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LEGAL LIMITS TO COMMUNICATION. COMMON LAW FRAUD  Cunning  Deception  Artifice  Cheat  Circumvent  Breach of Trust  Breach of Confidence  Undue.

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Presentation on theme: "LEGAL LIMITS TO COMMUNICATION. COMMON LAW FRAUD  Cunning  Deception  Artifice  Cheat  Circumvent  Breach of Trust  Breach of Confidence  Undue."— Presentation transcript:


2 COMMON LAW FRAUD  Cunning  Deception  Artifice  Cheat  Circumvent  Breach of Trust  Breach of Confidence  Undue Advantage  False Material Representation  Known to be False or Asserted Without Knowledge of the Truth  Intended to be Acted Upon  Relied Upon  Caused Injury

3 STATUTORY FRAUD  Similar to common law fraud  False representation of a past or existing material fact  Made to induce person to enter into a contract  Relied upon by person in entering into contract; or  Material false promise to do an act  Made with intention of not fulfilling it  Made to induce person to enter into a contract  Relied upon person in entering into contract

4 ACTUAL DAMAGES If court/jury finds that person acted with “actual awareness” of falsity (inferred where objective manifestations indicate that the person acted with actual awareness), it may award exemplary damages.

5 NEGLIGENT MISREPRESENTATION  Representation made by party in a transaction in which he/she has a pecuniary interest  Party provides “false information” for the guidance of others in their business  Party did not exercise reasonable care or competence in obtaining or communicating the information  Recipient suffered a pecuniary loss by justifiably relying on such information

6 TEXAS DECEPTIVE TRADE PRACTICES ACT  Purpose: to protect consumers against false, misleading and deceptive business practices, unconscionable acts, and breaches of warranty ~ Very few defenses ~ Applies to the sale and lease of personal and real property ~ Victim does not have to rely on representation

7 LAUNDRY LIST ITEMS (SUMMARY)  Passing off goods or services as those of another  Causing confusion or misunderstanding  Misrepresenting attributes of goods or services  Misrepresenting agreements and legal rights  Misrepresenting authority But Mere puffing is not actionable  Personal belief  Information generally known to listener  Listener would not expect speaker to have superior knowledge

8 NONDISCLOSURE  Failure to disclose information concerning goods or services which was known at time of transaction if such failure to disclose was intended to induce consumer into transaction which consumer would not have entered had the information been disclosed

9 REMEDIES  Actual damages  Lost profits  Loss of use  Expenses  Three times actual damages  Attorney fees  Injunctions

10 DEFAMATION  Injury to reputation  Whether a person of ordinary intelligence would perceive entire statement to affect reputation, in light of surrounding circumstances  Question of law for court unless statement is of ambiguous or doubtful meaning  Ambiguous language may be defamatory  Not all falsehoods are defamatory

11 ELEMENTS OF DEFAMATION  False and defamatory statement  Published to third party  Publication results from intentional or negligent conduct

12 LIBEL/SLANDER/BUSINESS DISPARAGEMENT  Libel – Written  Slander – Oral  Business Disparagement - Defames business reputation. Must have element of malice

13 PER SE DEFAMATION  Attribution of criminal activity  Attribution of moral turpitude or dishonesty  Attribution of business dishonesty  Attribution of loathsome disease  Attribution of racism  Attribution of bankruptcy or financial impropriety

14 APPLICATION OF PER SE DOCTRINE  Slander – rigorously applied  Libel – not as important because libel is controlled by statute  Business Disparagement – no per se violation

15 COMMUNICATION AND LITIGATION What is discoverable?  Generally, any unprivileged information that is relevant to subject matter of lawsuit  Includes witness or party statements whether or not prepared in anticipation of litigation  Includes electronic communications

16  More fact than opinion  Watch out for admissions  Carefully word critical self analysis  Limit circulation  Limit drafts MEMORANDUM AND REPORT WRITING *Remember: Anything you write may be discoverable

17  Exempts certain communications from disclosure in lawsuit  Allows for freer communication between clients and attorneys  Attorney/client privilege and work product of a party are interwoven PRIVILEGES AND WORK PRODUCT

18 ATTORNEY/CLIENT PRIVILEGE Persons covered:  Attorney  Attorney’s representatives  Client  Client’s representatives, which include:  Persons having the authority to obtain legal services or to act on legal advice on behalf of client  Any other person who, for purposes of effectuating legal representation for client, makes or receives a confidential communication while acting in the scope of employment for the client

19 COMMUNICATIONS PROTECTED  Attorney/Client communication  Confidential communication  For legal assistance Privilege lasts as long as client wants to assert it. It does not end with representation.

20 PARTY WORK PRODUCT  Used to be “attorney” work product  Expanded to include certain work product of parties  Work product of a party or its representatives – including the party’s attorneys, consultants, sureties, indemnities, insurers, employees or agents – exempt from discovery  Applies to materials prepared, mental impressions developed, or communications made in anticipation of litigation or for trial  Purpose is to allow the attorney to properly prepare for trial

21 ANTICIPATION OF LITIGATION  After the occurrence or transaction upon which suit is based  Reasonable person would have anticipated the litigation  Party believed in good faith there was a substantial chance litigation would follow Note: The materials must also have been prepared for a party or its attorney in the suit for which the privilege was asserted.

22 CORE WORK PRODUCT  Work product of an attorney or attorney’s representative – not discoverable NON-CORE WORK PRODUCT  Does not reflect attorney’s thought processes. Can be discovered if other side proves “need and hardship” PRIVILEGE DOES NOT EXEMPT  Witness information  Photographs  Witness statements

23 DOCUMENT AND EVIDENCE RETENTION  Retention/destruction policy  Electronic “documents” included  Spoliation

24 RETENTION/DESTRUCTION POLICY:  Written  Coincides with state and federal mandates  Enforced uniformally  Reviewed and updated periodically  Addresses electronic media  Will partially shield company from allegation of destroying relevant evidence

25 WHEN YOU GET NOTICE OF A CLAIM:  Stop rotation of backup media  Preserve all existing backup  Stop decompression, defragmention, etc.  Make sector by sector copies of relevant hard drives  Download all electronic logs, usage, records, audit trails, activity logs to storage device  Preserve hardware that might contain data  Locate all computers that may have relevant data

26 SPOLIATION  Not what happens to your food  When a party has possession of a piece of evidence at a time he knows or should have known it will be evidence in a controversy, and he thereafter disposes of it, makes it unavailable, or fails to produce it, he is guilty of spoliation  Courts will take measures to make sure a litigant’s rights are not impaired by the spoliation

27  May give jury charge that explains what spoliation is and that there is a a presumption that the evidence, had it been produced would have been unfavorable to the party who did not produce  Court may also tell the jury that if they find that the party had possession of evidence at the time of the occurrence that it knew or should have known it would be evidence, then the jury may presume it would have been unfavorable to the party who did not produce it  Court can also enter “death penalty sanctions,” deny admission of evidence and other penalties

28 WHAT TO DO When something happens that leads you to believe that a claim may arise, do not destroy the evidence, regardless of your document retention policy

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