreement.

We were aware at the time of the sale of the business that the person who was buying the business showed signs of a paranoid delusional individual. For example, they believe we cancelled their (our old) accounts with the businesses suppliers. Actually, the suppliers are just updating the business financial information to reflect the new owners information. We did not cancel any of the businesses accounts.

All other claims are similar (false and paranoid).

The false claims have seriously damaged relations in my family (between myself and those who worked at the former business)to the extent that I may end all relations with them.

I would feel sorry for the person making the false claims, but her husband is a medical doctor and he has been backing up her claims and threatening to take us to court.

Can I seek any damages against these people for making the false claims and damaging my family relations?

Thank You

Asked on 2/09/05, 3:52 am

1 Answer from Attorneys

Todd Epp Abourezk & Epp Law Offices

Re: False Allegations by New Business Owners

First, you need to remember that lots of people threaten lawsuits. Many don't follow through. Second, if they were to sue you, they have the burden of proof. Third, if you are sued, you would be able to counter claim. You may have counter claims; but based on what you have written, I would not wish to speculate on what they might be without knowing more facts.

Engaging a lawyer to responde to the new owner's accusations might send a message that you are serious about defending and won't put up with any monkey business. If this person is paying their attorney hourly and they are a little off, you may have a difficult combination on your hands.

I hope this information helps. I hope you will visit with a licensed attorney in your jurisdiction (the information we received said you were from S.D.) about your situation.

Best regards,

Todd D. Epp, Esq.

Abourezk & Epp Law Offices

Sioux Falls, SD

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Answered on 2/12/05, 9:53 pm

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