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the Empire offering memorandum and discussed the investment with
Gallagher and with other Ingersoll-Rand executives. Bennett
insisted that Gallagher visit the PI plant and see the recyclers.
Gallagher did so and reported back to the executives. Bennett
knew Gallagher was not an engineer and "could not assess the
machine in terms of its technical capability." Gallagher
arranged for the general partner of Empire, Roberts, to meet with
the officers at the Ingersoll-Rand corporate headquarters.
Bennett did not attend that meeting.
Ingersoll-Rand manufactures machinery, including
construction equipment, pumps, air compressors, rock drills,
pneumatic tools, and bearings. Its 1993 revenues were slightly
more than $4 billion. One of Ingersoll-Rand's subsidiaries
during 1981, Improved Machinery Company (IMCO), manufactured
plastic injection molding equipment. Bennett was aware of IMCO
and the nature of its business in 1981. He had been to the IMCO
plant several times and knew that IMCO's injection molding
machine used pellets, probably the same type produced by the
Sentinel EPE recycler. Bennett did not, however, talk to anyone
at IMCO about the Empire transaction or the Sentinel EPE recycler
prior to making his investment in Empire. Bennett knew that
several recyclers purportedly had been placed with end-users
before he invested in Empire. However, Bennett did not see a
Sentinel EPE recycler prior to investing in Empire, nor did he
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Last modified: May 25, 2011