Business partners typically have thorough agreements with one another outlining their obligations and expectations. They also generally have a fiduciary duty to the company that they started. They should put the company’s best interests ahead of the desire for personal benefit.
Provided that both partners uphold their contractual and fiduciary obligations, they may have a long and successful business partnership ahead of them. However, sometimes one partner uses their position for personal enrichment, potentially at the expense of the shared business. Especially if one partner has an interest in another organization, that could create a conflict of interests that damages the organization.
If one partner may also have an interest in an outside company or a separate professional practice steals a business deal that the organization had worked to arrange, that conduct may constitute a breach of their duty and could lead to business litigation.
When does taking a deal become a breach of duty?
Multiple factors influence the likelihood of success when taking legal action against a partner over stolen business opportunities. Generally speaking, the claims made by the partner alleging the theft of the deal must meet a clear standard imposed by the courts.
The Florida courts may side with the plaintiff in cases where the conduct of one partner involves tortious interference with the business deal. There must be proof of intentional actions taken to intervene in a business deal that would have moved forward successfully if they hadn’t underbid the company or engaged in other inappropriate conduct.
The plaintiff partner bringing the lawsuit generally needs to show that the situation passes the “interest or expectancy” test. In other words, they need to have had actual arrangements in place with the other company or clear negotiations indicating an upcoming contract rather than just an expectation of a business opportunity. If a partner interfered in a deal that was 95% complete, that could provide the basis for a lawsuit.
Reviewing prior communications – with a skilled legal team – concerning another business and the conduct of a partner can help those frustrated by a lost deal evaluate their options. Business litigation brought against a business partner can lead to a buyout or possibly even financial compensation for the impact of a lost business opportunity.