Competition is the lifeblood of a healthy market economy, and Nebraska law generally permits competitors to aggressively pursue business opportunities, recruit customers, and compete for talent. But there is a meaningful legal line between vigorous competition and tortious interference — conduct that crosses from legitimate business rivalry into wrongful interference with another party's contractual relationships or business expectancies. Understanding where that line falls is essential for any Nebraska business owner who has been harmed by a competitor's conduct or who wants to ensure that their own competitive tactics stay within legal bounds.
Nebraska courts have developed a body of tortious interference law that recognizes two distinct claims: tortious interference with a contract and tortious interference with a prospective business relationship or expectancy. While related, these two claims have different elements and different practical applications, and understanding the distinction is important for evaluating whether you have a viable cause of action.
Tortious Interference with a Contract
A claim for tortious interference with contract arises when a third party — typically a competitor — knowingly and improperly induces another party to breach an existing contract with the plaintiff. To establish this claim under Nebraska law, the plaintiff must prove:
The "improper" element is critical and is what distinguishes actionable interference from lawful competitive activity. Nebraska courts consider a number of factors in evaluating whether conduct was improper, including the nature of the conduct, the defendant's motive, the interests sought to be advanced, and the social interests in protecting the freedom of action and the contractual interest of the plaintiff.
Examples of conduct that Nebraska courts have found to constitute actionable tortious interference with contract include: a competitor who knowingly convinces a key employee under a valid non compete agreement to violate its terms and join the competitor; a business that induces a supplier to breach an exclusive supply agreement with a competitor; and a party that makes false representations about a competitor to induce another party to cancel an existing contract.
Tortious Interference with a Prospective Business Relationship
This claim protects a plaintiff's reasonable expectation of future economic benefit from a business relationship that has not yet been formalized into a contract. Because the law provides less protection to prospective relationships than to existing contracts, the standards for establishing this claim are more demanding. The plaintiff must generally show that the defendant's interference was motivated by improper means — such as fraud, misrepresentation, intimidation, or other wrongful conduct — rather than simply the assertion of a legitimate competitive interest.
Pure competition, even aggressive competition, does not support a tortious interference with prospective business claim in Nebraska. A competitor who wins a contract by offering a better price or better terms, or who convinces a potential customer to switch to their business through legitimate marketing, has not committed a tort even if the competitor knew of the plaintiff's interest in the same business.
The line between aggressive competition and tortious interference is not always clear, and the facts of each situation matter enormously. A competitor who uses false statements, intimidation, or other improper means to disrupt your business relationships has crossed a legal line that the courts will recognize and remedy.
Defenses to Tortious Interference Claims
Several important defenses can defeat a tortious interference claim in Nebraska. The most significant is the privilege to compete: a party acting in legitimate competition generally has the privilege to interfere with the business relationships of a competitor, provided the means used are not independently wrongful. Other defenses include the absence of improper means or motive, the plaintiff's failure to establish actual damages, and the defense of justification — the argument that the defendant's conduct was justified by a legitimate business reason or legal right.
For defendants facing tortious interference claims, the key strategic question is whether the plaintiff can establish the "improper" element. If the defendant's conduct amounted to nothing more than vigorous but lawful competition, the claim should fail. But if the conduct involved misrepresentation, coercion, or inducement of contract breach with knowledge of the contract's existence, the exposure can be substantial.
Damages in Nebraska Tortious Interference Cases
A successful tortious interference plaintiff in Nebraska can recover damages for economic losses proximately caused by the defendant's wrongful conduct. This includes lost profits from the disrupted contractual or business relationship, costs incurred in responding to the interference, and in cases of willful or malicious conduct, potentially punitive damages. The burden of proving damages with reasonable certainty rests with the plaintiff, and speculative or uncertain damages will not be awarded.
How Horgan Law Can Help
The business litigation attorneys at Horgan Law Firm represent Nebraska businesses in both bringing and defending tortious interference claims. These cases require a thorough understanding of Nebraska's competitive harm doctrine, the ability to develop and present complex business damages evidence, and the strategic judgment to evaluate whether litigation is the right approach or whether alternative resolution strategies make more sense. If a competitor has engaged in conduct that you believe has wrongfully harmed your business relationships, contact us to discuss whether you have a viable tortious interference claim.
