154 F.3d 1212 (10th Cir. 1998), 97-4007, Utah Foam Products Co. v. Upjohn Co.

Docket Nº:97-4007, 97-4008.
Citation:154 F.3d 1212
Party Name:UTAH FOAM PRODUCTS CO., a Utah corporation, Plaintiff-Appellant-Cross-Appellee, v. THE UPJOHN COMPANY, a Delaware corporation, Defendant-Appellee-CrossAppellant.
Case Date:September 04, 1998
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit
 
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Page 1212

154 F.3d 1212 (10th Cir. 1998)

UTAH FOAM PRODUCTS CO., a Utah corporation,

Plaintiff-Appellant-Cross-Appellee,

v.

THE UPJOHN COMPANY, a Delaware corporation,

Defendant-Appellee-CrossAppellant.

Nos. 97-4007, 97-4008.

United States Court of Appeals, Tenth Circuit

September 4, 1998

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[Copyrighted Material Omitted]

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C. Richard Henriksen, Jr., Henriksen & Henriksen, P.C., Salt Lake City, UT, (Ralph W. Curtis, Henriksen & Henriksen, P.C., Salt Lake City, UT, with him on the briefs) for Plaintiff-Appellant.

Jonathan A. Dibble, Ray, Quinney & Nebeker, Salt Lake City, UT, (Stephen B. Nebeker and Rick B. Hoggard, Ray, Quinney & Nebeker, Salt Lake City, UT, with him on the briefs) for Defendant-Appellee.

Before TACHA, BRORBY and EBEL, Circuit Judges.

EBEL, Circuit Judge.

Plaintiff-Appellant Utah Foam Products Co. ("Utah Foam") appeals from a jury verdict and order of damages in its favor on its fraud and negligent misrepresentation claims against Defendant-Appellee, The Upjohn Company ("Upjohn"). Utah Foam claims that the district court erred in making certain evidentiary rulings, in dismissing Utah Foam's claim under the Utah Unfair Trade Practices Act, and in denying Utah Foam's request for prejudgment interest on damages awarded. Utah Foam also claims that the district court judge erred in refusing to recuse himself from the case. Upjohn brings a cross-appeal, claiming that the district court erred in refusing to grant judgment as a matter of law in favor of Upjohn on Utah Foam's fraud and negligent misrepresentation claims. We affirm the jury's verdict and all of the district court's rulings.

Background

This lengthy litigation grew out of a dispute about the price Upjohn charged Utah Foam for polymeric isocyanate (trade name "PAPI"), a chemical made by Upjohn and used by Utah Foam in making rigid sprayable polyurethane foam, an insulating material. From 1978 until 1986, Upjohn contracted to supply Utah Foam with PAPI 27, one of the types of isocyanate made by Upjohn. According to Utah Foam, Upjohn fraudulently and negligently misrepresented to Utah Foam that Utah Foam would always be the recipient of Upjohn's "best price" for PAPI. See Utah Foam Products Co. v. The Upjohn Company, 930 F.Supp. 513, 516 (D.Utah 1996). Utah Foam discovered this alleged fraud and misrepresentation when circumstances forced Utah Foam to buy PAPI 27 from one of Utah Foam's competitors, and found that the competitor was able to offer the product to Utah Foam at a lower price than that charged by Upjohn.

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In July, 1987, Utah Foam filed suit against Upjohn, claiming that Upjohn violated Utah's Unfair Practices Act, breached the contract, and committed fraud and negligent misrepresentation. Utah Foam requested compensatory and punitive damages. During a drawn-out period of pretrial litigation, the district court repeatedly ruled that Upjohn's records regarding the sales of PAPI 135 would not be subject to discovery in this case, because PAPI 135 was not of like grade and quality to PAPI 27, the subject of Utah Foam's Unfair Practices claim. 1 The district court also denied Utah Foam's motions to compel production of sales records of CPR, a wholly-owned subsidiary of Upjohn, on the basis that all deliveries of PAPI from Upjohn to CPR qualified as intra-company transfers, and not sales, and thus they were irrelevant to Utah Foam's claims. On January 12, 1994, the district court granted summary judgment to Upjohn on Utah Foam's state price discrimination claim. The district court dismissed Utah Foam's breach of contract claim on October 18, 1994. On December 18, 1995, the district court ruled that Utah Foam's experts' testimony as to the calculation of damages would be limited to proving lost margins, based upon differences in the net price paid for PAPI, and not lost sales. On January 26, 1996, Utah Foam filed a motion for recusal, on the ground that the district court judge had exhibited bias against Utah Foam and favoritism for one of Upjohn's counsel. After a hearing, the district court denied the motion.

Utah Foam's fraud and negligent misrepresentation claims went to trial before a jury on February 20, 1996. See Utah Foam, 930 F.Supp. at 515. The jury found that Upjohn had made fraudulent and negligent misrepresentations to Utah Foam regarding the price of PAPI, and awarded Utah Foam $313,593 in compensatory damages plus $5.5 million in punitive damages. See id. at 516. Upjohn moved under Federal Rule of Civil Procedure 50(b) to vacate or adjust the award of compensatory damages on Utah Foam's fraud and negligent misrepresentation claims. See id. at 518. The court refused to vacate the award, but reduced the amount of compensatory damages to $303,573.11. See id. at 518-22, 532. The district court also denied Upjohn's Rule 50(b) motion to vacate the award of punitive damages, but granted its motion for remittitur, reducing the punitive damages award to $607,142.22. See id. at 523-32. In addition, the district court denied Utah Foam's motion for prejudgment interest. See id. at 522-23. The district court then issued an order offering Utah Foam the option of accepting remittitur or undergoing a new trial on all issues. See Utah Foam Prods. Co. v. The Upjohn Co., 930 F.Supp. 513, 519-22 (D.Utah 1996) (unpublished order). Utah Foam accepted remittitur.

Utah Foam now appeals the district court's evidentiary rulings restricting the discovery of Upjohn's PAPI 135 sales records, prohibiting discovery of CPR's records, and limiting Utah Foam's experts' testimony as to estimated losses and damages; the district court's denial of prejudgment interest; the district court's dismissal of Utah Foam's Utah Unfair Practices claim; and the district court's denial of Utah Foam's motion to recuse. Upjohn cross-appeals the district court's refusal to grant Upjohn's Rule 50(b)...

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