Breach of Fiduciary Duty: Asserting a Claim

by Practical Law Commercial Litigation

A Practice Note addressing the key considerations for asserting a breach of fiduciary duty claim under state law in commercial litigation. This Note provides an overview of the essential elements a plaintiff must typically establish, exploring the critical distinction between formal and informal fiduciary relationships. It also examines the potential remedies that may be available, including both monetary damages and various forms of equitable relief. This Note also discusses common defenses that an adverse party may raise, such as the business judgment rule and arguments concerning the scope of the relationship. It highlights other potential state law claims that are commonly asserted in conjunction with a breach of fiduciary duty claim, including aiding and abetting. Because the law in this area varies across jurisdictions, counsel should check the applicable law for any variations before asserting a breach of fiduciary duty claim.