They tried to cheat me. A competitor. Someone I’d known for years in the shipping trade. When they thought I wasn’t looking, they started spreading lies about my services, undercutting my rates to steal my clients, and telling my suppliers I was going out of business. I watched good customers slip away because of dirty tricks.
That’s when I learned: there’s a law against this. And if you can prove it, you can win big. Here’s what I learned fighting back—and how you can protect your business from the same thing.
The Legal Shield: What the Law Actually Says
Maritime business is governed by federal law and state law. Both protect you from unfair competition.
Federal protections:
- The Sherman Antitrust Act – Makes it illegal to monopolize markets or conspire to restrain trade
- The Federal Trade Commission Act – Bars unfair methods of competition and deceptive practices
- The Lanham Act – Protects against false advertising and trademark infringement
State protections:
- Unfair Competition Laws (UCL) – Most states have laws protecting against deceptive and unfair business practices
- Tortious Interference – You can sue if someone intentionally interferes with your business relationships
- Common Law Fraud – If a competitor lies to steal your business, that’s actionable
The Five Types of Unfair Competitor Behavior (and How to Prove Them)
1. Tortious Interference with Contract
This happens when a competitor intentionally causes one of your customers to break their contract with you.
What you need to prove:
- You had a valid contract with a customer
- Your competitor knew about the contract
- Your competitor intentionally acted to make the customer break the contract
- The customer actually breached (or you lost the deal)
- You suffered damages as a result
Real example from my business: A competitor of mine offered one of my regular clients a $5,000 discount to switch to his company. He told the client I was “unreliable” and “going out of business.” The client left. That’s tortious interference. He knew I had a contract. He intentionally tried to break it. The client breached. I lost money.
How to prove it: Get emails, text messages, or witness statements showing the competitor contacted your customer. Get invoices showing you had an ongoing relationship. Document the lost revenue. That’s your case.
2. Tortious Interference with Prospective Economic Advantage
Similar to the above, but covers situations where you didn’t have a signed contract—just a potential deal that the competitor sabotaged.
Example: A shipping company I was negotiating with told them I couldn’t deliver on time. They chose someone else. If I can prove the competitor lied and knew it would kill the deal, I have a case.
This is trickier because you have to show there was a reasonable probability of the deal happening. But if you can show you were seriously negotiating, had preliminary agreements, or were next in line, you’ve got a shot.
3. Predatory Pricing
A competitor sets prices so low they’re below cost, with intent to put you out of business. Once you’re gone, they raise prices back up.
In maritime shipping, this looks like:
- Offering transport rates 30-50% below market, below their own cost
- Deliberately targeting your customer list
- Advertising they can “beat any price”
- Using predatory pricing only in areas where you operate, not elsewhere
Why this matters: Predatory pricing is illegal under antitrust law if the competitor has market power and intent to monopolize.
How to prove it: You need economic evidence. Show the competitor’s costs (if you can get discovery in court). Show they’re selling below cost. Show the timing—that they started undercutting only after you entered the market. Show geographic targeting. Get customer testimony about why they switched (the price).
4. False Advertising and Disparagement
Your competitor spreads false claims about your services, your safety record, your financing, or your reliability.
Real example: The competitor who tried to cheat me told a potential client I’d had a cargo loss and lost my insurance. Completely false. That’s disparagement. It’s also potentially fraud.
What the law says: The Lanham Act makes it illegal to make false statements of fact about a competitor’s services that damage their reputation. You can recover damages and get injunctions (court orders forcing them to stop).
How to prove it: Get the false statement in writing if you can. Get witness testimony from people who heard it. Show how it damaged your business (lost customers, lower revenues). Prove the statement was false and the competitor knew it or should have known it.
5. Unfair Business Practices (The Catch-All)
This covers anything deceptive, fraudulent, or deliberately unfair that damages your business.
Examples:
- Offering kickbacks to your employees to steal trade secrets
- Filing false complaints with regulators about your company
- Spreading rumors about your financial stability
- Using bait-and-switch tactics to divert your customers
- Breaching their own contracts with you to harm you
The key is: the conduct has to be deceptive or unfair, and it has to damage your business directly.
The Burden of Proof: What You Have to Show
To win an unfair competition or tortious interference case, you need to prove:
- The conduct was unlawful, fraudulent, or unfair – Show it violates a law or basic principles of fair dealing
- It directly harmed your business – Not just in theory, but in fact. You lost customers, revenue, or opportunity
- You suffered measurable damages – Document the lost income, the client you lost, the deal that fell through
The last one is critical. Judges want numbers. Document everything.
How to Protect Your Business Before Problems Start
1. Document Everything
- Keep contracts with customers in writing
- Save emails, texts, and communications with clients
- Keep records of when clients leave and why (ask them)
- Track competitors’ pricing and advertising
- Save screenshots of their website claims, ads, and social media
2. Protect Your Trade Secrets
- Limit who has access to your pricing, customer lists, and operational details
- Use non-disclosure agreements with employees
- Mark sensitive documents “Confidential”
- Change passwords and access regularly
3. Monitor Competitors
- Subscribe to their advertising and pricing updates
- Ask your customers if competitors are poaching them
- Attend industry events and listen for rumors
- Check industry publications and news
4. Build Relationships with Regulators
- Know the Federal Maritime Commission and maritime regulators
- If a competitor is breaking rules, report them
- Regulatory complaints can be powerful evidence in civil litigation
What to Do When You Suspect Unfair Competition
Step-by-Step Response Plan
- Gather evidence immediately. Before they know you’re onto them, collect emails, messages, pricing documents, customer feedback, lost deal information. Don’t let evidence disappear.
- Send a firm letter (not legal yet). Contact the competitor directly. Tell them specifically what they’re doing wrong and demand it stop. Keep this professional—it shows you tried to resolve it before litigation.
- Document your damages. Calculate lost revenue, lost opportunities, costs to respond (hiring lawyers, etc.). Put numbers to the harm.
- Consult a maritime lawyer. Not an injury lawyer. Not a general business lawyer. A maritime lawyer who handles commercial disputes. They know the Sherman Act, COGSA, and shipping-specific claims.
- Send a cease-and-desist letter. This is more formal. Your lawyer writes it. It puts them on notice that if they continue, you’ll sue. Many competitors back off here.
- Consider arbitration or mediation. Some shipping contracts require dispute resolution this way. It’s faster and cheaper than court.
- If they don’t stop, file suit. Get injunctive relief (court order to stop the conduct) and monetary damages (compensation for losses).
What Remedies Can You Get?
If you win, the court can order:
- Injunction: A court order forcing the competitor to stop the unfair conduct immediately
- Actual damages: Money equal to your lost revenue and business
- Punitive damages: Extra money to punish the competitor for intentional wrongdoing
- Attorney’s fees and costs: In some cases, the court makes them pay your legal bills
- Treble damages: Under antitrust law, you can recover three times your actual damages
That last one—treble damages—is powerful. It makes competitors think twice.
The Defenses They’ll Use (and How to Counter Them)
Defense #1: “We Were Just Competing on Price”
Counter: Show the pricing is below cost, target your specific customers, and the timing is suspicious (started right after you entered market). Legitimate competition doesn’t require lying or predatory tactics.
Defense #2: “We Never Mentioned Your Company”
Counter: You don’t need them to name you directly. If they disparaged “transport companies that go out of business” and you lost customers to them shortly after, that’s disparagement.
Defense #2: “Customers Make Their Own Choices”
Counter: Yes, but if your competitor lied to influence that choice, that’s tortious interference. Get witness testimony and communications showing how the choice was influenced.
The Bottom Line
I learned the hard way that competitors can cheat and lie. But I also learned that the law is on the side of honest shipowners who document everything and fight back.
Don’t tolerate unfair competition. Don’t wait hoping it stops. Document everything. Consult a maritime lawyer. And if they won’t stop, sue. Most competitors back down fast when they realize you know the law and have the evidence.
That’s how you protect your family business.
Legal Disclaimer: This article is educational content only and does not constitute legal advice. Maritime and commercial law is complex and fact-specific. Consult a qualified maritime attorney before taking action on any commercial dispute.
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