July 31, 2013 Articles

Third-Party Reliance in New York: Navigating Conflicting Case Law

Lawyers have to pay special attention to their duty to cite contrary, controlling authority in this especially unsettled area.

By Michael Murtagh

Over the past 150 years, New York state and federal courts, from the New York Court of Appeals to the Second Circuit, have issued many contradictory decisions on the issue of third-party reliance under New York’s common law of fraud. Reliance is an element of fraud claims. The third-party reliance doctrine is implicated when a plaintiff sues for fraud based on statements made by the defendant to a third party that relied on those statements.

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