Business litigation results after breach of contract

When individuals share business ideas, it is common for them to enter into partnerships and create a company. Having multiple people on board can often help with decision making and other important factors of running a business. However, partners can also face difficulties that could lead to litigation, especially if someone breaches a contract.

Texas readers may be interested in a lawsuit that is currently underway in another state. Reports indicated that two men founded a company called Smashing Boxes in 2010. In 2017, the company was enlisted to help another company called Futures in developing an app and designing a website. Smashing Boxes reportedly estimated that its services would cost approximately $192,000 but that the estimate was not guaranteed. The companies also entered into a contract with terms that prevented Futures from employing individuals from Smashing Boxes for two years.

Reports stated that Futures began falling behind on payments, but that one of the Smashing Boxes founders — who was working closely with Futures on the project — assured the company that payments would be made. However, Smashing Boxes claims that the founder knew Futures could not pay. The last payment was due in Dec. 2017, but the company still owed $250,000 at that time. The lawsuit also states that Futures hired away the Smashing Boxes founder in Jan. 2018. As a result, Smashing Boxes has filed the lawsuit claiming breach of contract on the part of Futures and failing to act in the company’s best interests on the part of the Smashing Boxes founder.

It can be difficult when someone in a position of power within a company does not work in the best interests of the company. As this case shows, litigation may be necessary in order to address instances of contract breaches or other issues. If Texas business owners have experienced such issues with their partners, they may want to explore their legal options.