MINNESOTA SUPPLY COMPANY, a Minnesota Corporation, Plaintiff-Appellee/Cross-Appellant, v. The RAYMOND CORPORATION, a New York Corporation, Defendant-Appellant/Cross-Appellee.
Nos. 04-1416/1850/2168/2169
United States Court of Appeals, Eighth Circuit.
Submitted: Feb. 14, 2005. Filed: Dec. 28, 2006.
472 F.3d 524
Accordingly, the judgment of the district court is affirmed.
Before ARNOLD, BOWMAN, and GRUENDER, Circuit Judges.
BOWMAN, Circuit Judge.
In this diversity action, a jury returned a verdict in favor of Minnesota Supply Company (MN Supply) against The Raymond Corporation (Raymond) on three claims arising under the Minnesota Heavy and Utility Equipment Manufacturers and Dealers Act (HUEMDA),
I.
Raymond and MN Supply entered into a dealership agreement in 1947 whereby MN Supply would act as a dealership for lift trucks, i.e., forklifts, manufactured by Raymond. MN Supply was located in Eden Prairie, Minnesota, and its territory under the dealership agreement included Minnesota, North Dakota, South Dakota, and the western counties of Wisconsin. MN Supply sold only lift trucks manufactured by Raymond until 1989, when MN Supply also began selling lift trucks manufactured by Caterpillar. These Caterpillar lift trucks were designed and classified differently from the Raymond lift trucks and because of market conditions and customer preferences, generally did not compete with the Raymond lift trucks.
Also in 1989, the Minnesota legislature passed HUEMDA. HUEMDA specified that a heavy-equipment manufacturer must have good cause to terminate, cancel, or fail to renew a dealership agreement or to change the competitive circumstances of the agreement. The statute gave examples of what would constitute such good cause and specified certain actions that would amount to violations of HUEMDA. In particular, HUEMDA made it a violation for a manufacturer to “coerce an equipment dealer into a refusal to purchase the equipment manufactured by another equipment manufacturer.”
In 1990, MN Supply and Raymond updated their dealership agreement. One provision (Paragraph 18) of the updated agreement gave Raymond the right to terminate the agreement if MN Supply sold lift trucks that competed directly with Raymond lift trucks without first obtaining Raymond‘s written consent. Again, the Caterpillar trucks sold by MN Supply at the time were considered noncompeting because of their different design and target customer. In 1992, however, Raymond began producing narrow-aisle lift trucks for Caterpillar that did compete directly with the Raymond brand of lift trucks.1
Raymond was concerned about MN Supply‘s diversion of time and attention from representing Raymond lift trucks, and Raymond wanted to ensure that MN Supply would maintain Raymond‘s market share in MN Supply‘s territory. For this reason, Raymond negotiated changes to the dealership agreement before giving MN Supply consent to sell the competing Caterpillar lift trucks. The primary factor driving these negotiations was the threat that Raymond would terminate the dealership agreement pursuant to Paragraph 18 if MN Supply did not agree to amend the terms. By 1993, the parties had negotiated an amendment (the 1993 Amendment) under which MN Supply agreed to create a separate and independent division for the sale of Caterpillar narrow-aisle lift trucks. The 1993 Amendment also required MN Supply to maintain the market share for Raymond lift trucks that MN Supply had achieved in 1992, and it gave Raymond the right to terminate the dealership agreement if these conditions were not met. After the parties executed the 1993 Amendment, MN Supply began selling the competing line of Caterpillar lift trucks.
By 1995, Raymond‘s market share in MN Supply‘s territory had diminished substantially. Raymond expressed its concern to MN Supply, and MN Supply asked for a year‘s time to improve. In addition, MN Supply submitted to Raymond a business plan and performance objectives but nevertheless failed to reach the required performance levels over the next year. Raymond served notice to MN Supply on December 31, 1996, that it wished to terminate the dealership agreement, and Raymond denied MN Supply‘s request to provide a further extension to the agreement. The parties then began the process of terminating their fifty-year relationship.
The 1990 dealership agreement provided that as part of the termination process, Raymond would repurchase certain parts and inventory from MN Supply. The parties met in April 1997 to discuss this repurchase and other transitional issues. After the meeting, Raymond sent MN Supply a document entitled Termination by Mutual Consent (TMC) to spell out some of the termination issues. This document included a release of any claims by MN Supply against Raymond. The parties had several conversations regarding the TMC, and during the process of negotiating, Raymond informed MN Supply that Raymond would not move forward with the parts repurchase unless the TMC was finalized.
Further negotiations ensued, and MN Supply returned to Raymond a modified draft of the TMC it had received from Raymond. The modified draft included a release of any claims by Raymond against MN Supply similar to the release MN Supply had been asked to sign. MN Supply‘s modified draft of the TMC also declared Minnesota law as controlling the agreement, which was contrary to Raymond‘s original draft declaring New York law as controlling. MN Supply‘s president had signed the modified draft of the TMC before sending it to Raymond, but MN Supply never received a signed copy of the modified draft back from Raymond. In fact, MN Supply heard nothing more about the TMC until after the termination. Raymond claims its vice president of sales received the modified draft, signed it, and placed it in Raymond‘s file without sending a signed copy back to MN Supply. In any
In 1999, MN Supply brought this diversity action in federal court, claiming three violations of HUEMDA. MN Supply first claimed that Raymond had unlawfully coerced MN Supply into agreeing to the 1993 Amendment by threatening to terminate the dealership agreement if MN Supply sold the Caterpillar narrow-aisle lift trucks. MN Supply next claimed that the 1993 Amendment constituted a change in competitive circumstances imposed by Raymond without good cause. Finally, MN Supply claimed that Raymond‘s termination of the dealership agreement in 1997 was without good cause because it was based on MN Supply‘s failure to meet unreasonable terms set forth in the 1993 Amendment. Each party moved for summary judgment, with Raymond arguing, inter alia, that the suit was barred by the release of claims contained in the TMC and with MN Supply countering that the TMC was never formed. The court granted MN Supply‘s motion in part, finding that because Raymond never sent a signed copy of the TMC back to MN Supply, the release of claims contained in the TMC was not enforceable. The court denied Raymond‘s motion for summary judgment and the remainder of MN Supply‘s motion, and the parties prepared for a jury trial.
Prior to trial, the District Court held a jury-instruction conference at which Raymond sought to have the jury instructed that the TMC‘s release provision was an affirmative defense to MN Supply‘s claims, notwithstanding the partial grant of summary judgment in favor of MN Supply on the issue. MN Supply filed a motion in limine arguing that any evidence of the TMC should be suppressed pursuant to the District Court‘s summary judgment order. In response to MN Supply‘s motion in limine, Raymond brought forward alleged new evidence that it had indemnified MN Supply in a product-liability suit in 1997 and that this indemnification was pursuant to the terms of the TMC. This evidence, Raymond claimed, indicated that the TMC had indeed been formed. The District Court agreed with MN Supply, ruling that the evidence of indemnification should have been produced at the summary judgment stage and that no evidence of the TMC could be produced to the jury.
At trial, as evidence of damages, MN Supply produced an expert who testified that MN Supply had lost more than $14 million as a result of the 1997 termination of the dealership agreement. In reaching the amount of lost profits occurring before and after trial, the expert had present-valued certain portions of the actual losses claimed. Raymond objected, arguing that MN Supply‘s expert had included prejudgment interest in his estimate of damages, which by statute was to be calculated by the court, not the jury. See
After MN Supply finished presenting its case, Raymond moved for judgment as a matter of law (JAML) pursuant to
After the verdicts were returned, Raymond again moved for JAML on all of MN Supply‘s claims or, in the alternative, for a new trial. MN Supply countered that Raymond had waived the opportunity to argue for JAML by not renewing its motion at the close of all evidence. The District Court disagreed with MN Supply on the waiver issue and went on to deny most of Raymond‘s motion for JAML on the merits. The District Court partially granted Raymond‘s motion by ruling that the damages award, based as it was on the testimony of MN Supply‘s expert, included prejudgment interest, and the court reduced the award by almost $1.7 million. The District Court denied Raymond‘s alternative motion for a new trial. MN Supply then moved to amend the judgment by adding statutory prejudgment interest, and the District Court granted MN Supply‘s motion. As the prevailing party, MN Supply moved for an award of attorney fees and costs as provided in HUEMDA. The District Court granted MN Supply‘s motion, but awarded MN Supply an amount less than what MN Supply had requested—most significantly discounting the amount requested for MN Supply‘s damages expert.
Raymond appeals the partial grant of summary judgment barring its defense based on the release-of-claims provision in the TMC, appeals the denial of its motions for JAML or a new trial, appeals the award of damages, and appeals the award of certain attorney fees. MN Supply cross-appeals the reduction of the damages award and the amount awarded in expert witness fees.
II.
A.
The first question Raymond has raised for our review is whether the District Court erred in its partial grant of summary judgment to MN Supply by determining that, as a matter of law, the TMC was never formed. We review a grant of summary judgment de novo, viewing the evidence in the light most favorable to the non-moving party. Cameo Homes v. Kraus-Anderson Const. Co., 394 F.3d 1084, 1087 (8th Cir. 2005). We will affirm if there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Id. (citing
Under Minnesota law, the existence of a contract is a question of fact ordinarily decided by the jury. Herron v. Green Tree Acceptance, Inc., 411 N.W.2d 192, 195 (Minn. Ct. App. 1987). Delivery of a written contract is usually an essential element of execution because it provides “an overt, objective manifestation” of a party‘s intent to enter the contract. Nodland v. Chirpich, 307 Minn. 360, 240 N.W.2d 513, 517 (Minn. 1976). But “where one to whom an offer is made goes ahead and performs in accordance with the offer,” that performance constitutes acceptance of the offer. Johnson v. M.J. O‘Neil, Inc., 182 Minn. 232, 234 N.W. 16, 17 (Minn. 1931). If reasonable minds could differ as to whether Raymond performed the terms of the TMC, and thereby accepted the TMC as modified by MN Supply, then summary judgment was improper.
It is undisputed that Raymond failed to send a signed copy of the modified TMC back to MN Supply. Given that the TMC
Even viewing the evidence in the light most favorable to Raymond, we cannot draw the requested inference. MN Supply‘s modification of the TMC added a broadly worded release of claims by Raymond that mirrored the release Raymond was seeking from MN Supply. The modified draft also differed from Raymond‘s proposed draft in its declaration as to which state‘s law would govern the agreement. Thus, the modified draft MN Supply signed and sent to Raymond was a substantially different document than the draft MN Supply had received from Raymond. Without any other expressed assent or performance of the agreement, we cannot infer a meeting of the minds, given Raymond‘s silence and lack of further negotiation.
Nor can we infer that the equipment repurchase, which we reiterate was not required by the TMC, communicated an acceptance of that agreement. Raymond, when faced with a new draft of the TMC releasing all claims against MN Supply, may have abandoned its own desire for a release of claims, instead deciding to move forward with the equipment repurchase as planned. Further, MN Supply produced evidence that the equipment repurchase was already required by the dealership agreement, which would have prevented Raymond from making the TMC a condition precedent to the repurchase. In any event, we simply cannot make the inference of acceptance Raymond requests without some evidence that Raymond performed under the TMC as modified by MN Supply. Such evidence was missing from the record before the District Court when it granted MN Supply‘s motion. We therefore affirm the District Court‘s partial grant of summary judgment to MN Supply.
B.
We next must decide whether the District Court erred by refusing to reconsider its partial grant of summary judgment to MN Supply when faced with Raymond‘s alleged newly discovered evidence. A threshold question is whether the District Court‘s “refusal” is properly before this Court on review. It is undisputed that Raymond failed to file a motion for relief from the District Court‘s partial summary judgment order. See
Raymond realized during depositions taken after the summary judgment order that it had defended and indemnified MN Supply against a product-liability claim in 1997. According to Raymond, this was new evidence that Raymond had performed the TMC, which, if formed, would have required the defense and indemnification that Raymond provided. The District Court twice denied effective reconsideration of its order based on this evidence, finding that Raymond should have been aware of the defense and indemnification at the summary judgment stage. In so ruling, the District Court did not abuse its discretion.
We have no doubt that the TMC, if formed, would have precluded MN Supply from bringing any of its claims against Raymond. Raymond, however, was aware of the provisions of the TMC and, when faced with a summary judgment motion challenging the agreement‘s formation, could have scoured its records for evidence of having performed the terms of the agreement. Had Raymond done so, it likely would have discovered (or recalled) that it had defended and indemnified MN Supply only a few years earlier. More importantly, Raymond has offered no reason why this evidence could not have been discovered with due diligence before the summary judgment hearing. That Raymond failed to exercise due diligence does not make the evidence new, nor does its failure justify extraordinary relief from judgment under
III.
Raymond next claims that the District Court erred by allocating to Raymond the burden of showing that it had good cause to terminate the dealership agreement. See
To our knowledge, the question of who has the burden of proof under HUEMDA has not been litigated in the Supreme Court of Minnesota. The Minnesota Court of Appeals, however, squarely placed the
IV.
Raymond further claims that the District Court erred by denying its post-verdict motion for JAML under
Ordinarily, a party who fails to renew a
For scheduling reasons, the District Court deferred argument and ruling on Raymond‘s
V.
The District Court‘s denial of Raymond‘s motion for JAML is a matter of law that we review de novo, applying the same standards as the District Court. Douglas County Bank, 207 F.3d at 477. We ask whether sufficient evidence supports the jury‘s verdict, viewing the evidence in the light most favorable to the party who prevailed at trial. Id. “We will uphold the jury‘s verdict unless we conclude a reasonable jury could not have found for [MN Supply.]” Pittari v. Am. Eagle Airlines, Inc., 468 F.3d 1056, 1061 (8th Cir. 2006).
The jury determined that MN Supply prevailed on each of its three HUEMDA claims. We address whether judgment as a matter of law should have been granted on each claim in turn.
A.
MN Supply‘s first claim arises from HUEMDA
Prior to trial, Raymond argued that the jury would need guidance as to whether, in order to constitute a violation of the statute, the result of the coercion must be a refusal to purchase the equipment of another manufacturer. The District Court chose to instruct the jury that coercion is “conduct that constitutes the improper use of economic power to compel another to submit to the wishes of one who wields it.” Trial Tr. at 1908. The court then instructed the jury that in order for MN Supply to prevail, the jury had to find, inter alia, that Raymond “sought to coerce” MN Supply into refusing to carry the competing Caterpillar line. Id. It was thus left to the jury to decide whether Raymond‘s threat
Because our review of Raymond‘s motion for JAML requires a review of the District Court‘s post-verdict interpretation of HUEMDA, our review exceeds the scope of a typical Rule 50 review of the sufficiency of the evidence. See
Statutory interpretation is a question of law that we review de novo. Metro Motors v. Nissan Motor Corp., 339 F.3d 746, 749 (8th Cir. 2003). Under
We are satisfied that HUEMDA does not prohibit a manufacturer‘s efforts to persuade a dealer not to purchase equipment from a rival manufacturer. In reaching this conclusion, we are not swayed by MN Supply‘s efforts to analogize HUEMDA with the Minnesota Motor Vehicle Sale and Distribution Act (MVSDA), see
There is no evidence that MN Supply refused to purchase another manufacturer‘s equipment. Having discovered that MN Supply planned to sell the competing Caterpillar line, Raymond sought to “ensure the continued competitive presence of Raymond products in the markets [served by MN Supply].” Letter from Colquhoun to Koch of Aug. 6, 1992, at 1 (internal quotes and capitalization omitted). Raymond also sought to ensure that MN Supply did not “divert time and attention from the agressive representation of [Raymond‘s] products in the marketplace.” Id. Accordingly, Raymond gave MN Supply the option of either terminating the dealership agreement or changing MN Supply‘s obligations under the agreement. By negotiating the 1993 Amendment, Raymond consented to MN Supply‘s purchasing of the competing Caterpillar narrow-aisle lift trucks, consistent with Paragraph 18 of the dealership agreement. There is no evidence that MN Supply was coerced into accepting Paragraph 18, nor that MN Supply ever challenged the legality of Paragraph 18 while enjoying the benefits of the agreement. We hold that Raymond‘s threatened exercise of its right under Paragraph 18 to terminate the dealership agreement did not coerce MN Supply into refusing to purchase another manufacturer‘s equipment.
Implicit in this holding is our conclusion that Paragraph 18 was not voided by HUEMDA. We do not believe that HUEMDA prohibits a manufacturer from terminating a dealership agreement with a dealer who chooses to offer competing equipment where that termination was expressly provided for in the agreement. HUEMDA specifies that a manufacturer may terminate a dealership agreement for “good cause.”
B.
MN Supply‘s second claim was that Raymond violated HUEMDA by substantially changing the competitive circumstances of the dealership agreement without good cause. See
HUEMDA defines “good cause” as the “failure by an equipment dealer to substantially comply with essential and reasonable requirements imposed upon the dealer by the dealership agreement, if the requirements are not different from those requirements imposed on other similarly situated dealers by their terms.”
C.
MN Supply‘s third claim was that Raymond terminated the dealership agreement in 1997 without good cause in violation of
HUEMDA states that “[n]o equipment manufacturer . . . may terminate . . . a dealership agreement without good cause.”
MN Supply‘s concerns were justified. Koch testified that MN Supply could not achieve the market-share benchmarks because “[t]he market was in a very dynamic state.” Id. at 362. Despite selling 50% more trucks in 1994 than in 1992, for example, MN Supply‘s market share dropped. Id. MN Supply presented evidence that Raymond refused its requests to have purchases by the Target Corpora-
In addition to setting market-share benchmarks, the 1993 Amendment required MN Supply to “improve, or at least maintain, its dollar volume of parts per truck of population” sales. Letter from Dinn to Koch of Oct. 27, 1993, at 1. Koch told the jury that this parts-purchase requirement created “unachievable goals” because the benchmark was based on inaccurate reports that overestimated the number of Raymond trucks in use in MN Supply‘s territory. Trial Tr. at 304. This is further evidence from which the jury could have found the conditions in the 1993 Amendment unreasonable.
After hearing all of Koch‘s testimony, a reasonable jury could have found the performance requirements in the 1993 Amendment unreasonable and more stringent than those imposed on similarly situated dealers. As such, MN Supply‘s failure to comply with the requirements would have been insufficient under HUEMDA to give Raymond good cause to terminate. The District Court properly upheld the jury‘s verdict on this claim.
VI.
Because we have affirmed the District Court‘s entry of judgment on MN Supply‘s wrongful termination claim, we must address the parties’ arguments relating to the award of damages, attorney fees, and actual costs. HUEMDA permits the successful dealer-plaintiff to collect “damages sustained by the dealer as a consequence of the manufacturer‘s violation, together with the actual costs of the action, including reasonable attorney‘s fees.”
A.
Both parties present challenges to the damages award. At trial, MN Supply introduced the testimony of Frederic Lieber, a damages expert who calculated MN Supply‘s total damages from the termination of the dealership agreement at $14,076,784.9 In arriving at this total damages figure, Lieber calculated the profits lost by MN Supply prior to trial at $4,196,271 and then present-valued that amount to $5,886,819. Before the case was submitted to the jury, Raymond argued that the difference between the two amounts—approximately $1.7 million—was prejudgment interest that, by state statute, may only be calculated by the court.
On appeal, Raymond argues that the District Court erred in allowing Lieber‘s damages calculation including prejudgment interest to go to the jury. Raymond asserts that Lieber‘s entire opinion and report should have been stricken and a directed verdict entered for Raymond on all claims.10 MN Supply cross-appeals, arguing that the District Court erred in deeming the $1.7 million prejudgment interest and in decreasing the jury‘s award of damages.
Whether the District Court properly characterized the $1.7 million as prejudgment interest rather than as part of the present-valuing calculation is a matter of Minnesota law that we review de novo. See Conwed Corp. v. Union Carbide Corp., 443 F.3d 1032, 1039 (8th Cir. 2006) (standard of review), citing Salve Regina Coll. v. Russell, 499 U.S. 225, 231 (1991). As recognized by the District Court, no Minnesota case discusses the interplay between Minnesota‘s prejudgment-interest statute and the present-valuing of future or past damages from lost profits. Our Court has recognized, however, that in Minnesota, prejudgment interest “is designed to compensate the plaintiff for the loss of the use of the money owed.” Simeone v. First Bank Nat‘l Assoc., 73 F.3d 184, 191 (8th Cir. 1996). Lieber testified that he arrived at the $1.7 million figure by calculating the amount that MN Supply would have earned had it invested the profits it lost from 1997 to 2002 at an eighteen percent rate of return.11 Trial Tr. at 809-10. It appears to us that this figure therefore represents “prejudgment interest” under Minnesota law. See ZumBerge v. N. States Power Co., 481 N.W.2d 103, 110 (Minn. Ct. App. 1992) (interpreting expert‘s “calculation of the time value of the losses, i.e., what the ZumBerges would have accrued in interest if they would have put the loss amount in the bank each year earning 10% interest” as “prejudgment interest” such that expert‘s calculation should not have been considered by the jury); Security Prot. Servs., Ltd. v. Evenson, Nos. C4-92-556, C8-92-561, C6-92-1336, 1993 WL 14338, *3 (Minn. Ct. App. Jan. 26, 1993) (holding that expert‘s calculation of “amount which [plaintiff] would have earned had it invested all of the money that it sought as damages” was evidence of prejudgment interest that should not have been considered by the jury). We conclude that the District Court correctly determined that Lieber‘s analysis improperly included prejudgment interest which could only be calculated by the
We do not agree with Raymond, however, that JAML must be granted in its favor because the jury was allowed to consider Lieber‘s opinion including prejudgment interest. When evidence of prejudgment interest is erroneously admitted at trial, an appellant is not entitled to a new trial unless it proves that it was prejudiced by the error. See ZumBerge, 481 N.W.2d at 110. Because the District Court reduced the damages award by the $1.7 million improperly included in Lieber‘s calculation before correctly calculating the prejudgment interest according to Minnesota statute,13 Raymond can establish no prejudice.
Raymond also argues that Lieber‘s opinion was not reliable and should have been stricken because Lieber (1) incorrectly assumed that the termination of the dealership agreement caused MN Supply to lose all income generated from the sale of Raymond parts, service, and used equipment, (2) artificially inflated the amount that MN Supply would have received in cash discounts for purchases from Raymond, and (3) based his calculation of lost commissions to be paid by Raymond to MN Supply on unsupported assumptions tying commissions to new equipment sales. Raymond asserts that because of these alleged errors, Lieber‘s opinion cannot as a matter of law support the jury‘s damages award. We review a district court‘s admission of expert testimony for abuse of discretion. Children‘s Broad. Corp. v. Walt Disney Co., 357 F.3d 860, 864 (8th Cir. 2004).
Raymond‘s objections to Lieber‘s opinion are more appropriately directed to the weight of the testimony, not its admissibility:
As a general rule, the factual basis of an expert opinion goes to the credibility of the testimony, not the admissibility, and it is up to the opposing party to examine the factual basis for the opinion in cross-examination. Only if the expert‘s opinion is so fundamentally unsupported that it can offer no assistance to the jury must such testimony be excluded.
Id. at 865 (internal quotation marks and citations to quoted cases omitted). Raymond had an opportunity at trial to cross-examine Lieber regarding these matters, and it was within the province of the jury to evaluate issues of fact and credibility. We have examined the record and cannot say that Lieber‘s testimony was so unsupported that it could offer no assistance to the jury. Accordingly, the District Court did not abuse its discretion in refusing to strike the testimony.
We affirm the District Court‘s award of damages in all respects.
B.
Next, Raymond appeals the District Court‘s award of attorney fees and costs to MN Supply. Raymond‘s first basis for this challenge is inextricably linked
VII.
The judgment entered by the District Court on the jury verdict in favor of MN Supply is reversed on MN Supply‘s first and second claims, and affirmed on MN Supply‘s third claim. We remand the case and instruct the District Court to enter judgment as a matter of law in favor of Raymond on MN Supply‘s first and second claims, and to award damages, attorney fees, and costs to MN Supply consistent with this opinion.
