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Former Employee Unfairly Competing with Confidential Information?


When an employee leaves your business, you have enough to worry about: replacing the employee, training up a new employee, and maintaining all the relationships that the old employee had with your customers.  But what about when the employee that left is a vital part of your business?  What if the employee knew intimate details of your business including trade secrets and future strategies in your industry?  If that employee leaves and improperly uses that information to put you at a disadvantage, they may be engaging in unfair trade practices amongst other legal violations.

What are Unfair Trade Practices?

The Louisiana Unfair Trade Practices and Consumer Protection Act or LUTPA generally provides a right of action to people who claim damages as a result of the use of an unfair or deceptive method, act, or practice in trade.  LUTPA also allows for the recovery of court costs and attorney’s fees.  LUTPA applies to any person, whether natural or juridical, who suffers an ascertainable loss as a result of an unfair trade practice. Examples of Unfair Trade Practices include but are not limited to:

  • Improper Sharing of Trade Secrets
  • Unfair Methods of Competition
  • Certain types of Breach of Contract
  • Fraud
  • Misrepresentation
  • Deceptive Sales Practices
  • Tortious Interference with Contracts

The Louisiana Supreme Court has consistently held that a plaintiff must show that the alleged conduct offends established public policy and is immoral, unethical, oppressive, unscrupulous, or substantially injurious.  The range of prohibited practices under LUTPA is extremely narrow as the law only prohibits fraud, misrepresentation and similar conduct, not just negligence.

There are many elements to an unfair trade practice claim, and you should retain an experienced attorney if you feel that you or your business has fallen victim to unfair practices.  Sometimes, it is necessary to obtain injunctive relief to save your business which requires court appearances, extensive filings, and quick action.

Should you have any questions or you would like to discuss this issue in further detail, please do not hesitate to contact us to schedule a free consultation.

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