Williams v. Anderson
400 P.3d 1071
Utah Ct. App.2017Background
- Williams (plaintiff) alleged he owned 30% of Fix A Phone LLC and that Anderson and Zite unlawfully canceled his ownership and then sold the business to Tricked Out Services. He sought 30% of the sale proceeds and other relief.
- Williams initially disclosed (per Utah R. Civ. P. 26) that he was entitled to “30% of the price Tricked Out Services, Inc., paid for Fix A Phone,” later amending to assert additional possible claims (equity, distributions, punitive damages).
- Defendants produced the asset purchase agreement showing a $200,000 purchase price plus a contingent profit-sharing provision; defendants asserted they sold the assets for $200,000.
- Defendants moved in limine to exclude Williams’s damages evidence, arguing his disclosures provided only a formula (30% of x) without a concrete computation, prejudicing their discovery and trial preparation.
- The district court granted the motion, ruling that a fixed percentage claim does not satisfy Rule 26(a)(1)(C)’s requirement for a computation of damages and barred Williams from presenting damages evidence at trial.
- On interlocutory appeal, the Utah Court of Appeals held Williams’s disclosure that he sought 30% of the purchase price constituted an adequate computation for that component of damages (given defendants knew the $200,000 price), reversed the exclusion as to that claim, and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether stating entitlement to “30% of the price paid” satisfies Rule 26(a)(1)(C)’s requirement to disclose a computation of damages | Williams: disclosure identified the fact of damages and the method (30% of sale price); defendants knew the sale price so the computation was knowable ($60,000) | Defendants: a formula (30% of x) without defining x is not a computation; defendants were prejudiced in discovery and trial prep | Court: Disclosure of 30% of the purchase price satisfied Rule 26 for that component because defendants possessed the purchase price, so exclusion of that damages evidence was error |
| Whether references to other possible recovery (profit-share, distributions, equity, punitive damages) undermine adequacy of the 30% disclosure | Williams: even if he sought other items, his disclosure of 30% of the purchase price was consistent and clear | Defendants: ambiguity about other claimed items supports finding inadequate disclosure and prejudice | Court: Ambiguity about other items did not negate adequacy of the specific 30%/purchase-price disclosure; the court limited reversal to the $200,000 purchase-price component |
Key Cases Cited
- Design Strategy, Inc. v. Davis, 469 F.3d 284 (2d Cir. 2006) (disclosure must identify damage category and a supported computation; undifferentiated financial data without explanation may be insufficient)
- City & County of San Francisco v. Tutor-Saliba Corp., 218 F.R.D. 219 (N.D. Cal. 2003) (adequacy of damages computation depends on context; disclosures may require some analysis or method)
- Stevens-Henager College v. Eagle Gate College, 248 P.3d 1025 (Utah Ct. App. 2011) (discussing the scope of disclosure obligations under Rule 26)
- Askew v. Hardman, 918 P.2d 469 (Utah 1996) (standard for reviewing discovery rulings: abuse of discretion requires legal error or no evidentiary basis)