Pearlman v. Krasner

The defendant corporation operates a small broom factory and the defendants Krasner Wiener ran the business, but not with any marked degree of success. Each held fifty shares of the company stock, and, needing more capital, they induced the complainant to invest $2,500, for which he received fifty shares. One of the inducements was a written statement by them of the company's financial condition, that the assets were of the value of $5,000 (cash $598.61, machinery $3,504.41 and other assets $896.98), and its debts $382, and outstanding capital stock $5,000. It was testified that the machinery…