Protorae Law
Mike Holm | LeClairRyan | UBP Team

Unfair Business Practices



This blog focuses on unfair business and trade practices such as business conspiracy, breach of fiduciary duty, misappropriation of trade secrets and other proprietary information, fraud, tortious interference with contracts and other unfair business practices that are not neatly defined. Since we are located in Tysons Corner, Virginia, many of the cases discussed will come from Virginia, Maryland and the District of Columbia courts. We hope the reader finds this blog instructive.

Friday, January 4, 2008

Elements of a Business Conspiracy

In order to understand the breadth of the business conspiracy statute, it is helpful to focus on its elements. First, it requires a combination of parties who agree to act in concert. Second, there must be some unlawful act in furtherance of the conspiracy which may be satisfied by proof of either breach of fiduciary duty, interference with contract or business expectancy, conversion, some other business related tort, or other unlawful conduct.

In addition, there must be evidence that the conspirators’ purpose was to willfully and maliciously injure the plaintiff’s business interests. While this seems to require proof of actual malice, that is that the conspirators were motivated by personal spite or ill will, as is necessary to support a claim for punitive damages, such proof is not required. Instead, it only requires proof that the defendants acted intentionally, purposefully and without lawful justification, a concept known as legal malice. In other words it is not necessary to show that the conspirators’ primary and overriding purpose was to injure the plaintiff, but only that it be an anticipated outcome. Accordingly, proof of motive is not that significant a hurdle for a plaintiff. See Commercial Business Systems, Inc. v. BellSouth Services, Inc., 249 Va. 39, 453 S.E.2d 261 (1995) (unavailable via internet); Advanced Marine Enterprises, Inc. v. PRC, Inc. , 256 Va. 106, 501 S.E.2d 148 (1998) http://www.courts.state.va.us/opinions/opnscvwp/1971950.doc; Feddeman and Co. v. Langan Associates, 260 Va. 35, 530 S.E.2d 668 (2000) http://www.courts.state.va.us/opinions/opnscvtx/1991996.txt.

The business conspiracy statute does not apply to injury to one’s personal or employment interests, only business interests. Once injury has been shown, the statute allows a successful plaintiff to recover treble damages as well as costs and reasonable attorneys fees. It does not preclude the additional recovery of punitive damages if such damages are recoverable under other claims asserted in the case. See Advanced Marine.

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