Brian Williams, Measles, and Fraudulent Misrepresentation. Bumbling Brian Williams tried to explain why he said he took fire in Iraq.   Many people are scared to get measles shots and other immunizations because some guy falsified his research linking immunizations to autism.  So what does this all mean to our businesses?  You guessed it: fraudulent misrepresentation (and damage from it) is terribly hard to prove.

Although the elements vary a bit from state to state, misrepresentation comes in a couple general flavors:

Negligent Misrepresentation:  X supplied information to Y; the information was false; X did not exercise reasonable care in obtaining or communicating the information; and Y justifiably relied on the information.

Fraudulent Misrepresentation: X intentionally misrepresents material information to Y; X knew its was false or made it "recklessly" without regard to its truth or falsity; Y reasonably relied on the misrepresentation; Y suffered damage; and X's misrepresentation related to an existing or past fact.

The harmed person can bring a cause of action to recover damages or, in the case of fraud, rescission and heightened damages.

So let's give it a try.  First up, Brian Williams.

He goes to Iraq and reports that his helicopter was shot down, but it turns out his story simply wasn't true.  Let's try for intentional misrepresentation.  It seems likely that he intentionally misrepresented the story to people.  It seems likely that he knew it was false (he was there).  Did anyone rely on it?  Well in the sense that people trusted him, yes, but did anyone make a commercial transaction based on his statement?  Probably not.  Did anyone suffer monetary damage (other than maybe NBC) – not that I'm aware of.    So even though Brian Williams may have intentionally misrepresented his valor, it really doesn't give rise to a Fraudulent Misrepresentation claim.

Next up, back in 1998 Andrew Wakefield published an infamous study falsely linking childhood immunizations to autism. It turns out he simply made up most of the data.  The study has since been retracted, and he was even stripped of his medical license.  Despite the retraction and work to counteract Wakefield's fraud, people around the world latched on to the idea that immunizations are somehow associated with autism.  The NY Times had a particularly well-written op-ed a few days ago discussing some rather famous politicians that fell for the scam.   According to the CDC, in 2012 measles was eliminated from the U.S. (based on no cases for a year).  Fast forward to 2015, and there have been 121 cases reported this year already.  Let's try for intentional misrepresentation on this one.  Seems pretty clear that Wakefield intentionally misrepresented his research – and he knew it.  Thousands of people have relied on his research (or at least used it as an excuse) not to vaccinate.  Was their reliance reasonable?  Maybe?  These parents have certainly suffered damages.   Can we get Wakefield for intentional misrepresentation?  Probably not – first, his study was a long time ago.  Second, it is really hard to show that he caused these outbreaks, right?  I'll bet very few parents have even read his study- I haven't. For the record my kids are vaccinated.  We even signed them up for some extra, non-required ones.  My personal favorite New Yorker Cartoon on the subject:

So what is the takeaway?  Well, even though my examples are a bit far fetched, you can quickly see how difficult it is to prove negligent or intentional misrepresentation – and we didn't even talk about proving damages from it!

So, as a precaution be sure to carefully document your transactions.  It never hurts to have as much in writing as possible. Certainly have your agreement in writing, but also document in the agreement what the critical facts are.  If you are buying a product only because of X, Y and Z, be sure to say that in your agreement.  Keep in mind that negotiation correspondence is typically swept aside when an agreement is signed (except fraud, which is hard to prove).  So, if something is truly important to you, be sure you point it out in your agreement.  This helps because it makes it easier to prove a fact was fundamental to the deal (in a way that cannot be easily disputed).  If the fact turns out not to be true, then you are already halfway through the misrepresentation analysis.

Also, please vaccinate.

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