Fraud

San Diego Business Fraud and Misrepresentation Attorneys

California fraud claims arise from misrepresentations, concealments, and broken promises that induce another party to act to their detriment. Fraud cases unlock damages and remedies that ordinary contract claims do not — including punitive damages under Civil Code §3294, rescission, and disgorgement. Khashayar Law Group prosecutes and defends fraud cases throughout California with the same trial-readiness that produced the firm's $61.5 million jury verdict against a multi-billion-dollar insurance company.

California Fraud Categories

Common fraud and misrepresentation theories include:

• Actual fraud (intentional misrepresentation) under California Civil Code §1572 — a knowing false statement of material fact made with intent to induce reliance.
• Constructive fraud under Civil Code §1573 — a breach of duty by a fiduciary that gains an advantage by misleading another.
• Negligent misrepresentation under Civil Code §1709 — an honest but unreasonably made misstatement causing harm.
• Fraudulent concealment — a knowing failure to disclose material facts when there is a duty to disclose.
• Promissory fraud — a promise made without intent to perform.
• Fraudulent inducement of contract — fraud that induces the formation of a contract.
• Securities fraud under California Corporations Code §§25400–25404 and federal securities laws.

Why California Fraud Cases Reward Trial-Ready Counsel

Defendants vigorously contest fraud claims because the consequences are severe — punitive damages, attorneys' fees in some contexts, rescission, and reputational harm. Successful fraud cases require careful documentation of every element: false statement, knowledge of falsity (scienter), intent to induce reliance, justifiable reliance, and resulting damages. The firm prepares fraud cases to meet the heightened pleading standard under California Code of Civil Procedure §425.10 and to survive demurrers and motions for summary judgment.

How Khashayar Law Group Handles These Matters

Khashayar Law Group approaches every matter with the same trial-ready discipline that produced over $165 million in recoveries firm-wide. Daryoosh Khashayar has tried cases before juries, before judges, and before the California Court of Appeal, where he has secured multiple reversals of Superior Court rulings. He has litigated against major insurers including GEICO and Progressive, and against large corporations including Walmart and Costco.

ABOTA Membership and What It Means for Clients

Daryoosh Khashayar is a member of ABOTA — the American Board of Trial Advocates, an invitation-only organization for attorneys with exceptional verified civil jury trial experience and judicial recommendations. The firm has recovered more than $165 million for clients and prepares every matter — transactional or litigated — with the trial-readiness corporate counterparties respect.

Time Limits and Governing California Law

California Code of Civil Procedure §338(d) generally provides a three-year statute of limitations for fraud, running from discovery of the facts constituting the fraud (the "discovery rule"). Constructive fraud claims are also typically governed by §338(d). Negligent misrepresentation may be subject to the shorter two-year tort statute under §339(1) or three-year statute depending on theory. Statutes of repose may apply in securities cases.

Frequently Asked Questions

What's the difference between fraud and breach of contract in California?

A breach-of-contract claim turns on whether a party failed to perform. A fraud claim turns on whether a party made a knowing false statement to induce another into the contract or transaction. Fraud unlocks punitive damages (Civil Code §3294) and rescission remedies that breach-of-contract claims do not.

Can I recover punitive damages for fraud in California?

Often yes. California Civil Code §3294 allows punitive damages in cases involving "oppression, fraud, or malice" proved by clear and convincing evidence. The amount must bear a reasonable relationship to the actual harm and the defendant's wealth.

What is the "discovery rule" in California fraud cases?

Under California Code of Civil Procedure §338(d), the three-year fraud statute of limitations runs from when the plaintiff discovered, or with reasonable diligence should have discovered, the facts constituting the fraud — not necessarily the date of the false statement itself.

Can I rescind a contract based on fraud?

Yes. Civil Code §1689 allows rescission when consent to a contract was obtained by fraud, including fraudulent inducement. Rescission returns the parties to their pre-contract position and is an alternative to damages.

How do California courts evaluate "justifiable reliance"?

Reliance must be both actual and reasonable under the circumstances. Sophisticated parties are held to a higher standard of due diligence, but California courts have repeatedly held that a party cannot be "reasonably" expected to investigate matters specifically misrepresented by the other side.

Talk to a San Diego Business Fraud Attorney

Khashayar Law Group serves clients throughout San Diego and California. Consultations are free and confidential. Call (858) 509-1550 or visit our office at 1350 Columbia St., Suite 303, San Diego, CA 92101.