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Buying & Selling a Business

I just found out the seller lied about the numbers — what can I actually do now?

TSL Written by the Treadstone Law team· Updated August 2026

If the deal has already closed, your main route is generally an indemnity claim under the purchase agreement for breach of the seller's representations about the business's numbers. That claim is subject to whatever survival period, cap on recoverable amounts, and basket (a minimum threshold before a claim can proceed) the parties actually negotiated for that representation — these are deal-specific terms the agreement sets, not something fixed by law. Depending on the facts, a standalone misrepresentation claim outside the contract may also be available, particularly where the false numbers weren't simply an honest mistake.

If you're still before closing when you discover this instead, the analysis changes: you'd be looking at whether an unsatisfied closing condition, or a material-adverse-change clause, lets you delay or walk away, since the indemnity route generally only becomes available once the transaction has actually closed. Either way, timing matters — some survival periods run from closing and may already be underway. Get the purchase agreement in front of a lawyer promptly so the specific representation, its survival period, and your options can be assessed properly.

Key takeaways

  • A post-closing discovery generally supports an indemnity claim, not an automatic unwind of the deal.
  • Survival period, cap, and basket are negotiated terms, not fixed by law.
  • Discovering the problem before closing points toward a condition or MAC clause instead.
  • Act promptly, since a negotiated survival period may already be running.
This is general information, not legal advice. It doesn’t create a lawyer–client relationship, and the rules can change. For advice on your situation, a Treadstone business lawyer can help.
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