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Quote of the Day - Illegal aliens have always been a problem in the United States. Ask any Indian. - Robert Orben
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The Lawsuits Are Coming! The Lawsuits Are Coming!

Paul Revere couldn't have said it better:  Lawsuits between businesses have hit the Courts.  Yes, I know that's not news.  Stay with me for a minute.  It's not just the everyday litigation we presently have, but business-to-business lawsuits now include litigation over illegal immigrants.  MIPTC previously reported this phenomenon, and promised to let you know when litigation was filed.  It has. 

Here's how it goes:  Company A, Global Horizons, provides temporary workers to businesses.  It has a contract to supply employees to Company B, Munger Brothers, a vegetable farm that hires illegal immigrants to harvest its crops.  Company A verifies that all of its temporary employees are U.S. citizens, so presumably to keep its costs down, Company B wasn't interested in hiring any temporary employees from Company A.  Company B instead hires its temporary workers from a temp agency we'll call Companies C and D, (Ayala Agricultural Services and J&A Contractors)which doesn't screen its temporary workers for citizenship.  Temp agency A therefore sues farmer B for unfair competition

It's a novel theory to be sure, and it's likely not to last.  There are too many variables about why Company A isn't doing well financially, and they've likely named the wrong defendant anyway.  It seems to MIPTC that the defendant in this instance should be Companies C and D, not Company B.  The farm is not competing with the temporary employee agency.  It's the other temporary employee agencies, Companies C and D in our case.  I checked the UCL Practitioner's site, and Kim may disagree with me on the potential for the ultimate success of these cases.  She's sure to cover it further, so keep a weather eye.  I'll go out on a limb here and predict that the only viable cause of action for the temp agency against the farm is breach of contract.  Even then, that lawsuit's probably just a yawner. 

Even so, let's play that game.  If temp agency A sued temp agencies C and D, could it win?  The case is a bit closer, but it still seems unlikely.  The unfair competition laws require direct proof of injury by one business to another.  Kim agrees with me on that point, but not likely with my final analysis.  Here, temp agency A would claim that temp agencies C and D's practices of providing illegal immigrants as temp workers unfairly competes with it.  While that scenario has a bit of sex appeal to it, it misses the mark.  It's very likely that temp agency C offers U.S. citizens for employment and it's just as likely that temp agency A has plenty of other reasons that it is not doing well financially. 

Without a full-fledged, consistent pattern and practice of temp agencies C and D undercutting most, if not all of temp agency A's employment contracts, the single instance of one lost contract due to illegal immigrants won't likely sustain an unfair competition lawsuit.  This suit won't be the last of these that are filed, and you can be sure that in each successive, the plaintiff' lawyers will learn what they need to allege to pass muster, so later rather than sooner we may see a lawsuit that gets past a trial court. 

Then we'll see what the court of appeals will do in the next couple of years.  Stay tuned

Printer friendly page Permalink Email to a friend Posted by J. Craig Williams on Saturday, August 26, 2006 at 10:48 Comments Closed (0) |
 
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