Gtr Rental, LLC v. Dalcanton, C/A No. 3:05-1007-MBS.

• Court: United States District Courts. 4th Circuit. United States District Court of South Carolina
• Writing for the Court: Margaret B. Seymour
• Citation: 547 F.Supp.2d 510
• Parties: GTR RENTAL, LLC f/k/a CitiCapital Trailer Rental, Inc., Plaintiff, v. John DALCANTON, Gary Gillion, and Capital City Trailer, LLC, Defendants.
• Decision Date: 25 March 2008
• Docket Number: C/A No. 3:05-1007-MBS.

547 F.Supp.2d 510 GTR RENTAL, LLC f/k/a CitiCapital Trailer Rental, Inc., Plaintiff,
v.
John DALCANTON, Gary Gillion, and Capital City Trailer, LLC, Defendants. C/A No. 3:05-1007-MBS. United States District Court, D. South Carolina, Columbia Division. March 25, 2008. Judgment Entered March 27, 2008.

Page 511

COPYRIGHT MATERIAL OMITTED

Page 512

COPYRIGHT MATERIAL OMITTED

Page 513

Benjamin Rush Smith, III, Brian P. Crotty, Don Lawrence Kristinik, III, Nelson Mullins Riley and Scarborough, Columbia, SC, Christina Rampey Hunoval, Nelson Mullins Riley and Scarborough, Charlotte, NC, Allen D. Allred, Lawrence C. Friedman, Stephen B. Higgins, Thompson Coburn, Matthew Wilson Geekie, Xtra Corporation, St. Louis, MO, for Plaintiff.

Bonnie D. Shealy, Frank Rogers Ellerbe, III, Rachel G. Peavy, Robinson McFadden and Moore, John A. O'Leary, O'Leary Associates, Robert Yates Knowlton, Sarah Spruill, Travis C. Wheeler, Haynsworth Sinkler Boyd, Columbia, SC, Adam Howard Charnes, Kilpatrick Stockton, Winston-Salem, NC, Timothy A. Duffy, Burleson Pate and Gibson, Dallas, TX, for Defendants.

Page 514

ORDER

MARGARET B. SEYMOUR, District Judge.

Plaintiff GTR Rental, LLC ("GTR"), formerly known as CitiCapital Trailer Rental, Inc. ("CitiCapital"), is a trailer leasing company headquartered in St. Louis, Missouri. Defendant John DalCanton was employed as vice president of CitiCapital's trailer leasing division. Defendant Gary Gillion was employed as regional sales manager of CitiCapital.

Around November 2003, while still employed with CitiCapital, Gillion formed Defendant Capital City Trailer, LLC ("Capital City"). Capital City also was in the trailer renting business and competed directly with CitiCapital. DalCanton was aware of Capital City Trailer's existence as early as March 2004.

CitiCapital alleged in this action that DalCanton and Gillion used Capital City to convert money and resources from CitiCapital. The case was tried before a jury commencing on June 18, 2007. The evidence adduced at trial demonstrated that Gillion, who was acting for Capital City, would submit falsified credit approval requests to DalCanton, who was acting for CitiCapital. DalCanton would then approve the credit requests and lease CitiCapital's trailers to Capital City at prices that were below market value. Capital City then would sublease the trailers to CitiCapital's existing customers for market value rates. On numerous occasions, Capital City would fail to pay CitiCapital at all for the sham leases. There was also evidence that Gillion and DalCanton would provide false assurances to customers that Capital City and CitiCapital were sister organizations.

Evidence also was adduced demonstrating that Capital City would sell CitiCapital's trailers to third parties and keep the profits. Capital City also would instruct CitiCapital customers to remit future rent payments to Capital City. DalCanton profited from this operation by accepting $46,000 in checks and an undisclosed amount of cash from Gillion. Significantly, Gillion asserted his Fifth Amendment privilege against self-incrimination throughout the proceeding and trial.

On June 22, 2007, the court granted judgment as a matter of law in favor of CitiCapital as to its claims against Gillion for (1) breach of fiduciary duty; (2) conversion; (3) fraud; (4) violation of South Carolina Unfair Trade Practices Act (SCUTPA); and (5) breach of contract. Thereafter, the issue of liability as to DalCanton and Capital City was presented to the jury, as was the issue of damages, if any, to be assessed as to Gillion.

As to DalCanton, a jury determined by a preponderance of the evidence that DalCanton breached his fiduciary duty as an employee of CitiCapital. The jury awarded damages of $88,450 as to this cause of action. The jury determined by a preponderance of the evidence that DalCanton converted property of CitiCapital. The jury awarded damages of $205,803 as to this cause of action. The jury determined by clear and convincing evidence that DalCanton committed fraud against CitiCapital. The jury awarded money damages in the amount of $46,544 as to this cause of action. The jury also found by a preponderance of the evidence that DalCanton violated the SCUTPA. The jury awarded $71,544 as to this cause of action. In addition, the jury determined by clear and convincing evidence that CitiCapital was entitled to punitive damages from DalCanton in the amount of $800,000.

As to Capital City, the jury determined that CitiCapital had proved $10.00 in damages for conversion; $10.00 in damages for fraud; $10.00 in damages for violation of

Page 515

the SCUTPA; and $10.00 for breach of contract. The jury also awarded $100.00 in punitive damages as to Capital City.

As to Gillion, the jury awarded damages in the amount of $88,450 for breach of fiduciary duty; $205,803 as to conversion; $3,000 for fraud; $46,544 for violation of the SCUTPA, and $116,125 for breach of contract. In addition, the jury determined by clear and convincing evidence that punitive damages should be awarded against Gillion in the amount of $300,000. See generally Verdict Form (Entry 236).

This matter now is before the court on various motions filed by the parties. The court will address the motions in turn.

A. Motion of Gillion and Capital City for judgment as a matter of law, to alter or amend the judgment, and for a new trial, which motion was filed July 16, 2007 (Entry 247). CitiCapital filed a memorandum in opposition to Defendants' motion on August 6, 2007, to which Gillion and Capital City filed a reply on August 16, 2007. CitiCapital filed a surreply on August 2k, 2007.

Gillion and Capital City first assert that CitiCapital should be required to elect its remedy. These Defendants assert that CitiCapital challenged the same course of conduct and presented one calculation of damages to the jury under all of its causes of action. The court disagrees.

The doctrine of election of remedies involves a choice between different forms of redress afforded by law for the same injury, or different forms of proceeding on the same cause of action. Jones v. Winn-Dixie Greenville, Inc., 318 S.C. 171, 456 S.E.2d 429, 431 (S.C.Ct.App.1995) (citing Boardman v. Lovett Enter., Inc., 283 S.C. 425, 323 S.E.2d 784 (S.C.Ct.App.1984), rev'd on other grounds, 287 S.C. 303, 338 S.E.2d 323 (1985)). Its purpose is to prevent, double redress for a single wrong. Id. at 432 (citing Save Charleston Found, v. Murray, 286 S.C. 170, 333 S.E.2d 60 (S.C.Ct.App.1985)). However, the principle has no application where separate causes of action, each based on different facts, exists. Id. (citing Harmon v. Jenkins, 282 S.C. 189, 318 S.E.2d 371 (S.C.Ct. App.1984)).

In this case, the evidence supported CitiCapital's claims that it had been subjected to the distinct harms alleged against Gillion and Capital City. The causes of action are based on different elements. The facts supporting the separate claims asserted by CitiCapital occurred over a lengthy period and involved numerous activities involving CitiCapital's customers, property, and finances. In the court's view, the complex series of transactions undertaken by Defendants does not comprise a single wrong that would give rise to but one cause of action. See Hospital Care Corp. v. Commercial Cas. Ins. Co., 194 S.C. 370, 9 S.E.2d 796 (1940). Gillion and Capital City's assertion that CitiCapital should be required to elect its remedies is without merit.

Gillion and Capital City next contend that CitiCapital should be required to elect whether it will seek trebling of its damage under the South Carolina Unfair Trade Practices Act or seek recovery under the jury award of punitive damage. In Smith v. Strickland, 314 S.C, 192, 442 S.E.2d 207, 210 (S.C.Ct.App.1994), the South Carolina Court of Appeals noted that a plaintiff can recover damages that are punitive in nature only once, either as expressly-designated punitive damages or as treble damages, where their recovery concerns a single wrong. In this case, the evidence supports the finding of separate and distinct wrongs for fraud (creating a false paper trail and insurance papers) and

Page 516

violation of the South Carolina Unfair Trade Practices Act (unfair competition with CitiCapital). Gillion and Capital City's assertion that CitiCapital should be limited to one punitive damages award is without merit.

Gillion and Capital City next assert that they should be granted judgment as a matter of law as to CitiCapital's causes of action for conversion, breach of fiduciary duty, and violation of the South Carolina Unfair Trade Practice Act. The court already has granted judgment as a matter of law in favor of CitiCapital on these causes of action. Thus, the court will construe the motion as seeking the court's reconsideration of these rulings under Fed.R.Civ.P. 59(e).

Although Rule 59 addresses grounds for new trials, some courts have reasoned that the concept of a new trial under Rule 59 is broad enough to include a rehearing of any matter decided by the court without a jury. 11 Wright, Miller & Kane, Federal Practice & Procedure § 2804. Notwithstanding the broad nature of Rule 59, motions for reconsideration are disfavored. They are not a matter of routine practice. Settino v. City of Chicago, 642 F.Supp. 755, 759 (N.D.Ill.1986). Several courts have observed that they are neither expressly cognizable under the Federal Rules of Civil Procedure nor authorized by the local rules of the district court. See, e.g., Fisher v. Samuels, 691 F.Supp. 63, 74 (N.D.Ill.1988).

Motions for reconsideration are inappropriate merely to introduce new legal theories or new evidence that could have been adduced during the pendency of the prior motion. Keene Corp. v. Int'l Fidelity Ins. Co., 561 F.Supp. 656 (N.D.Ill.1982), affd, 736 F.2d 388 (7th Cir.1984). The Fourth Circuit recognizes only three limited grounds for a district court's grant of a motion under Rule 59(e): (1)...