387 F.3d 109 (2nd Cir. 2004), 03-7090, Fabri v. United Technologies Intern., Inc.

Docket Nº:Docket Nos. 03-7090(L), 03-7249(XAP).
Citation:387 F.3d 109
Party Name:Juan F. FABRI, Sr., and Juan F. Fabri, Jr., d/b/a Juan F. Fabri, Plaintiffs-Intervenors-Defendants-Appellees-Cross-Appellants, v. UNITED TECHNOLOGIES INTERNATIONAL, INC., United Technologies Corporation and Sikorsky Aircraft Corporation, Defendants-Appellants-Cross-Appellees, Bogle & Gates, PLLC, Intervenors-Plaintiffs.
Case Date:October 21, 2004
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

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387 F.3d 109 (2nd Cir. 2004)

Juan F. FABRI, Sr., and Juan F. Fabri, Jr., d/b/a Juan F. Fabri, Plaintiffs-Intervenors-Defendants-Appellees-Cross-Appellants,


UNITED TECHNOLOGIES INTERNATIONAL, INC., United Technologies Corporation and Sikorsky Aircraft Corporation, Defendants-Appellants-Cross-Appellees,

Bogle & Gates, PLLC, Intervenors-Plaintiffs.

Docket Nos. 03-7090(L), 03-7249(XAP).

United States Court of Appeals, Second Circuit

October 21, 2004

Argued: April 1, 2004

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Evan A. Davis, Cleary, Gottlieb, Steen & Hamilton, New York, N.Y. (Beth M. Sasfai, on the brief), for Defendants-Appellants-Cross-Appellees.

Edward T. Krumeich, Ivey, Barnum & O'Mara, LLC, Greenwich, CT (Al Van Kampen, Rohde & Van Kampen PLLC, Seattle, WA, on the brief), for Plaintiffs-Intervenors-Defendants-Appellees and Cross-Appellants.

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Before: FEINBERG, CABRANES, and POOLER, Circuit Judges.

POOLER, Circuit Judge:

Like Humpty Dumpty, a jury verdict once broken is difficult to put together again. At least, it is difficult to refashion the verdict in a way that accords each party substantial justice. Hence, elementary considerations of fairness support certain procedural obstacles to challenges to a jury's verdict. For instance, a party who fails to object to the sufficiency of the evidence on a particular claim may lure his opponent into failing to present evidence that would cure the asserted defect. The Federal Rules provide a prophylactic against such a strategy by requiring that a party make its sufficiency challenges with some specificity before the other party rests. See Fed.R.Civ.P. 50(a) (2). Similarly, allegedly inconsistent verdicts do not necessarily imply that the jury erred by rendering a verdict favoring plaintiff. Instead, the jury may have made an error favoring defendant, or there may be no real inconsistency. Thus, a party concerned about the possibility of an inconsistent verdict must challenge the court's charge or projected verdict sheet before submission to the jury. See Fed.R.Civ.P. 51(d) (allowing a party to claim error based on a charge only if it timely objected to the charge at trial). If a party does not object before the jury retires to consider its verdict, we ordinarily will not consider the argument on appeal. On this appeal, defendants seek reversal on bases that they did not properly place before the district court. Finding no reason to excuse their defaults, we refuse to consider their arguments.


Juan F. Fabri, Sr. ("Fabri, Sr.") and Juan F. Fabri, Jr. ("Fabri, Jr.") do business as Juan F. Fabri (collectively, the "Fabris"). For over thirty years, the Fabris acted as sales representatives in Argentina for Sikorsky Aircraft Corporation ("Sikorsky"), whose parent is United Technologies, Inc. ("UTI"), and for various other UTI-affiliated entities. Each year the Fabris entered into a Sales Representation Agreement ("SRA") with UTI to make sales on behalf of Sikorsky and other UTI entities (collectively, "defendants"). Pursuant to the SRA in effect at the time of the events under review, the Fabris would receive "commissions and/or other compensation" from UTI in exchange for selling UTI's products. Further, the Fabris warranted and represented to UTI that

[n]one of such commissions nor any other money or thing of value has been or will be paid, offered, given or promised by the Representative, his agents or employees, directly or indirectly, to:

. . . .

(c) any political party or official thereof, any candidate for political office, or any officer or employee of any government or of any instrumentality controlled by any government, or any person acting on behalf of any government or any instrumentality controlled by any government, for the purposes of:

(I) [i]nfluencing any act or decision of such party, official, candidate, officer, employee, or person in his or its official capacity;

(ii) [i]nducing any such party, official, candidate, officer, employee, or person to use his or its influence with a government or government controlled instrumentality to affect or influence any act or decision of such government or government controlled instrumentality,

in order to promote sales of [the companies'] products or otherwise to assist

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[the companies] in any aspect of [their] business.

The agreement authorized either party to terminate it on thirty days written notice. In addition, UTI and its subsidiaries had a unilateral right to immediately terminate the agreement under several circumstances, including when "UTI has reason to believe that the representations and warranties made by the [Fabris and quoted above] are no longer valid." Upon termination, UTI or its affiliate had no obligation to pay a commission on any sale the Fabris had arranged unless a sales contract had been signed before the termination. These provisions were included in the SRA to protect Sikorsky and other UTI companies from liability under the Foreign Corrupt Practices Act ("FCPA"), Pub.L. No. 95-213, 91 Stat. 1494 (1977), as amended, codified in pertinent part at 15 U.S.C. § 78dd-2 (imposing liability on companies that pay commissions to sales representatives while knowing that all or part of the commission will be used to bribe a foreign official).

On November 24, 1993, defendants terminated the SRA purportedly because "[v]arious discussions that [they] had with [the Fabris] during the course of the [prior] three weeks had given [defendants] reason to believe that [the Fabris had] violated the terms of [the Fabris' warranty not to pay or agree to pay any portion of their commission as a bribe]." At the time, the Fabris were negotiating with Argentinian president, Carlos Saul Menem, for the purchase of one of Sikorsky's S-70A helicopters. After terminating the Fabris, Sikorsky continued negotiations with Argentinian officials, who ultimately agreed to purchase the helicopter on the terms and conditions that had been proposed by the Fabris. In September 1994, Sikorsky delivered the helicopter, for which it was paid almost $16 million.

On November 21, 1996, the Fabris filed a complaint in the United States District Court for the District of Connecticut. Their claims included breach of contract, promissory estoppel, unjust enrichment, quantum meruit, tortious interference, violation of the Connecticut Unfair Trade Practices Act ("CUTPA"), Conn. Gen. St. § 42-110a et seq., breach of the duty of good faith and fair dealing, and invasion of privacy.

Prior to trial, the Fabris withdrew their invasion of privacy claim. At the beginning of the trial, Judge Dorsey dismissed the breach of good faith claim, finding that it was not a cause of action independent of the breach of contract claim. The judge also determined that the jury would not consider unjust enrichment. Finally, he limited the jury's consideration of the quantum meruit claim.

At the close of plaintiffs' proof, defendants moved, pursuant to Rule 50(a), for judgment as a matter of law. As to the CUTPA claim, they argued: (1) plaintiffs' claims for breach of contract, promissory estoppel, unjust enrichment, and quantum meruit could not support a CUTPA claim; (2) therefore, the viability of the CUTPA claim depended on plaintiffs' claim of tortious interference--i.e., that defendants improperly interfered with plaintiffs' contracts with other businesses; and (3) plaintiffs had not proven tortious interference. Defendants renewed this motion without further argument before the case was submitted to the jury pursuant to Rule 50(b).

The jury found that although plaintiffs had not established their claims for breach of the SRA, promissory estoppel, breach of an oral contract, quantum meruit, or tortious interference, they had proven a CUTPA violation. Despite awarding plaintiffs no compensatory damages, the jury awarded one dollar in nominal damages. Finally, the jury found that defendants'

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violation of CUTPA was willful, reckless, malicious, or oppressive and that plaintiffs were entitled to $500,000 and legal fees as punitive damages.

After the verdict, defendants renewed their motion for judgment as a matter of law. They argued: (1) the CUTPA verdict should be set aside because the jury found that plaintiffs failed to prove an ascertainable loss, which, defendants argued, is an element of a CUTPA violation; (2) the evidence did not support a CUTPA violation; (3) the jury should not have been allowed to consider punitive damages or attorney's fees because those issues are for the court not the jury; (4) the punitive damage award was legally and factually unsupported; and (5) even it were allowed to stand, the award was excessive. With respect to the insufficiency of the CUTPA evidence, defendants principally argued that because plaintiffs had offered the same factual allegations and evidence on the common law and CUTPA claims, the jury's verdict in defendants' favor on the common law claims mandated dismissal of the CUTPA claim.

The district court denied defendants' motion. It found that the CUTPA claim could be differentiated from plaintiffs' common law claims and that the jury's general verdict rejecting the common law claims did not necessarily reject the factual allegations underlying those claims. The district court also saw no merit in defendants' alternative argument that the jury's failure to award compensatory damages required that the court set aside the liability verdict.

Judge Dorsey also rejected each of defendants' challenges to the punitive damages award. Finally, he found that the jury's assessment that...

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