C & C Props. v. Shell Pipeline Co.

• Decision Date: 27 November 2019
• Docket Number: No. 1:14-cv-01889-DAD-JLT,1:14-cv-01889-DAD-JLT
• Court: U.S. District Court — Eastern District of California
• Parties: C & C PROPERTIES, et al., Plaintiffs, v. SHELL PIPELINE COMPANY, et al., Defendants.

C & C PROPERTIES, et al., Plaintiffs,
v.
SHELL PIPELINE COMPANY, et al., Defendants.

No. 1:14-cv-01889-DAD-JLT

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA

November 27, 2019

ORDER RESOLVING VARIOUS POST-TRIAL MOTIONS

(Doc. Nos. 250, 257, 258, 265, 266, 267)

This matter is before the court on various post-trial motions. At the conclusion of trial, judgment was entered in favor of plaintiffs and against defendants on plaintiff's cause of action for trespass. (Doc. No. 29.) Defendants Alon Bakersfield Property, Inc. and Paramount Petroleum Corporation (collectively "Alon") and defendant Shell Pipeline Company ("Shell") have now moved for judgment as a matter of law, for a new trial, and to alter or amend the judgment. (Doc. Nos. 250, 257, 258.) Plaintiffs C & C Properties, Inc., JEC Panama, LLC, and Wings Way, LLC ("plaintiffs") have also moved to amend the judgment and, in addition, seek attorneys' fees and prejudgment interest. (Doc. Nos. 265-267.) A hearing on all of these motions was held on October 9, 2019. Attorneys Thomas Vogele and Timothy Kowal appeared on behalf of plaintiffs. Attorneys Michael Matthias, Andrew Grossman, W. Ray Whitman, Regina Jones, and Misty Foy appeared on behalf of defendant Alon, and attorneys Ray Cardozo and Kevin Day appeared on behalf of defendant Shell. Having considered the parties' briefing

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and the arguments of counsel, the court now issues this order resolving the parties' various post-trial motions.

BACKGROUND

The parties are familiar with the facts of this case, which have been set out in prior orders of this court and were presented to the jury at trial. At the conclusion of the trial, the jury unanimously found in favor of plaintiffs on their trespass cause of action. The jury awarded plaintiffs trespass damages in the amount of $670,824.00 against each defendant, for a total of $1,341,648.00. (Doc. No. 227 at 3.) In addition, pursuant to California Civil Code § 3334, the jury found that Shell had obtained benefits from its trespass in the amount of $33,901,692.00, and that Alon had obtained benefits from its trespass in the amount of $6,058,834.00. (Id.) Although the jury also found by clear and convincing evidence that both defendants had acted with malice, oppression, or fraud in connection with their trespassing on plaintiff's property, the jury declined to award any punitive damages. (Id. at 2; Doc. No. 228.)

LEGAL STANDARDS

A. Motion for Judgment as a Matter of Law, Motion to Amend or Alter the Judgment, Motion for a New Trial

Rule 50(a)(1) of the Federal Rules of Civil Procedure provides as follows:

If a party has been fully heard on an issue during a jury trial and the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue, the court may: (A) resolve the issue against the party; and (B) grant a motion for judgment as a matter of law against the party on a claim or defense that, under the controlling law, can be maintained or defeated only with a favorable finding on that issue.

Federal Rule of Civil Procedure 50(b) governs renewed motions for judgment as a matter of law made ("JMOL") under Rule 50(a) and provides that the court may: "(1) allow judgment on the verdict, if the jury returned a verdict; (2) order a new trial; or (3) direct the entry of judgment as a matter of law." The Ninth Circuit has held:

A Rule 50(b) motion for judgment as a matter of law is not a freestanding motion. Rather, it is a renewed Rule 50(a) motion. Under Rule 50, a party must make a Rule 50(a) motion for judgment as a matter of law before a case is submitted to the jury. If the judge denies or defers ruling on the motion, and if the jury then returns a

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verdict against the moving party, the party may renew its motion under Rule 50(b). Because it is a renewed motion, a proper post-verdict Rule 50(b) motion is limited to the grounds asserted in the pre-deliberation Rule 50(a) motion. Thus, a party cannot properly "raise arguments in its post-trial motion for judgment as a matter of law under Rule 50(b) that it did not raise in its preverdict Rule 50(a) motion." Freund v. Nycomed Amersham, 347 F.3d 752, 761 (9th Cir. 2003) (citing Fed. R. Civ. P. 50 advisory committee's notes to the 1991 amendments ("A post trial motion for judgment can be granted only on grounds advanced in the preverdict motion.")); Murphy v. City of Long Beach, 914 F.2d 183, 186 (9th Cir. 1990) ("[Judgment notwithstanding the verdict] is improper if based upon grounds not alleged in a directed verdict [motion]." (brackets in original)); see also Fed. R. Civ. P. 50 advisory committee's notes to the 2006 amendments ("Because the Rule 50(b) motion is only a renewal of the preverdict motion, it can be granted only on grounds advanced in the preverdict motion."). However, Rule 50(b) "may be satisfied by an ambiguous or inartfully made motion" under Rule 50(a). Reeves v. Teuscher, 881 F.2d 1495, 1498 (9th Cir. 1989). Absent such a liberal interpretation, "the rule is a harsh one." Nat'l Indus., Inc. v. Sharon Steel Corp., 781 F.2d 1545, 1549 (11th Cir. 1986).

EEOC v. Go Daddy Software, Inc., 581 F.3d 951, 961 (9th Cir. 2009).

In considering a Rule 50 motion, the court must view the evidence in the light most favorable to the party in whose favor the jury returned a verdict and draw all reasonable inferences in favor of the non-moving party. First Nat'l Mortg. Co. v. Fed. Realty Inv. Tr., 631 F.3d 1058, 1067 (9th Cir. 2011); Lakeside-Scott v. Multnomah County, 556 F.3d 797, 802 (9th Cir. 2009); Josephs v. Pac. Bell, 443 F.3d 1050, 1062 (9th Cir. 2006); City Sols., Inc. v. Clear Channel Commc'ns, 365 F.3d 835, 839 (9th Cir. 2004); see also A.D. v. Cal. Highway Patrol, 712 F.3d 446, 453 (9th Cir. 2013) (stating that when evaluating a Rule 50 motion the court should "give significant deference to the jury's verdict and to the nonmoving parties"). "A district court can set aside a jury verdict and grant JMOL only if, under governing law, there can be but one reasonable conclusion as to the verdict and only if there is no legally sufficient basis for a reasonable jury to find for that party on that issue." Jules Jordan Video, Inc. v. 144942 Can. Inc., 617 F.3d 1146, 1155 (9th Cir. 2010) (internal citation and quotation omitted); see also A.D., 712 F.3d at 453 ("Such a judgment is proper if the evidence, construed in the light most favorable to the nonmoving party, permits only one reasonable conclusion, and that conclusion is contrary to the jury's verdict.") (quoting Pavao v. Pagay, 307 F.3d 915, 918 (9th Cir. 2002)); First Nat'l Mortg. Co., 631 F.3d at 1067-68 (stating that the court "must disregard evidence favorable to the

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moving party that the jury is not required to believe, and may not substitute its view of the evidence for that of the jury"); Lakeside-Scott, 556 F.3d at 802 ("Judgment as a matter of law is proper when the evidence permits only one reasonable conclusion and the conclusion is contrary to that reached by the jury.") (quoting Ostad v. Or. Health Scis. Univ., 327 F.3d 876, 881 (9th Cir. 2003)).

Rule 50 also provides that if the court does not grant a motion for JMOL, the movant may make an alternative request for a new trial pursuant to Rule 59. Fed. R. Civ. P. 50(b). A motion brought under Rule 59(e) may seek "'reconsideration of matters properly encompassed in a decision on the merits.'" United States ex rel. Hoggett v. Univ. of Phoenix, 863 F.3d 1105, 1108 (9th Cir. 2017) (quoting Osterneck v. Ernst & Whinney, 489 U.S. 169, 174 (1989)). This requires a "substantive change of mind by the court." Id. (quoting Bordallo v. Reyes, 763 F.2d 1098, 1102 (9th Cir. 1985)); see also Tattersalls, Ltd. V. DeHaven, 745 F.3d 1294, 1299 (9th Cir. 2014). Whether a Rule 59(e) motion should be granted is within the discretion of the district court. McDowell v. Calderon, 197 F.3d 1253, 1255 (9th Cir. 1999) (en banc); see also Turner v. Burlington N. Santa Fe R. Co., 338 F.3d 1058, 1063 (9th Cir. 2003). In most contexts, such a motion "should not be granted, absent highly unusual circumstances, unless the district court is presented with newly discovered evidence, committed clear error, or if there is an intervening change in the controlling law." McDowell, 197 F.3d at 1255 (quoting 389 Orange St. Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999)); see also Brighton Collectibles, LLC v. Believe Productions, Inc., Case No. 2:15-cv-00579-CAS(ASx), 2018 WL 1381894, at *6 (C.D. Cal. Mar. 15, 2018) (denying Rule 59(e) motion to reduce the jury's damage award, applying the "highly unusual circumstances" standard and finding the jury's award supported by substantial evidence). However, a district court may also grant such a motion if it is "necessary to correct manifest errors of law or fact upon which the judgment is based" or if "the motion is necessary to 'prevent manifest injustice.'" Turner, 338 F.3d at 1063; see also Nelson v. Equifax Info. Servs., LLC, 522 F. Supp. 2d 1222, 1238-39 (C.D. Cal. 2007) ("Since the jury's award of statutory damages is a manifest error of law, Defendant is not precluded from raising the issue in its 59(e) motion[.]").

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B. Motion for Attorneys' Fees

"Rule 54 provides a federal procedural mechanism for moving for attorney's fees that are due under state law." Cheffins v. Stewart, 825 F.3d 588, 597 (9th Cir. 2016). Where, as here, a federal district court exercises jurisdiction over a state law claim, the law of the forum state regarding the award of attorneys' fees should generally be followed "so long as state law does not run counter to a valid federal statute or rule of court[.]" MRO Commc'ns, Inc. v. Am. Tel. & Tel. Co., 197 F.3d 1276, 1281 (9th Cir. 1999) (internal quotation marks omitted).

Awards of attorneys' fees in actions on a contract are governed by California Civil Code § 1717. That provision provides, in relevant part, that

[i]n any action on a contract, where

...