Jackson v. Swift-Eckrich, Inc.

Decision Date26 October 1993
Docket NumberCiv. No. 92-5133.
Citation836 F. Supp. 1447
PartiesBill JACKSON and Juanita Jackson, Plaintiffs, v. SWIFT-ECKRICH, INC., Defendant.
CourtU.S. District Court — Western District of Arkansas

James G. Lingle, Mark W. Corley, Lingle & Corley, Rogers, AR, Clay Fulcher, Strait Law Firm, Dardanelle, AR, for plaintiffs.

James Crouch, Charles Harwell, Cypert, Crouch, Clark & Harwell, Springdale, AR, for defendants.

MEMORANDUM OPINION

H. FRANKLIN WATERS, Chief Judge.

Between September of 1985 and September of 1991 the plaintiffs entered into a series of one-year "floor" contracts in which they agreed to raise turkeys on their farms and sell them defendant, Swift-Eckrich, Inc., a "vertically integrated" turkey processor. The arrangement was that the plaintiffs agreed to purchase from Swift specified numbers of turkey poults to house, place, grow, and care for on their farms. At the end of the growing season for each flock, the turkeys were caught and transported by Swift employees or independent contractors hired by it to the processing plant located in Huntsville, Arkansas, to be processed. After the birds were processed, Swift repurchased the turkeys from plaintiff at a price determined by numerous factors including weight, grade, condemnation, market price, and several other factors specified in the contracts. Under this arrangement, the plaintiffs' ultimate income was determined, at least to a large degree, not only by their performance, but by market conditions at the time the birds were processed.

In September of 1991 the business relationship terminated, obviously not on good terms, and this lawsuit resulted. Plaintiffs, in their complaint and amended complaint, allege numerous causes of action, but it would serve no purpose to delineate them in this opinion. Instead, the court will discuss below those issues which the jury was allowed to consider at the conclusion of a trial which commenced on August 17, 1993, and ended on August 20, 1993.

After ruling on various pretrial motions and motions made during the trial, the court allowed the jury to consider whether the defendant in its dealings with the plaintiffs violated various provisions of the Packers and Stockyards Act (7 U.S.C. § 181 et seq.); whether such actions constituted a breach of contract; whether defendant breached an implied warranty of merchantability with respect to the poults delivered; and whether the acts of the defendant constituted common law fraud.

After deliberation, the jury, in answer to specific interrogatories submitted by the court, found in favor of the plaintiffs on each issue submitted with the exception of the implied warranty of merchantability claim. Because the court had, as expressed at the trial, concern about whether the law and the evidence supported certain portions of plaintiffs' claim that the Packers and Stockyards Act had been violated, the jury was asked, in Interrogatory No. 5, to separately specify damages which the jury found were recoverable in respect to certain issues or claims. Interrogatory No. 5 was completed as follows:

INTERROGATORY NO. 5 (a) STATE THE AMOUNT OF DAMAGES, IF ANY, YOU FIND WERE SUSTAINED BY THE PLAINTIFFS AS A RESULT OF VIOLATIONS OF THE PACKERS AND STOCKYARDS ACT IN CONNECTION WITH PLAINTIFFS' CONTENTION THAT DEFENDANT FAILED TO OFFER PLAINTIFFS PERFORMANCE CONTRACTS IN THE FOLLOWING YEARS (1) 1989 ANSWER: $124,000.00 (AMOUNT) (2) 1990 ANSWER: $ 56,000.00 (AMOUNT) (3) 1991 ANSWER: $ 71,500.00 (AMOUNT) (b) STATE THE AMOUNT OF DAMAGES, IF ANY, YOU FIND WERE SUSTAINED BY THE PLAINTIFFS AS A RESULT OF ANY OTHER VIOLATIONS OF THE PACKERS AND STOCKYARDS. ANSWER: $50,000.00 (AMOUNT) (c) STATE THE AMOUNT OF DAMAGES, IF ANY, YOU FIND WERE SUSTAINED BY THE PLAINTIFFS ON THEIR BREACH OF CONTRACT CLAIMS, BREACH OF WARRANTY CLAIMS AND FRAUD CLAIMS. ANSWER: $50,000.00 (AMOUNT) 8/20/93 Lisa Murphy (DATE) (SIGNATURE OF FOREPERSON

Defendant has timely moved for judgment as a matter of law, for remittitur, or for a new trial, and plaintiffs have responded. The attorneys for the parties have well-briefed the issues and the court has carefully considered their arguments and contentions, and is now prepared to rule.

I. Standard for Considering Motion for Judgment as a Matter of Law and Motion for a New Trial

Of course, prior to 1991 amendments made to the Federal Rules of Civil Procedure, a Rule 50 motion was a motion for directed verdict or motion for judgment notwithstanding the verdict. The 1991 amendments merely changed the name of these motions, but the standard for application of this rule remains the same.

As stated in 9 Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 2537 at 599 (1971): "The standard for granting judgment notwithstanding the verdict is precisely the same as the standard for directing a verdict." Id. (footnote omitted).

Thus, the test that this court must follow in ruling on the motion for judgment as a matter of law is well-stated in 9 Wright and Miller, Federal Practice and Procedure § 2524 as follows:

The question is not whether there is literally no evidence supporting the party against whom the motion is directed but whether there is evidence upon which the jury could properly find a verdict for that party. In determining whether the evidence is sufficient the court is not free to weigh the evidence or to pass on the credibility of the witnesses or to substitute its judgment of the facts for that of the jury. Instead, it must view the evidence most favorably to the party against whom the motion is made and give that party the benefit of all reasonable inferences from the evidence.

Id. at 543-45 (footnotes omitted).

The Court of Appeals for the Second Circuit, in Simblest v. Maynard, 427 F.2d 1 (2d Cir.1970), stated the test that is to be applied in words that have been oft repeated:

Simply stated, it is whether the evidence is such that, without weighing the credibility of the witnesses or otherwise considering the weight of the evidence, there can be but one conclusion as to the verdict that reasonable men could have reached.

Id. at 4.

The Court of Appeals for this circuit, in Jeanes v. Milner, 428 F.2d 598 (8th Cir.1970) advised trial courts that a judgment notwithstanding the verdict should be sparingly granted because to do so deprives the parties of their right to a jury trial. Be that as it may, it is clearly this court's duty to examine the record in the light most favorable to plaintiffs, but it must be examined under the "`requirements of the governing substantive law for the imposition of liability'" Kirchoff v. American Cas. Co., 997 F.2d 401, 404 (8th Cir.1993), quoting, Linegar v. Armour of America, Inc., 909 F.2d 1150, 1152 (8th Cir. 1990).

As to the standard to be applied in considering motions for a new trial, at least in this court's view the "law" in the Eighth Circuit before the court's decision in White v. Pence, 961 F.2d 776 (8th Cir.1992), had been cloudy, if not opaque. See our opinion in U.S. v. Schay, 746 F.Supp. 877 (E.D.Ark.1990), rev'd, 961 F.2d 776 (8th Cir.1992). As indicated in our Schay opinion, this court believes that some of the Eighth Circuit's opinions prior to Pence mixed and confused the standards for considering a motion for directed verdict with what should be a distinctly separate and different one when considering a motion for a new trial. However, in Pence the Court of Appeals said that: "The trial court can rely on its own reading of the evidence — it can `weigh the evidence, disbelieve witnesses, and grant a new trial even where there is substantial evidence to sustain the verdict.'" Pence, 961 F.2d at 780, quoting, Ryan v. McDonough Power Equip., 734 F.2d 385, 387 (8th Cir.1984).

A remittitur may be granted "when the verdict is so grossly excessive as to shock the court's conscience." American Business Interiors, Inc. v. Haworth, Inc., 798 F.2d 1135, 1146 (8th Cir.1986).

II. Packers and Stockyards Act Violation — Performance Contract Issue

A major thrust of plaintiffs' lawsuit and presentation at the trial involved alleged violations of § 202 of the Packers and Stockyards Act, codified as 7 U.S.C. § 192. That section provides, in pertinent part, as follows:

It shall be unlawful for any packer with respect to livestock, meats, meat food products, or livestock products in unmanufactured form, poultry, or for any live poultry dealer with respect to live poultry to:
(a) Engage in or use any unfair, unjustly discriminatory, or deceptive practice or device; or
(b) Make or give any undue or unreasonable preference or advantage to any particular person or locality in any respect whatsoever, or subject any particular person or locality to any undue or unreasonable prejudice or disadvantage in any respect whatsoever; or

7 U.S.C. § 192 (1980 & Supp.1993).

At the close of the evidence, the court ruled that plaintiffs had made a submissible case on whether the above quoted provisions of the Packers and Stockyards Act had been violated by defendant's claimed refusal to allow plaintiffs to change from a "floor contract" to a "performance contract," but expressed concern about whether the law and the evidence supported such ruling, and counsel were advised that, if the jury returned a verdict for plaintiffs on that issue, the court would carefully re-consider the issue if a motion for judgment as a matter of law was timely filed.1 It was primarily for this reason that the court required the jury to separately consider and specify the damages determined to be attributable to that alleged violation. Additionally, the court instructed the jury in Instruction No. 7 in respect to other alleged violations of the act as follows:

(C) FAILING TO TRANSPORT TURKEYS PROMPTLY AFTER LOADING AND DETERMINING THE GROSS WEIGHT FOR GROWER PAYMENT UPON ARRIVAL AT THE PROCESSING PLANT. PRIOR TO MAY OF 1989 THE REGULATIONS REQUIRED THE GROSS WEIGHT FOR GROWER PAYMENT TO BE DETERMINED PROMPTLY UPON
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