Floorgraphics Inc. v. News America Marketing In-Store Services, Inc., 042011 FED3, 10-2721

Docket Nº:10-2721
Opinion Judge:SMITH, Circuit Judge.
Party Name:FLOORGRAPHICS INC., Appellant v. NEWS AMERICA MARKETING IN-STORE SERVICES, INC; NEWS AMERICA MARKETING IN-STORE INC.
Attorney:Thomas S. Biemer, Esq. (argued), Laura E. Vendzules, Esq., Dilworth Paxson., William Isaacson, Esq., Boies, Schiller & Flexner. Counsel for Appellant. Lee N. Abrams, Esq. (argued) James C. Schroeder, Esq., Kristin W. Silverman, Esq., Mayer Brown, Steven P. Goodell, Esq. Herbert, Van Ness, Cayci &...
Judge Panel:Before: FUENTES, SMITH, and GREENBERG, Circuit Judges.
Case Date:April 20, 2011
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit

FLOORGRAPHICS INC., Appellant

v.

NEWS AMERICA MARKETING IN-STORE SERVICES, INC; NEWS AMERICA MARKETING IN-STORE INC.

No. 10-2721

United States Court of Appeals, Third Circuit

April 20, 2011

NOT PRECEDENTIAL

Argued March 24, 2011

On Appeal from the United States District Court for the District of New Jersey District Court No. 3-04-cv-03500 Senior District Judge: The Honorable Anne E. Thompson.

Thomas S. Biemer, Esq. (argued), Laura E. Vendzules, Esq., Dilworth Paxson., William Isaacson, Esq., Boies, Schiller & Flexner. Counsel for Appellant.

Lee N. Abrams, Esq. (argued) James C. Schroeder, Esq., Kristin W. Silverman, Esq., Mayer Brown, Steven P. Goodell, Esq. Herbert, Van Ness, Cayci & Goodell Diane Green-Kelly, Esq. Reed Smith Counsel for Appellees.

Before: FUENTES, SMITH, and GREENBERG, Circuit Judges.

OPINION

SMITH, Circuit Judge.

In 2004, Floorgraphics, Inc. (FGI), a company that "pioneered the use of floor advertising in retail grocery stores, " filed suit against, inter alia, News America Marketing In-Store Services, Inc., and News America Marketing In-Store, Inc. (collectively News). FGI asserted federal claims under the Computer Fraud & Abuse Act and the Lanham Act, as well as ten state law claims alleging that News had engaged in unfair competition. After protracted discovery and the denial of cross-motions for summary judgment, a jury trial commenced on March 3, 2009, before United States District Judge Anne Thompson. On March 10, in the midst of trial, the parties settled the case and the jury was discharged. The parties executed a Mutual Release. Although the Mutual Release did not provide for an exchange of consideration, it did reference the fact that the parties were contemporaneously executing an Asset Purchase Agreement, Goodwill Purchase Agreements with the majority stockholders, Non-Compete and Non-Solicitation Agreements, as well as Consulting Agreements. Pursuant to the terms of these agreements, FGI, its principals and its majority shareholders received a total of $29.5 million.

On March 9, 2010, a day shy of the one year anniversary of FGI's settlement with News, FGI filed a motion seeking relief from judgment under Federal Rule of Civil Procedure 60(b)(2), (3), and (6). FGI filed the motion "because it ha[d] recently learned of a substantial body of evidence that was produced by [News] in separate litigation, [i.e., the federal antitrust action of Valassis Communications, Inc. v. News America, Inc., No. 06-10240 (E.D. Mich.)], which appears critically important to FGI's claims and should have been – but was not – produced in this matter." It cited a number of video recordings of meetings of News' executives, which pertained to News' competition with FGI and other companies in the advertising market for consumer goods. FGI also explained that it had discovered that "budget books, " which it had requested during discovery and which had not been produced, had been provided to Valassis. "Given the serious and troubling implications of these recent revelations, FGI [sought] relief to gain access to critical evidence [News] failed to produce in discovery and to protect the integrity of the judicial process."

News opposed the Rule 60(b) motion and moved to enforce the terms of the Mutual Release. It asserted, inter alia, that the material FGI cited in its motion fell into three categories: (1) material not encompassed by FGI's discovery requests; (2) material that FGI may have sought initially, but failed to pursue once News objected to the request; or (3) material that had not been produced in light of the Magistrate Judge's order denying FGI's discovery request.

During oral argument before Judge Thompson, FGI advised that the "primary reason" for its motion was that videos of News' CEO, Paul Carlucci, showed that he "said things that are directly contradictory to the [deposition] testimony that he gave in this case." FGI further asserted that News' failure to provide the video of Mr. Carlucci effectively foreclosed FGI from presenting its claim. After hearing from both parties, Judge Thompson denied the motion and concluded the hearing by stating that she did not "believe that it would be just to grant a 60(b) motion in this case." A timely notice of appeal followed, challenging the denial of relief under only 60(b)(2) and (3).1

Rule 60(b) provides that the "court may relieve a party . . from a final judgment, order, or proceeding for the following reasons: . . . (2) newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial under Rule 59(b); [and] (3) fraud (whether previously called intrinsic or extrinsic), misrepresentation, or misconduct by an opposing party[.]" Fed.R.Civ.P. 60(b)(2) and (3). In Compass Technology, Inc. v. Tseng Laboratories, Inc., 71 F.3d 1125, 1130 (3d Cir. 1995), we instructed that Rule 60(b)(2) "requires...

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