Barring fraudulent concealment claims under the so-called economic loss doctrine would create “perverse incentives” for people to draw others into contracts and “have their way with them,” the California Supreme Court was told Tuesday by counsel for an Argentinian attorney suing Uber on allegations it hid crucial information from him.
Cindy Tobisman of Greines Martin Stein & Richland LLP appeared before the state’s highest court as it seeks to answer a certified question from the Ninth Circuit that is central to her client Michael Rattagan’s claims against Uber Technologies Inc.
Rattagan alleges Uber fraudulently concealed information from him when he represented their subsidiaries during a problem-filled launch in Buenos Aires, leading to him being arrested and vilified in the media.
Not allowing fraudulent concealment claims like his to go forward because of the economic loss doctrine — which prevents a party in a contract from recovering for economic losses in tort unless the party can show there was harm beyond a broken contractual promise — would give cover for parties to trick others into a contract or to misbehave during the execution of the contract, Tobisman said.
