40 F.3d 492 (1st Cir. 1994), 94-1044, Eastern Mountain Platform Tennis, Inc. v. Sherwin-Williams Co., Inc.

Docket Nº:94-1044, 94-1045.
Citation:40 F.3d 492
Party Name:EASTERN MOUNTAIN PLATFORM TENNIS, INC., Plaintiff, Appellant, v. The SHERWIN-WILLIAMS COMPANY, INC., Defendant, Appellee. EASTERN MOUNTAIN PLATFORM TENNIS, INC., Plaintiff, Appellee, v. The SHERWIN-WILLIAMS COMPANY, INC., Defendant, Appellant.
Case Date:November 28, 1994
Court:United States Courts of Appeals, Court of Appeals for the First Circuit

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40 F.3d 492 (1st Cir. 1994)



The SHERWIN-WILLIAMS COMPANY, INC., Defendant, Appellee.



The SHERWIN-WILLIAMS COMPANY, INC., Defendant, Appellant.

Nos. 94-1044, 94-1045.

United States Court of Appeals, First Circuit

November 28, 1994

Argued June 7, 1994.

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Ovide M. Lamontagne with whom George R. Moore and Devine, Millimet & Branch, P.A., Manchester, NH, were on brief, for The Sherwin-Williams Co.

Stephen S. Ostrach, Patrick W. Hanifin, Todd S. Brilliant and New England Legal Foundation, Boston, MA, were on brief, for Business and Industry Ass'n of New Hampshire, amicus curiae.

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Kenneth G. Bouchard with whom Paul B. Kleinman and Bouchard & Mallory, P.A., Manchester, NH, were on brief, for Eastern Mountain Platform Tennis, Inc.

Before TORRUELLA, Circuit Judge, CAMPBELL, Senior Circuit Judge, and CARTER, [*] District Judge.

CARTER, Chief District Judge.

This action arose from the sale of a paint system recommended by Defendant, The Sherwin-Williams Company ("Sherwin-Williams"), to Plaintiff, Eastern Mountain Platform Tennis, Inc. ("EMPT"), for use in producing platform tennis courts. Sherwin-Williams' representative David Shelley ("Shelley") recommended a paint system to EMPT after EMPT informed Shelley that it would not change products unless the new system met or exceeded the performance of the paint system it had used previously. The Sherwin-Williams system did not perform as well as the system it replaced. In fact, the courts covered with Sherwin-Williams paints began to show signs of wear, with the coating peeling away from the aluminum panels and the courts' surface becoming slick due to loss of aluminum oxide aggregate during the first season of use. 1 After a jury trial, the jury entered a verdict in favor of EMPT in the amount of $1,087,000. The special verdict form indicated that the jury found that Sherwin-Williams had violated an express warranty, an implied warranty of fitness for a particular purpose, and the New Hampshire Consumer Protection Act ("CPA" or "the Act"). N.H.Rev.Stat.Ann. Sec. 358-A (1993). In addition, the jury found that Sherwin-Williams had willfully or knowingly engaged in unfair or deceptive practices. Pursuant to section 10 of the CPA, the trial judge doubled the jury verdict. N.H.Rev.Stat.Ann. Sec. 358-A:10 (1993). In addition, the trial judge awarded prejudgment interest on the amount of the original jury verdict up to the date of entry of the final judgment. N.H.Rev.Stat.Ann. Sec. 524:1-b (1993).


Sherwin-Williams raises a number of issues on appeal. First, it challenges the trial judge's denial of summary judgment on the CPA claim contending that the CPA does not apply to purely commercial transactions (i.e., transactions that do not involve sales to ultimate consumers). Second, Sherwin-Williams argues that, if the CPA does govern purely commercial transactions, the trial judge nevertheless erred in denying its motion for summary judgment on the CPA claim because the undisputed facts did not establish a violation of the Act. Third, Sherwin-Williams argues that the trial judge erred in denying its motion to set aside the verdict on the CPA claim because the issue should not have been presented to the jury and because it was impossible to determine what portion, if any, of the award was the result of the CPA violation. Fourth, Sherwin-Williams contends that the judge erred in failing to give the jury instructions on "plaintiff's misconduct" or comparative fault. Fifth, Sherwin-Williams seeks a new trial, or remittitur, on the basis that the damages awarded were speculative. Sixth, Sherwin-Williams asserts that the trial judge's conduct during the trial requires a new trial. Finally, Sherwin-Williams challenges the calculation of the award of prejudgment interest on the grounds that such interest is available only to the date of the jury verdict, rather than to the date of entry of final judgment. It further contends that it was error to

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award prejudgment interest on the portion of the verdict which represented an award of future lost profits.

On cross-appeal, EMPT argues that the trial judge erred in awarding prejudgment interest only on the original jury verdict and not on the entire amount of the judgment, including the doubled verdict under the CPA.

We will address, in turn, each of these contentions.


I. Application of the New Hampshire Consumer Protection Act to the Purely Commercial Transaction.

The Appellant has failed to preserve this point for review on appeal. The denial of a motion for summary judgment does not merge into the final judgment. Glaros v. H.H. Robertson Co., 797 F.2d 1564, 1573 (Fed.Cir.1986). Such a denial, to be preserved for review of a legal conclusion subsumed in the ruling, must be perfected by making a motion for judgment as a matter of law at the close of the evidence. Watson v. Amedco Steel, Inc., 29 F.3d 274, 279 (7th Cir.1994); Whalen v. Unit Rig, Inc., 974 F.2d 1248, 1251 (10th Cir.1992); see Lama v. Borras, 16 F.3d 473 (1st Cir.1994). The denial of this latter motion does merge into the judgment, and all rulings of law subsumed within it are subject to review on appeal from the judgment.

Here, Appellant failed to make any motion for judgment as a matter of law at the close of all the evidence. Accordingly, the determination, as a matter of law, by the trial judge in ruling on the summary judgment motion that the CPA applied to business transactions never merged into the judgment and is not available for review on this appeal.

Even though the issue of statutory construction was not preserved for appeal, we have nevertheless reviewed the record and are satisfied that, in determining the legal question as to whether the CPA applied to the type of transaction disclosed by the evidence in this case, the trial judge committed no "manifest error." The appeal on this point raises a question of statutory construction. In short, Sherwin-Williams argues that the Consumer Protection Act was intended to redress the discrepancies between a knowledgeable commercial seller and a consumer who is placed in the position of relying on the representations of that seller. The provisions of the Act, Sherwin-Williams argues, have no application where, as here, a commercial buyer acquires a product for use in the manufacture of another product in which its expertise may easily be greater than that of the seller. On amicus brief, the Business and Industry Association of New Hampshire agrees. Because the issue raised is an issue of law, our review is de novo.

We begin, and could easily conclude, our assessment of this argument by considering the plain meaning of the words of the statute. Town of Wolfeboro v. Smith, 131 N.H. 449, 556 A.2d 755, 756-57 (1989). We must glean the intention of the legislature as to the scope of the Act "from its construction as a whole, not by examining isolated words and phrases." Petition of Jane Doe, 132 N.H. 270, 564 A.2d 433, 438 (1989). A thorough reading of the entire statute provides no direct support for Sherwin-Williams' contention that the Act applies only to transactions with ultimate consumers. The unfair and deceptive practices prohibited by the CPA appear to include transactions between business competitors as well as those involving ultimate consumers. N.H.Rev.Stat.Ann. 358-A:2 (1993). There are no provisions which limit the Act's protection to ultimate "consumers" alone. Indeed, there is no definition of a consumer, a consumer good, or a consumer transaction, although such definitions would be critical if the Act were intended to be limited in the way that Sherwin-Williams suggests. Moreover, the statute specifies "exempt transactions" and does not include among them the kind of "commercial transactions" the defendant would delete from the purview of the statutory provisions. N.H.Rev.Stat.Ann. 358-A:3 (1993).

With this overview of the statute, we now turn to the specific provisions that EMPT contends make Sherwin-Williams' acts unlawful, and provide EMPT with a

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right of action. Here, the statute declares that "[i]t shall be unlawful for any person to use any unfair method of competition or any unfair or deceptive act or practice in the conduct of any trade or commerce within this state." N.H.Rev.Stat.Ann. 358-A:2 (1993) (emphasis added). 2 Section 10 of the statute provides a private right of action as follows:

I. Any person injured by another's use of any method, act or practice declared unlawful under this chapter may bring an action for damages and for such equitable relief, including an injunction, as the court deems necessary and proper. If the court finds for the plaintiff, recovery shall be in the amount of actual damages or $200, whichever is greater. If the court finds that the use of the method of competition or the act or practice was a willful or knowing violation of this chapter, it shall award as much as 3 times, but not less than 2 times, such amount. In addition, a prevailing plaintiff shall be awarded the costs of the suit and reasonable attorney's fees, as determined by the court. Any attempted waiver of the right to the damages set forth in this paragraph shall be void and unenforceable.

N.H.Rev.Stat.Ann. 358-A:10 (1993) (emphasis added). Defendant points to nothing in the statute that suggests that "any person" in either of these sections should be read to exclude commercial purchasers. Nor do they point to language that indicates that "commerce or trade" is restricted to commerce or trade involving...

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