Transactions involving the sale of assets, stock, businesses and the like are a fertile ground of potential fraud claims. A typical scenario involves the purchaser being disappointed in the subject of the purchase after the deal and wanting to rescind the sale, or more often, collect monetary damages to compensate for what was allegedly misrepresented by the seller.
In a bit of a twist, one of the most litigated aspects of such fraud claims centers on the actions of the party claiming fraud, rather than the party accused of the fraud. That is, whether the purchaser did enough to protect itself from any alleged misinformation concerning the deal, or whether it acted reasonably in relying upon information provided by the seller or whether such reliance really caused the purchaser to enter the transaction. Closely related to this focus is precisely what the contractual agreement and transactional documents provide about the assets or subject being sold, and the disclaimers of any reliance. Topics in this Blog, such as Justifiable/Reasonable Reliance and Disclaimers collect the many cases and my commentary on this subject.