What Are the Sanctions for Stealing Clients From Another Attorney?

The act of stealing clients by a business person from another may take place through various means. These include engaging in unfair and deceptive acts, meddling with an attorney-client relationship or stealing trade secrets. If the means of acquiring a client from an attorney are illegal, then this constitutes a breach of federal and state laws that protect businesses and individuals from unfair competition.
  1. Tortious Interference

    • One way that someone can steal clients is through tortious interference. This involves engaging in acts that knowingly and illegally interfere with a contract between two parties. An attorney who steals clients from another can be said to engage in tortuous interference if she acts maliciously to meddle with the contract between the other attorney and her client, if she induces a client not to continue with the agreement he has with his attorney or if she causes the other attorney financial loss due to these acts. If the attorney engages in these acts when she knows that there exists a contract agreement between the other attorney and his client, she may incur civil action. This may include paying for financial damages caused to the plaintiff attorney.

    Trade Secrets

    • If one attorney illegally uses confidential information belonging to another attorney to lure clients, then he may have breached trade secret laws. Laws vary from state to state, but most states have adopted the Uniform Secret Acts which regulates the use of secret information to gain unfair advantage over another person or business. An example of breaching trade secret law is if an attorney obtains information about a client from another attorney and then induces that client to breach the contract he has with his attorney. Sanctions for these acts include paying damages for the loss incurred, or a court may issue an injunction to prevent further use and manipulation of trade secrets.

    Breach of Fiduciary Duty

    • Breach of fiduciary duty involves engaging in acts that conflict with the interest of a client or an employer. These acts include using corporate assets to provide services to private clients, accepting secret commissions or payment from clients or being disloyal to an employer or a client. For example, a breach of fiduciary duty may occur if an attorney in a law firm uses that firm's assets to divert clients from other partners to her private practice. Sanctions for this include payment of damages caused to the law firm or the attorneys in question.

    Unfair Competition

    • Unfair competition entails engaging in economic behavior that is deceptive to the client. This includes the use of bait and switch tactics or dirty tricks that serve to dissuade the client from her attorney. For example, an attorney may engage in misleading or false advertising about certain legal services to induce a client to terminate his contract with the other attorney. The Federal Trade Commission protects both clients and service providers from unfair or deceptive practices. If a court finds proof of unfair competition, it will issue an injunction against the attorney who engaged in these acts to order him to refrain from further engaging in unfair competition. The court will also order him to pay for damages caused to the other party.

    Fraudulent Misrepresentation

    • Fraudulent misrepresentation is closely identified with fraud or actions of deceit. This takes place when one party provides false information or intentionally fails to provide an important fact. This may lead a client to move from one attorney to another even though he would not have, had he known the true facts. The attorney who loses a client to another through false misrepresentation can claim damages for the financial loss she may have incurred.

Learnify Hub © www.0685.com All Rights Reserved