Taking on the Big Guns: Legal Strategies for Facing Down Corporate Bullies

February 20, 2024
6
minutes to read
by
Michael Nuciforo
Table of Contents

Litigious competitors are a reality that many business owners face in today's competitive market. These bullies are often larger companies that use their size and resources to intimidate and dominate smaller businesses. Their tactics can range from false legal claims to outright bullying to push smaller competitors out of the market. In this blog, we will explore the characteristics of litigious competitors and, most importantly, strategies for handling bullying behaviour.

How Does a Litigious Competitor Act? 

Litigious competitors frequently resort to legal action to gain an advantage over their rivals. These types of competitors often have deep pockets and a willingness to use legal tactics as a weapon against their smaller opponents. Litigious competitors file frivolous lawsuits, send threatening legal letters, or engage in aggressive legal tactics to intimidate other players in the industry. For small businesses, dealing with a belligerent competitor can be frustrating, so small business owners need to know how to handle the situation and protect themselves legally. 

Why Do Competitors Adopt Bullying Behaviour? 

There are several reasons why a large corporate competitor engages in bullying tactics. One common reason is that the large corporation feels threatened by a new competitor and wants to limit its growth or popularity. By making false legal claims, the corporate bully hopes to intimidate, distract and financially drain the smaller business. By creating the perception that they are litigious and aggressive, the corporate bully can reduce the momentum a small business may be experiencing with customer adoption. Some corporate bullies also just enjoy the power trip from intimidating and threatening smaller enterprises. Regardless of the reason, small business owners need to take proactive steps to protect their businesses and stand up to corporate bullies. 

Example Case Study – Airheads

Let's use an example to understand the tactics of a litigious competitor and how best to handle them. 

Imagine a small business called Veneris that specialises in high-end telecommunications equipment. They have been operating for a year and have built up a loyal customer base. Suddenly, a larger corporation called Airheads, which also produces telecommunications equipment, sends fictitious legal claims to distract the small business. Despite Veneris having established a reputation for quality products and excellent customer service, Airheads starts bullying them in a bid to regain market share.   

Airheads makes false legal claims that the small business has an inferior product. They send intimidating legal letters, threatening to take the small business to the telecommunications regulator. The small business knows the claims have no legal basis but are forced to respond and engage with lawyers

In this case, Veneris responds with factual evidence about why their product is designed how it is and how Airheads has a totally different design. By responding professionally, the Airheads' legal team is forced to backtrack on their legal claims. Furthermore, if Airheads did not, Veneris would have gone public with the false claims to highlight the bullying and anti-competitive behaviour perpetrated by Airheads.  

How To Deal with Competitor Bullying  

Dealing with corporate bullies can be challenging, but it is important to know how to respond. Here are some strategies small business owners can use to protect their businesses from bullying. 

  • Don't give in to their tactics: Resist the urge to engage in a tit-for-tat argument. Instead, focus on the underlying facts and respond professionally to any claims. 
  • Don't fall for false legal claims: Seek legal advice from experienced lawyers who specialise in your industry to assess the validity of the claims made by the bully. 
  • Leverage relationships: Engage with mutual connections, such as investors with strong ties to the bullying firm. This can help clear the air and ensure cooler heads prevail.  
  • Develop a legal strategy: Work with your lawyer to develop a legal strategy that aligns with your goals and budget. 
  • Consider legal action: If the bully's activities are illegal or unethical, consider taking legal action to put the false claims to an end. 
  • Keep involved: Stay engaged in the legal process and work with your lawyer to gather evidence and prepare your case. 
  • Fight back publicly: If the bully continues to make false claims, respond publicly. Stand up for your business and your customers. 

Dealing with a corporate bully can be long and complex, but don't give up. Keep fighting for your business and your customers. By following these strategies, small business owners can protect their businesses from corporate bullies and thrive in a competitive market.  

FAQs 

Can I ignore legal notices sent from a litigious competitor? 

No, it is not recommended to ignore a letter from a litigious competitor. These letters typically demand that you stop engaging in a specific activity, and failing to respond can lead to legal action. It is important to respond promptly and seek legal advice if necessary. 

Should I retaliate against a litigious competitor? 

No, retaliation is not recommended. Responding to a corporate bully with aggression or public disputes can escalate the situation. It is important to maintain a professional and calm demeanour and focus on protecting your business and legal rights. 

How can I protect my business from false legal claims made by a litigious competitor? 

One of the best ways to protect your business is to maintain accurate records of your business activities. Responding promptly and professionally to legal claims or threats and seeking legal advice if necessary is also essential. 

How can I find a lawyer to help me deal with a litigious competitor? 

You can find a lawyer by searching online, reading reviews and recommendations, and asking for referrals from other small business owners in your industry. It is vital you choose a lawyer with experience in your industry and discuss your goals and budget upfront. Sprintlaw is an excellent online legal service you can take advantage of.

How can I deal with a bullying competitor without escalating the situation? 

Maintaining a professional and calm demeanour when dealing with a bullying competitor is essential. Avoid retaliating and focus on protecting your business and your legal rights.  

Can I file a lawsuit against a bullying competitor? 

You can file a lawsuit against a bullying competitor if they have engaged in illegal or unethical behaviour that has harmed your business. However, it is important to weigh the costs and benefits of legal action and to seek legal advice before taking any legal steps. 

Key Takeaways 

Dealing with competitors who are bullies and litigious can be a frustrating experience for small business owners who want to focus on delivering quality services to their customers. During the process, it is important to remember that you are not alone. While it may be tempting to engage in retaliation or public disputes, it is important to maintain a professional and calm demeanour and focus on protecting your business and your reputation. Ultimately, the most important thing is to be prepared and informed. By understanding your legal rights and options and working with experienced legal professionals, you can successfully navigate the challenges of a competitive market and emerge stronger and more resilient. 

DISCLAIMER: Team Thrive Pty Ltd ABN 15 637 676 496 (Thriday) is an authorised representative (No.1297601) of Regional Australia Bank ABN 21 087 650 360 AFSL 241167 (Regional Australia Bank). Regional Australia Bank is the issuer of the transaction account and debit card available through Thriday. Any information provided by Thriday is general in nature and does not take into account your personal situation. You should consider whether Thriday is appropriate for you. Team Thrive No 2 Pty Ltd ABN 26 677 263 606 (Thriday Accounting) is a Registered Tax Agent (No.26262416).

Why waste time on financial admin when Thriday can do it for you?

JOIN FOR FREE
Already have an account? Login here
Thriday Debit Card

SEE HOW THRIDAY HELPS
SMALL BUSINESSES

Live demo this Thursday at 12:30pm.
SAVE YOUR SPOT
Close