Court Opinion

ID: 8208440
Source: CourtListenerOpinion
Date Created: 2022-09-22 16:09:51.500344+00
Date Added: 2024-06-11T16:41:32.421341
License: Public Domain

[Cite as Malek v. eResearch Technology, Inc., 2022-Ohio-3330.]

                              COURT OF APPEALS OF OHIO

                             EIGHTH APPELLATE DISTRICT
                                COUNTY OF CUYAHOGA

CHAD MALEK,                                           :

                Plaintiff-Appellant,                  :
                                                                 No. 111232
                v.                                    :

ERESEARCH TECHNOLOGY, INC.,                           :
ET AL.,

                Defendants-Appellees.                 :

                               JOURNAL ENTRY AND OPINION

                JUDGMENT: AFFIRMED
                RELEASED AND JOURNALIZED: September 22, 2022

            Civil Appeal from the Cuyahoga County Court of Common Pleas
                                Case No. CV-20-933338

                                           Appearances:

                Kushner & Hamed Co., L.P.A., Philip S. Kushner, Michael
                R. Hamed, and Brandon Mordue, for appellant.

                Gallagher Sharp LLP, Lori E. Brown, and Maia E. Jerin,
                for appellees.

KATHLEEN ANN KEOUGH, P.J.:

                  Plaintiff-appellant, Chad Malek, appeals from the trial court’s

judgments granting (1) defendants-appellees eResearch Technology, Inc. (“ERT”),

and James Corrigan’s motion for summary judgment on Malek’s fraud claim, (2)
defendants-appellees ERT and Steve Nuckols’s motion for summary judgment on

Malek’s claim for negligent misrepresentation, and (3) defendant-appellee Timothy

Kulbago’s Civ.R. 12(C) motion for judgment on the pleadings regarding Malek’s

fraud claim.1 For the reasons that follow, we affirm.

I.   Factual Background

               The record in this case reveals the following facts. ERT is a global

data and technology company that offers products and services to minimize risks in

clinical trials. Malek was the global vice president of imaging sales at ERT from

February 2017 until May 28, 2019, when he voluntarily resigned from his

employment. Corrigan, Nuckols, and Kulbago were part of ERT’s management

team. Nuckols and Kulbago reported to Corrigan, who was ERT’s former chief

executive officer; Nuckols was ERT’s chief commercial officer and Malek’s direct

supervisor; and Kulbago was ERT’s vice president of imaging.

               In 2019, ERT was owned primarily by two investors, Nordic Capital

and Novo Holdings. Nordic and Novo held seats on ERT’s Board, along with an

independent board member and Corrigan. As private equity investors, Nordic and

Novo’s goals included obtaining a return on their investment, whether through a

sale of ERT or co-investment, and they regularly explored potential sale or

investment opportunities.

      1 Malek does not challenge the trial court’s grant of summary judgment to Nuckols
on Malek’s fraud clam against him nor the granting of Corrigan’s and Kulbago’s Civ.R.
12(C) motions for judgment on the pleadings regarding Malek’s negligent
misrepresentation claim against them. He thus has waived any argument on appeal
regarding the trial court’s rulings on these claims.
                 Malek was not an ERT stockholder but was granted options pursuant

to the Goldcup Holdings, Inc. 2016 Stock Option Plan (“SOP”) to purchase ERT

stock under certain scenarios.2 Pursuant to the SOP terms, option holders could

potentially receive a payout if there was a “change in control” at ERT, which the SOP

defined as “the sale of the company * * * to an independent third party” where “such

party or parties acquires * * * more than 50% of the voting power of all outstanding

voting Equity Securities of the Company * * *.”

                 ERT’s investor group, Nordic, responded to frequent potential

investor inquiries during the first quarter of every year. In early 2019, after Nordic

attended an industry conference, it received inquiries from several potential

investors. Nordic and Novo decided to explore these opportunities and engaged an

outside consulting firm to help them “evaluate potential strategic alternatives for

ERT.” Nordic and Novo had preliminary discussions with several entities in early

2019, naming these initial discussions “Project Tenerife.” These initial discussions

were handled by Nordic and Novo without ERT’s involvement. In February 2019,

Nordic asked Corrigan to prepare a presentation for a number of potential investors,

including investment company Astorg, who were making inquiries about ERT.

                 On March 4, 2019, Bloomberg News published an article headlined

“Nordic Capital Considering Sale of ERT.” The Bloomberg article, in its entirety,

stated:

      2   Malek was granted 743,113 shares at an exercise price of $1.00 per share.
      Buyout firm Nordic Capital is considering a sale of health-care data
      collection company ERT Operating Co., people with knowledge of the
      matter said.

      Nordic has held talks with potential advisers about strategic options for
      the Philadelphia-based ERT, said the people, who asked not to be
      identified because they weren’t authorized to speak publicly. ERT
      could fetch about $2.5 billion in a sale, one of the people said. Nordic
      hasn’t made a final decision on whether to pursue a sale and could still
      elect to keep the business, they said.

      A representative for ERT referred request for comment to Nordic. A
      spokeswoman for Nordic, with offices including Stockholm, declined to
      comment.

      Nordic agree to buy ERT from peer Genstar Capital in March 2016 in a
      deal that valued the company at about $1.8 billion. The company,
      which provides patient data collection solutions for use in the
      development of clinical pharmaceutical products, has grown via
      acquisitions including Biomedical Systems Corp. and iCardiac
      Technologies Inc. in 2017, according to its website.

      Nordic, which is led by Managing Partner Kristoffer Melinder, has
      invested about 13 billion euros ($14.7 billion) since being founded in
      1989. The company also owns shares in air-treatment firm Munters
      Group AB and consumer loans and deposits company Nordax Group
      AB, according to its website.

              Upon learning of the article, one ERT board member emailed

Corrigan and Raj Shah, a partner at Nordic and a board member, that it was “not

good to have this story out there. So much for keeping these initial chats quiet.”

Shah responded, “[A]gree no[t] great having rumors but not sure it makes much of

an impact.” The board member responded, “Agree we don’t need to focus much on

it ─ but hopefully Jim doesn’t create too much internal distraction for you to manage

and doesn’t impact negatively our recruiting efforts.” Corrigan responded that “it
will be a distraction for a few days” and that he would let them know if the article

impacted recruiting.

              The Bloomberg article contained a number of inaccuracies, including

misidentifying ERT’s name and misrepresenting it as a data-collection company.

On March 5, 2019, ERT’s Chief Strategy Officer sent an email to ERT employees

confirming the article’s inaccuracies. That same day, Malek attended a management

team meeting during which Corrigan confirmed to the group that the Bloomberg

article was not factual and that “a sale was not on the horizon.”

              On March 7, 2019, Corrigan met with representatives from Astorg

and Goldman Sachs. In light of the preliminary nature of the meeting and because

he believed the companies were “window shopping,” Corrigan gave a marketing

pitch rather than an in-depth presentation. No other executive team members were

advised of or attended the meeting due to the preliminary and confidential nature

of the meeting. Corrigan admitted that because the talks were so preliminary, he

had the Astorg people pose as Nordic personnel who were in town for a visit because

if employees saw him walking around with people they did not recognize, “it might

fuel up rumors,” especially because the Bloomberg article had just been released.

              After the meeting, Corrigan reported to ERT’s board that Astorg

“seemed very interested in the space and company and our potential.” Although

Goldman Sachs was initially interested in ERT, it lost interest after another meeting

in March 2019. Corrigan continued meeting with other potential investors and did
not meet with the Astorg representatives again until July 25, 2019, when Astorg

became more serious about investing in ERT.

              In January 2019, Malek began exploring employment opportunities

outside ERT. On April 2, 2019, ERT put Malek on a performance improvement plan.

Malek felt that his job was in jeopardy because he believed that employees who are

put on improvement plans generally leave their employment. Fearful of his future

at ERT, in May 2019, Malek accepted a job with his current employer, BenchSci.

Malek resigned from ERT on May 29, 2019, and his last day of work there was June

28, 2019. Upon resignation, pursuant to the SOP, Malek had 60 days, or until

August 28, 2019, to exercise his stock options.

              In Malek’s exit interview, both Corrigan and Nuckols asked him to

stay on at ERT, and Kulbago told Malek that if he did not like his new job, he could

come back to ERT. But Malek was determined to leave, explaining to Corrigan and

Kulbago that his “decision to leave ERT [was] based on the fact that I know you lost

faith in my ability to manage the commercial imaging team.”

              In early June 2019, Nordic met with Astorg. Nordic reported to

Corrigan that although the discussions were positive, the parties had not agreed on

any specific next steps and “the ball was definitely in [Astorg’s] court.” Due to the

preliminary nature of the discussions, Corrigan advised ERT’s board that although

certain members of the executive management team would make presentations to

the board at its upcoming meeting regarding other subjects, they would not be
present nor participate in any discussions regarding Project Tenerife during the

meeting.

              In early July 2019, Astorg became more serious about its interest in

ERT and the discussions were given a new name: “Project Vinland.” It was still

unclear, however, whether ERT would ultimately strike a deal with Astorg or

whether such an event would be considered a “change of control” that would affect

employees’ stock options.

              On July 24, 2019, Corrigan met with Astorg for a second meeting

where he gave an in-depth presentation on a confidential basis. In late July, as

Nordic and Astorg began the due diligence process, Nordic gave Corrigan

permission to engage ERT’s controller, general counsel, and vice president of

financial planning in Project Vinland. However, because Astorg’s deal with ERT was

still uncertain, details were kept confidential from the rest of the executive

management team.

              Finally, on September 8, 2019, because Astorg had become a serious

potential investor, Corrigan disclosed to the entire executive management team,

including Nuckols and Kulbago, that Nordic and Novo were considering a potential

transaction and instructed them to attend a meeting in Boston on September 9,

2019, where further details would be disclosed.

              On October 21, 2019, ERT announced an investment by Astorg, who

entered as a partner with the existing owners through a purchase of 41 per cent of

ERT’s shares. On October 28, 2019, in a text conversation with Nuckols, Malek
stated that he was going to exercise his stock options. When Nuckols advised him

that he had missed the window to exercise, Malek responded that he had six months

after leaving ERT to exercise his options. On October 29, 2019, Malek contacted his

financial planner and asked him to procure a lender who would loan him the

$500,000 plus that he believed he needed to exercise his options. Malek was

subsequently informed by ERT that he had missed the window to exercise his

options.

               On February 4, 2020, eight months after Malek voluntarily left ERT,

the Astorg transaction closed. Because Astorg did not purchase ERT, and its

investment was not at 50 per cent, the transaction did not meet the definition of

“change of control” in the SOP so as to implicate a potential payout. However, a

decision to liquidate ERT management’s stock holdings was made in late fall 2019,

well after Malek’s stock options had expired and six months after the Bloomberg

article was released.

II. Procedural Background

               In June 2020, Malek filed suit against ERT, Corrigan, Nuckols, and

Kulbago, asserting claims for fraud and negligent misrepresentation arising out of

his decision to resign from ERT without exercising his stock options. After the

pleadings were closed, the trial court granted Kulbago’s Civ.R. 12(C) motion for

judgment on the pleadings regarding both claims. ERT, Corrigan, and Nuckols

subsequently filed a motion for partial judgment on the pleadings regarding the
negligent misrepresentation claim, which the trial court granted as to Corrigan but

denied as to Nuckols and ERT.

              Both parties then filed cross-motions for summary judgment. Malek

moved for summary judgment on his fraud claims against Corrigan and ERT and

his negligent misrepresentation claim against Nuckols and ERT. ERT, Corrigan,

and Nuckols (collectively, “appellees”) moved for summary judgment on all

remaining claims. The trial court denied Malek’s motion and granted appellees’

motion. This appeal followed.

III. Law and Analysis

      A. Summary Judgment Rulings

              In his first assignment of error, Malek contends that the trial court

erred in granting appellees’ motion for summary judgment on his fraud claim

against Corrigan and ERT and his negligent misrepresentation claim against

Nuckols and ERT.

         a. Standard of Review

              We review a trial court’s decision on a motion for summary judgment

de novo. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671 N.E.2d 241 (1996).

Summary judgment is appropriate when, construing the evidence most strongly in

favor of the nonmoving party, (1) there is no genuine issue of material fact; (2) the

moving party is entitled to judgment as a matter of law; and (3) reasonable minds

can only reach a conclusion that is adverse to the nonmoving party. Zivich v. Mentor

Soccer Club, 82 Ohio St.3d 367, 369-370, 696 N.E.2d 210 (1998).
               The party moving for summary judgment bears the burden of

demonstrating that no material issues of fact exist for trial. Dresher v. Burt, 75 Ohio

St.3d 280, 292-293, 662 N.E.2d 264 (1996). The moving party has the initial

responsibility of informing the trial court of the basis for the motion and identifying

those portions of the record that demonstrate the absence of a genuine issue of

material fact on the essential elements of the nonmoving party’s claims. Id. After

the moving party has satisfied this initial burden, the nonmoving party has a

reciprocal duty to set forth specific facts by the means listed in Civ.R. 56(C) showing

that there is a genuine issue of material fact. Id.

          a. Malek’s Fraud Claim Against Corrigan

               The elements of fraud are (1) a representation of fact (or where there

is a duty to disclose, concealment of a fact); (2) that is material to the transaction at

issue; (3) made falsely, with knowledge of its falsity or with utter disregard and

recklessness as to whether it is true or false; (4) with the intent of misleading another

into relying upon it; (5) justifiable reliance upon the misrepresentation (or

concealment); and (6) resulting injury proximately caused by the reliance. Cohen v.

Lamko, Inc., 10 Ohio St.3d 167, 169, 462 N.E.2d 407 (1984). All of these elements

must be present to find actionable fraud. Westfield Ins. Co. v. HULS Am., Inc., 128

Ohio App.3d 270, 280, 714 N.E.2d 934 (10th Dist.1998). The absence of even one

of these elements precludes recovery. Id.

               Malek’s fraud claim against Corrigan is based on his contention that

Corrigan fraudulently “denied ERT was pursuing a transaction” when he said in an
ERT team meeting on March 5, 2019, that the Bloomberg article was untrue and

unfounded. Malek also asserted in his motion for summary judgment and his brief

in opposition to appellees’ motion for summary judgment that after the meeting, he

asked Corrigan “too many times to count” whether there was any event on the

horizon that could make his options valuable and Corrigan consistently told him

“there was nothing that [he] saw that was going to * * * change the investment or

the ownership of the company.” He contends that if Corrigan had not misled him,

he would have stayed at ERT and been paid for his stock options.

              Initially, we find that Malek cannot assert a fraud claim for Corrigan’s

alleged statements after the March 5, 2019 meeting that there was nothing on the

horizon with respect to any upcoming event relating to Malek’s stock options

because these statements were not pled with particularity in the complaint, as

required by Civ.R. 9(B). Under Civ.R. 9(B), the pleading must contain allegations of

fact that tend to show each element of a cause of action for fraud. Fast Tract Title

Servs. v. Barry, 8th Dist. Cuyahoga No. 110939, 2022-Ohio-1943, ¶ 12. “This means

that a defendant must state ‘the time, place, and content of the false representation,

the fact misrepresented, and the nature of what was obtained or given as a

consequence of the fraud.’” Cord v. Victory Solutions, L.L.C., 8th Dist. Cuyahoga

No. 106006, 2018-Ohio-590, ¶ 14, quoting Carter Jones Lumber Co. v. Denune, 132

Ohio App.3d 430, 433, 725 N.E.2d 330 (10th Dist.1999). Malek’s complaint makes

no allegation at all regarding Corrigan’s alleged additional statements; the

complaint’s single allegation of fraud against Corrigan is that during a management
meeting the week of March 4, 2019, Corrigan told Malek and several other

employees that the Bloomberg article was “false” and “likely had been released by a

competitor to cause disruption.” Thus, Malek’s fraud claim against Corrigan is

limited to this single instance of alleged fraud. Upon review, we find that the trial

court properly dismissed this claim against Corrigan and by extension, ERT,3

because Malek did not produce evidence in response to appellees’ summary

judgment motion regarding each element of his claim.

           a. No Material Misrepresentation

               First, Malek has produced no evidence that Corrigan made a material

misrepresentation of fact on March 5, 2019, when he stated that the Bloomberg

article was inaccurate or false. The Bloomberg article announced “Nordic Capital

Considering Sale of ERT.” But there is no evidence that Nordic had advised Corrigan

that it was looking to sell ERT at that time. Rather, the evidence is clear that when

Corrigan made the statement, he understood that Nordic was looking for a co-

investor and that ERT was not for sale. In fact, ERT was never sold. As Corrigan

testified in his deposition, “a co-investment occurred and a recap occurred, but not

a sale.”

               In addition to an inaccurate headline, the article itself contained

several significant inaccuracies. It misidentified ERT’s line of work, because it is not

       3A party injured by an employee acting within the scope of his employment may
pursue damages against the employer under the doctrine of respondeat superior, in
addition to pursuing damages against the employee. Osborne v. Lyles, 63 Ohio St.3d 326,
329, 587 N.E.2d 825 (1992); Schisler v. Columbus Med. Equip., 10th Dist. Franklin No.
15AP-551, 2016-Ohio-3302, ¶ 31.
a “healthcare data collection company.” The article also falsely stated a sale price of

$2.5 billion, which both Corrigan and Nuckols testified was inconceivable given that

Nordic had just purchased ERT in 2016 for $1.8 billion and a sales price of $2.5

billion would not be a sufficient return for ERT’s investors.

               Furthermore, the status of the discussions with the potential

investors in March 2019 was so preliminary as to render any speculation regarding

a potential purchase by Astorg wholly unsubstantiated. ERT’s investor group,

Nordic, responded to potential investor inquiries at the beginning of every year.

When the Bloomberg article was published, discussions with a number of investors

were in very preliminary stages. Corrigan could not disclose the possibility of a sale

before Nordic had begun negotiating in earnest with Astorg or any other investor.

Furthermore, in March 2019, Corrigan believed that the investors who had

expressed an interest in ERT were merely “window shopping” and not seriously

interested in ERT. In fact, no serious investment discussions were happening at that

time and no sale was on the horizon.          Thus, there is no evidence Corrigan

misrepresented on March 5, 2019, that ERT was not considering a sale for $2.5

billion because no such sale was being considered or negotiated at that time.

               Malek contends that Corrigan lied when he said the article was not

true, however, because the article accurately reported that ERT was considering a

multibillion-dollar transaction. As support, he points to the phrase in the article

stating that “Nordic has held talks with potential advisors about strategic options

for Philadelphia-based ERT,” and the fact that a month before the article was
released, ERT had hired consulting firm KPMG to advise it on “potential strategic

alternatives.” (Emphasis added.) Malek’s argument fails. Although the article does

indeed contain the words “strategic options,” reading the headline and article in its

entirety clearly demonstrates that the Bloomberg article was indisputably about the

sale of ERT. Thus, Corrigan’s statement that the article was not true was not a

material misrepresentation given that the article concerned a sale that was not being

contemplated when the article was published and a sale that, in fact, never

happened.

      b.      No Fraudulent Intent

              Malek also produced no evidence that Corrigan intended to defraud

or mislead him into voluntarily resigning in June 2019, or to forego exercising his

stock options in August 2019, when he said during a meeting in March 2019, that

the Bloomberg article was not true. Fraud is not established unless the person

makes the misrepresentation with knowledge of its falsity and with the intent of

misleading another to rely on it. Gaines v. Preterm-Cleveland, Inc., 33 Ohio St.3d

54, 56, 514 N.E.2d 709 (1987).

              Malek’s case is based on his “hunch” that the appellees knew about

the Astorg transaction and were purposely misleading him because, as alleged in his

complaint, “[m]ulti-billion dollar transactions do not appear out of thin air. They

require months of planning, negotiations, and diligence.” But fraudulent conduct

cannot be established by mere conjecture; it must be proved by direct evidence or
justifiable inferences from established facts. Seitz v. Harvey, 2d Dist. Montgomery

No. 25867, 2015-Ohio-122, ¶ 43.

               Malek’s suspicions are insufficient to create a genuine issue of

material fact regarding any fraudulent intent. Rather, the evidence demonstrates

that when the Bloomberg article came out on March 4, 2019, many of the details in

the article were incorrect. Further, the evidence demonstrates that Corrigan’s

statement about the Bloomberg article was not made directly to Malek; it was made

to a group of ERT employees during a regularly scheduled meeting. Finally, it is

undisputed that Corrigan asked Malek to stay on at ERT even after he had decided

to resign, a fact that in itself negates the element of intent. Quite simply, there is no

evidence that Corrigan intended that Malek rely on a statement made during a group

meeting in March 2019 in deciding to resign from ERT in May 2019, and not exercise

his stock options in August 2019, some five months after the statement was made.

               Malek suggests in his appellate brief, as he argued in his brief

opposition to appellees’ motion for summary judgment, that Corrigan’s

concealment of the initial discussions with Astorg indicates fraudulent intent, as

demonstrated by his testimony that he had the Astorg representatives pose as

Nordic personnel for the March 7, 2019 meeting. But the two cases Malek cites in

support of his argument that concealment is an indication of fraudulent intent and

a “badge of fraud” do not support his common law fraud claim. In Harrison v.

Creviston, 168 Ohio App.3d 349, 354, 860 N.E.2d 113 (8th Dist.2006), the court

simply noted that concealing the transfer of money shortly before or after incurring
a substantial debt is a “badge of fraud” for purposes of determining whether a

fraudulent transfer occurred pursuant to R.C. 1336.04(B). Richardson v. Commr.,

509 F.3d 736 (6th Cir.2007), involved a party who fraudulently underreported taxes

in violation of a federal statute. Both cases are inapplicable here because neither

case discusses common law fraud under Ohio law or a factual scenario even remotely

similar to this case.

               Malek also contends that Corrigan’s testimony that he believed the

Bloomberg article was a “distraction” to ERT employees and that he wanted to keep

the focus on growing the company rather than the rumor and distraction created by

the article demonstrates fraudulent intent. We disagree. As discussed above, the

article contained numerous inaccuracies. Being inaccurate and being a distraction

are two different things. Corrigan’s desire to keep employees focused on growing

ERT rather than the distraction created by the article does not render the article

true, and his desire to avoid the distraction created by the article does not support

Malek’s assertion that Corrigan intentionally misrepresented the article’s veracity.

               Malek also suggests that the board member’s email to Corrigan and

another board member after the article was published that “it was not good to have

this story out there,” and Corrigan’s response that the article would “be a distraction

for a few days,” demonstrates that Corrigan’s statement about the Bloomberg article

was untrue. Again, whether the article was a distraction does not make it true, nor

make Corrigan’s statement that the article was “unfounded” a misrepresentation.
              In short, there is no evidence in the record from which a jury could

conclude that Corrigan intended to defraud Malek or induce him to act on the

representation.

      c.      No Justifiable Reliance

              Next, we find that Malek produced no evidence of any justifiable

reliance on Corrigan’s March 5, 2019 statement in his decision to resign from ERT

in May 2019, and let his stock options expire some five months later. In fact, Malek

testified that he left ERT, despite being asked to stay, because he was fearful of his

future at the company after he was put on a performance improvement plan and was

concerned about his job security. In his resignation letter, Malek confirmed that he

left ERT “based on the fact that I know you lost faith in my ability to manage the

commercial imaging team.” Thus, the undisputed evidence demonstrates that

Malek did not leave ERT because of or in reliance on Corrigan’s statement; he left

because he was worried about his job.

              The evidence also demonstrates that Malek’s decision to not invest

over $500,000 in ERT and timely exercise his stock options within 60 days after he

resigned from ERT is because he mistakenly believed he had six months after his

resignation to exercise his options. On October 28, 2019, Malek sent Nuckols a text

message in which he stated that he had six months to exercise his options, and on

October 29, 2019, Malek asked his financial planner to find a lender who could “pull

the $518,779” Malek believed he needed to exercise his options. However, as Malek

now admits, by then it was too late; his options had expired 60 days after his
voluntary resignation from ERT. Malek’s text makes clear that his decision to not

timely exercise his options was not based on Corrigan’s March 5, 2019 statement

about the Bloomberg article; it was based on his misunderstanding regarding how

long he had to exercise his options.

               The absence of any element of a fraud claim precludes recovery.

Minaya v. NVR, Inc., 8th Dist. Cuyahoga No. 105445, 2017-Ohio-9019, ¶ 12.

Because Malek did not produce evidence demonstrating there was a genuine issue

of fact regarding all the elements of his fraud claim against Corrigan, the trial court

properly granted summary judgment to appellees on this claim.

          a. Malek’s Negligent Misrepresentation Claim Against Nuckols

               Malek next challenges the trial court’s grant of summary judgment to

Nuckols on his negligent misrepresentation claim.

               In Delman v. Cleveland Hts., 41 Ohio St.3d 1, 534 N.E.2d 835 (1989),

the Ohio Supreme Court set for the elements of negligent representation as follows:

      One who, in the course of his business, profession or employment, or
      in any other transaction in which he has a pecuniary interest, supplies
      false information for the guidance of others in their business
      transactions, is subject to liability for pecuniary loss caused to them by
      their justifiable reliance upon the information, if he fails to exercise
      reasonable care or competence in obtaining or communicating the
      information.

Id. at 4. Thus, “the elements of a negligent misrepresentation claim ‘require (1) a

defendant who is in the business of supplying information; and (2) a plaintiff who

sought guidance with respect to his business transactions from the defendant.’”

Hamilton v. SYSCO Food Servs. of Cleveland, 170 Ohio App.3d 203, 2006-Ohio-
6419, 866 N.E.2d 559, ¶ 20 (8th Dist.), quoting Nichols v. Ryder Truck Rental, Inc.,

8th Dist. Cuyahoga No. 65376, 1994 Ohio App. LEXIS 2697 (June 23, 1994).

              In his complaint, Malek alleged that Nuckols falsely represented in

March 2019 that the Bloomberg article was false, ERT was not close to an exit plan

because too much work needed to be done to improve ERT’s operations, and the

$2.5 billion valuation was inaccurate and too low. Malek further alleged that he

spoke with Nuckols on four separate occasions between June 27, 2019, and the end

of August and, each time, Nuckols told him that ERT had no transaction in sight that

would result in his stock options having value for at least 12 to 18 months. We find

that the trial court properly granted appellees’ motion for summary judgment

regarding this claim.

              First, any statements that Nuckols allegedly made while Malek was

an employee of ERT are not actionable under a claim of negligent

misrepresentation. In Nichols, this court specifically rejected the application of the

tort of negligent misrepresentation in the employer – employee context because an

employer is not in “the business of supplying information for the guidance of

others.” Id. at 11. This court reasoned that the class of persons “who are in the

business of supplying information for the guidance of others typically include

attorneys, surveyors, abstractors of title and banks dealing with no-depositors’

checks.” Id. at 11-12. Further, the court found that “no court in Ohio has held the

tort of negligent misrepresentation applicable to the employer – employee

relationship.” Id. at 12. Accordingly, we find that the trial court properly granted
summary judgment to appellees on Malek’s misrepresentation claim regarding any

statements made by Nuckols prior to June 28, 2019, when Malek resigned from

ERT.

               We likewise find that the trial court properly granted summary

judgment on Malek’s misrepresentation claim with respect to any statements by

Nuckols in July and August 2019, because it is undisputed that Nuckols is not “in

the business” of supplying information about stock options.

               Malek contends, however, that this case involves a “transaction in

which Nuckols had a pecuniary interest”; i.e., that Nuckols, as a participant in ERT’s

stock plan, had a pecuniary interest in any pending transaction involving ERT that

would affect the value of his stock. Malek asserts that this is the “second type of

negligent misrepresentation claim” identified in Delman, supra, as opposed to the

“first type” involving representations made in the course of a “business, profession,

and employment,” and thus, he contends that the trial court improperly granted

summary judgment on this claim.

               Malek cites Barr v. Lader, 8th Dist. Cuyahoga No. 87514, 2007-Ohio-

156, in support of this argument. Barr does not support Malek’s argument that the

trial court improperly granted summary judgment in favor of Nuckols on his claim,

however. The question in Barr was whether the plaintiff had adequately pleaded a

cause of action for negligent misrepresentation against a corporation and its officers

sufficient to withstand a Civ.R. 12(B)(6) motion to dismiss for failure to state a claim

upon which relief may be granted. Id. at ¶ 14. The issue here, however, is whether
Malek produced any evidence in response to appellees’ motion for summary

judgment to create a genuine issue of material fact regarding his negligent

misrepresentation claim against Nuckols. We find that he did not.

              Malek admitted that he had no evidence that Nuckols knew of the

Astorg transaction in the summer of 2019 when he spoke with him (Malek Dep., p.

85), and in fact, Nuckols testified that he had no knowledge of the transaction until

September 8, 2019, when Corrigan told him and other members of the executive

management team to fly to Boston for a meeting on September 9, 2019, where they

were advised of the potential transaction. (Nuckols Dep., p. 29-30). Malek fails to

explain or offer any evidence regarding how Nuckols could have an interest in June,

July, and August 2019, in a “transaction” that he knew nothing about and that did

not even exist when his statements were made. Furthermore, Malek testified that

he did not speak with Nuckols in a business capacity relative to his stock options

(Malek Dep., p. 78), but rather, that he and Nuckols informally discussed their

children, the state of ERT, and Malek’s “hunch” that there was some financial

transaction on ERT’s horizon. Even assuming, as Malek argues, that this case

involves the “second type” of negligent misrepresentation claim, there is no evidence

that Nuckols’s statements were made in the context of a “transaction in which he

had a pecuniary interest,” and thus, they cannot form the basis for a negligent

misrepresentation claim.

              Furthermore, Nuckols’s statements are not actionable because they

were merely his opinion and prediction regarding a future event. Malek testified
that Nuckols told him that exercising his options was “up to you. I can’t make that

call” but “they’re not going to be worth anything for at least 12 to 18 months.” (Malek

Dep., p. 74.) Negligent misrepresentation claims “require misrepresentations of

past or existing facts, not promises or representations relating to future actions or

conduct.” Telxon Corp. v. Smart Media of Del., Inc., 9th Dist. Summit No. 22098,

2005-Ohio-4931, ¶ 33. Nuckols’s statements, made in light of a transaction he knew

nothing about, were nothing more than his opinion and prediction about what could

happen in the future and thus cannot form the basis for a negligent

misrepresentation claim.

               Last, there is no evidence to support Malek’s claim that Nuckols acted

negligently in supplying him with confidential corporate information after he

resigned, in violation of ERT policy. Malek contends that ERT’s prohibition against

sharing business information with former employees applies to information

regarding whether it is pursuing business transactions and thus, “by providing [him]

with false information about the pending transaction, Nuckols violated corporate

policy * * * and acted negligently.” However, there is no evidence whatsoever that

Nuckols knew about the Astorg transaction during his conversations with Malek in

the summer of 2019 and therefore, nothing to support Malek’s assertion that

Nuckols gave him false information about the transaction.

               To summarize, the record reflects that Malek failed to produce any

evidence to create a genuine issue of material fact regarding either his fraud claims

against Corrigan or his negligent misrepresentation claim against Nuckols.
Accordingly, the trial court properly granted summary judgment to appellees on

both claims. The first assignment of error is overruled.

      B. Civ.R. 12(C) Ruling

              In his second assignment of error, Malek contends that the trial court

erred in granting Kulbago’s Civ.R. 12(C) motion for judgment on the pleadings

regarding his fraud claim.

              Motions for judgment on the pleadings are governed by Civ.R. 12(C),

which states that “[a]fter the pleadings are closed but within such time as not to

delay the trial, any party may move for judgment on the pleadings.” To be entitled

to a dismissal under Civ.R. 12(C), “it must appear beyond doubt that [the

nonmovant] can prove no set of facts warranting the requested relief, after

construing all the material factual allegations in the complaint and all reasonable

inferences therefrom in [the nonmovant’s] favor.” State ex rel. Toledo v. Lucas Cty.

Bd. of Elections, 95 Ohio St.3d 73, 74, 765 N.E.2d 854 (2002). We review a ruling

on a motion for judgment on the pleadings de novo. DiGorgio v. Cleveland, 8th

Dist. Cuyahoga No. 95945, 2011-Ohio-5878, ¶ 19.

              The entirety of Malek’s allegations against Kulbago are as follows:

      Not long after that meeting [referring to the March 5, 2019
      management meeting], Mr. Malek asked Tim Kulbago, ERT’s Imaging
      Produce Line Executive and a member of the Executive Management
      Team, about any possible sale involving ERT. Mr. Kulbago and Mr.
      Corrigan had a close working relationship, including weekly one-on-
      one meetings. They also golfed outside of work. Mr. Malek brought up
      a rumor circulating in the Company that Mr. Corrigan was courting
      potential buyers and investors. Mr. Kulbago responded that the
      Bloomberg article was completely untrue and that he would know if the
      CEO was courting potential buyers or investors because he knew what
      meetings were on Mr. Corrigan’s calendar.

(Complaint, ¶ 30.)

               As discussed above, in accordance with Civ.R. 9(B), claims of fraud

must be pled with particularity. The rule “places a higher burden than is normally

required upon the person asserting such a claim to support general allegations with

specific facts.” Reasoner v. State Farm Mut. Auto. Ins. Co., 10th Dist. Franklin No.

01AP-490, 2002-Ohio-878, ¶ 20-21.

      To comply with the Civ.R. 9(B) requirement, “‘the pleading must
      contain allegations of fact which tend to show each and every element
      of a cause of action for fraud.’” Parmatown S. Assn. v. Atlantis Realty
      Co., 8th Dist. Cuyahoga No. 106503, 2018-Ohio-2520, ¶ 7, quoting
      Minaya v. NVR Inc., 2017-Ohio-9019, 103 N.E.3d 160, ¶ 11 (8th Dist.).
      “This means that a defendant must state ‘the time, place, and content
      of the false representation, the fact misrepresented, and the nature of
      what was obtained or given as a consequence of the fraud.’” Cord v.
      Victory Solutions, L.L.C., 8th Dist. Cuyahoga No. 106006, 2018-Ohio-
      590, ¶ 14, quoting Carter Jones Lumber Co. v. Denune, 132 Ohio
      App.3d 430, 433, 725 N.E.2d 330 (10th Dist.1999). Such particularity
      is required to both apprise the opposing party of the act that is the
      subject of the fraud claim and to allow the opposing party to prepare an
      effective defense. Turner v. Salvagnini Am., Inc., 12th Dist. Butler No.
      CA 2007-09-233, 2008-Ohio-3596, ¶ 26.

Fast Tract Title Servs., 8th Dist. Cuyahoga No. 110939, 2022-Ohio-1943 at ¶ 12.

               Malek’s fraud claim against Kulbago was clearly not pled with

sufficient particularity. Its vague allegation that Malek spoke with Kulbago “not long

after” the March 5, 2019 meeting does not sufficiently plead the date, time, and place

of the alleged fraudulent misrepresentation.

              Likewise, there are no specific allegations that Kulbago knew the

Bloomberg article was false and that he intended to mislead Malek when he told him
the article was not true. In fact, in his answer, Kulbago admitted that he was advised

by ERT’s executive vice president in an email dated March 5, 2019, that the

Bloomberg article was “based on rumours [sic] and needs to be ignored.” But even

without considering Kulbago’s answer, it is apparent that Malek alleged no facts that

Kulbago knowingly misrepresented information about the Bloomberg article with

the intent to mislead him into relying on the statement.

               Likewise, there are no specific allegations that Malek relied on

Kulbago’s representation in March 2019 in deciding to leave ERT and not timely

exercise his stock options. In fact, Malek alleges in the complaint that he relied on

Nuckols’s representations in declining to exercise his stock options. (Complaint, ¶

40.)

               Finally, Malek made no specific allegation that Kulbago knew about

the Astorg transaction in March 2019 such that his statement about the Bloomberg

article was untrue. Malek’s fraud claim against Kulbago, like his fraud claim against

the other defendants, is based on mere conjecture that it would have been

impossible for Kulbago, as a senior executive at ERT, not to have known about any

pending transaction involving ERT and that his statement about the Bloomberg

article must therefore have been untrue. But as discussed above, a fraud claim

cannot be based on conjecture; it must be supported with specific facts establishing

each element of the claim. Malek’s complaint failed to do so with respect to Kulbago;

it simply lumped him in with the other defendants without allegations of fraud

relating specifically to him.
              Accordingly, because Malek failed to plead his fraud claim against

Kulbago with the requisite particularity required by Civ.R. 9(B), the trial court did

not err in granting Kulbago’s Civ.R. 12(C) motion for judgment on the pleadings.

              The second assignment of error is overruled.

              Judgment affirmed.

      It is ordered that appellees recover from appellant costs herein taxed.

      The court finds there were reasonable grounds for this appeal.

      It is ordered that a special mandate be sent to said court to carry this judgment

into execution.

      A certified copy of this entry shall constitute the mandate pursuant to Rule 27

of the Rules of Appellate Procedure.

KATHLEEN ANN KEOUGH, PRESIDING JUDGE

MARY EILEEN KILBANE, J., and
EMANUELLA D. GROVES, J., CONCUR