The elements of a claim for negligent misrepresentation are (1) the representation was made by a defendant in the course of his business, or in a transaction in which he had a pecuniary interest; (2) the defendant supplied false information for the guidance of others in their business; (3) the defendant did not exercise reasonable care or competence in obtaining or communicating the information; and (4) the plaintiff suffered pecuniary (financial) loss by justifiably relying on the representation.

Justifiable reliance usually presents a question of fact. But the justifiable-reliance element can be negated as a matter of law (on summary judgment or directed verdict) when circumstances exist under which reliance cannot be justified.

In determining whether justifiable reliance is negated as a matter of law, courts consider the nature of the parties’ relationship and the contract. In an arm's-length transaction, the defrauded party must exercise ordinary care for the protection of his own interests.

A failure to exercise reasonable diligence is not excused by mere confidence in the honesty and integrity of the other party. And when a party fails to exercise such diligence, it is charged with knowledge of all facts that would have been discovered by a reasonably prudent person similarly situated.

Thus, that party cannot blindly rely on a representation by a defendant where the plaintiff's knowledge, experience, and background warrant investigation into any representations before the plaintiff acts in reliance upon those representations.

In Ohio, a claim for negligent misrepresentation requires that the defendant made a false representation in the course of business or a transaction with a pecuniary interest, provided false information for the guidance of others in their business, did not exercise reasonable care in obtaining or communicating the information, and the plaintiff suffered a financial loss by justifiably relying on the representation. Justifiable reliance is typically a factual question, but it can be negated as a matter of law if the circumstances suggest that reliance was not justified. Courts will look at the relationship between the parties and the nature of the transaction. In arm's-length transactions, parties are expected to exercise ordinary care to protect their interests. A party is presumed to have knowledge of what a reasonably prudent person would have discovered through due diligence. Therefore, a party cannot claim justifiable reliance on a defendant's representations without proper investigation, especially when their knowledge and experience should prompt them to question those representations.