Schutz Container Systems, Inc. et al v. Mauser Corp. et al
Filing
359
ORDER: Plaintiff's Motion to Exclude Putative Expert Testimony from Michael Laskinski 307 is GRANTED as to any testimony based upon his appointment calculation. Defendants' Motion to Exclude the Survey and Testimony of Dr. Kenneth Bernha rdt 308 is DENIED. Defendants' Motion to Preclude Plaintiff from Offering Evidence, Testimony, or Argument Regarding Defendants' Reconditioned IBC's 309 is DENIED. Defendants' Motion to Strike Witnesses is GRANTED IN PART an d DENIED IN PART. Plaintiff will be permitted to call Mr. Leddy as a witness. However, as to the remaining witnesses disclosed by Plaintiff, those witnesses may be called solely to authenticate documents if Defendants are unwilling to stipulate to au thentication. Defendants' Motion to Exclude Certain Testimony From Plaintiff's Expert Dr. Sher Paul Singh 311 is DENIED. Plaintiff's Motion to Strike and/or for Leave to File Sur-Reply 345 is DENIED. Signed by Judge Richard W. Story on 3/31/2014. (cem)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
SCHÜTZ CONTAINER
SYSTEMS, INC.
Plaintiff,
v.
MAUSER CORPORATION and
NATIONAL CONTAINER
GROUP, LLC,
Defendants.
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CIVIL ACTION NO.
1:09-CV-3609-RWS
ORDER
This case is before the Court for consideration of the following motions:
Plaintiff’s Motion to Exclude Putative Expert Testimony from Michael Lasinski
[307]; Defendants’ Motion to Exclude the Survey and Testimony of Dr.
Kenneth L. Bernhardt [308]; Defendants’ Motion to Preclude Plaintiff From
Offering Evidence, Testimony, and Argument Regarding Defendants’
Reconditioned IBCs [309]; Defendants’ Motion to Strike Witnesses that
Plaintiff Did Not Disclose During Discovery and Preclude Plaintiff From
Offering Testimony From Such Witnesses [310]; Defendants’ Motion to
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Exclude Certain Testimony From Plaintiff’s Expert Dr. Sher Paul Singh [311];
and Plaintiff’s Motion to Strike and/or Leave to File Sur-Reply Regarding
Defendants’ Alleged June 21, 2013 Undertaking With Respect to Washed
Cross-Bottled IBCs [345]. The Court will address each of the Motions in turn.
Plaintiff’s Motion to Exclude Putative Expert Testimony from Michael
Lasinski [307]
Defendants have proffered Michael J. Lasinski as an expert to offer
opinions regarding the proper costs to be deducted from Defendants’ revenues
and to make other proper adjustments, such as apportionment, to determine the
amount of Defendants’ profits that Plaintiff would be entitled to recover if it
were to succeed in proving liability. Plaintiff challenges Mr. Lasinski’s
testimony as not being helpful to the jury and not being based on a reliable
methodology.
First, Plaintiff asserts that Mr. Laskinski fails to offer an opinion
regarding the costs that should be deducted from Defendants’ revenues to
determine its profits. Plaintiff argues that Mr. Laskinski merely suggests “could
be” conclusions that would provide no assistance to the jury.
While it is true that Mr. Laskinski does identify a number of different
costs that could be deducted depending upon the decision of the fact finder, the
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Court finds that he did, in fact, offer his own opinion on the subject.
Specifically, he stated his opinion that the appropriate measure of profits to
which Plaintiff would be entitled is $514,572. He also stated the basis for his
calculation of that amount.
As a part of Mr. Laskinski’s opinion, he relied upon an apportionment
factor of 16.7% to identify the portion of Defendants’ profits that should be
attributed to Defendants’ unlawful conduct. In arriving at this percentage, Mr.
Laskinski relies upon the testimony of Brett White, Plaintiff’s National Sales
Manager, and the report of Diana Twede, an expert who was subsequently
withdrawn by Defendants. Despite a lack of experience in this area of
marketing, Mr. Laskinski essentially combined the testimony of White and
Twede and settled on five factors of demand for the product at issue. He then
added a sixth factor, the effect of the alleged unlawful activity. Most
troublesome, he then attributed equal weight to all six factors in creating his
apportionment formula. There is no evidence in the record that supports this
calculation. Therefore, the Court finds that the calculation of damages based on
this apportionment theory is flawed and is not admissible. Plaintiff’s Motion to
Exclude Putative Expert Testimony from Michael Laskinski [307] is
GRANTED as to any testimony based upon his apportionment calculation.
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Defendant’s Motion to Exclude the Survey and Testimony of Dr. Kenneth
L. Bernhardt [308]
Dr. Kenneth Barnhardt conducted a survey on behalf of Plaintiff
regarding the respondents’ beliefs about cross bottling. Dr. Bernhardt did not
test for the likelihood of confusion for whether consumers were deceived by the
accused advertising statements. In fact, the accused advertisements were not
shown to respondents. Defendants assert that because the survey offers no
evidence or information on the issues of confusion or deception, it is irrelevant
and should not be admitted at the trial. Further, Defendants assert that any
probative value of the survey is outweighed by the risk of prejudice to
Defendants.
Plaintiff acknowledges that the survey did not directly test broad issues
of customer confusion and actual deception caused by Defendants’ advertising.
However, because Defendants have argued that when their customers buy
cross-bottled IBCs bearing the SCHÜTZ mark, the customers appreciate any
performance differences between those products and genuine Schütz IBCs,
Plaintiff should be permitted to offer Dr. Bernhardt’s survey to establish what
customers actually believe. Plaintiff further argues that because the case will
not be tried to a jury, concerns about prejudicial effect are reduced.
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While the Court finds that Dr. Bernhardt’s survey has very limited
relevance to the issues to be decided by the Court, the Court finds that the
survey may, in fact, have some relevance. Because this will be a bench trial, the
Court is not concerned about undue prejudice to Defendants arising from the
evidence. Therefore, Defendants’ Motion to Exclude the Survey and Testimony
of Dr. Kenneth Bernhardt [308] is DENIED.
Defendants’ Motion to Preclude Plaintiff From Offering Evidence,
Testimony, or Argument Regarding Defendants’ Reconditioned IBCs
[309]1
During discovery, Defendants requested from Plaintiff’s wholly-owned
subsidiary, Cardinal Container, “[a]ll documents related to Cardinal’s quality
control procedures related to re-conditioned, re-bottled, and/or cross-bottled
IBCs.” (Defs.’ Br. [309], Ex. C). In response to the Request, Cardinal
(represented by Plaintiff’s counsel) “object[ed] to this request to the extent that
1
In their Reply Brief, Defendants state for the first time that beginning June 21,
2013, they will place stickers on any IBC comprised of a reconditioned Schütz cage
and reconditioned Mauser bottle with language comparable to the “remanufactured
NCG” sticker which the Court found in the Summary Judgment Order was sufficient
to “preclude any reasonable consumer from claiming confusion as to the source of the
IBC.” (March 28, 2012 Order [276] at 66). (Reply Br. [332] at 7). Thereafter, Plaintiff
filed a Motion to Strike and/or for Leave to File Sur-Reply regarding Defendants’
Alleged June 21, 2013 Undertaking With Respect to Washed Cross-Bottled IBCs
[345]. Because there remain factual issues regarding the use of the proposed stickers,
the Court concludes that their use does not moot the issues raised in Defendants’
Motion [309]. These issues will be addressed at the trial of the case. Plaintiff’s Motion
to Strike and/or for Leave to File Sur-Reply [345] is DENIED.
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it seeks the disclosure of information that is not relevant to any claim or defense
in this action or is not reasonably likely to lead to the discovery of admissible
evidence, including information concerning its washing (i.e., re-conditioning)
services.” (Id., Ex. D). Following receipt of the Response, Defendants sought a
clarification from Plaintiff in a November 19, 2010 letter stating:
Cardinal has objected to discovery regarding its reconditioned
IBCs. In light of Cardinal’s position, please supplement Plaintiff’s
Response to Interrogatory No. 18 [seeking Plaintiff’s damages
positions] (which is the subject of a separate letter) to indicate that
none of Plaintiff’s claims or alleged injuries are based in any way
on reconditioned IBCs (meaning IBCs in which the bottle was not
replaced by the seller) sold by Plaintiff, Defendants, or any third
parties. If Plaintiff is unwilling to do so, Cardinal’s objections are
unfounded.
(Id., Ex. F).
In a related letter on that same date, Defendants also stated:
Our understanding based on the discovery responses and
objections of Plaintiff and of Cardinal is that Plaintiff is basing its
damages claims on harm to the sale of rebottled Schütz IBCs by
Plaintiff as a result of the alleged infringement and alleged false
advertising related to cross-bottled IBCs rebottled and sold by
NCG and comprised of a reconditioned Schütz cage and a new
Mauser bottle that was placed in the cage by NCG. Defendants’
understanding is that no new units or reconditioned units are at
issue in this case (i.e., units in which Defendants, Plaintiff, or any
third parties have washed out the unit, performed routine
maintenance, etc., without replacing the bottle, including any units
that were cross-bottled before they were received), and that
Plaintiff will not be basing its damages claims on new or
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reconditioned units sold by Plaintiff, Defendants, or anyone else.
Please confirm Defendants’ understanding by supplementing
Plaintiff’s response to Interrogatory No. 18 to that effect.
(Id., Ex. G).
On November 29, 2010, Plaintiff responded to Defendants’ letters as
follows:
Your statement that “no new or reconditioned units are at issue in
this case” is only partially correct. Schütz does not intend to base
any damages claims on reconditioned IBCs, defined as “IBCs
having a bottle that was not replaced by NCG (i.e., washed IBCs).”
However, Schütz will not limit its damages claims further, as
Defendants’ false advertising clearly diminish sales of both new
and rebottled units from Schütz.
[and]
Schütz does not intend to assert damages based on reconditioned
IBCs, defined as “IBCs having a bottle that was not replaced by
NCG (i.e., washed IBCs).” Cardinal therefore maintains this
objection and will not produce documents to the extent they
exclusively involved reconditioned IBCs as defined above.
(Id., Ex. H and I) Based on this response, Defendants did not pursue their
document discovery into Cardinal’s reconditioning procedures.
After the close of discovery, motions for summary judgment were filed.
In a sur-reply brief, Plaintiff acknowledged that it had not included washed
cross-bottled IBCs in its calculation of damages but stated that it had “not
agreed that the sale of such products is otherwise ‘not at issue.’” (Pl.’s Br.
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[274], at 4, n.2). This statement was made in connection with its argument that
the “sale of washed cross-bottled IBCs creates the same likelihood of confusion
and requires the same equitable relief as does the sale of Defendants’ other
cross-bottled IBCs.” (Id.). In denying Defendants’ Motion for Summary
Judgment, the Court found that such evidence was sufficient to create an issue
of fact regarding the likelihood of consumer confusion with regard to Plaintiff’s
trademark infringement claim. (March 28, 2012 Order [276] at 67-69). Based
on the position taken by Plaintiff in its Sur-Reply Brief, Defendants filed the
present motion seeking to preclude Plaintiff from asserting claims for injunctive
relief based on IBCs reconditioned by Defendants.
In its Response, Plaintiff asserts that in spite of its objection to
Defendants’ discovery requests, it did provide substantial discovery regarding
the quality control procedure of Cardinal. (Resp. [325] at 6-8). After a party
objects to discovery based upon a disclaimer of claims, that party should not be
allowed to reverse that position by simply providing some of the requested
discovery. To the extent that Plaintiff represented that it was not asserting
claims during discovery, Plaintiff is bound by that position.
The question before the Court is what claims Plaintiffs abandoned.
Specifically, Plaintiff stated that it did “not intend to base any damages claims
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on reconditioned IBCs.” (Defs.’ Br. [309], Ex. I). It did not state that it would
not seek injunctive relief based on the reconditioned IBCs. Further, Plaintiff
asserts, and the Court agrees, that Cardinal’s practices and procedures are not
relevant to a claim for injunctive relief regarding the reconditioned IBCs. This
claim is based upon Plaintiff’s position that the use of a non-Schütz inner
plastic bottle in the IBC results in a likelihood of confusion for the purchaser.
The claim does not rely upon the process by which an entity washes the crossbottled IBC. (Resp. Br. [325] at 12). Thus, the discovery at issue would have no
bearing on this claim. The Court concludes that Plaintiff did not abandon a
claim for injunctive relief related to reconditioned IBCs. However, consitent
with the position taken by Plaintiff in discovery, Plaintiff will be precluded
from offering any evidence concerning the washing procedures utilized by
Cardinal or Defendants.
Based on the foregoing, Defendants’ Motion to Preclude Plaintiff From
Offering Evidence, Testimony, or Argument Regarding Defendants’
Reconditioned IBCs [309] is DENIED.
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Defendants’ Motion to Strike Witnesses That Plaintiff Did Not Disclose
During Discovery and Preclude Plaintiff From Offering Testimony From
Such Witnesses [310]
When the parties initially exchanged trial witness lists in May 2012,
Plaintiff included six witnesses that it had not identified in initial disclosures or
supplements thereto as individuals likely to have discoverable information that
Plaintiff may use to support its claims. See Fed. R. Civ. P. 26(a)(1)(A)(i). Then
on April 12, 2013, Plaintiff identified 10 additional new witnesses on its trial
witness list that had not been previously disclosed as potential witnesses.
Defendants filed the present Motion seeking to exclude these witnesses from
testifying at trial. Plaintiff opposes the Motion asserting that it fulfilled its
disclosure requirements under the rules for at least 12 of the 16 witnesses by
disclosing them as individuals with discoverable information in depositions and
responses to Defendants’ Interrogatories. (Resp. Br. [326] at 1). Defendants
assert that the disclosure of these witnesses during discovery was not adequate
because they represent 12 of 274 individuals identified by name in depositions
or discovery responses. Thus, Defendants could not have reasonably been
expected to identify these witnesses as potential trial witnesses simply because
they were named in discovery.
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Rule 26 of the Federal Rules of Civil Procedures requires
parties to exchange initial disclosures containing the identity of
persons likely to have discoverable information along with the
subjects of that information. Fed. R. Civ. P. 26(a)(1). Rule 26(e),
moreover, requires the parties to supplement their Rule 26(a)
disclosures “in a timely manner if the party learns that in some
material respect the disclosure or response is incomplete or
incorrect, and if the additional or corrective information has not
otherwise been made known to the other parties during the
discovery process or in writing.” Fed. R. Civ. P.
26(e)(1)(A)(emphasis added).
The Advisory Committee Notes to the 1993 Amendment to
Rule 26(e) provide that there is “no obligation to provide
supplemental or corrective information that has otherwise been
made known to the parties in writing or during the discovery
process, as when a witness not previously disclosed is identified
during the taking of a deposition. . ..” See also 8 Charles Alan
Wright & Arthur R. Miller, Federal Practice and Procedure §
2049.1 (3d ed. 2010) (“[T]here is no need as a matter of form to
submit a supplemental disclosure to include information already
revealed by a witness in a deposition or otherwise through formal
discovery.”)
“If a party fails to provide information or identify a witness
as required by Rule 26(a) or 26(e), the party is not allowed to use
that information or witness to supply evidence on a motion at a
hearing, or at a trial, unless the failure was substantially justified or
is harmless.” Fed. R. Civ. P. 37(c)(1). The non-disclosing party has
the “burden of establishing that a failure to disclose was
substantially justified or harmless.” Mitchell v. Ford Motor Co.,
318 F. Ap’x 821, 825 (11th Cir. 2009)
Ojeda-Sanchez v. Bland Farms, LLC, Case No. 608CV096, 2010 WL 2382452,
*1-2 (S.D. Ga. June 14, 2010). The witnesses provided by Plaintiff in May 2012
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included former or present employees of National Container Group, Spencer
Walker, Wally Ledet, Fred Slemmer, and Anthony Bergman. Plaintiff asserts
that it advised Defendants as early as March of 2010 that it intended to rely on
individuals employed by Defendants who had information about the “technical,
development, testing and certification information concerning products
manufactured, developed, re-bottled, cross-bottled and/or offered for sale by
Defendants” and “technical, financial, marketing and product management
information concerning Defendants re-bottled and/or cross-bottled products.”
(Resp. Br. [326] at 10). Plaintiff asserts that these 4 witnesses have knowledge
about these categories of information and were identified in depositions as
possessing such information. (Id. at 11).
The Court has reviewed the citations provided by Plaintiff as being
sufficient to put Defendants on notice that these individuals were likely to be
witnesses in the case. Based upon that review, Plaintiff will be permitted to call
Wally Ledet and Anthony Bergman as witnesses but will no be permitted to call
Spencer Walker or Fred Slemmer. As for the remaining two witnesses disclosed
in May 2012, Anthony Lima and Phil Pease, the Court finds that sufficient
information was not provided as to these witnesses to place Defendants on
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notice that they would likely be witnesses as the trial of the case. Therefore,
Plaintiff will not be permitted to call these witnesses at trial.
Plaintiff represents that the witnesses added on April 12, 2013 were
added for the purpose of authenticating documents to which Defendants had
objected in the Pretrial Order. Plaintiff represents that these witnesses are
necessary only for the purpose of authenticating documents. The Court finds
that Defendants were provided sufficient information regarding Kevin Leddy
during discovery to place them on notice that he might be a witness at trial.
Therefore, Plaintiff will be permitted to call Mr. Leddy as a witness. However,
as to the remaining witnesses disclosed by Plaintiff, those witnesses may be
called solely to authenticate documents if Defendants are unwilling to stipulate
to authentication.
Based on the foregoing, Defendants’ Motion to Strike Witnesses [310] is
GRANTED IN PART and DENIED IN PART.
Defendants’ Motion to Exclude Certain Testimony From Plaintiff’s Expert
Dr. Sher Paul Singh [311]
Defendants move the Court to exclude certain aspects of the testimony of
Dr. Sher Paul Singh. (Defs.’ Br. [311] at 1). Defendants argue that Dr. Singh
offered opinions that were not disclosed in his expert reports and that were not
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supported by scientific analysis or testing. (Id. at 6). The Court has reviewed the
challenged testimony and finds that Defendants’ objections go to the weight
rather than the admissibility of the testimony. Therefore, Defendants’ Motion
[311] is hereby DENIED.
SO ORDERED, this 31st day of March, 2014.
________________________________
RICHARD W. STORY
United States District Judge
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