C-ART, Ltd. was an exporter of goods based in Hong Kong. C-ART entered into a contract with the New York Merchandising Company, a New York importing company, for the purchase of goods from manufacturers in Hong Kong. The goods were shipped by Hong Kong Islands Line America, S.A., an ocean carrier, from Hong Kong to California. In 1986, C-ART purchased goods from various Hong Kong manufacturers and arranged for their shipment to NYMCO in California. Upon delivery of each shipment of goods to HKIL in Hong Kong, HKIL issued to C-ART a bill of lading which C-ART would in turn present to a bank to exchange for payment from NYMCO. NYMCO would ultimately receive the original bills of lading in exchange for its proper payment for the goods. NYMCO would then present the bills of lading to HKIL upon the arrival of its ship in California in order to take possession of the goods. However, HKIL released the shipments to NYMCO upon the presentment of a NYMCO "corporate guarantee" that payment would be forthcoming. Shortly after HKIL's release of the goods to NYMCO but before C-ART had been paid, NYMCO filed for bankruptcy. After unsuccessfully attempting to recover payment for the goods from NYMCO, C-ART filed a lawsuit against HKIL for misdelivery of the goods without a properly endorsed bill of lading. The district court ruled in favor of C-ART and entered judgment for $185,997.65, and HKIL appealed. What is the legal effect of the bill of lading in this case? How should the shipper's liability be construed with respect to the provisions of the bill of lading? Does it make any difference that the goods were shipped F.O.B. Hong Kong, thus transferring the risk of loss to NYMCO prior to the ship's arrival in California?