In a July 26, 2011, decision by Justice Pines, the court granted in part and denied in part defendant-sellers’ motion for summary judgment dismissing plaintiff-buyer’s causes of action alleging breach of contract, piercing the corporate veil, fraud, and punitive damages. The parties entered into a contract for the provision of a variation of pulp for making paper. After delivery of the product, a dispute arose about whether the delivered product constituted the pulp called for in the contract or wastepaper, and plaintiff sued. The court denied defendants’ motion seeking dismissal of plaintiff’s claim for breach of contract, finding that plaintiff raised issues of fact regarding the nature of the product called for in the contract. The court also found that plaintiff raised issues of fact regarding individual liability of the owner of the defendant companies, particularly in light of his failure to comply with corporate formalities and his use of “fictitious employees to execute invoices and engage in correspondence in the course of business.” The court, however, granted defendants’ motion seeking dismissal of the claims for fraud and punitive damages, finding that plaintiff failed to “show how these false statements induced plaintiff to engage in the transaction at issue.”

FSA Fortex, AB v Universal Exports, Inc., Sup Ct, Suffolk County, July 26, 2011, Pines, J., Index No. 30296/2009