Entering into a business can open a lot of opportunities. On top of getting your brand out to the public, you also get the chance to meet other business owners, especially within the same industry. But while having a healthy industry relationship is ideal, competition can sometimes drive some companies to resort to unlawful business practices to solicit customers, which can harm other competitors’ businesses.
As a business owner, it is a good practice to familiarize yourself with acts that may constitute unfair competition.
Spotting unfair competition
In the business context, unfair competition refers to a company’s deceptive or wrongful business practices that could cause economic harm to another business in the same industry. Sample cases of unfair competition are:
- Predatory pricing and other strategies of forcing competition out of the market
- Spreading false information about a competing product
- The “bait-and-switch” technique or the unauthorized substitution and selling of one brand for another
- Trademark Infringement
- Fraud and misrepresentation of products or services
- False advertising
- Theft of trade secrets
- Use of confidential information to solicit customers
It is good to note that this is not a fixed list. What could pass as an “unfair” practice depends on the nature of the business and the facts of the individual case.
How can I protect my business?
Fortunately, while state laws against deceptive trade practices mainly protect consumers, it indirectly protects businesses affected by such harmful acts. If a consumer or attorney general successfully brings a suit against the liable company, remedies may include injunction, restraining order and fines.
If you believe that a competitor is engaging in deceptive or unfair conduct that could harm your business, you may consult with an attorney to clarify if you should seek further legal action to protect your business.