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29. Does the distributor have a viable fraud claim against the manufacturer?

Two years into the contract, the manufacturer announced that it no longer intended to sell products in State A and canceled its contract with the distributor. The manufacturer did not thereafter supply products for distribution or sale in State A.

At the time the manufacturer entered into the contract, it had already firmly decided to withdraw from the State A market in two years. Because the distributor had heard rumors of such a plan, its chief executive officer, before signing the contract, asked a representative of the manufacturer whether such a plan was in place. The representative denied the existence of any such plan.

A manufacturer entered into a five-year contract with a distributor to supply the distributor with products to be distributed in State A. The manufacturer reserved the right to enter into additional such contracts with other State A distributors. The manufacturer knew that the distributor would, on the basis of the agreement, invest in an expansion of its distribution centers in State A in order to handle the distribution of the manufacturer's products to retail sellers in that state.