Fraudulent misrepresentation is a common cause of business tort cases. While not necessarily the top cause, it remains a serious civil wrong that can devastate commercial victims in Florida’s vibrant business environment.
This deceptive practice involves knowingly making false statements with the intent to deceive another party, resulting in financial loss or damage. Businesses must be vigilant and well-informed to protect themselves from such malicious acts.
Examples of fraudulent misrepresentation
Businesses can fall prey to various forms of fraudulent misrepresentation. One common example is false advertising, where a company might make exaggerated claims about the benefits or features of a product to lure other businesses into purchasing or investing.
Another example is fraudulent financial statements, where a business presents false or misleading financial information to secure loans, attract investors or sell their company at an inflated value.
Misrepresentation in contract negotiations is also prevalent, where one party deliberately provides false information about key terms, such as costs, capabilities or timelines, to secure an advantageous deal.
Available remedies for harmed businesses
Commercial operations have a right to be made whole after fraudulent misrepresentation leads to financial loss. Examples of potential remedies to explore include:
- Rescission: Allows the business to cancel a contract based on fraudulent information and be restored to its pre-contract position
- Compensatory damages: Provides recovery of financial losses incurred due to the fraudulent act
- Punitive damages: Punishes the wrongdoer by increasing their financial penalties (in especially egregious cases)
- Injunctive relief: Court issues an order preventing further fraudulent actions by the wrongdoer
When fraud harms your business, especially when it impacts your bottom line, remember your right to seek a solution. Learning more about business torts can help you withstand any legal hardships that may come your way.
