The Ethical Dimension

Was Cypress’s conduct unethical? Why or why not?

The Social Dimension

What does the decision in this case suggest to sellers of commercial real estate and others who engage in business negotiations?

Peter Fazio began talks with Cypress/ GR Houston I, LP, to buy retail property whose main tenant was a Garden Ridge store. In performing a background investigation, Fazio and his agents became concerned about Garden Ridge’s financial health. Nevertheless, after being assured that Garden Ridge had a positive financial outlook, Fazio sent Cypress a letter of intent to buy the property for $ 7.67 million “based on the currently reported absolute net income of $ 805,040?” Cypress then agreed to provide all information in its possession.