Legal Definitions - intrinsic fraud

Intrinsic fraud refers to deceptive actions that occur during a legal proceeding, where the affected party had a fair opportunity to detect and challenge the deception within that same legal process. The key characteristic is that the fraud takes place within the "four walls" of the courtroom or the litigation process itself, and the opposing party had the chance to expose or counter it at the time.

Because the opportunity to address the fraud existed during the original case, intrinsic fraud generally cannot be used later to overturn or reopen a final judgment. The legal system expects parties to use the tools available during the trial (like cross-examination, discovery, or presenting counter-evidence) to uncover and address such deceptions.

Here are some examples to illustrate intrinsic fraud:

• Fabricated Evidence Presented in Court: Imagine a company suing a former employee for theft of trade secrets. During the trial, the company presents a document, claiming it's an email from the employee confessing to the theft. The employee's legal team believes the email is fake but, despite having the opportunity to request forensic analysis, challenge its authenticity through cross-examination, or present their own evidence to contradict it, they fail to do so effectively. If a judgment is entered against the employee, they generally cannot later claim "intrinsic fraud" based on the fake email to overturn the judgment. The fraud occurred within the trial, and the employee had the chance to expose it then.

• Misleading Testimony About Asset Value: Consider a divorce case where one spouse testifies under oath about the value of a jointly owned business, significantly understating its worth to reduce the financial settlement for the other spouse. The other spouse's attorney has access to financial documents during the discovery phase, can cross-examine the testifying spouse, and can present their own expert valuation. If, despite these opportunities, the court accepts the lower valuation and a judgment is finalized, the aggrieved spouse generally cannot later claim intrinsic fraud to reopen the property division, even if they subsequently find more definitive proof of the initial undervaluation. The misleading testimony was part of the trial, and the opportunity to challenge it was present.

• Concealed Information During Discovery: In a product liability lawsuit, a manufacturer provides responses to discovery requests (questions and document demands from the opposing side) that subtly omit crucial information about known defects, without outright lying. The plaintiff's legal team has the opportunity to review these responses, follow up with additional questions, depose company representatives, and seek court orders to compel more complete disclosure. If the plaintiff's team does not effectively uncover the concealed information during the discovery phase and a judgment is rendered, they typically cannot later claim intrinsic fraud to overturn the verdict. The concealment occurred within the litigation process, and the plaintiff had mechanisms to uncover it.