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I own a large website and while trying to sell it, I found

a potential buyer who is...
I own a large website and while trying to sell it, I found a potential buyer who is based out of Canada and is a large online company. I told the potential buyer that any information which I give them regarding this website can not be disclosed, and that he is not allowed to copy/replicate it. He replied back saying he agreed.

Then I talked to him (through saved online texts) regarding the website as he asked more and more questions. He wanted all information regarding the website, including details on what gives it the edge, trade secrets, etc. As I had thought he is a big company owner and he already accepted he wont try to duplicate it, I thought it was fine.

So for the past 2 months he has been leading me on thinking he is interested in buying but not made his decision yet. So he wanted me to keep him up to date on my website, what Im doing, how Im making it better, etc. So I kept telling him.

Then today, I found out that he has copied my website about 1.5 months ago and is copying and replicating my methods of promoting the website, and everything. I have solid proof that he is the one who owns this website even though he did not admit it yet.

He kept leading me on for the past 2 months just so he can get information out of me and so his site(which is now a competitor to mine) could copy what I do and replicate how I make money. His site was started after I gave him information and I have proof of this as well.

I am wondering if I have a case and if so, how big, since he clearly agreed to not disclosing/copying/replicating any information I was going to tell him about the site. Yet, he did all of that. His site competed against mine(and still is) for the past 2 months where he kept leading me on to learn about my secrets so he could apply to his site. I also had couple other buyers who I did not spend as much time with as I thought this company was much bigger and seriously interested since I had vested so much time in telling them all about it.

All conversations were made through text which have been saved and recorded. All proof of him owning the website is also recorded and saved.

Thanks
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Answered in 4 minutes by:
8/1/2013
Dimitry K., Esq.
Category: Legal
Satisfied Customers: 41,221
Experience: Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.
Verified
Thank you for your question. Please permit me to assist you with your concerns.

My apologies that you are in this situation. Did you get this 'non-disclosure' in writing, or was it purely an oral assurance?
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Customer reply replied 4 years ago

He had asked if I wanted an NDA signed and I said this:


 


"No need for an NDA, as long as you just verbally agree on here not to disclose or copy/replicate what I show you then I am completely fine. As long as you confirm that via email, I am on Skype now so we can talk there quicker."


 


To which he replied:


"I agree to that Avais.I have added you please accept so we can discuss."


 


All discussions from here on out for the most part were on Skype and I have that saved. Some were through email when I sent him files about details on the website, files with data, etc.

Thank you for your follow-up.

This is going to be a very tough case to pursue. I will explain why in my formal answer. If I may ask, what do you estimate your injuries and losses to be? How much is your site and/or business or profit affected by this?
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Customer reply replied 4 years ago

Well, the asking price of this website was and is $10M for a full buyout, which was never bargained down throughout the process. Exact estimate or injuries to our website earnings could be anywhere from upper 5 figures to lower 6 figures, it is not exactly known as they tried to copy us and we had to pay higher amount to compete with them.


 


The fact that they clearly scammed us, shouldnt that count for something? Also the potential loss that I did not pursue other buyers as I thought he was interested and lost that 7 figure deal due to him. So potential loss of 7 figures as I have not sold the site, but instead the value of the site is now less since there is a competitor(him) who is using the same resources which we were paying money for(now have to pay more money for due to him)

Thank you for your follow-up.

This is not a 'clear scam', at least not exactly. The reason most NDAs are signed is because an NDA puts forward all conditions (and not just general limits) on what is covered and what is not covered under the NDA language. It also may place limits or at least estimates on what the damages may be under which you could file suit for. When there is a promise to not disclose what is 'shown' a person may argue legitimately that he did not know what was protected and what wasn't under this statement, and what exactly was the length of the NDA in terms (for example if it was for just that first conversation or all conversations), or what 'show' may mean. The fact you did not pursue other buyers is ultimately your own concern because there was no duty or obligation for you to choose to pursue this potential buyer. I am not stating that you have no claim, it just harder.

What I do see is still a potential NDA argument but also a potential copyright infringement claim on having the other party use your information without consent. If the information is not protected, this is a weaker claim but it is still a claim based on substantial similarity to your site.

I will say that as the value of your site is very high, retaining an IP attorney here is essential. You need counsel that has experience in business/contract law, intellectual property, and litigation. You can still sue for damages as well as tortious interference of your business interest. But ultimately I see this as very hard-fought fight. Next time please get the NDA in writing, and not just on a verbal assurance (text is considered mostly verbal).

Good luck.

Dimitry K., Esq.
Category: Legal
Satisfied Customers: 41,221
Experience: Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.
Verified
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