FEDERALSupreme Court of the United States
1998

Textron Lycoming Reciprocating Engine Division v. United Automobile, Aerospace & Agricultural Implement Workers

140 L. Ed. 2d 863Supreme Court of the United States • Decided 1998Voided
FLAGSHIPFlow-DownCited 156 times

HOLDING

A union claimed Textron fraudulently hid plans to subcontract work when negotiating a labor agreement, and sued to void the contract. The Supreme Court ruled federal courts cannot hear fraud claims that try to void a contract unless there's an actual breach of the contract itself. For subcontractors, this means you can't use fraud as a reason to escape a signed agreement—courts will dismiss the case before trial.

KEY FINDINGS

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Fraud claims alone won't void a contract in federal court. You must prove the other party actually broke the contract terms.

FULL COURT OPINION