Businesses and their officers and directors are subject to an array of business torts that relate to their actions and omissions in operating the business.
Tortious Interference with Contract
In order to prove a fraud claim, the plaintiff must satisfy a higher evidentiary burden and establish: (1) the defendant made a false statement of material fact; (2) the defendant had knowledge of its falsity; (3) the defendant made the statement for the purpose of inducing the plaintiff to act; (4) the plaintiff reasonably relied upon the truth of the false statement; and (5) the plaintiff incurred damages.
Fraud is a common business tort that arises in various contexts. For example, after a purchaser of a business settles in and takes a closer look at the books and records of their new company, they may discover that the seller failed to disclose all of the accounts payable, debts of the business, or misrepresented its prior income. Such an omission could arise to fraud because it was a material misrepresentation or omission that the purchaser relied upon.
Breaches of Fiduciary Duty