MIAMI BUSINESS LITIGATION: TORTIOUS INTERFERENCE WITH BUSINESS RELATIONSHIPS

In the absence of a non-compete agreement, Florida law prohibits tortious interference with certain business relationships. The Supreme Court of Florida, in Tamiami Trail Tours, Inc. v. Cotton, 463 So.2d 1126 (Fla. 1985), explained that the elements of a claim for tortious interference with a business relationship are “(1) the existence of a business relationship…(2) knowledge of the relationship on the part of the defendant; (3) an intentional and unjustified interference with the relationship by the defendant; and (4) damage to the plaintiff as a result of the breach of the relationship.” A protected business relationship need not be evidenced by an enforceable contract. In Landry v. Hornstein, 462 So.2d 844 (Fla. 3d DCA 1985), Florida’s Third District Court of Appeal explained in pertinent part: “An action for intentional interference is appropriate even though it is predicated on an unenforceable agreement, if the jury finds that an understanding between the parties would have been completed had the defendant not interfered…A mere offer to sell, however, does not, by itself, give rise to sufficient legal rights to support a claim of intentional interference with a business relationship.” In other words, “an action for intentional interference with a business relationship will lie if the parties’ understanding would have been completed if the defendant had not interfered.” Charles Wallace Co. v. Alternative Copier Concepts, Inc., 583 So.2d 396 (Fla. 2d DCA 1991). Peter Mavrick is a Miami business litigation attorney, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

Important precedent from the Supreme Court of Florida, in Ethan Allen, Inc. v. Georgetown Manor, Inc., 647 So.2d 812 (Fla. 1995), held that “a plaintiff may properly bring a cause of action alleging tortious interference with present or prospective customers but no cause of action exists for tortious interference with a business’s relationship to the community at large…As a general rule, an action for tortious interference with a business relationship requires a business relationship evidenced by an actual and identifiable understanding or agreement which in all probability would have been completed if the defendant had not interfered.” In reaching its decision, the Supreme Court found the Landry decision persuasive. In Landry, a pharmacist who rented premises for his drugstore entered into negotiations, with his landlord’s permission, with a prospective purchaser to sell the pharmacist’s business and to assign the pharmacy lease. However, when the landlord told the prospective buyer that the landlord was “going to get rid of” the pharmacist and that the landlord would rent the premises directly to the buyer, the negotiations stopped between the pharmacist and the prospective buyer. Thereafter, the prospective buyer leased the drugstore from the landlord. The pharmacist then sued the landlord for tortious interference with a business relationship. The appellate court in Landry found a business relationship existed between the pharmacist and the prospective buyer, explaining: “[T]he negotiations had progressed beyond the stage of a mere offer, to an understanding between [the pharmacist and the prospective buyer] for the sale of the business and assignment of the lease, transactions which would have been consummated had [the landlord] not interfered. Evidence disclose that [the landlord]…had undertaken their own negotiations with [they buyer] regarding the rental of the drugstore premises while [the buyer and the pharmacist] were still involved in negotiations.” In Ethan Allen, the Supreme Court explained that the plaintiff, Georgetown, was entitled to damages reasonably flowing from Ethan Allen’s interference with existing relationships. Ethan Allen also qualified its decision, stating that Georgetown’s “relationship with its past customers was not one upon which a claim for tortious interference could be based. Georgetown had no identifiable agreement with its past customers that they would return to Georgetown to purchase furniture in the future. The mere hope that some of its pas customers may choose to buy again cannot be the basis for a tortious interference claim.” The Supreme Court recognized, however, that there are situations where a plaintiff may have valid tortious interference claim based on the plaintiff’s reasonable expectation of future business from a recurring practice of performing work for certain clients. Such a scenario would be distinguishable from a situation of a retail furniture dealer, like Georgetown, with tens of thousands of past customers who may or not return for future furniture purchases.

Peter Mavrick is a Miami business litigation lawyer, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. This article does not serve as a substitute for legal advice tailored to a particular situation.