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David H. Schwartz April 16, 2020

In every business transaction, agreement, or contract, it is essential that all parties involved are acting in good faith. However, if one party provides misleading information or false statements that cause you to enter into a contract, you are within your rights to sue for fraudulent misrepresentation. Attorney David Schwartz can provide suitable answers to all your questions about fraudulent misrepresentation with regard to business torts.

The Law Offices of David H. Schwartz is proud to serve clients in San Francisco, Santa Clara, Oakland, Alameda County, San Jose, and the greater San Francisco Bay Area of California.

What is Fraudulent Misrepresentation?

A business contract is only considered valid when all parties to the contract are in agreement with the contract terms. In a situation that the expressed terms are inaccurate, then all agreements will be solely based on false statements, thus making the contract invalid.

Fraudulent misrepresentation is a false statement of fact that induces or causes someone to enter into a contract or an agreement with another party. Making false statements intentionally, whether verbally, in writing, silence when you should speak, or through a simple gesture, can constitute false misrepresentation if it causes harm or material effect on the business transaction or deal.

For instance, let's say a pharmaceutical company is trying to acquire another drug company that boasts of having several "promising" drugs in clinical trials. However, the drug company fails to mention the disappointing results obtained so far. This could cause the acquiring company to assume that these drugs would add more value to the deal, when in reality they will be suffering damages by overpaying.

As another example, let's pretend a jewelry company sells you a "diamond" ring which you later discover to be made of cubic zirconia. This is considered false representation. The same would be true of a car dealer who presents false information to convince a consumer to purchase a vehicle. In both examples, the party making the misrepresentation is trying to deceive the consumer in an effort to persuade them to move ahead with the deal.

Fraudulent Misrepresentation With Contract Law in California

Under California law, you can file a claim against the party who presented misleading information that led you to enter into a contract. However, to prevail in a fraudulent misrepresentation lawsuit, the plaintiff must prove that:

  • A representation was made.

  • The particular representation was false.

  • The defendant had knowledge that, as of the time of making the representation, it was false or made carelessly.

  • The representation was made with the intention that the plaintiff would count on it to enter into the agreement or contract.

  • The plaintiff did, in fact, count on the misleading information, and wouldn't have entered into the contract if not for the misrepresentation.

  • The plaintiff suffered damages or measurable harm due to the misleading information or false statement.

It may not be easy to obtain evidence to prove all of the elements above. That is why it's vital that you consult with an experienced business litigation attorney. Doing so can drastically improve your chances of rescinding the contract and getting fair compensation to cover your damages.

How Can an Attorney Help With Your Fraudulent Misrepresentation Lawsuit?

Entering into a business contract with another person or company based on misleading information can cause you to suffer significant measurable harm. If you believe you have been the victim of fraudulent representation, you are within your rights to take legal action against the responsible party and pursue compensation. Should you choose to do so, you should seek the help of a seasoned commercial litigation attorney straightaway.

Attorney David H. Schwartz is an experienced corporate litigation attorney who has been representing clients in matters of commercial litigation, negotiation, and arbitration for more than 45 years. Mr. Schwartz knows how to aggressively protect your legal rights, establish claims, and recover compensatory damages for your losses.

Since fraudulent representation renders a contract voidable, Mr. Schwartz can help with the rescission of the contract. If, on the other hand, you are the accused party of fraudulent misrepresentation, Mr. Schwartz can defend your rights, evaluate all of the relevant evidence, and fight to have the lawsuit dropped. With David Schwartz on your team, you can have peace of mind knowing you have decades of legal experience working in your favor.

Experienced Business Litigation Attorney in San Francisco, California

If an individual has persuaded you to enter into a contract using misleading information, or if you are under investigation for fraudulent misrepresentation, you don't have to face these challenges alone. Call the Law Offices of David H. Schwartz today to schedule a free consultation. Mr. Schwartz will review every aspect of your case, fight aggressively to protect your rights, and use over 45 years of knowledge and experience to help you pursue a favorable outcome.

Based in San Francisco, Mr. Schwartz proudly serves clients in San Jose, Alameda County, San Mateo, Oakland, Santa Clara, and the surrounding communities of the San Francisco Bay Area. Reach out to his office today to get the help you need.