Civil obligations are assigned under tort laws if someone hurts you or your property. They allow you to pursue financial compensation from those who caused your injury.

Business tort law enables companies to seek redress from people or companies whose activities hurt them. These remedies could be injunctive reliefs, punitive damages, or compensatory damages.

What is a business tort?

A business tort refers to wrongful actions causing harm to a business entity, such as fraud, interference with contracts, defamation, or unfair competition. These civil wrongs can lead to legal liability and financial consequences.

Types of Business Tort Claims

Business tort claims encompass a range of wrongful actions that can harm a business. Some common types of business tort claims include:

  • Fraud:

Fraud is a deliberate act of deception to secure unfair or unlawful gain. This can involve false representation, concealment of information, or misleading statements to manipulate someone into taking actions that result in financial loss or harm.

  • Intentional Interference with Contracts:

This legal concept occurs when a third party intentionally disrupts a contractual relationship between two parties. This interference could lead to a breach of contract, financial loss, or damage to the involved parties. Courts often consider the motive, means, and consequences in such cases.

  • Defamation:

Defamation involves false statements that harm the reputation of a business, either spoken (slander) or written (libel). To be legally actionable, the false statements must be damaging, untrue, and presented as a fact rather than an opinion.

  • Trade Secret Misappropriation:

Trade secret misappropriation involves the unauthorized use or disclosure of confidential business information that provides a competitive advantage. This can include formulas, processes, or any proprietary data that gives a business a unique edge in the marketplace.

  • Unfair Competition

Unfair competition encompasses various deceptive and dishonest business practices aimed at gaining an unfair advantage over competitors. This can include false advertising, trademark infringement, or other unethical actions that violate principles of fair play in the marketplace.

Examples: False advertising, trademark infringement (See more on what is trademark protection), or predatory pricing strategies.

  • Breach of Fiduciary Duty:

A breach of fiduciary duty occurs when a person in a position of trust and confidence, known as a fiduciary, fails to act in the best interests of another party to whom they owe a duty.


  • Corporate Insider Trading: Company executives exploit confidential information for personal gain.
  • Attorney-Client Misconduct: Lawyers mishandling client funds, divulging confidential information, or failing to act in the client’s best interests.

Each of these business torts has its own legal nuances, and pursuing a claim requires demonstrating the specific elements relevant to the alleged wrongdoing.

Remedies for business tort

Business torts can inflict significant harm on companies, ranging from financial losses to damage to reputation. Various legal remedies are available to address these wrongs, encompassing compensatory damages, punitive measures, equitable relief, and restitution. 

Understanding the remedies for business torts is crucial for businesses seeking justice and redress for wrongful actions committed by others in the commercial realm.

  • Legal Remedies:

Compensatory Damages: Monetary compensation awarded to the plaintiff to cover the losses suffered due to the business tort. This includes economic losses (such as lost profits) and non-economic losses (such as emotional distress).

Punitive Damages: In cases of intentional or egregious misconduct, punitive damages may be awarded to punish the defendant and deter similar conduct.

Nominal Damages: Token damages are awarded when a legal right has been violated, but no substantial harm is proven. It acknowledges the wrongful act without significant financial compensation.

  • Equitable Remedies:

Injunctions: Court orders that prohibit the defendant from engaging in certain actions or require specific actions to prevent further harm. This may involve restraining unfair competition or trade secret misappropriation in business torts.

Specific Performance: A court order requiring a party to fulfill contractual obligations or cease certain activities. This remedy is more common in contractual disputes but may apply in business torts where monetary damages are inadequate.

  • Restitutionary Remedies:

Restitution: A remedy to restore the plaintiff to their position before the wrongful act occurred. It involves returning any unjustly gained benefits to the plaintiff.

Constructive Trust or Resulting Trust: If the defendant acquired property or assets through a business tort, a court may impose a trust to ensure that these assets are held for the plaintiff’s benefit.

Importance of business tort law

Business tort law plays a vital role in safeguarding the interests and rights of businesses in the commercial landscape. It provides a legal framework for addressing wrongful acts and disputes arising in the business context. 

Business tort law helps maintain fairness, accountability, and ethical conduct within the business community by defining rights, obligations, and remedies. This legal framework fosters a helpful environment for businesses to thrive while ensuring those who engage in tortious conduct are held accountable, promoting justice and ethical business practices.

Has your business suffered business tort? Contact a lawyer

A business tort lawyer can provide essential legal guidance and representation to protect your business from wrongful acts or tortious conduct. From handling disputes and seeking remedies to advising on preventive measures, they play a crucial role in safeguarding your business interests and maintaining a legally sound environment.