Comet Delta, Inc. ("CDI"), an American conglomerate, was an agricultural products corporation that shipped grain all over the world. In July 2002 CDI purchased 200,000 50-kilo polypropylene bags of U.S. No. 2 or better milled rice, maximum 4% brokens. This rice was shipped to the port of Pascagoula, Linden, for storage in terminals "G" and "H" owned by RyanWalsh, Inc. ("RWI"). These terminals were covered with plastic drapes to protect the rice. CDI began looking for a buyer for this rice, and eventually entered into a contract with Lodean, Ltd. of London, United Kingdom ("Buyer"), to deliver the rice to Nigeria in October 2002 for $614 per metric ton, f.o.b. Pascagoula. This purchase price on 10,022.68 metric tons equals $6,153,925.52. North of RWI's terminals was a coal storage facility operated by Pate Enterprises ("PE"). Barges loaded with coal were loaded and unloaded at PE's facility. Open barges of coal generate coal dust when strong winds are blowing. Occasionally, particularly if the barge was headed for a distant port, the barge would be enclosed, but most of the time the coal was open to the air. After the contract between CDI and Buyer was finalized, Buyer appointed an agent, SGS Control Services ("SGS"), to inspect the rice prior to shipment. On August 17, 2002, CDI gave RWI instructions to remove the plastic drapes covering rice stored in Terminals "G" and "H" for purposes of fumigation, and to permit inspection by SGS as agent for Buyer. During the period of August 17-24, while the rice was uncovered for inspection, a strong southerly wind carried coal dust that contaminated CDI's rice. As a result of this contamination, SGS recommended to Buyer that they cancel the contract for the rice.

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