Denson International Limited v. Liberty Diversified International, Inc.

Filing 170

Order Granting 124 Plaintiff's Motion for Summary Judgment; Granting 127 Defendant's Motion for Summary Judgment; Denying as Moot 146 Plaintiff's Motion to Exclude. Signed by Senior Judge David S. Doty on 9/1/2015.(DLO)

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Civil No. 12-3109(DSD/JSM)
Denson International Limited,
Plaintiff,
v.
ORDER
Liberty Diversified
International, Inc., d/b/a
Safco Products Company,
Defendant.
Tiffany A. Blofield, Esq., Wintrop & Weinstine, PA, 225
South 6th Street, Suite 3500, Minneapolis, MN 55402, for
plaintiff.
William R. Stoeri, Esq. and Meghan L. DesLauriers, Esq.,
Dorsey & Whitney LLP, 50 South 6th Street, Suite 1500.
Minneapolis, MN 55402, for defendant.

This matter is before the court upon the cross-motions for
summary judgment by defendant Liberty Diversified International,
Inc.

(LDI)

and

plaintiff/counterclaim

International Limited (Denson).

defendant

Denson

Based on a review of the file,

record, and proceedings herein, and for the following reasons, the
court grants both motions.1

BACKGROUND
This commercial dispute arises out of the parties’ business

1

Denson also moves to strike the testimony and report of
LDI’s expert witness, Arthur Hill. ECF No. 146. Because the court
grants summary judgment without relying on Hill’s report or
testimony, it denies as moot the motion to exclude.

relationship.

LDI is the parent company of Safco Products Co.

(Safco), which sells office furniture and equipment.

Between 2004

and July 2012, LDI also owned and operated Valley Craft, Inc.,
which manufactures and sells metal hand trucks.2
defunct

Hong

Kong

trading

company,

Denson, a now-

contracted

with

Chinese

manufacturers to produce office equipment and furniture.

Denson

then sold the finished products to companies like LDI.
I.

The Parties’ Business Relationship
In 1992, LDI retained Denson to coordinate with several

factories in China to manufacture office products.
¶ 8.

Duffy Decl.

Generally, LDI would send drawings or samples of its desired

products

to

Denson,

which

would

then

identify

a

Chinese

manufacturer to manufacture the products. Mandigo Dep. at 35:9-23.
Denson also negotiated wholesale prices with the manufacturer and
conducted quality control.

Duffy Decl. ¶ 9.

These tasks were

primarily performed by Denson’s former Operations Manager, Vincent
To.

Duffy Decl. ¶¶ 9-13.
Two Chinese factories - EKO Factory and Nanjing Lanqu Import

& Export Limited factory (Nanjing Factory) - manufactured the “vast
majority” of the products that Denson sourced on behalf of LDI, and
specifically
coordinated

Safco.
with

Weil

three

Affirmation

smaller

2

Chinese

¶

21.

Denson

manufacturers.

also
Id.

For ease of reference, the court will refer to LDI, Safco,
and Valley Craft collectively as “LDI” unless a finer distinction
is required.
2

Although

Denson

was

LDI’s

main

contact

in

China,

LDI

would

coordinate with other brokers when it believed that Denson’s prices
were too high.

Mandigo Dep. at 30:2-6, 32:5-15.

In April 2008,

LDI opened an office in Shanghai and began directly purchasing
products without Denson’s involvement.
DesLauriers Decl. Exs. 8-12.

Id. at 29:15-18, 33:18-21;

LDI eventually stopped purchasing

through Denson altogether.
II.

Facts Relating to Denson’s Claims
In March 2007, Vincent To contacted LDI employees Phil Mandigo

and Pam LaFontaine to discuss potential employment with LDI.

See

Krummen Decl. Ex. 32, at LDI 2495. To maintain confidentiality, To
communicated through a private email account, over the telephone,
and in person.

See, e.g., id. at LDI2495, LDI2493; Ex. 36.

Initially, To offered to manage LDI’s planned operations in China.
On April 17, 2008, LaFontaine asked To make estimates of LDI’s
projected

monthly

expenses.

DesLauriers

Decl.

Ex.

14.

To

responded with general ideas on salary, staffing, and production
control, and estimated that he could save LDI ten percent annually.
Id. Ex. 15.

LaFontaine responded that “when we have taken product

lines and quoted them elsewhere we have seen around 35% savings.”
Duffy Decl. Ex. 8, at DENSON 432.

LaFontaine rejected To’s

proposal on May 22, 2008, stating that LDI had already opened an
office in Shanghai and expected to begin operations by the end of
the summer.

DesLauriers Decl., Ex. 17.

3

Approximately two years later, To offered to work for LDI as
a consultant and help move “the Safco manufacturing business from
Denson and direct to the original vendors and factories.”
18, at DENSON 33.

Id. Ex.

When LDI rejected this proposal, To offered to

serve as a broker for the three smaller Chinese factories that made
products for Safco.

Id. Ex. 19.

LaFontaine asked if To could

provide a list of items and prices that would be covered under the
arrangement.

DesLauriers Decl. Exs. 20, 21. On April 21, 2011, To

sent LaFontaine a “prices list of the remaining products from the
three factories.”

Id. Ex. 23, at DENSON 1.

The document stated

that “specification, requirement, quality and packaging will be
[the] same as Denson shipments ....”

Id. at DENSON 3.

The prices

were between five and fifteen percent lower than the prices that
Denson charged LDI.

Weil Affirmation ¶ 42(ii-iii).

LDI accepted

the proposal, and TO resigned from Denson in May 2011.

Id. ¶ 32.

Denson sued To in Hong Kong shortly thereafter, and the parties
settled in August 2012.

DesLauriers Decl. Exs. 24, 25.

As part of

the settlement, To admitted that he breached his fiduciary duties
to

Denson.

Id. Ex.

25.

He

denied

however,

that

he “ever

disclosed, divulged or provided copies or extracts of any of
[Denson’s] confidential information or trade secrets.”

Id. Ex. 27

¶ 11.
III. Facts Relating to LDI’s Counterclaims
In December 2004, the United States Department of Commerce

4

issued an antidumping order that set a 383.6 percent duty rate on
most Chinese exporters and manufacturers of hand trucks.
DesLauriers

Decl.,

Ex.

1.

At

the

time,

Denson

Second

had

been

coordinating with Chinese factories to manufacture and ship hand
trucks for Valley Craft. Some of the hand trucks were manufactured
by nonparty Qindao Taifa Group Co. (Taifa), a factory in northern
China

that

was

subject

to

a

lower

approximately thirty percent.

antidumping

Id. Ex. 2

duty

rate

of

Other hand trucks,

however, were manufactured by a factory subject to the higher duty
rate. Id.

Taifa would only fulfill large quantity orders, so when

Valley Craft

needed

a

small

quantity of

hand

trucks,

Denson

coordinated the orders with EKO Development, a distributor located
in Guangzhou, China.

See Duffy Dep. at 148:3-17, 149:21-24.

EKO

would purchase hand truck orders in bulk from Taifa, and Denson
would then sell them to Valley Craft.

See id.

Vincent To informed Valley Craft that Denson could move the
manufacture of all of its hand trucks to Taifa to avoid the higher
duty rate.

Second DesLauriers Decl. Ex. 2.

In order to comply

with the Customs order, Valley Craft asked that Denson provide the
name and address of the factory, and to include the applicable
anti-dumping case number on each invoice.
7550.

Id. Ex. 4, at DENSON

Valley Craft agreed that it would be sufficient to “send a

declaration letter” for each shipment that would include “Taifa’s
name, address, the case number and all the models and quantities

5

shipped[.]”

Id. at DENSON 7549.

From 2005 to 2007, the invoices for all transactions stated
that the hand trucks were “produced by Qingdao Taifa Group Imp[.]
& Exp. Co., Ltd. with the Anti-Dumping Case Number A56-891-004.”
See Handler Decl. Ex. 5; Second DesLauriers Decl. Exs. 7-12; Duffy
Dep. 192:22-24.

At least some of these shipments also included a

certificate stating that the hand trucks were sold by Taifa to
Denson.

See, e.g., Handler Decl. Exs. 4, 35, 36.3

In January 2008, Customs rejected a shipment to Valley Craft
because the invoice did not include an antidumping clause. Handler
Decl. Ex. 6; Second DesLauriers Decl. Ex. 13, at DENSON 7590-91.
Valley Craft contacted Vincent To to inquire about the missing
clause. Second DesLauriers Decl. Ex. 13, at DENSON 7590. To first
responded that Denson believed the higher duty rate did not apply
to the particular hand trucks purchased by Valley Craft.

Id.

To

later admitted, however, that he had make a mistake and that the
higher

duty

rate

did

in

fact

apply.

Handler

Decl.

Ex.

7.

Specifically, To explained that the hand trucks at issue were
manufactured by a “sister company (in south China) of Taifa (in
North China)” and that “Taifa would not accept orders for new items

3

Denson claims that it cannot locate certain documents,
including specific certificates of sale, that are almost a decade
old. Countercl. Def.’s Reply Mem. at 9. As a result, although
Denson has produced a number of certificates of sale, only a few
correspond to the 2005 to 2007 transactions at issue in this case.
See, e.g., Handler Decl. Ex. 35, at DENSON 553, 7393 (corresponding
to purchase order numbers 91229 and 97189).
6

and in small quantities and our factory in the south could not add
the clause any more.”

Id.

LaFontaine told Valley Craft that she

could use LDI’s collective buying power to ensure that Denson put
the clause back on the invoices.

Id. Exs. 8-9.

That same day, LDI

asked Denson to include language indicating that the orders were
“exempt from the anti-dumping clause.”

Id. Ex. 10.

To responded on April 3, 2008, stating “[p]ursuant to your
request, [Denson] will arrange the shipment of this order and will
put the statement that these carts are exempt from the anti-dumping
series.” Id. Ex. 11.

Denson’s next invoice, dated April 10, 2008,

stated simply that “these carts are exempt from the anti-dumping
series.”

Id. Ex. 13.

The invoice did not state, however, that the

hand trucks were manufactured by Taifa, nor did it include Taifa’s
specific antidumping case number. Id. On October 14, 2008, Denson
sent a second invoice that included identical language.
14.

Id. Ex.

Before the shipment, Valley Craft asked To if the hand trucks

would be subject to the higher antidumping rate.
DENSON 7655.

Id. Ex. 15, at

To responded that the hand trucks were “in the list”

but that “there should be no problem” because “this factory in
south China is not famous (compare[d] with Taifa) and lastly your
order quantity is small.”

Id.

In December 2008, customs rejected the hand truck shipment
corresponding to the October purchase order.

Id. Ex. 18.

Valley

Craft contacted To, who disclosed that Yangjiang Shunhe Industrial

7

Co. Ltd (Yangjiang) had produced the hand trucks.
Second DesLauriers Decl. Ex. 15.

Id. Ex. 19;

To further explained that the

“products were manufactured in south China ... and all shipped
products are [on] the anti-dumping list.”

Handler Decl. Ex. 19.

He claimed that he “just followed the instruction from Valley Craft
to add the statement in the shipping documents[.]” Id.
Customs

sent

LDI

a

Notice

of

Action

in

February

2009,

informing the company that it was under investigation for failing
to pay antidumping duties.

Id. Ex. 23, at LDI 246.

LDI conducted

an internal investigation and responded to Customs on October 13.
Id. at LDI 237.

LDI informed Customs that there was “inconsistent

and/or incomplete underlying documentation” to prove that certain
hand trucks shipped between 2005 and 2009 were manufactured by
Taifa.

Id. at LDI 241.

On July 23, 2012, Customs sent a Notice of

Penalty to LDI, alleging that the company failed to identify or
state

the

purchases.

correct

antidumping

case

Id. Ex. 26, at LDI 2916.

numbers

on

some

of

its

The notice further alleged

that the “violation ... occurred as a result of negligence.”

Id.

On August 2, 2012, LDI sent a letter and check for $1,252,045 to
Customs, stating that the payment was to “resolve all liabilities
with respect to importations made by Valley Craft, Inc.”

Id. at

LDI 2915.
IV.

Procedural History
Denson filed suit against LDI on December 13, 2012, alleging

8

misappropriation

of

trade

secrets

misappropriation

of

trade

and

secrets.

willful

LDI

filed

and

malicious

counterclaims,

alleging fraudulent misrepresentation, fraudulent omission, and
breach of contract.

Denson moved for summary judgment on the

counterclaims and the court granted the motion only as to the
breach-of-contract claim.
judgment,

and

LDI

Denson now again moves for summary

moves

for

summary

judgment

on

the

misappropriation claims.

DISCUSSION
I.

Standard of Review
“The court shall grant summary judgment if the movant shows

that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”

Fed. R. Civ.

P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
A fact is material only when its resolution affects the outcome of
the case.
(1986).

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248

A dispute is genuine if the evidence is such that it could

cause a reasonable jury to return a verdict for either party.

Id.

at 252.
On a motion for summary judgment, the court views all evidence
and inferences in a light most favorable to the nonmoving party.
Id. at 255.

The nonmoving party, however, may not rest upon mere

denials or allegations in the pleadings but must set forth specific

9

facts sufficient to raise a genuine issue for trial.
U.S. at 324.

Celotex, 477

A party asserting that a genuine dispute exists - or

cannot exist - about a material fact must cite “particular parts of
materials in the record.”

Fed R. Civ. P. 56(c)(1)(A).

If a

plaintiff cannot support each essential element of a claim, the
court must grant summary judgment because a complete failure of
proof regarding an essential element necessarily renders all other
facts immaterial.
II.

Celotex, 477 U.S. at 322-23.

Misappropriation of Trade Secrets
Denson argues that LDI misappropriated its trade secrets in

violation of the Minnesota Uniform Trade Secrets Act (MUTSA).

To

prevail on this claim, Denson must show the existence of a trade
secret and improper acquisition, disclosure, or use of the trade
secret.

Minn. Stat. § 325C.01, subd. 3; Electro-Craft Corp. v.

Controlled Motion, Inc., 332 N.W.2d 890, 897 (Minn. 1983). A trade
secret is information that must (1) not be generally known or
readily ascertainable, (2) derive independent economic value from
its secrecy, and (3) be the subject of reasonable efforts to
maintain its secrecy.

Minn. Stat. § 325C.01, subd. 5; Electro-

Craft, 332 N.W.2d at 899.
Denson argues that LDI, via To, misappropriated the following
trade secrets:

(1) “price lists by factory, customer, and product

type, price discounts, and shipping and invoice processes”; (2)
“financial information, including profit margins, direct costs and

10

expenses, salaries, payroll expenses, office rent, office overhead,
and other internal expenses”; (3) “quality control procedures,
inspection

reports,

and

inspection

checklists”;

“engineering drawings of the manufacturing process.”

and

(4)

DesLauriers

Decl. Ex. 28, at 7-8.
A.

Failure to Identify Alleged Trade Secrets

LDI argues that Denson’s claim fails because it has not
adequately identified its alleged trade secrets.

“To succeed on a

trade secret misappropriation claim, a plaintiff must first define
its alleged trade secrets with sufficient specificity.”

Bay Side

Recycling Co., LLC v. SKB Envtl., Inc., No. 14-4550, 2014 WL
6772908, at *10 (D. Minn. Dec. 1, 2014).
secret there

can

be no

action for

defendants’ actions were wrongful.”
897.

“Without a proven trade

misappropriation,

even

if

Electro-Craft, 332 N.W.2d at

LDI argues that Denson has not sufficiently described what

“engineering drawings of the manufacturing process” are. The court
agrees.
First, Denson director David Weil admitted that even he did
not know what the term “engineering drawings of the manufacturing
process” means.

Weil Dep. at 149:22-150:2.

Second, although

Denson’s 30(b)(6) witness identified one product for which the
company created drawings, he did not provide an example of the
drawings or explain their content with any particularity.

Duffy

Dep. at 80:15-25; see CHS Inc. v. PetroNet, LLC, No. 10-94, 2011 WL

11

1885465, at *8 (D. Minn. May 18, 2011) (finding no trade secret
where plaintiff “fail[ed] to explain what the allegedly secret
processes reflected in the[] documents are” and only gave “a few
specific examples of the documents it claims are trade secrets”).
Under these circumstances, the engineering drawings cannot form the
basis of a misappropriation claim.
LDI next argues that Denson fails to adequately specify the
financial information that it alleges to be a trade secret. Denson
claims that this category covers information “about our employment,
our staff levels, our salaries, our overhead, our expenses, ... our
profit

margins”

and

“[a]nything

else

viability, profitability of a business.”

which

goes

toward

the

Duffy Dep. at 47:11-17.

Such generalizations are insufficient to establish a trade secret
as a matter of law.

See Menzies Aviation (USA), Inc. v. Wilcox,

978 F. Supp. 2d 983, 994-95 (D. Minn. 2013) (denying temporary
restraining

order

information

such

where
as

plaintiff

marketing

“merely

information,

generalize[d]
internal

that

reports,

employment matters and financial condition were confidential”); CHS
Inc., 2011 WL 1885465, at *7 (granting summary judgment where
plaintiff did nothing more than “list general areas of information
which

contain

unidentified

trade

secrets”).

Although

Denson

submitted recent annual financial statements in response to LDI’s
motion, see Krummen Decl. Exs. 70-73, it does not specify the
information included within those reports that should be considered

12

a trade secret.

See AMP, Inc. v. Fleischhacker, 823 F.2d 1199,

1203 (7th Cir. 1987) (finding insufficient “six single-spaced,
typewritten pages listing by general item and category hundreds of
pieces of ... internal information”); U.S. Gypsum Co. v. LaFarge N.
Am., Inc., 508 F. Supp. 2d 601, 636 (N.D. Ill. 2007) (stating
plaintiff cannot “point to an 11,000-page document covering many
diverse topics and assert that the entire document constitutes a
trade secret”).

The court therefore cannot conclude that Denson’s

engineering drawings and financial information, as identified by
Denson, are trade secrets.
B.

Remaining Trade Secrets

The court also finds that Denson has not established that the
remaining categories of information are trade secrets.4

First,

Denson fails to show that it adopted any measures, let alone
reasonable ones, to maintain the confidentiality of any of its
alleged trade secrets.

Denson provides no evidence that its

4

To establish that its information is entitled to trade
secret status, Denson relies heavily on a declaration submitted by
its 30(b)(6) witness.
Many of the allegations made in the
declaration are either conclusory or contradict the witness’s
deposition testimony.
See, e.g., Duffy Decl. ¶ 27 (“These
engineering drawings were not generally known or reasonably
ascertainable and provided Denson with a competitive advantage.”);
id. ¶ 37 (“Denson had a policy against disclosing this information
to outside sources.”). As a result, the court will not consider
these statements. See Ballard v. Heineman, 548 F.3d 1132, 1136
(8th Cir. 2008) (“[C]onclusory affidavits devoid of specific
factual allegations rebutting the moving party’s evidence cannot
defeat a summary judgment motion.”); City of St. Joseph v. Sw. Bell
Tel., 439 F.3d 475-76 (8th Cir. 2006) (disregarding affidavit that
contradicts prior deposition testimony without explanation).
13

employees signed confidentiality or non-disclosure agreements, that
it

adopted

a

policy

requiring

that

it

certain

marked

information

any

of

its

to

remain

confidential,

or

documents

as

confidential.

Duffy Dep. at 128:3-129:2; Weil Dep. at 176:18-21,

180:12-181:21.

Instead, Denson simply argues that the importance

of confidentiality is widely understood among Hong Kong businesses.
Weil Dep. at 180:17-181:21.
law.

This is insufficient as a matter of

See Nw. Airlines v. Am. Airlines, 853 F. Supp. 1110, 1115 (D.

Minn. 1994) (“Mere intention to keep material confidential is not
enough to confer trade secret protection.”); Electro-Craft, 332
N.W.2d at 901-09 (finding no violation where plaintiff did not
maintain

physical

confidential,

or

security

of

issue

the

a

premises,

policy

label

statement

documents
regarding

confidentiality).
Moreover, Denson has not adequately shown that its wholesale
price list derived economic value from its secrecy.

To satisfy

this element, the list “must provide a competitive advantage” to
Denson. Wyeth v. Natural Biologics, No. 98-2469, 2003 WL 22282371,
at *19 (D. Minn. Oct. 2, 2003).

Denson argues that its wholesale

prices were valuable because the price list that To provided to LDI
was allegedly derived from Denson’s prices.

Even if this is true,

however, the record shows that LDI engaged in its own price
negotiations with manufacturers long before To provided his list,
and compared its prices against those that Denson offered LDI.

14

LaFontaine Dep. at 39:1-40:24.

Indeed, LDI conducted a review of

To’s list and noted that his proposed savings were close to those
that LDI had obtained from negotiating directly with the Nanjing
and EKO factories.

See id. at 43:4-6, Krummen Decl. Ex. 56.

LDI next argues that Denson’s quality control procedures and
training processes were readily ascertainable.

The court agrees.

Although Denson’s inspectors made detailed observations regarding
each product, Denson used a procedure known as “MTD-STD-105E S2 AQL
1.0 & 4.0,” a military standard that is readily available on the
Internet. See Weil Dep. at 47:5-25, 51:20-52:16; DesLauriers Decl.
Exs. 31, 32; Krummen Decl. Exs. 74-77.

Thus, there is no credible

dispute that each of Denson’s alleged trade secrets fail to meet at
least one of the required elements under Minnesota law.

As a

result, summary judgment is warranted on Denson’s misappropriation
claim.5
III. LDI’s Fraud Counterclaims
LDI’s first counterclaim alleges that Denson fraudulently
misrepresented the manufacturer of certain hand truck shipments,
which directly caused LDI’s liability to customs authorities.

LDI

specifically argues that Denson lied when it claimed that certain
hand trucks shipped between 2005 and 2008 were manufactured by
Taifa, which triggered lower antidumping duties than otherwise

5

Because the court grants summary judgment on the
misappropriation claim, summary judgment is also warranted on the
claim for willful and malicious misappropriation.
15

would have applied. To establish fraudulent misrepresentation, LDI
must demonstrate that
(1) there was a false representation by a
party of a past or existing material fact
susceptible of knowledge; (2) made with
knowledge of the falsity of the representation
or made as of the party’s own knowledge
without knowing whether it was true or false;
(3) with the intention to induce another to
act in reliance thereon; (4) that the
representation caused the other party to act
in reliance thereon; and (5) that the party
suffer[ed] pecuniary damage as a result of the
reliance.
Hoyt Props., Inc. v. Prod. Res. Grp., LLC, 736 N.W.2d 313, 318
(Minn. 2007).
As an initial matter, the court finds that the shipments made
between 2005 to 2007 cannot form the basis of a fraud claim,
because there is no evidence in the record establishing that hand
trucks shipped during that period were not manufactured by Taifa.
For

at

least

some

of

those

transactions,

Denson

produced

certificates showing that Taifa sold the hand trucks to Denson.
See, e.g., Handler Decl. Ex. 36, at DENSON 553.

LDI notes that

shipping orders for every purchase from 2005 to 2008 state that all
hand trucks were shipped from the port of Huangpu, which is more
than 1,000 miles from Taifa.

See, e.g., Second DesLauriers Decl.

Exs. 7 at DENSON 25888, 12 at DENSON 22646.

As explained by

Denson, however, Taifa often accepted Valley Craft’s smaller orders
only

if

they

were

included

in

bulk

purchases

Development, a distributor located near Huangpu.
16

made

by

EKO

Second Duffy

Decl. ¶¶ 6, 20-21; Duffy Dep. at 148:3-15, 149:21-24.

Thus, the

location of the shipping port does not necessarily preclude a
determination

that

the

products

were

manufactured

in

Taifa.

Further, the fact that Denson regularly relied on EKO Development
between 2005 and 2008 does not credibly suggest that the same
manufacturer produced all of the hand trucks at issue.
LDI also alleges that Customs determined the hand trucks were
not produced by Taifa.

The court disagrees.

In its Notice of

Penalty, Customs alleged that LDI failed to state the correct
antidumping codes on some of the shipments.
at LDI 2923.

There was no determination as to where the hand

trucks were manufactured.
its

internal

Handler Decl. Ex. 24,

Indeed, LDI admits that the result of

investigation

following

the

Customs

notice

was

inconclusive, and it settled the matter before Customs could make
any final determination.

Id. Ex. 26, at LDI 2915.

The only actual

evidence in the record suggests that the hand trucks ordered
between 2005 and 2007 were in fact manufactured by Taifa.

As a

result, those orders cannot form the basis of LDI’s fraud claim.
The court also finds that Denson did not make fraudulent
statements regarding who manufactured the hand trucks delivered in
2008.

Denson did not state that the hand trucks were manufactured

by Taifa on its January 2008 invoice, nor did it claim that they
were subject to a lower antidumping duty rate.
6.

Denson

later

informed

LDI

17

that

the

Handler Decl. Ex.
hand

trucks

were

manufactured by a separate factory in south China “who could not
add the clause anymore.”

Id. Ex. 7.

Despite this, LDI asked

Denson to place the clause on all future orders, and Denson
obliged.

Id.

Exs. 8-13.

Thereafter, all invoices included a

clause but did not indicate Taifa as the manufacturer.
13-14.

Id. Exs.

When LDI later asked whether specific hand trucks were

subject to the higher duty rate, To confirmed that they were, but
that “there should be no problem” because they were manufactured by
a “south China” factory “that is not famous (compare[d] with
Taifa).”

Id. Ex. 15, at DENSON 7655.

Because Denson did not

represent to LDI that any of the hand trucks delivered in 2008 were
manufactured by Taifa or subject to the lower antidumping duty
rate, LDI cannot now claim to have been misled in that regard.
LDI’s fraudulent omission claim also fails because there is no
evidence

suggesting

that

Denson

intentionally

manufacturer of the hand trucks shipped in 2008.

concealed

the

Indeed, the

January 2008 invoice did not state that the hand trucks were
subject to the higher antidumping duty, nor did it state that they
were manufactured by Taifa. There is simply no evidence to support
the contention that Denson concealed the manufacturing location.
As a result, summary judgment is warranted on the fraudulent
omission claim.

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CONCLUSION
Accordingly, based on the above, IT IS HEREBY ORDERED that:
1.

Denson’s motion for summary judgment [ECF No. 124] is

granted;
2.

LDI’s motion for summary judgment [ECF No. 127] is

granted; and
3.

Denson’s motion to exclude [ECF No. 146] is denied as

moot.
LET JUDGMENT BE ENTERED ACCORDINGLY.

Dated: September 1, 2015
s/David S. Doty
David S. Doty, Judge
United States District Court

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