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Protecting your business from tort claims

On Behalf of | Oct 28, 2023 | Business Litigation

Tort claims are legal actions that seek compensation for harm inflicted on individuals or property. There were 29,657 tort cases in Pennsylvania in 2021 as well as 1,441 mass tort cases, according to The Unified Judicial System of Pennsylvania.

In the business world, tort claim cases can cause financial damage to companies and may lead to legal issues, including civil lawsuits.

Types of business torts

Some prevalent business torts are tortious interference and trade restraint. These offenses disrupt normal operations and can lead to significant financial losses. Other torts like fraudulent misrepresentation and breach of fiduciary duty also fall under this category. Conflicts over trade secrets can lead to tort cases. Trade libel, which involves making false statements about a business’s products or services, is another common type of business tort.

The consequences of business torts usually manifest as monetary damages or injunctions. Calculating the financial loss from these torts can be complex. Depending on the case, remedies can include monetary compensation, stopping harmful actions and enforcing contracts.

Preventing tort claims

One way to protect a business is to maintain transparent practices. This involves honest marketing, fair employment policies and open lines of communication with stakeholders. Educating staff about ethical business practices can prevent inadvertent wrongs that lead to tort claims. Regular training can keep employees updated on legal obligations and ethical considerations.

Having written contracts with clear terms and conditions is important. These agreements set the groundwork for business relationships and provide a safety net in disputes. Businesses should also protect their intellectual property, including trademarks, copyrights and trade secrets. Robust legal protection can be a deterrent against unauthorized use.

Customizing your insurance portfolio to suit the specific needs of your business can make a significant difference when a tort claim arises as well. Insurance coverage can be a financial safety net against various risks, including business torts.

Understanding the common types of business torts and how to protect against them is important for long-term success.