A corporate purchaser of titanium and ferro metals sued a corporate officer personally for fraudulent misrepresentation after paying for multiple shipments that were never delivered.
The court found that by sending bills of lading, booking notices, packing lists, and related documents, the defendant represented that product had departed the factory or was ready for immediate shipment upon payment, and that those representations were false for the relevant shipments.
The court held that the defendant acted recklessly, not merely carelessly, because he was copied on extensive communications showing chronic shipping failures and nevertheless continued demanding payment while closing his eyes to obvious problems.
Reliance was established only for the later shipments after the purchaser's understanding of the shipping documents was clarified.
Liability was found, but damages, interest, and costs were left for further submissions.
