Court Opinion

ID: 6763052
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:33:30.650435+00
Date Added: 2024-06-11T16:02:39.083996
License: Public Domain

H. Brown, J.,
concurring in part and dissenting in part. While I concur in the syllabus law and Parts I, III, and IV of the opinion, I respectfully dissent from Part II of the opinion.
Russ claimed in his complaint that TRW defrauded him into participating in TRW’s price-padding scheme by falsely representing that the price padding was legal. A claim of common-law fraud requires proof of a representation or concealment, material to the transaction at hand, made falsely with the intent to mislead the plaintiff, upon which the plaintiff justifiably relies to his detriment. Burr v. Stark Cty. Bd. of Commrs. (1986), 23 Ohio St. 3d 69, 23 OBR 200, 491 N.E. 2d 1101, paragraph two of the syllabus; Cohen v. Lamko, Inc. (1984), 10 Ohio St. 3d 167, 169, 10 OBR 500, 502, 462 N.E. 2d 407, 409. Russ’s claim fails to meet this standard on two critical points.
First, Russ has not produced any evidence that any TRW official directly told him that TRW’s price-padding scheme was legal. The fact that TRW management apparently adopted this scheme, company-wide,5 as a routine business practice, does not equate to a representation of legitimacy. As our society’s long and unpleasant experience with drug abuse has shown, the “argument” that “everybody does it” is used to rationalize illegal activity, not to color it with legality.
Second, even assuming there had been some sort of misrepresentation, there is nothing in the record to suggest that Russ would not have been a “good soldier” and followed orders in its absence. Rather, Russ’s own testimony was that he participated in *52the falsification of production hours, not because he was duped into believing it was legal, but because he was directed to do so by his superiors. Thus, Russ has failed to show any causal 'relationship between the purported misrepresentation and his own actions.
Accordingly, I would reverse the judgment as to the fraud claim, but affirm as to the emotional distress claim and remand for calculation of damages.

 TRW’s counsel makes the claim that TRW, as a corporation, cannot possibly be considered a participant in the price-padding scheme because, it claims, “* * * TRW management, above the division level, knew nothing of the pricing scheme prior to * * * 1984.” This argument fails for two reasons. First, it is undisputed that similar price-padding schemes were being investigated in four other TRW divisions. This raises at least the inference that these activities were part of an overall corporate policy.
Second, it is hornbook law that employers are considered to know what their employees know, and are responsible for their wrongful acts committed within the scope of their employment. Higbee Co. v. Jackson (1920), 101 Ohio St. 75, 128 N.E. 61; Wellston Coal Co. v. Smith (1901), 65 Ohio St. 70, 61 N.E. 143. In the case of a corporate entity such as TRW, the employer has no physical existence — it can only act or acquire knowledge through its employees. State, ex rel. Celebrezze, v. Environmental Enterprises, Inc. (1990), 53 Ohio St. 3d 147, 160, 559 N.E. 2d 1335, 1348 (H. Brown, J., concurring in part and dissenting in part). Because the employees of TRW’s Airfoils Division were employees of TRW, their knowledge was TRW’s knowledge, and their actions were TRW’s actions.