Promissory fraud is not actionable unless it is part of a scheme to defraud, that is, unless it is one element of a pattern of fraudulent acts.
A sports agency filed claims for tortious interference with a business relationship and violation of the Illinois Consumer Fraud and Deceptive Practices Act (Act) against a competing sports agency. The competing sports agency made a promise of endorsements to the sport agency's client, which it claims was fraudulent and had induced him to terminate his contract with them. The district court issued a summary judgment in favor of the competing sports agency. The case was appealed to the United States Court of Appeals.
Were the claims for tortious interference valid?
The court affirmed the judgment, finding competing sports agency's conduct in luring away a client from plaintiff was protected by the competitor's privilege. The court found that plaintiff's client had a contract with it that was terminable at will, and the conduct of defendant in inducing a breach of that contract was not actionable. The court held that to sustain a cause of action based on false and fraudulent promises by defendant, plaintiff had to establish that such promises were part of a scheme to defraud being perpetrated by defendant. Plaintiff was unable to prove this. The court concluded that for plaintiff to bring suit under the Act as a representative of the consumer interest, it had to prove, by clear and convincing evidence, how the complained-of conduct implicated consumer protection concerns, which it could not.