fraud
Definitions from Case Law · United States Supreme Court
Definitions from Case Law
From 375 U.S. 180 - Securities & Exchange Commission v. Capital Gains Research Bureau, Inc. · 1963Most cited · 1,802 citing opinions
equity, Investment Advisers Act
Fraud has a broader meaning in equity (than at law) and intention to defraud or to misrepresent is not a necessary element. Fraud, indeed, in the sense of a court of equity properly includes all acts, omissions and concealments which involve a breach of legal or equitable duty, trust, or confidence, justly reposed, and are injurious to another, or by which an undue and unconscientious advantage is taken of another.
How the Supreme Court has restated “fraud”
Each Supreme Court definition of “fraud,” sized by how often later courts cited it. “Change” is measured by wording overlap with earlier definitions — a rough signal, not a semantic judgment.
How often courts cite the cases defining “fraud”
Court decisions citing the 7 opinions that defined “fraud” — 3,005 in all, by decade. Counts are citations to the defining cases as a whole, not verified uses of the term. The dip in the most recent years is a data-coverage gap, not a real trend — our corpus holds fewer opinions from the latest years.
All 7 definitions, chronological · 1809–1963
- ORIGINAL
Fraud consists in intention, and that intention is a fact which ought to have been averred, for it is the gist of the plea, and would have been traversable.
must be pleaded with intent
It is true that the defendant acted fraudulently and knew what he was about. But a man, by committing a fraud, does not become an outlaw and caput lupinum. He may have no standing to rescind his transaction, but when it is rescinded by one who has the right to do so, the courts will endeavor to do substantial justice, so far as is consistent with adherence to law.
party not an outlaw
It was there held that the title of a person who negotiates commercial paper is defective when he has obtained any signature thereto by fraud, and that if the party so defrauded be relieved from liability thereon, then such fraud makes such paper voidable by all the other persons who signed it, though they did not participate in and were ignorant of such fraudulent conduct at the time they signed it. This conclusion was reached upon the ground that, when several persons assume such an obligation, it is material and important that all who join as makers should share equally in bearing the burden of its payment, and if, through the fraud of the person holding it, such equality of burden is disturbed and the burden increased as to some of the persons signing it, such fraud renders the title defective as to all of the persons who signed it.
effect on multiple comakers
The necessary elements of the defense of fraud, established by our decisions to be: (1) a false representation (2) in reference to a material fact (3) made with knowledge of its falsity (4) and with the intent to deceive (5) with action taken in reliance upon the representation.
Fraud connotes perjury, falsification, concealment, misrepresentation.
Questions of fraud may be determined in the light of the effect advertisements would most probably produce on ordinary minds.
misleading advertising