Is the Fraud Claim Against Your Business Actually a Simple Breach of Contract Claim?

on February 5, 2014 by James Hunt

Jim hunt picIn our overly litigious world, many business lawsuits that claim fraud are actually simple breach of contract actions. The allegation of fraud is used as a tool for gaining leverage in the case. Thus, it is vital that your business attorney work to obtain a dismissal of meritless fraud claims as quickly as possible.

If your company has been sued for fraud, it is likely you have numerous defenses available. A few examples include:

Plaintiff’s inability to prove material misrepresentation of presently existing or past fact. While there are several factors that must be established for a legitimate fraud claim, many allegations of fraud fail the requirement of a material misrepresentation of presently existing or past fact. For example, if a sale representative promises to ship a product quickly at some point in the future and fails to do so, this is not a statement about a presently existing or past fact. Statements that are promissory in nature are typically a basis for a simple breach of contract claim, not a fraud allegation.

Puffery and opinions. Statements of puffery or mere opinion do not form the basis for a claim of fraud. The reason is that opinions are not statement of fact at all, and therefore do not constitute actual misrepresentation.

Conclusory statements. Fraud allegations have a “heightened” pleading requirement and must be pled with particularity. Thus, a plaintiff’s complaint that sets forth mere conclusions or recitations of the statutory requirements without facts to support the allegations is insufficient for a fraud claim.

At Slater, Tenaglia, Fritz & Hunt, PA, our business attorneys are skilled in narrowing the focus of lawsuits to the true issues at stake.

The attorneys at Slater, Tenaglia, Fritz & Hunt, P.A., provide clients with experienced legal representation.  We handle many types of business disputes on behalf of corporate clients, including Fortune 500 Corporations and individuals throughout New York, New Jersey, Pennsylvania and nationally. Our attorneys handle cases from pre-litigation negotiations through litigation to obtaining and enforcing judgments.  If you need assistance, or are interested in learning more, please contact us by phone at (201) 820-6001 in New Jersey or (212) 692-0200 in New York. We can also be found on Facebook, Linkedin, Twitter, Google+, Youtube and the Internet. All initial consultations are free of charge.