Write and post a response to the following scenario: 265 words

Thomas and Jon founded Inventions, Inc., to market household consumer products. The success of their first product, the Clean Mop, continued with later products, which were sold through infomercials. Thomas and John were the firms officers and equal shareholders, with Thomas responsible for product development and Jon in charge of day-to-day activities. By 1998, they had become dissatisfied with each others efforts. Jon represented the firm as financially dying, in a grim state...worse than ever, and offered to buy all of Thomass shares for $1.6 million. Thomas accepted. On the day that they signed the agreement to transfer the shares, Inventions began marketing a new productthe Bright Light. It was an instant success, generating millions of dollars in revenues. In negotiating with Thomas, Jon had intentionally kept the Bright Light a secret. Thomas sued Inventions, asserting fraud and other claims.

1. Under what principle might Inventions be liable for Jons fraud?

2. Is Inventions liable in this case? Explain.