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 Chilling Effects Clearinghouse > Defamation > Notices > Defamation Claims Regarding Bankruptcy Case (NoticeID 1030, http://chillingeffects.org/N/1030) Printer-friendly version

Defamation Claims Regarding Bankruptcy Case

August 11, 2003

 

Sender Information:
[Private]
Sent by: [Private]
[Private]
US

Recipient Information:
[Private]
[Private]
USA


Sent via: Mail
Re:

Dear [Recipient]:

As you know we represent [Private] with regard to the [Private] bankruptcy case currently pending in the United States Bankruptcy Court under cause number [Private] (the "Bankruptcy Case"). [Private] has recently learned that you have been taking a number of actions that are interfering with and disrupting the Bankruptcy Case and [Private]'s ability to make a living including but not limited to:

 
FAQ: Questions and Answers

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Question: What is tortious interference with a business relationships?

Answer: Tortious interference with a business relationship is a claim by a contracting party against a third party for unjustified interference with the contractual relationship. To establish a claim for interference with contract, a plaintiff must plead and prove: (1) a valid and existing contract between plaintiff and a third party; (2) defendant's knowledge of this contract; (3) defendant's intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage.


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Question: What is defamation?

Answer: Generally, defamation is a false and unprivileged statement of fact that is harmful to someone's reputation, and published "with fault," meaning as a result of negligence or malice. State laws often define defamation in specific ways. Libel is a written defamation; slander is a spoken defamation.


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Question: What are the elements of a defamation claim?

Answer: The party making a defamation claim (plaintiff) must ordinarily prove four elements:

  1. a publication to one other than the person defamed;
  2. a false statement of fact;
  3. that is understood as
  4. a. being of and concerning the plaintiff; and
    b. tending to harm the reputation of plaintiff.
  5. If the plaintiff is a public figure, he or she must also prove actual malice.


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Question: What is the duty of confidentiality of an employee?

Answer: Confidential information or trade secrets received during the course of an employer-employee relationship cannot be used or disclosed to the detriment of the employer during or after termination of the relationship, even if the employee and the employer had no express contract prohibiting the use or disclosure.
However, an employee can use all the skills and knowledge he acquired during his employment, if the skills and knowledge are commonly used in the trade.

Many states have adopted the Uniform Trade Secrets Act, which is intended to provide states with a legal framework for improved trade-secret protection. The Act contains a definition of trade secrets which is consistent with common-law definitions. Factors used to determine if information is a trade secret include:

? The extent to which the information is known outside of the employer's business.
? The extent to which the information is known by employees and others involved in the business.
? The extent of measures taken by the employer to guard the secrecy of the information.
? The value of the information to the employer and to competitors.
? The amount of effort or money expended by the company in developing the information.
? The extent to which the information could be easily or readily obtained through an independent source.

Trade secrets need not be technical in nature. Market-related information such as information on current and future projects, as well as potential future opportunities for a firm, may constitute a trade secret.


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Question: What does a request to "cease and desist" mean?

Answer: A request to cease and desist is basically asking the party to immediately stop the infriging behavior and then permanently refrain from it.


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Question: What constitutes the tort of interference with a prospective economic relationship/contract?

Answer: One can be held liable for intentionally or negligently interfering with the existing or prospective economic relationships of another. (e.g. contractual/business relationships)

The 2d restatement of the law which contain general defintions of the law taken from the laws of many states, defines the tort of Intentional Interference with Prospective Contractual Relations as follows:
"One who intentionally and improperly interferes with another's prospective contractual relation (except a contract to marry) is subject to liability to the other for the pecuniary harm resulting from loss of the benefits of the relation, whether the interference consists of

(a) inducing or otherwise causing a third person not to enter into or continue the prospective relation or
(b) preventing the other from acquiring or continuing the prospective relation."
Rest 2d (Torts) section 766B.

Usually, damages are dependent on proof that "but for" the allegedly interfering behavior, an economic relationship, the contract, would have been entered into.

Most jurisdictions and the restatement have slightly different wording for the seperate tort of interference with an already existing contractual relationship.(e.g. when a 3rd party's behavior prevents the performance of or induces the breach of a pre-existing contract)


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Question: What constitutes practice of law?

Answer: The "practice of law" is generally defined as doing and performing services in a court of justice. It also includes giving legal advice and counsel, rendering a service that requires the use of legal knowledge or skill, and preparing instruments and contracts by which legal rights are secured, whether or not the matter is pending in a court. The mere holding out by a layperson or suspended attorney that he or she is practicing or is entitled to practice law constitutes the unauthorized practice of law. However, as long as services in connection with preparation for trial are not distinctively legal and remain subject to the control of the lawyer who has responsibility for the case, those performing them are not engaged in the unauthorized practice of law. Thus, for example, an attorney may contract with a legal consulting firm for assistance in handling a medical malpractice lawsuit where the firm was to contact medical experts, but did not attempt to guaranty the "delivery" of expert testimony.
The publication of an article written by a suspended attorney in a professional journal does not constitute the unauthorized practice of law.
Some courts hold that the practice of law does not necessarily involve charging or receiving a fee for services performed. Other courts, however, emphasize that the element of charging a fee for services is an important factor in determining whether specified conduct constitutes the practice of law.


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Question: What is a violation of a automatic stay?

Answer: When a debtor files a bankruptcy case, he is protected against actions by any creditor. All the debtor


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Question: What is a temporary restraining order?

Answer: A temporary restraining order (TRO) is an emergency order stopping a party from acting before the court can hold a full hearing. Generally, the TRO lasts only a short time before the other party must seek a preliminary or permanent injunction.


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Question: What is "injunctive relief"?

Answer: "Injunctive relief" (or injunction) refers to a court order that someone do or stop doing something. A preliminary injunction is an order before a full trial, "to preserve the status quo," while a permanent injunction may be ordered after trial to protect the complainant's rights.

Normally, when one party sues another for trademark, patent, or copyright infringement, the parties can either settle the matter out of court or go to a civil trial. Meanwhile both parties may continue their business until either event occurs.

However, if the owner of a trademark, patent, or copyright can show a court that the violation of its rights is obvious, that it is likely to prevail in a trial, and that it is being harmed by the continued violation of rights while it awaits trial, the court may order a preliminary injunction directing the other party to stop selling the infringing product or to cease operating an infringing web site immediately until the matter is settled. Failure to respond to a court-ordered injunction may result in criminal penalties for contempt, such as a fine or imprisonment.


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Question: What are "treble damages"?

Answer: Treble damages are damages that, by statute, are three times the amount that the fact-finder determines is owed; also termed "triple damages."


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