Texas Cracks Down on Fraudulent Contracts

What Every Business Owner Must Know

Texas court decision causes upheaval among local entrepreneurs, highlighting legal uncertainties.

A new wave of contract enforcement cases is making headlines across Texas—and if you're a business owner, you need to pay attention. State regulators and courts are cracking down on deceptive contract practices that harm small businesses, from hidden clauses to forged agreements.

In this article, we’ll break down what’s happening, what it means for you, and how to protect your business from costly legal trouble.

1. What’s Behind the Crackdown?

Texas lawmakers and judges are tightening the screws on bad-faith contracts. Recent high-profile lawsuits—especially in Houston and Dallas—have revealed a rise in predatory business agreements, often targeting new or minority-owned companies.

These include:

• Forged or backdated contracts

• Unenforceable fine print

• Lack of mutual consent

2. Common Red Flags to Watch For

Protecting your business by avoiding contracts with:

• No signatures or mismatched dates

• “Evergreen” clauses that auto-renew without consent

• Clauses waiving your right to sue or arbitrate

• No defined terms or responsibilities

3. What the Law Says in 2025

Under Texas Business & Commerce Code and recent court rulings, contracts may be invalid if:

• They were signed under pressure or misinformation

• Material terms were hidden or ambiguous

• One party didn’t have the capacity to enter the agreement

4. What to Do If You Suspect Contract Fraud

✅ Step 1: Gather all related documents and communication

✅ Step 2: Avoid signing any amendments or acknowledgments

✅ Step 3: Schedule a contract review with a business litigation attorney

5. How The Spencer Law Firm Can Help

We specialize in uncovering contract fraud and defending Houston-based entrepreneurs. Our attorneys can analyze your agreements, file for breach of contract, and represent you in court if needed.

Worried about a shady contract? Get a free legal review from our expert business attorneys.📞 Book your consultation today: Spencer-Law.com/company-contracts Protect your business before it’s too late.