Smith v. Bolles, 132 U.S. 125 (1889), was an action to recover out-of-pocket damages for alleged fraudulent representations in the sale of shares of mining stock.

The case is important in contract law, specifically legal remedies and compensating expectancies.

Chief Justice Fuller disagreed, saying the measure of damages is not the difference between the contract price and the fair market value if the property had been properly represented.

The trial court should not have looked to what the plaintiff might have gained if the representations had been true, but rather what he had lost by being deceived into the purchase.

Defendant is "bound to make good the loss sustained, such as the moneys the plaintiff had paid out and interest, and any other outlay legitimately attributable to defendant's fraudulent conduct; but this liability did not include the expected fruits of an unrealized speculation.