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What to do when accused of unfair competition

On Behalf of | Jul 8, 2024 | Business

The world of business has always been competitive. It is often common when owners employ ways to stand out among others. If someone accuses you of unfair competition, or wrongful or deceptive business practices, you may need to pursue legal action to protect your business.

Texas takes a strong stance against unfair competition

Texas does not have a single law against “unfair competition.” Instead, it relies on the Deceptive Trade Practices Act (DTPA), trademark laws, trade secret laws and common law actions. This combination of regulations and federal laws aims to stop unfair practices from creating deceitful advantages.

Fighting these allegations

If found liable, you could face court-ordered changes to your business practices, financial penalties and even damages awarded to the plaintiff. You may be able to debunk such a claim by:

  1. Understanding the nature of the accusation: Is it a formal complaint or an informal one from a competitor? Get details on the specific practices they find unfair.
  2. Assessing the accusation: Are there any business practices that people may misconstrue? If you can identify potential issues early, you can build a strong defense.
  3. Responding professionally: If the accusation is informal, consider a measured response. Explain your position clearly and professionally. Do not admit guilt or engage in mudslinging.
  4. Reviewing your business practices: Internally assess your marketing, sales and customer service practices. Make sure they comply with relevant laws and avoid any ambiguity.

Seek to involve an experienced business lawyer each step of the way. They can help analyze the situation, advise you on legal options and represent you if necessary.

An accusation does not equate to guilt

The accusing party usually has the burden of proof. Still, taking preventive measures can be good for you and your business. This can include having clear contracts with employees regarding confidentiality, using registered trademarks and ensuring truthful advertising. In case allegations arise, you then have legal options.