## Facts

- Conipost, a Brazilian manufacturer owned and financed by Siderpali, agreed to sell steel shafts to Judal for $169,504; Judal paid $70,000 up front and used a letter of credit for the balance.
- To secure Judal’s advance, Siderpali arranged an $80,000 standby letter of credit payable upon Judal’s certified statement that the goods had not been received by September 15, 1989.
- On September 7, 1989, Judal’s president, Alan Schreer, certified non-receipt and drew $80,000 on the standby letter of credit; the issuing bank paid.
- Conipost delivered the goods to ocean carrier Netumar in Brazil on September 13, 1989; Netumar issued a negotiable order bill of lading naming Judal as the party authorized to take delivery in New York.
- The shipment arrived October 27, 1989; when Judal attempted pickup, Netumar initially refused release at Conipost’s direction due to the dispute over Judal’s standby draw, though containers were later released.
- Plaintiffs sued for fraud, conversion, and breach of contract; the court previously granted partial summary judgment on breach and conversion, limiting recovery to a single $80,000 award.
- After that ruling, plaintiffs sought entry of partial judgment, summary judgment on fraud, dismissal of counterclaims, and sanctions; Judal sought dismissal of fraud and sanctions; Netumar sought summary judgment on Judal’s cross-claims and sanctions.

## Issues

1. Whether the court should enter partial judgment for plaintiffs in the amount of $80,000 based on the prior partial summary judgment ruling.
2. Whether plaintiffs were entitled to summary judgment on fraud, or whether Judal and Schreer were entitled to dismissal of the fraud claims.
3. Whether Judal’s counterclaims against plaintiffs survived summary judgment, including claims for costs allegedly caused by Conipost’s instruction to withhold delivery.
4. Whether Netumar was liable on Judal’s cross-claims for withholding cargo, and whether either side was entitled to summary judgment on those cross-claims.
5. Whether sanctions were warranted based on the parties’ motion practice and litigation conduct.

## Decision

- Granted plaintiffs’ motion to enter partial judgment against Judal for $80,000 consistent with the prior ruling (recoverable once, not duplicatively under multiple theories).
- Denied plaintiffs’ motion for summary judgment on fraud and denied Judal’s motion to dismiss the fraud causes of action, leaving fraud for further adjudication.
- Granted plaintiffs summary judgment on certain Judal counterclaims that were legally deficient or unsupported, while allowing other counterclaims to proceed.
- Granted Netumar summary judgment dismissing most of Judal’s cross-claims arising from the initial refusal to release the cargo; denied Judal’s cross-motion for partial summary judgment on those cross-claims.
- Largely denied the competing sanctions requests.

## Legal Principles

- Partial judgment may be entered on an adjudicated damages component when liability and amount have already been determined, even if other claims remain pending.
- Fraud claims generally cannot be resolved on summary judgment where intent and good faith are genuinely disputed and material to whether a certification was knowingly false.
- Counterclaims seeking consequential damages require competent proof of causation and non-speculative damages; conclusory expense assertions or weak causal links do not defeat summary judgment.
- An ocean carrier may avoid liability for withholding cargo when acting within its role under the bill of lading and following shipper/owner instructions amid a bona fide dispute over entitlement to delivery.
- Sanctions are inappropriate absent a showing of frivolous filings or bad-faith conduct meeting the applicable procedural standards.

## Conclusion

The court entered an $80,000 partial judgment for plaintiffs based on Judal’s prior adjudicated liability, refused to resolve fraud on dispositive motions due to disputed intent, pared back unsupported counterclaims, dismissed most cross-claims against the carrier for following shipper instructions during a delivery dispute, and declined to impose sanctions on the record presented.


Siderpali, S.P.A. v. Judal Indus., Inc., 833 F. Supp. 1023 (S.D.N.Y. 1993)