Progressive Emu, Inc. v. Nutrition & Fitness, Inc.

• Court: U.S. District Court — Northern District of Alabama
• Writing for the Court: ABDUL K. KALLON UNITED STATES DISTRICT JUDGE
• Decision Date: 31 May 2018
• Docket Number: Civil Action Number 2:12-cv-01079-AKK
• Citation: Progressive EMU, Inc. v. Nutrition & Fitness, Inc., Civil Action Number 2:12-cv-01079-AKK (N.D. Ala. May 31, 2018)
• Parties: PROGRESSIVE EMU, INC., Plaintiff, v. NUTRITION & FITNESS, INC., Defendant.

PROGRESSIVE EMU, INC., Plaintiff, v. NUTRITION & FITNESS, INC., Defendant.

Civil Action Number 2:12-cv-01079-AKK

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION

May 31, 2018

MEMORANDUM OPINION AND ORDER

The court has before it Progressive Emu's Motion to Alter, Amend or Vacate Directed Verdict and Interlocutory Orders, Renewed Motion for Judgment as a Matter of Law and/or Motion for New trial, doc. 258. This motion follows a three day jury trial during which the court granted directed verdicts in favor of Nutrition and Fitness, Inc. with regard to Pro Emu's claim for unpaid royalties related to alleged off-the-book sales and NFI's claim that it overpaid Pro Emu for certain orders of emu oil. Doc. 255 at 1-2. Pro Emu's breach of contract claim for unpaid royalties on reported sales in March and April 2012 was submitted to the jury, which found against Pro Emu. Id. at 2. Accordingly, the court entered judgment in favor of NFI on that claim. Id.

Pro Emu now argues that it is entitled to (1) either a new trial or judgment as a matter of law with respect to its breach of contract claim for unpaid royalties from March and April 2012; and (2) a new trial on its damages claim based on off-the-book sales. These arguments are now fully briefed; docs. 258-1 and 273, and ripe for review.¹ Upon careful consideration of the record and the parties' briefs, Pro Emu's motion is due to be denied.

I. STANDARD OF REVIEW

A court applies "precisely the same" standard for granting a Rule 50(b) motion for judgment as a matter of law as it does for "'granting the pre-submissionmotion [under 50(a)].'" McGinnis v. Am. Home Mortg. Servicing, Inc., 817 F.3d 1241, 1254 (11th Cir. 2016) (quoting Chaney v. City of Orlando, 483 F.3d 1221, 1227 (11th Cir. 2007)). Accordingly, "in ruling on a party's renewed motion under Rule 50(b) after the jury has rendered a verdict, [the] court's sole consideration of the jury verdict is to assess whether that verdict is supported by sufficient evidence." Chaney, 483 F.3d at 1227. In other words, when "considering a Rule 50(b) motion after the jury verdict, 'only the sufficiency of the evidence matters. The jury's findings are irrelevant.'" Cadle v. GEICO Gen. Ins. Co., 838 F.3d 1113, 1121 (11th Cir. 2016) (quoting Connelly v. Metro Atlanta Rapid Transit Auth., 764 F.3d 1358, 1363 (11th Cir. 2014)). In considering the sufficiency of the evidence, "'the court must evaluate all the evidence, together with any logical inferences, in the light most favorable to the non-moving party.'" McGinnis, 817 F.3d at 1254 (quoting Beckwith v. City of Daytona Beach Shores, 58 F.3d 1554, 1560 (11th Cir. 1995)). The court bears in mind, however, that, "'[i]t is the jury's task—not [the court's]—to weigh conflicting evidence and inferences, and determine the credibility of witnesses." McGinnis, 817 F.3d at 1254 (quoting Shannon v. Bellsouth Telecomms., Inc., 292 F.3d 712, 715 (11th Cir. 2002)).

Parties seeking relief after an unfavorable jury verdict may also request a new trial under Rule 59(a) on the grounds that "the [jury's] verdict is against the weight of the evidence, that the damages are excessive, or that, for other reasons,the trial was not fair . . . and may raise questions of law arising out of alleged substantial errors in admission or rejection of evidence or instructions to the jury." Montgomery Ward & Co. v. Duncan, 311 U.S. 243, 251 (1940). Thus, "'in a motion for a new trial the judge is free to weigh the evidence,'" Rabun v. Kimberly-Clark Corp., 678 F.2d 1053, 1060 (11th Cir. 1982) (quoting King v. Exxon Co., U.S.A., 618 F.2d 1111, 1115 (5th Cir. 1980)), and "may, in [her] discretion, grant [the motion] 'if in [the judge's] opinion, the verdict is against the clear weight of the evidence . . . or will result in a miscarriage of justice, even though there may be substantial evidence which would prevent the direction of a verdict.'" McGinnis, 817 F.3d at 1254 (quoting Hewitt v. B.F. Goodrich Co., 732 F.2d 1554, 1556 (11th Cir. 1984)).

Finally, the court may alter or amend a ruling under Rule 59(e) if "a party presents the court with evidence of an intervening change in controlling law, the availability of new evidence, or the need to correct clear error or manifest injustice." Summit Med. Ctr. of Ala., Inc. v. Riley, 284 F. Supp. 2d 1350, 1355 (M.D. Ala. 2003). Rule 59(e) motions, however, cannot be used "to relitigate old matters, [or to] raise argument or present evidence that could have been raised prior to the entry of judgment." Michael Linet, Inc. v. Vill. of Wellington, 408 F.3d 757, 763 (11th Cir. 2005). Indeed, the Eleventh Circuit has said "a motion to reconsider should not be used by the parties to set forth new theories of law . . .absent some showing that" the theory was previously unavailable. Mays v. U.S. Postal Serv., 122 F.3d 43, 46 (11th Cir. 1997).

A. Breach of Contract Claim for Unpaid Royalties

After years of extensive litigation, including two summary judgment rulings and an appeal, the core issue remaining for trial was Pro Emu's claim that NFI breached the parties' contract by failing to pay Pro Emu royalties in March and April 2012. Doc. 258-1 at 2. NFI argued that it was excused from making royalty payments because Pro Emu had already breached the contract by failing to use its best efforts to fill NFI's March 2012 order for emu oil. Doc. 231 at 6-10. At the close of NFI's case-in-chief, Pro Emu moved for a judgment as a matter of law asserting that it lacked both the money and the inventory to supply NFI's request for oil, and that it had accordingly satisfied the contract's "best efforts" requirement. See Doc. 264 at 171-73. The court denied the motion, id. at 173, which Pro Emu now moves to renew pursuant to Rule 50(b) of the Federal Rules of Civil Procedure. In the alternative, Pro Emu asks for a new trial on this issue pursuant to Rule 59(a). Doc. 258-1 at 9, 11.

1. Renewed Request for Judgement as a Matter of Law on the "Best Efforts" Issue

In support of its Rule 50(b) motion, Pro Emu primarily argues that the evidence is undisputed that it lacked the emu oil in March 2012 to supply NFI's order and that, under the Eleventh Circuit's mandate, the contract expressly limitedNFI's remedy to seeking replacement oil from other sources. Thus, Pro Emu argues that its actions constituted best efforts and that, in any event, NFI was not excused from making royalty payments.²

The parties generally agree on what the trial evidence showed. To summarize briefly, Pro Emu introduced evidence indicating that, at the time of NFI's March 2012 order for emu oil, it lacked both the oil to fill the order and the money to purchase replacement oil from another source. Doc. 264 at 172-73. The evidence also indicated that Pro Emu did not seek to acquire oil in the spot market via credit, as it subsequently demonstrated the ability to do, did not communicate with NFI regarding the oil shortage beyond stating it was unable to fill the order at the same time it provided NFI notice that it had filed the instant lawsuit, and that it otherwise failed to assist NFI in finding a replacement source for the oil. Doc. 263 at 92-95, 97-100. In its motion, Pro Emu seeks to avoid the import of this undisputed evidence by seeking to read the "best efforts" provision out of the contract by arguing that NFI's sole remedy for Pro Emu's failure to fill an order was to purchase replacement oil in the market. However, this argument is foreclosed by a prior ruling of this court in which Judge William Acker interpretedthe parties' contract to resolve this very issue explaining that "[P]ro Emu [was] . . . required to use all reasonable efforts in good faith to fulfill NFI's orders for emu oil." Doc. 82 at 8. Accordingly, Judge Acker found that the limitation on NFI's remedies imposed by ¶ 2.2 applied only to "failures to supply emu oil after Pro Emu [had] given its best efforts." Id. at 9.

Under the law of the case doctrine, once "a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages [of] the same case." Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 816 (1988) (quotation omitted). Although this doctrine is "discretionary and does not limit a court's power to reconsider its own decisions . . . 'where litigants have once battled for the court's decision, they should neither be required nor without good reason permitted, to battle for it again.'" Virgin Atl. Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992) (quoting Zdanok v. Glidden Co., 327 F.2d 944, 953 (2d Cir. 1964)). The rule serves "important goals vital to just and efficient judicial process, including the provision of an end to litigation . . . and the promotion of consistency in rulings between courts." Klay v. All Defendants, 389 F.3d 1191, 1197 (11th Cir. 2004). Indeed, "as matters wend closer to final disposition, stability takes on increased importance." McSurely v. McClellan, 753 F.2d 88, 96 (D.C. Cir. 1985) (quotation omitted).

To justify revisiting this long-settled legal issue, Pro Emu must show that Judge Acker's ruling constituted clear error,³ a showing that it has failed to make. Indeed, Pro Emu had the opportunity to challenge Judge Acker's construction of the contract on appeal, and it apparently elected not to do so.⁴ Further, during the trial, one of Pro Emu's executive officers, Andrew Martin, agreed that "an accurate statement of [Pro Emu's] obligations under the contract" was the requirement that Pro Emu "use its best efforts to fulfill all orders as quickly as is reasonably possible." Doc. 263 at 92. Accordingly, NFI's obligation to pay royalties was contingent on Pro Emu's use of its best efforts which Georgia law defines as the "use [of] reasonable diligence as well as good faith in [the] performance of the contract." Flynn v. Gold Kist, Inc., 353 S.E.2d 537, 539 (Ga. Ct. App. 1987) (quotation omitted). NFI, as...