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Did you know that you can sue someone for unfair competition?

On Behalf of | Jan 29, 2021 | Business Disputes

If you own your own company, then you’ve likely heard of the terminology “unfair competition.” Do you know what constitutes this, though?

You may find it helpful to know that both state and federal laws afford you the ability to sue fellow business owners who engage in this practice, so it’s smart to understand the concept. There’s more on the subject below.

What exactly is unfair competition?

It’s okay to be competitive with other companies, but it isn’t okay to be deceptive or unethical.

Lawmakers refer to any unethical or deceptive business practices that harm other businesses or consumers as unfair competition. False advertising, the unauthorized substitution or false representation of a brand’s services or product, and the misuse of trade secrets or trademarks all fall under the umbrella of unfair competition. These laws aim to protect a person or company’s right to their intellectual property and any associated economic gain that others stand to make by representing another’s work as their own. 

What laws prohibit unfair competition?

Some of the more notable federal laws that prohibit unfair competition are the Commerce Clause, §43(a) of the Lanham Act, and 15 U.S.C. §1125(a). These address both intellectual property rights and false advertising and spell out how business owners can sue anyone who violates these statutes.

Another federal law that protects both individuals’ and business owners’ intellectual property rights is the Uniform Trade Secrets Act. It prohibits the production of counterfeit goods and the unauthorized sharing of trade secrets.  

Many states also have unfair competition statutes on the law books. Some call for individuals and businesses to first send cease and desist letters letting someone else know that they violated their rights before suing for injunctive relief. 

Can you file a lawsuit against the person or entity that violated your rights?

Your ability to sue someone who engages in unfair competition here in Texas is contingent upon various factors, including how long the impropriety lingered on, whether the defendant’s alleged conduct was willful and the damages involved. Speaking with a Houston attorney can help you learn more about the strengths and weaknesses of your claim.

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