In Roy Allen Slurry Seal, Inc. v. American Asphalt South, Inc., (2017) 2 Cal.5th 505, the California Supreme Court recently ruled that disappointed bidders could not state a claim for the tort of intentional interference with prospective economic advantage against companies that obtain public contracts based on business practices that allegedly violate employment laws.
In this case, Roy Allen and another general contractor, Doug Martin Contracting, Inc., asserted the tort of intentional interference with prospective economic advantage in their lawsuit against American Asphalt, in which they alleged that they had lost a large number of public contracts to American Asphalt based on American Asphalt’s ability to submit deflated bids due to lower labor costs derived from not paying prevailing wages or overtime compensation to its workers. The trial court sustained American Asphalt’s demurrer without leave to amend, but the court of appeal reversed, holding that plaintiffs had stated a claim for intentional interference with prospective economic advantage. The California Supreme Court said no, plaintiffs did not state a claim. Continue Reading California Supreme Court Says No to Tortious Interference in Public Bidding