ISG, a minority-owned subcontractor, sued an insurance company for fraud and breach of contract related to a claims processing subcontract. The court ruled that a merger clause in the signed contract blocked ISG's fraud claims based on promises made before the contract was finalized. The court also rejected ISG's claim for lost profits from a future, unsigned contract. This case shows that once you sign a fully integrated contract with a merger clause, you generally cannot sue for fraud based on earlier verbal promises or representations about deals that never got executed.
A merger clause in your signed contract will block fraud claims based on pre-contract promises—get all important promises in writing before you sign