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Have your competitors engaged in industrial espionage?

Sep 1, 2022 | Business Litigation

Healthy and legal competition can drive innovation and can help inspire your workforce. Unfair competition, on the other hand, may make it unduly difficult for your company to turn a profit and remain in business.

There are many forms of unfair competition that could put your business at a distinct disadvantage. For example, your competitors could all get together and engage in price fixing, which involves them agreeing to set prices that reduce how competitive you are on the local market. On the other hand, they could try to defame your company, spreading unfounded rumors or leaving multiple negative reviews of your business on different online platforms.

One of the most complex and potentially damaging forms of unfair competition is corporate espionage. Do you think that one of your competitors engaged in corporate espionage and harmed your business?

What constitutes corporate espionage?

Any fraudulent, manipulative or illegal activity intended to give one business access to another company’s trade secrets may constitute corporate espionage. Contacting one of your workers to offer them cash if they photocopy your client list is one example of corporate espionage. Arranging for their former employees to infiltrate your company and gain access to your recipes or production processes would be another example.

You can sometimes protect your business against corporate espionage by thoroughly checking the background of any new hire that will have access to trade secrets and also investing in solid information technology and security systems so that you can prove who accessed certain information. Finally, restrictive covenants in your contracts can create penalties for the workers involved in such cases.

Espionage claims often lead to litigation

If you suspect one of your competitors of infiltrating your company or convincing one of your workers to give it access to your trade secrets, you may have grounds to initiate business litigation. The stronger the connection between the breach of your company’s security and your competitor, the easier it will be for you to prove your case in court.

Unlike criminal trials, which require evidence that will convince a jury beyond a reasonable doubt, civil cases only require that a preponderance of evidence support the plaintiff’s claim. Fighting back against unfair competition may require business litigation to hold another business accountable for unethical practices.