Welcome back to our litigation series on California cannabis claims. Fraud is one of those claims that clients believe will be easy to pursue, but it actually requires a lot of factual development and proof, even just to assert it in a complaint. Below is a primer.
A fraud claim requires six elements: (1) a misrepresentation, (2) knowledge of that representation’s falsity, (3) an intent to induce reliance, (4) reliance, (5) causation, and (6) resulting damages. Even in a complaint, fraud must be pleaded specifically – a plaintiff must plead facts that show the how, when, where, to whom, and by what means the misrepresentations were made. This level of detail is not typically required of a plaintiff’s first filing, which is why we commonly see fraud claims challenged early via a demurrer, which is a defendant’s first chance to challenge a plaintiff’s claim as legally insufficient on its face.
Statute of Limitations
The statute of limitations for fraud is three years. The clock starts ticking when a plaintiff discovers the facts constituting the misrepresentation. So if you wait three years and a day after discovery of facts leading to a fraud claim, your claim will likely be