Mid-America Tablewares Inc. v. Mogi Trading Co.
| Decision Date | 22 November 1996 |
| Docket Number | MID-AMERICA,No. 96-1843,96-1843 |
| Citation | 100 F.3d 1353 |
| Parties | TABLEWARES, INC., d/b/a ROYAL DINNERWARES, Plaintiff-Appellee, v. MOGI TRADING CO., LTD., Defendant-Appellant |
| Court | U.S. Court of Appeals — Seventh Circuit |
Appeal from the United States District Court for the Western District of Wisconsin, Barbara B. Crabb, Judge, No. 94 C 0755
Edwin J. Hughes (argued), Joseph P. Wright, Stafford, Rosenbaum, Rieser & Hansen, Madison, WI, for Plaitniff-Appellee.
Marcia E. Goodman, James C. Schroeder (argued), Mayer, Brown & Platt, Chicago, IL, Douglas Yokomizo, Monteleone & McCrory, Los Angeles, CA, for Defendatn-Appellant.
Before CUMMINGS, COFFEY and KANNE, Circuit Judges.
In May 1994, Mid-America Tablewares, Inc. d/b/a Royal Dinnerwares ("Mid-America") entered into a contract with Mogi Trading Company, Ltd., whereby Mogi was to provide dinnerware for Mid-America's new Harvest Festival dinnerware line. The Harvest Festival dinnerware line was intended to complement Mid-America's pre-existing Harvest Festival table linen line. Shortly after Mogi shipped the dinnerware to the United States in July and August of 1994, the Food and Drug Administration determined that the dinnerware exceeded FDA regulatory guidance levels for leachable lead. In the ensuing litigation between the parties, Mogi stipulated to liability for breach of warranty and the case proceeded to trial on the issue of damages only. Mogi's Rule 50(a) motion for judgment as a matter of law on the issue of future lost profits at the close of Mid-America's case was denied and not renewed at the close of all evidence. The jury returned a special verdict awarding Mid-America $311,353 for lost revenues from 1994 sales of Harvest Festival dinnerware and $57,734 as compensation for incidental expenses incurred by Mid-America as a result of Mogi's breach. Additionally, the jury awarded Mid-America $2,655,752 as compensation for lost profits on sales of Harvest Festival dinnerware after 1994, and $131,960 for lost profits on sales of Harvest Festival table linens after 1994. The district court entered judgment in accordance with the jury's special verdict. Thereafter, the district court denied Mogi's post-trial renewed motion for judgment as a matter of law on future lost profit issues or in the alternative for a new trial. The district court entered an amended judgment (awarding Mid-America enhanced interest and double costs under Wis. Stats. secs. 807.01(3) and (4) as a consequence of Mogi's rejection of Mid-America's settlement offer) on March 6, 1996. Mogi now timely appeals the district court's denial of its motion to dismiss for lack of personal jurisdiction, the denial of several evidentiary motions, and the denial of Mogi's renewed motion for judgment as a matter of law on lost profit issues or in the alternative for a new trial. For the reasons that follow, we affirm in part, reverse in part, and remand for a new trial.
Mid-America is a Wisconsin corporation with its principal place of business in Eau Claire, Wisconsin. In late 1993, Mid-America's president, Daniel Hemmerich, decided to produce and sell a dinnerware line to accompany its Harvest Festival table linen line, which had enjoyed success during 1993. The Harvest Festival linen line consists of tablecloths and napkins printed in a fall/Thanksgiving motif including turkeys, pumpkins, and fallen autumn leaves. Hemmerich sought a manufacturing source for the dinnerware and was given Mogi's name. Mogi is a Japanese corporation with its principal place of business in Japan and is in the business of, among other things, contracting for the manufacture and sale of ceramic dinnerware. However, Mogi itself does not manufacture ceramics.
On December 28, 1993, Hemmerich faxed a letter to Masaichi Tsuchiya, Mogi's Director Senior Merchandise Manager, who is responsible for Mogi's export activities. Hemmerich's letter stated that he was in the process of developing a dinnerware project and was very interested in discussing Mogi "sourcing" (i.e., arranging for the manufacture of) the dinnerware line for him. Tsuchiya responded by fax the next day. In his letter, Tsuchiya discussed some advantages of utilizing a Japanese, rather than Chinese or Indonesian, manufacturer; he also provided some general information about price, quantity, and shipping. Tsuchiya concluded his first correspondence with Hemmerich by noting, Hemmerich responded later that day, stating, among other things:
On December 31, Tsuchiya faxed Hemmerich another letter asking a variety of production and shipping questions. In particular, Tsuchiya inquired, "Where to ship, either your warehouse or customer direct[?]" Tsuchiya also noted, "At this stage I can leave for Wisconsin on 1/12 from St. Louis." In a return fax transmitted later that day, Hemmerich answered Tsuchiya's inquiry about shipping, stating "Ninety five percent of the ware will be shipped into my warehouse." Mid-America's warehouse is located at the company's headquarters in Eau Claire.
In the following days and months, Hemmerich and Tsuchiya continued to correspond about various aspects of the Harvest Festival dinnerware line as well as other potential prospective business dealings. In an early January 1994 exchange of faxes, Hemmerich and Tsuchiya discussed quantity, shipping, and delivery plans for the Harvest Festival dinnerware. After Hemmerich presented a proposed schedule, Tsuchiya responded that the proposed schedule seemed manageable, and he quoted the following schedule: "1st order . . . latest to arrive at your warehouse by 8/13[.] 2nd order . . . latest to arrive at your warehouse by 9/20."
Also, in the early January exchanges, Hemmerich emphasized the importance of complying with lead regulations and instructed Tsuchiya to ensure that any ware Mogi sources for Mid-America falls well within the lead release standards for all states other than California (which had enacted uniquely strict lead release standards). Hemmerich requested that Mogi provide a certificate of compliance listing the lead content for any ware Mogi sources, and he stressed, In a return fax a few days later, Tsuchiya discussed the lead issue generally and specifically represented that "our goods always are under FDA standard, if over, Japanese government not . . . allow to ship."
Tsuchiya met with Hemmerich in Eau Claire over the course of three days in mid-February 1994. Hemmerich and Tsuchiya spent February 14, 1994 at Mid-America's offices in Eau Claire, at which time Tsuchiya saw Mid-America's warehouse. Tsuchiya brought samples of some of Mogi's products (e.g., mugs, bath products, and different dinnerware products) with him and he displayed these products to Hemmerich. Hemmerich attested that Tsuchiya also attempted to interest him in a new dinnerware product resembling bone china that Mogi could develop and source. Hemmerich also attested that throughout his three-day visit, Tsuchiya solicited Mid-America's business.
In May 1994, Mid-America faxed Mogi an order for dinnerware and Mogi accepted the offer by return fax. Under the terms of the contract, the sale was F.O.B. Nagoya, Japan and Mid-America was responsible for all freight, duties, and insurance from that point forward. Mogi delivered the goods to carriers in Nagoya during July and August 1994 and received payment in Japan under a letter of credit. At Mid-America's request the goods were shipped to Minneapolis, Minnesota. The containers holding the goods were shipped ocean freight to Seattle, Washington and then came overland to the customs clearinghouse in Minneapolis. After the goods cleared customs, they were trucked to their ultimate destination, Mid-America's warehouse in Eau Claire, Wisconsin, where the containers were unsealed and unpacked.
On August 16, 1994, Mid-America was informed by an FDA representative that the FDA had tested a Harvest Festival fruit/salad bowl and found that the bowl exceeded FDA guidelines for leachable lead. Further testing confirmed that the bowls indeed exceeded FDA lead limits. Hemmerich informed Mogi of the lead problem and requested Mogi to ship 348 replacement bowls directly to Mid-America in Eau Claire. Samples of the replacement bowls were also tested by the FDA and found to exceed lead limits. Subsequent testing by the FDA of all Harvest Festival products revealed unacceptably high lead levels in six different Harvest Festival sets or pieces. Upon being informed of the FDA's test results of October 1994, Mid-America stopped shipping dinnerware to its customers and began the process of recalling all the Harvest Festival dinnerware that had already been shipped.
Mid-America sued Mogi in the United States District Court for the Western District of Wisconsin, invoking the court's diversity jurisdiction. Mogi stipulated to liability for breach of express warranty, breach of implied warranty of merchantability, and breach of implied warranty of fitness for a particular purpose.1 The case proceeded to trial on damages issues only. Prior to trial, Mogi filed a motion in limine to exclude any evidence, testimony, or argument relating to lost profits in any year other than 1994. Mogi also filed a pretrial motion in limine to exclude the testimony of Mid-America's damages expert, John Nevin, as a consequence of Mid-America's failure to provide Nevin's opinions in its initial expert report as required by Fed. R. Civ. P. 26(a)(2)(B). The district judge...
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...for an inadequacy in its case, such as the summary of the expert’s testimony. See, e.g., Mid-America Tablewares v. Mogi Trading Co. , 100 F.3d 1353, 1363 (7th Cir. 1996). In a criminal case, however, the district court’s power to levy such sanctions is more constrained. Although “few rights......
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...for an inadequacy in its case, such as the summary of the expert’s testimony. See, e.g., Mid-America Tablewares v. Mogi Trading Co. , 100 F.3d 1353, 1363 (7th Cir. 1996). In a criminal case, however, the district court’s power to levy such sanctions is more constrained. Although “few rights......
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Motions
...motion must have been made pursuant to Rule 50(a) (2) at the close of all evidence. Mid-American Table-wares, Inc. v. Mogi Trading Co. , 100 F.3d 1353, 1363 (7th Cir. 1996). But even if a motion was made at the close of all evidence, there may still be limits to a party’s rights to make a p......
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Attacking the Opposing Expert
...for an inadequacy in its case, such as the summary of the expert’s testimony. See, e.g., Mid-America Tablewares v. Mogi Trading Co. , 100 F.3d 1353, 1363 (7th Cir. 1996). In a criminal case, however, the district court’s power to levy such sanctions is more constrained. Although “few rights......