Fraudulent Misrepresentation On the Internet is recognized by Illinois

BONHOMME v. St. James, Ill: Appellate Court, 2nd Dist. 2011 - Google Scholar


This is not a commercial case, but the topic is novel and important and could have implications for the commercial world.


The Illinois Appellate Court for the Second District held that the plaintiff, who was duped by a fake persona on the internet, could maintain a cause of action for fraudulent misrepresentation.


Plaintiff alleged that the defendant developed a fake persona to lure the plaintiff to make expensive gifts. Eventually, plaintiff gave the defendant and her friends about $10,000 in gifts and other items. Plaintiff and Defendant began on-line conversations in a chat room for the HBO show Deadwood. The court summarizes the "relationship" as follows: "In June, defendant registered again, posing as a man named Jesse James and under the user name of "Auboy." "Jesse" began chatting with and e-mailing plaintiff in July 2005. Defendant, in her own name, also began e-mailing plaintiff in July. ... Plaintiff and "Jesse" began an on-line romantic relationship that lasted until July 2006."


The Court explained why it believed it was appropriate to expand the law of fraudulent misrepresentation:


It is clear, then, that while the "typical case" of fraudulent misrepresentation arises in a commercial context, our supreme court has acknowledged that this tort may, in the appropriate circumstances, be expanded to cover areas outside of the commercial context. We conclude that this is an appropriate circumstance in which to expand the application of fraudulent misrepresentation. We first note that this case is "one in which the plaintiff has parted with money, or property of value, in reliance upon the defendant's representation" (W. Page Keeton et al., Prosser & Keeton on Torts §105, at 726-27 (5th ed. 1984)), so it is not, all at once, an expansion of the tort into "purely personal settings." See Doe, 228 Ill. 2d at 348. Plaintiff clearly pleaded that she spent over $10,000 on gifts, some of which were for defendant, but some of which were for "Jesse" and other characters invented by defendant, and $700 for preparations for a move to live with "Jesse." Clearly, these are economic losses alleged to have resulted from defendant's misrepresentations. Plaintiff has also alleged other damages, including bills for therapy and medical expenses "to recover from Defendant's false representation regarding the fictitious characters and their activities." However, as this case involves a motion to dismiss during the pretrial stage, we need not address whether such damages could be recovered here.


Looking again to the elements of this cause of action ((1) a false statement of material fact; (2) knowledge or belief of the falsity by the party making it; (3) intention to induce the plaintiff to act; (4) action by the plaintiff in justifiable reliance on the truth of the statement; and (5) damage to the plaintiff resulting from that reliance), we conclude that plaintiff has alleged sufficient specific facts to establish a cause of action for fraudulent misrepresentation. Plaintiff alleged that defendant posed as at least 20 fictional characters between June 2005 and April 2007, the most important of which was "Jesse," with whom plaintiff started "chatting" in the Deadwood chatroom in July 2005. Defendant also communicated with plaintiff in her own name and represented to plaintiff that "Jesse" and the other characters were real persons she knew. Thus began an almost-two-year masquerade of false statements from defendant to plaintiff, statements that defendant obviously knew were untrue. The complaint is filled with specific dates of, and quotes from, e-mails from defendant, "Jesse," and other characters.


Comment: I agree with the Court's decision. The plaintiff was duped by the defendant (who created phony online profiles) to part with her hard earned money. The creation of each of the phony online personalities involved making false statements to Plaintiff. The false statements were designed to convince plaintiff that internet persona "A" was really somebody else.


UPDATE:


Since my original post, the Illinois Supreme Court accepted this case, heard argument, and reversed. The Court held that the trial court properly dismissed the fraudulent misrepresentation claim because the dispute arose out of a personal relationship.  


The citation to the case is 2012 IL 112393.


The court, in an opinion by Justice Thomas, held: 


"In light of Doe [v. Dilling 228 Ill. 2d 324, 343-43 (2008)], the crucial question in this case is whether the facts at issue are purely personal in nature, or whether there exists some commercial, transactional, or regulatory component that moves them beyond the purely personal.  This is not a difficult question to answer.  When all is said and done, what lies beneath this case is two private persons engaged in a long-distance personal relationship...Indeed, all of the hallmarks of ordinary human relationship are present: correspondence, conversation, intimacy, trust, mutual beneficence, emotional support, affection, disappointment and even grief.  And just as importantly, there is absolutely nothing of the commercial, transactional, or regulatory at work...Consequently, as regrettable as the alleged facts are, we hold that they are not the types of facts upon which a claim for fraudulent misrepresentation may be pled."


Edward X. Clinton, Jr.

www.clintonlaw.net