Liberty Mut. Ins. v. Employee Resource Management

• Decision Date: 29 March 2001
• Docket Number: No. C/A NO. 2-98-2205-18.,C/A NO. 2-98-2205-18.
• Citation: 176 F.Supp.2d 510
• Parties: LIBERTY MUTUAL INSURANCE COMPANY, Plaintiff, v. EMPLOYEE RESOURCE MANAGEMENT, INC.; William Attaway, Jr.; Robert Berman; William E. King, III; Robert T. Rand; and Kelli Yountz, Defendants.
• Court: U.S. District Court — District of South Carolina

176 F.Supp.2d 510

LIBERTY MUTUAL INSURANCE COMPANY, Plaintiff, v. EMPLOYEE RESOURCE MANAGEMENT, INC.; William Attaway, Jr.; Robert Berman; William E. King, III; Robert T. Rand; and Kelli Yountz, Defendants.

No. C/A NO. 2-98-2205-18.

United States District Court, D. South Carolina, Charleston Division.

March 29, 2001.

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W. Howell Morrison, Charleston, SC, Lynn E. Szymoniah, Boca Raton, FL, for plaintiff.

Timothy Bouch, O. Grady Query, W. Jefferson Leath, Charleston, SC, for defendants.

ORDER

NORTON, District Judge.

This matter is before the court on a veritable plethora of post-trial motions following a June 2000 jury trial in this matter.¹

I. Factual Background

Plaintiff commenced this action on July 28, 1998, asserting state law causes of action against Employee Resource Management, Inc. ("ERM") for breach of contract and violation of the South Carolina Unfair Trade Practices Act ("SCUTPA"). Plaintiff also asserted federal question causes of action against defendants Attaway, Berman, King, Rand, and Yountz ("Individual Defendants") for violation of 42 U.S.C. § 1962(a) and (c) of the Racketeering Influenced and Corrupt Organization Act ("RICO").

Pre-trial discovery in this case was extensive. The parties exchanged or reviewed an estimated thirty thousand (30,000) documents and took depositions of no less than twenty-five (25) fact and expert witnesses. Similarly, the parties' case-dispositive motions proved to be voluminous and complex.

A jury trial was held on June 12-19 and June 26-28, 2000. On June 27, 2000, this court granted the individual defendants judgment as a matter of law on the RICO § 1962(c) cause of action, but submitted the breach of contract and SCUTPA causes of actions against ERM to the jury on June 28, 2000. Later that same day, the jury returned verdicts for plaintiff on both causes of action, including a finding that ERM willfully violated the SCUTPA. The jury awarded plaintiff actual damages in the amount of $956,953.08 on both counts.

The deputy clerk entered a judgment in the amount of $956,592.08 on June 29, 2000. On July 6, 2000, plaintiff filed a Notice of Election of Remedy and Request for Additional Relief. In this Notice, plaintiff requested that this court treble the actual damages award and enter judgment accordingly for plaintiff in the amount of Two Million Eight-Hundred Sixty-Nine Thousand Seven Hundred Seventy-Six and 24/100 ($2,869,776.24) Dollars. In response, ERM filed motions for judgment as a matter of law, or in the alternative for a new trial, and in the alternative for a new trial nisi remittitur.

II. Defendant's Post-Trial Motions

A. Employee Resource Management's Motion for Judgment as a Matter of Law, or in the alternative, For a New Trial, and in the alternative, For a New Trial Nisi Remittitur

ERM moves pursuant to Rules 50(b) and 59 for an Order granting judgment as a matter of law, or in the alternative, for a new trial and/or new trial nisi remittitur.

1. ERM's Motion for Judgment as a Matter of Law Pursuant to Rule 50(b)

At the conclusion of plaintiff's case, defendants moved for Judgment as a Matter of Law pursuant to Rule 50(a) to dismiss Count II of plaintiff's Amended Complaint, which alleged violations of the South Carolina Unfair Trade Practices Act ("SCUTPA") against ERM. This court denied the motion. ERM now moves pursuant to Rule 50(b) for judgment as a matter of law on Count II of the Amended Complaint.

Rule 50(b) provides that: "[i]f, for any reason, the court does not grant a motion for judgment as a matter of law made at the close of all the evidence, the court is considered to have submitted the action to the jury subject to the court's later deciding the legal questions raised by the motion." A party is entitled to judgment as a matter of law "if the nonmoving party failed to make a showing on an essential element of his case with respect to which he had the burden of proof." Price v. City of Charlotte, 93 F.3d 1241, 1249 (4th Cir.1996) (quoting Bryan v. James E. Holmes Regional Med. Ctr., 33 F.3d 1318, 1333 (11th Cir.1994)). If there is any evidence on which a reasonable jury could return a verdict in favor of the nonmoving party, judgment as a matter of law should not be granted. See id. However, judgment as a matter of law is appropriate when the evidence can support only one reasonable conclusion. See Chaudhry v. Gallerizzo, 174 F.3d 394, 405 (4th Cir. 1999), cert. denied, 528 U.S. 891, 120 S.Ct. 215, 145 L.Ed.2d 181 (1999); Singer v. Dungan, 45 F.3d 823, 827 (4th Cir.1995); Persinger v. Norfolk & Western Ry. Co., 920 F.2d 1185, 1189 (4th Cir.1990) (holding that JNOV [now Judgment as a Matter of Law]² "should not be granted unless the evidence is so clear that reasonable men could reach no other conclusion than the one suggested by the moving party.").

The court must review the evidence and all reasonable inferences in the light most favorable to the nonmoving party. See Price, 93 F.3d at 1249. In considering a motion for judgment as a matter of law, the court must not re-weigh the evidence, make credibility determinations, or substitute its own judgment for the jury's. See id.; see also Anheuser-Busch, Inc. v. L & L Wings, Inc., 962 F.2d 316, 318 (4th Cir.1992), cert. denied, 506 U.S. 872, 113 S.Ct. 206, 121 L.Ed.2d 147 (1992). A party moving for judgment as a matter of law bears a heavy burden to establish that the jury's verdict should be invalidated. See Thompson v. Direct Impact, Co., 63 F.Supp.2d 721, 723 (E.D.Va.1998), aff'd 188 F.3d 503 (4th Cir.1999). In ruling on a renewed motion for judgment as a matter of law, a court may allow the jury's verdict to stand, order a new trial, or direct entry of judgment as a matter of law. See Fed. R.Civ.P. 50(b). In sum, "[a] renewed motion for judgment as a matter of law is not an occasion for the Court to usurp the jury's authority to weigh the evidence and gauge the credibility of witnesses." See Thompson, 63 F.Supp.2d at 723 (citing Taylor v. Home Ins. Co., 777 F.2d 849, 854 (4th Cir.1985)). "The defendant bears a `heavy burden' in establishing that the evidence is insufficient to uphold the jury's verdict." Thompson, 63 F.Supp.2d at 723 (citing Price, 93 F.3d at 1249).

2. ERM's Argument that the SCUTPA Only Applies to Consumer Protection or Antitrust Activity

In its Rule 50(b) motion, ERM reasserts an argument it made in its Rule 50(a) motion. It argues that the SCUTPA is limited solely to instances of consumer protection or antitrust activity, because the FTC Act [15 U.S.C. § 45(1)(n)] is so limited. ERM premises this argument on § 39-5-20(b) of the SCUTPA, which provides:

[I]t is the intent of the Legislature that in construing paragraph (a) of this section [declaring unlawful unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce] the courts will be guided by the interpretations given by the Federal Trade Commission and the Federal Courts to § 5(a)(1) of the Federal Trade Commission Act (15 U.S.C. 45(a)(1)), as from time to time amended.

Contrary to ERM's argument, § 39-5-20(b) merely provides that the courts shall be guided by the FTC and federal court interpretation.³ The language of the SCUTPA itself declares unlawful "unfair methods of competition and unfair or deceptive acts or practices within the conduct of any trade or commerce." S.C.Code Ann. § 39-5-209(a). The South Carolina Supreme Court recently held that "the provisions of any services constitutes commerce within the meaning of the UTPA." Taylor v. Medenica, 324 S.C. 200, 479 S.E.2d 35, 44 (1996). In at least two cases, the South Carolina Supreme Court affirmed the applicability of the SCUTPA in contexts that fall outside of the "usual" consumer protection and antitrust actions. See, e.g., Taylor v. Medenica, 479 S.E.2d at 44 (holding that both physician and laboratory medical services fell within the expansive commerce definition of the SCUTPA); Prestwick Golf Club, Inc. v. Prestwick, Ltd. Partnership, 331 S.C. 385, 503 S.E.2d 184, 187 (1998) (holding that abrogation of tee time schedule by defendant could give rise to a SCUTPA cause of action). Moreover, a federal district court in South Carolina has specifically held that the SCUTPA is not constrained solely to consumer protection:

[t]he UTPA does not expressly apply only to consumer transactions. Judicial interpretation of the UTPA, by requiring that a transaction must affect the public interest to be cognizable, may have given a de facto consumer orientation to it. But the South Carolina UTPA also includes transactions between businesses or commercial entities such as the parties to these actions. That this interpretation of South Carolina's UTPA is correct is necessarily implied by South Carolina decisions involving only non-consumer parties such as Noack Enterprises, Inc. v. Country Corner Interiors, 290 S.C. 475, 351 S.E.2d 347 (1986) and Key Co., Inc. v. Fameco Distributors, 292 S.C. 524, 357 S.E.2d 476 (1987). If a dispute between non-competing businesses or commercial entities were not within the UTPA's scope, the court would never have reached the issue of required involvement of the public interest in Noack or the issue of the insufficiency of a mere breach of contract in Fameco. Consequently, the fact the parties' transaction is not a consumer transaction does not prevent it from giving rise to a UTPA claim.

McTeer v. Provident Life & Accident Ins., 712 F.Supp. 512, 515 (D.S.C.1989). Based on the foregoing discussion, this court rejects ERM's argument that the SCUTPA is limited solely to instances of consumer protection or antitrust activity because the FTC Act [15 U.S.C. § 45(1)(n)] is so limited.

a. Liberty Mutual Proved that the Unfair/Deceptive Act Had An Impact Upon the Public Interest

In order for an unfair or deceptive act or practice to be covered under the SCUTPA, the unfair or deceptive act or practice must...