Claims for fraud in the inducement
also arise frequently in earnout litigation, typically when the sellers allege that the buyers of the business or asset misrepresented their abilities or intentions to generate revenue sufficient to meet the earn-out target.
The trial court held that in the absence of fraud, the arbitration and venue clauses were enforceable, but the allegations of fraud in the inducement
of the agreement were to be resolved by a hearing prior to either party compelling arbitration.
117) Although the Huron Tool court recognized that fraud in the inducement
presented a special situation, because misrepresentations undermine the ability to negotiate freely,(118) the court added an additional caveat: The fraud claim must be factually distinguishable.
Capital Video, the landlord sought to rescind a new commercial lease on the grounds of fraud in the inducement
by the tenant.
Courts have been less than consistent, however, in their approach to whether commercial tort claims, such as fraud in the inducement
, misrepresentation, conspiracy, etc.
They are: (1) Breach of Contract (2) Specific Performance (3) Fraud in the Inducement
(4) Negligent Misrepresentation (5) Breach of Fiduciary Duty and (6) Breach of Warranty of Implied Authority.
3) In HTP the court held that a "cause of action for fraud in the inducement
of contract is an independent tort and is not barred by the economic loss rule.
as well as key executives alleging they have violated federal racketeering statutes (RICO Act), conspired to violate federal racketeer statutes (RICO Act), fraud in the inducement
, breach of contract, promissory fraud, negligent misrepresentation, breach of covenant of good faith and fair dealing, and failure to pay wages due.
Fraud in the inducement
presents a special situation where parties to a contract appear to negotiate freely which normally would constitute grounds for invoking the economic loss doctrine but where in fact the ability of one party to negotiate fair terms and make an informed decision is undermined by the other party's fraudulent behavior.
The lawsuit was filed, in order to protect the shareholders, for damages resulting from alleged stock manipulation, federal securities fraud, violations of the Colorado Securities Act, common law fraud, fraud in the inducement
, conspiracy, and similar causes of action.
International CableTel sought damages of at least $84 million for breach of contract, fraud in the inducement
and unjust enrichment.
and seeks damages of at least $84 million for fraud in the inducement
, breach of contract and unjust enrichment.