Commercial & Economic Torts
Business Torts in California.
Fraud, breach of fiduciary duty, tortious interference, trade-secret theft, and Unfair Competition Law claims under California state and federal law.
California Business Torts & Commercial Fraud
What This Means For You — Plain-Language Overview
When a competitor lies to your customers, a former executive walks out the door with your client list, a counterparty signs a contract it never intended to perform, or a partner siphons money from a joint venture, California gives you more than a contract claim. The state's "business tort" toolkit — common-law fraud, tortious interference, trade-secret misappropriation, breach of fiduciary duty, conversion, and the Unfair Competition Law — can transform a routine breach into a case for compensatory damages, punitive damages, restitution, injunctive relief, and attorney's fees.
But each of these claims comes with traps. Promissory-fraud claims require proof that the promisor never intended to perform when the contract was signed — a high bar. Interference claims demand an "independently wrongful act" when a competitor (rather than a contract counterparty) is the target. Trade-secret claims are broadly preempted by the California Uniform Trade Secrets Act, meaning related conversion or unfair-competition theories may be wiped out. UCL claims look powerful but cap recovery at restitution and injunction — no damages, no jury. And the economic-loss rule can collapse a fraud claim into a contract claim unless you fit within the narrow Robinson Helicopter carve-out.
This memo walks through each cause of action — the elements, the controlling cases, the pleading hazards, and the remedies. The goal is to help you (a) recognize when you have a real claim worth filing, (b) understand the proof you will need to develop in discovery, and (c) avoid the procedural and substantive landmines that defeat business-tort cases at demurrer or summary judgment. We close with a practice-pointer checklist, an authorities table, and the standard disclaimer.
Recent Developments
Our annual reviews track the most significant legislative, regulatory, and judicial developments in California business torts law.
Related Insights & Key Terms
The following doctrines analyzed in this memo are covered in depth in our Insights library.
Legal Analysis Library
In-depth analysis of CUTSA, trade secret misappropriation, fiduciary duty, and commercial tort litigation in California.
Common-Law Fraud and Misrepresentation
I. Common-Law Fraud and Misrepresentation A.
Read Analysis PDFTortious Interference
II. Tortious Interference A. Intentional Interference with Contract Intentional interference with contractual relations targets a defendant who k...
Read Analysis PDFTrade Secret Misappropriation
III. Trade Secret Misappropriation A. The California Uniform Trade Secrets Act (CUTSA) CUTSA, codified at Civil Code section 3426 et seq., is Cal...
Read Analysis PDFThe Unfair Competition Law (Bus. & Prof. Code § 17200)
IV. The Unfair Competition Law (Bus. & Prof.
Read Analysis PDFFiduciary Duty and Conversion
V. Fiduciary Duty and Conversion A. Breach of Fiduciary Duty A claim for breach of fiduciary duty requires (1) the existence of a fiduciary relat...
Read Analysis PDFThe Economic-Loss Rule and Robinson Helicopter Carve-Out
VI. The Economic-Loss Rule and Robinson Helicopter Carve-Out A.
Read Analysis PDFPractice Pointers
VII. Practice Pointers Plead fraud with particularity.
Read Analysis PDFAuthorities Table
VIII. Authorities Table Authority Citation Holding / Relevance Deceit statutes Cal.
Read Analysis PDFTheories of Liability & Common Defenses
Theories of Liability & Common Defenses Plaintiff's Theories of Liability Fraud / Intentional Misrepresentation Civ.
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