Logistec USA Inc. v. Daewoo International Corporation et al

Filing 145

ORDER, going into trial, then, the court adopts in its entirety the Magistrate Judge's rulings on the motions in limine. Daewoo has failed to show that any of the Magistrate Judge's rulings in which it objects were clearly erroneous or contrary to law re 127 APPEAL OF MAGISTRATE JUDGE DECISION to District Court re 124 Order. Signed by Chief Judge Lisa G. Wood on 7/31/2015. (ca)

3n the aniteb otateo 39i0trid Court
for the boutbern 30iotritt of deoria
30runibid flibiion
LOGISTEC USA INC.,
Plaintiff,
CV 213-27

V.

DAEWOO INTERNATIONAL
CORPORATION,
Defendant.
ORDER

Before the Court are Defendant Daewoo International
Corporation's Rule 72(a) Objections to the Magistrate Judge's
Order on the Parties' motions in limine. Dkt. no. 127.
This case concerns Logistec USA Inc.'s breach of a contract
it had with Daewoo. The Court, in a prior Order, determined that
Logistec's failure to procure a "truck tipper" per the Agreement
was a breach of that contract. See Dkt. no. 91 ("Summary
Judgment Order").' The Court reserved for the jury the question
of whether that breach was material such that Daewoo could
rescind the agreement. See id.
The Parties filed several motions in limine before the
Magistrate Judge. These motions include:
1

A factual background of the case can be found in the Court's Summary
Judgment Order. Dkt. no. 91.
AO 72A
(Rev. 8/82)

I
I

. Daewoo's Motion in Lirnine to Exclude Evidence (Dkt. no. 98)
. Daewoo's Motion in Limine Regarding Plaintiff's Trial
Exhibits (Dkt. no. 103)
. Logistec's Motion in Limine to Exclude Parol and Extrinsic
Evidence as to the Meaning of the Term "Truck Tipper" (Dkt.
no. 99)
• Logistec's Motion in Limine to Exclude Any Argument or
Commentary by Defendant that the Agreement Was Subject to a
Condition Precedent or Condition Subsequent (Dkt. no. 100)
• Logistec's Motion in Limine to Exclude Impermissibly
Disclosed Documents and Similar Evidence Relating to
Daewoo's Woodchip Procurement Costs, Analyses and Financial
Losses It Sustained Following Its Termination of the
Agreement (Dkt. no. 101)
The Magistrate Judge held a hearing on these Motions on June 9,
2015. See Dkt. no. 130-1 ("Hearing Trans.") . The Magistrate
Judge subsequently issued an Order granting in part and denying
in part Daewoo's Motions, denying Logistec's motion regarding
the term "truck tipper," granting as unopposed Logistec's motion
regarding conditions precedent or subsequent to the agreement,
and granting in part and denying in part Logistec's motion
regarding Daewoo's financial losses. Dkt. no. 124 ("MJ Order").

AO 72A
(Rev. 8/82)

2

Defendant Daewoo makes several Objections to the Magistrate
Judge's Order. Dkt. no. 127. Logistec has responded to these
Objections. Dkt. no. 130. Because the Magistrate Judge rests
many of his holdings on reasoning discussed on the record at the
motions hearing, this Court will review the Magistrate Judge's
Order in consideration of the Hearing Transcript (Dkt. no. 1301) and the various motions and briefs discussed at that hearing.
I. Standard of Review

When a magistrate judge rules on a motion in limine,
parties may object to that ruling and seek review from the
district judge under Federal Rule of Civil Procedure 72(a). See
Fed. R. Civ. P. 72(a). In reviewing the magistrate judge's order,
the district judge must "modify or set aside any part of the
order that is clearly erroneous or is contrary to law." Id. "A
ruling is clearly erroneous where either the magistrate judge
abused his discretion or the district court, after reviewing the
entirety of the record, is left with a definite and firm
conviction that a mistake has been made." Id. (citations
omitted). "A decision by the magistrate judge is contrary to law
where it either fails to follow or misapplies the applicable
law." Id. (citations omitted). "The mere fact that a reviewing
Court might have decided the issue differently is not sufficient
to overturn a decision when there are two permissible views of
the issue." Hope for Families & Cmty. Serv., Inc. v. Warren, No.
AO 72A
(Rev. 8/82)

3
I

3:06-CV-1113, 2009 WL 174970, at *3 (M.D. Ala. Jan. 26, 2009)
(quoting Merrill-Stevens Yacht Sales, LLC v. Fr. Lurssen Werft
GmbH & Co., No. 07-61389-dy, 2008 WL 2690798, at *2 (S.D. Fla.
July 2, 2008)).
Daewoo, in its Objections, suggests that the Court should
modify, reject, or set aside, "after de novo review," those
portions of the Magistrate Judge's Order that are clearly
erroneous or contrary to law. The de novo standard and the
"clearly erroneous or contrary to law" standard are distinct,
and the Court will not conduct a de novo review here. 2
II. Discussion

Daewoo groups its various objections in five general
classes.
a. Evidence of Daewoo' s Other Lawsuits and Settlements

The Magistrate Judge's Order grants Daewoo's motion to
exclude evidence of (a) lawsuits involving Daewoo and other
parties, and (b) settlements by Daewoo in other lawsuits with

2

Notably, none of the cases Daewoo cites for the de novo standard for Rule
72(a) objections actually applies this standard of review on non-dispositive
magistrate orders. See Dkt. no. 127, pp. 1-2 (citing Hope for Families &
Cmty. Servs., 2009 WL 174970, at *3 (applying the "clearly erroneous or
contrary to law" standard for Rule 72(a) objections); Am. Comp. Trust Leasing
v. Jack Farrell Implement Co., 136 F.R.D. 160, 162 (D. Minn. 1991) (same).
While one case Daewoo cites does, in fact, conduct a de novo review of a
magistrate judge's order, the objection to that order fell under Rule 72(b),
which concerns objections to a magistrate judge's dispositive orders. See
Santana v. Kuhlmann, 232 F.Supp.2d 154, 157-58 (S.D.N.Y. 2002) (reviewing de
novo a magistrate judge's Report and Recommendation recommending denial of a
petition for habeas corpus); see also Fed. R. Civ. P. 72(b) (3) (stating that
for "Dispositive Motions and Prisoner Petitions," "The district judge must
determine de novo any part of the magistrate judge's disposition that has
been properly objected to.").
AO 72A
(Rev.

8/82)

1

4

other parties. MJ Order 3-4 (Sections 1.2 and 1.3). But Daewoo's
requests are granted with the qualification that "if Logistec
believes at trial that this evidence has become relevant for
rebuttal purposes, Logistec should raise the issue to the Court
at that time. Logistec is advised to do so outside the presence
of the jury, given the prejudicial nature of this evidence." Id.
Unsatisfied with this qualified grant of its motion, Daewoo
"objects to use of the other lawsuits or settlements because
they would never become relevant for any reason, including
rebuttal." Dkt. no. 127, p. 3. Daewoo is wrong. Federal Rule of
Evidence 404(b), on which Daewoo bases its argument that
evidence of past acts (in this case, the prior litigation)
cannot be used to establish a party's general character for
acting in a certain manner, is specifically limited to character
evidence. Fed. R. Evid. 404(b) (1) ("Evidence of a crime, wrong,
or other act is not admissible to prove a person's character in
order to show that on a particular occasion the person acted in
accordance with the character."). Evidence of prior acts is
generally admissible, though, for any other purpose besides
establishing character, which would include rebuttal. See Fed.
R. Evid. 404(b) (2) ("This evidence may be admissible for another
purpose, such as proving motive, opportunity, intent,
preparation, plan, knowledge, identity, absence of mistake, or
lack of accident.")
AO 72A
(Rev. 8/82)

5

I

Likewise, Daewoo argues that under Federal Rule of Evidence
408, evidence of settlements cannot be used as proof of a
party's liability. But Rule 408, like Rule 404, also has a nonexhaustive set of exceptions and is thus not as absolute as
Daewoo suggests: "The court may admit this evidence for another
purpose, such as proving a witness's bias or prejudice, negating
a contention of undue delay, or proving an effort to obstruct a
criminal investigation or prosecution." Fed. R. Evid. 408(b).
Neither Rule absolutely proscribes admitting evidence of
past settlements or litigation. The Court in no way suggests
that any of the exceptions to these Rules is likely to arise at
trial. Nevertheless, a situation may arise where such evidence
is appropriate. As such, the Magistrate Judge's ruling is not
clearly erroneous or contrary to law, and Daewoo's objections to
sections 1.2 and 1.3 of the Magistrate Judge's Order are
OVERRULED.
b. Evidence of Daewoo's Allegedly Contrived Excuse for
Rescission of the Agreement

Daewoo's most substantial objection to the Magistrate
Judge's Order is to those holdings regarding evidence and
argument that touches on Logistec's "contrived excuse" theory.
Logistec will present this theory at trial to suggest that the
fallout from its procurement of a "trailer tipper" instead of a
"truck tipper" had more to do with Daewoo looking for an excuse

6
6

AO 72A
(Rev. 8182)

I

to rescind the contract than it did with any actual concern over
the efficacy of a trailer tipper. Daewoo argued before the
Magistrate Judge that at trial, "Logistec should not be allowed
to use any documents or things or mention in any way that Daewoo
supposedly contrived an excuse for its reason to terminate the
parties' contract." Dkt. no. 103, p. 5.
To support its theory, Logistec seeks to produce Daewoo
America's (a separate legal entity from Defendant) prior efforts
to contract with a company named Megahan to procure woodchips
out of Jacksonville. It also seeks to produce other exhibits
tending to show that Daewoo contrived an excuse to rescind the
contract. For its part, Daewoo seeks to admit evidence showing
that woodchip procurement would not have been more favorable in
Jacksonville to rebut the contrived excuse theory.
i. Termination Contract Between Megahan and Daewoo
America

The Magistrate Judge determined that evidence of the
terminated Megahan/Daewoo America contract was relevant to
establishing Defendant Daewoo's efforts to explore a more
favorable woodchip procurement plan. MJ Order 4-5. Daewoo
objects that the Megahan Daewoo America contract is irrelevant
because Daewoo International (Defendant here) was not a party to
those negotiations. Dkt. no. 127, p. 4. However, given the
relationship between Daewoo America and Daewoo International,

AO 72A
(Rev. 8/82)

7
7
I

Defendant does not necessarily have to be a party to those
negotiations for them to be relevant to the contrived excuse
argument. The Magistrate Judge's relevance analysis on this
point is well-reasoned, and is not clearly erroneous or contrary
to law.
ii. Argument of the Contrived Excuse and Other
Supporting Evidence

Before the Magistrate Judge, Daewoo argued that Logistec
should not even be able to make the contrived excuse argument at
trial because, Daewoo claims, it did not have proper notice of
this claim. The Magistrate Judge disagreed, and gave a lengthy
recitation of each point in the record where Daewoo had notice
of Logistec's intent to argue that Daewoo's indignation towards
the trailer tipper was a contrived excuse to rescind the
Agreement. Hearing Trans. 11:17-15:13; see also MJ Order 7-8.
Daewoo now argues that "the Magistrate misconstrued Daewoo's
argument on contrived excuse. . . . The point of Daewoo's
argument to exclude evidence of an alleged contrived excuse is
that Logistec did not state what it meant by contrived excuse
until after discovery closed." Dkt. no. 127. The first document,
standing alone, that the Magistrate Judge referenced during the
hearing refutes this contention: even before the Complaint was
filed, Daewoo knew that it was Logistec's opinion that "It is
clear that Daewoo's objection to Logistec's truck tipper is

8

AO 72A
(Rev. 8/82)

I

being used as an excuse to avoid their contract obligation to
deliver woodchips to Logistec's Brunswick facility." Hearing
Trans. 11:20-25. The Magistrate Judge's decision that Daewoo was
well aware of the "contrived excuse" theory is adequately
supported by the record, and is not clearly erroneous or
contrary to law.
Daewoo also objects to the admission of certain exhibits in
support of Logistec's "contrived excuse" theory. Daewoo
originally took the position before the Magistrate Judge that
Logistec had failed to produce these documents during discovery.
The Magistrate Judge concluded that Logistec had no such duty to
disclose these documents because they were either in the custody
of third parties or were provided to Logistec by Daewoo. MJ
Order 23; Hearing Trans. 15:14-16:8. In its Objection, Daewoo
does not appear to challenge the Magistrate Judge's holding as
to these documents as clearly erroneous or contrary to law in
and of itself, but rather challenges the admission of the
documents as part of its general challenge to the contrived
excuse theory. Because the "contrived excuse" argument will be
permitted at trial, and because Logistec's exhibits supporting
that theory were not Logistec's to produce, the Magistrate
Judge's admission of these exhibits is not clearly erroneous or
contrary to law.

AO 72A
(Rev. 8182)

1

9

iii. Daewoo' s Evidence in Rebuttal of the Contrived
Excuse Argument

Relatedly, Daewoo argues that if Logistec is permitted to
make its contrived excuse argument at trial, Daewoo should
likewise be able to rebut that argument with evidence of how
profitable (or unprofitable) these alleged alternative
procurement plans would have actually been to Daewoo. Logistec
moved to exclude impermissibly disclosed documents and similar
evidence relating to Daewoo's woodchip procurement costs,
analyses, and financial losses it would sustain if it terminated
the Agreement. See Dkt. no. 101. Daewoo countered that its costs
of doing business in Jacksonville were relevant and admissible
to rebut Logistec's contrived excuse allegation and that,
specifically, the "untimely" disclosed documents should be
admitted because of Logistec's delay in articulating the
contrived excuse theory, and that certain "Forest2Market" cost
reports were admissible without an expert as either market
reports or business records. See Dkt. no. 110.
As to these matters, the Magistrate Judge ruled that: (a)
argument and evidence concerning Daewoo's costs in Jacksonville
would be relevant in light of Logistec's contrived excuse
argument, and thus generally admissible; (b) specific untimely
disclosed documents would nevertheless be inadmissible because
they ran afoul of Federal Rule of Civil Procedure Rules 26 and

AO 72A
(Rev. 8/82)

10
I

37; and (c) the untimely disclosed Forest2Market reports were
also inadmissible for the additional reason that they are expert
testimony and thus cannot be admitted without an expert.
Daewoo now argues that the Forest2Market reports should be
admitted because they are not prejudicial to Logistec. But the
Magistrate Judge correctly concluded that these reports, if
admitted outside the Rule 26 procedures, would be prejudicial
because Logistec would not have time, on the eve of trial, to
depose the authors of the Forest2Market reports about the
information therein. See MJ Order 21-22.
Daewoo also objects to the exclusion of the untimely
disclosed documents because, again, the admission would not be
prejudicial to Logistec. However, applying the "substantially
justified or harmless" standard for disclosures that do not
conform to Rule 26, the Magistrate Judge correctly determined
that the late disclosure of these documents, which came more
than a year after Daewoo alleges Logistic articulated its
contrived excuse allegation, is not substantially justified. MJ
Order 17-18; Fed. R. Civ. P. 37

(C)

(1). Furthermore, because some

of the documents are undated, do not indicate their author or
creator, or are otherwise of dubious relation to Daewoo's
woodchip procurement costs, the Magistrate Judge concluded that
admitting the documents would require additional discovery for

AO 72A
(Rev. 8182)

I

I

11

Logistec to understand their nature. Admission of these
documents, then, would not be harmless.
The Magistrate Judge's decision to permit the contrived
excuse theory, admit Logistec's evidence on this point, and
exclude specific documents from Daewoo in rebuttal to this
argument while allowing other rebuttal arguments and evidence
generally is not clearly erroneous or contrary to law.
Logistec's objections to the Magistrate Judge's ruling on the
contrived excuse argument and related documents is OVERRULED.
c. Parol and Extrinsic Evidence of the Term "Truck
Tipper"

The Magistrate Judge denied Logistec's motion to exclude
parol and extrinsic evidence as to the meaning of the term
"truck tipper," but noted that "this evidence is admissible only
to prove materiality and may not be introduced to prove the
meaning of the term 'truck tipper,' which this Court has already
resolved." MJ Order 13 (Section II) . Indeed, this Court held in
the Summary Judgment Order that "Daewoo bargained for a tipper
that did not require detaching the cab from the trailer, and
that both parties understood that this type of tipper is what
the term 'truck tipper' in the Agreement referenced." Dkt.
no. 91, p. 22.
Daewoo objects to this holding. According to Daewoo,
The Magistrate's Order should be modified to allow
evidence as to the meaning of the term "truck tipper,"
AO 72A
(Rev. 8182)

I

12

so that the jury will be allowed to consider all of
the circumstances and the intent of the parties, as it
considers the issue of whether Logistec's breach of
the parties' contract by not providing a truck tipper
was a material breach of the contract.
Dkt. no. 127, pp. 8-9. Daewoo's objection appears to be rooted
in a misunderstanding of the Magistrate Judge's holding.
Evidence tending solely to define the term "truck tipper" is not
necessary in this case because the Court has already determined,
for purposes of the Agreement, that a "truck tipper" is one that
can tip a fully connected semi-trailer truck without having to
first disconnect the truck from the semi-trailer. That said,
evidence of the Parties' negotiations regarding what type of
tipper would be provided—including their understanding of what a
"truck tipper" is—is still admissible pursuant to the Magistrate
Judge's Order because that evidence is key to understanding the
full circumstances of the transaction. Thus, evidence of the
meaning of the word "truck tipper" is still admissible so long
as it also reveals the particular circumstances of the parties'
negotiations and intent regarding the agreement.
The Magistrate Judge's Order already permits evidence of
the "full circumstances of the transaction," including what the
parties envisioned as a "truck tipper" when forming the
Agreement. There is no need to modify the Magistrate Judge's
Order, and Daewoo's request for this Court to do so is
OVERRULED.

AO 72A
(Rev. 8/2)

I

13

d. Evidence of Logistec's Damages

The Magistrate Judge denied Daewoo's motion to exclude
evidence of Logistec's alleged damages for lost profits,
damages, and capital expenditures. MJ Order 5-6. The Magistrate
Judge concluded that a motion in limine was not the appropriate
time to bring a dispositive motion on these claims. Id. (citing
Variable Annuity Life Ins. Co. v. Laenq, No. 8:12-cv-2280, 2013
WL 3992418, at *2 (M.D. Fla. Aug. 2, 2013) (noting that "a
motion in limine is not the proper vehicle to resolve
substantive issues, to test issues of law, or to address or
narrow the issues to be tried.").
Daewoo does not "object" to these rulings, even though
Daewoo lists them among its Rule 72(a) objections. Instead,
Daewoo simply preserves "objections for purposes of Motion for
Directed Verdict, for Motion for Judgment as a Matter of Law,
for Motion for Judgment Notwithstanding the Verdict, and for any
and all other purposes, during, before or after trial and on any
appeal taken by either party." Daewoo's preservation is duly
noted.
Daewoo does object, though, to the Magistrate Judge's
decision to permit Logistec to amend the pretrial order to
include a claim for punitive damages. See NJ Order 6-7. The
Magistrate Judge reasoned that amending the pretrial order was
appropriate in this instance because Daewoo has known since its
AO 72A
(Rev. 8182)

14

inception that Logistec intended to bring a claim for punitive
damages and because Daewoo failed to show that it suffered any
prejudice from the claim's omission in the pretrial order. Id.
(quoting United States v. Varner, 13 F.3d 1503, 1507-08 (11th
Cir. 1994) ("There is a presumption that a pretrial order will
be amended in the interest of justice and sound judicial
administration provided there is no substantial injury or
prejudice to the opposing party or inconvenience to the
court.")). In its objection, Daewoo makes no effort to show that
it will be prejudiced if Logistec is allowed to amend the
pretrial order to include its punitive damages. See Dkt.
no. 127, pp. 9-10. The Magistrate Judge's decision on Logistec's
damages claims, then, is not clearly erroneous or contrary to
law, and Daewoo's objection is OVERRULED.
e. Logistec's Trial Exhibits

Finally, Daewoo objects to the Magistrate Judge's rulings
on its motion in limine regarding certain other exhibits
Logistec seeks to admit at trial.
First, Daewoo objects to the Magistrate Judge's decision to
grant Daewoo's motion to exclude Logistec's Trial Exhibit S. The
Magistrate Judge ruled that the Exhibit, a guaranty concerning
the performance of Daewoo Logistics Corporation if that entity
(which is legally distinct from Defendant) contracted with
Logistec, will not be admissible in Logistec's case-in-chief,
15
AO 72A
(Rev. 8182)

but may be admissible if it becomes relevant for rebuttal. MJ
Order 22. Daewoo would have this Court declare the exhibit
inadmissible for any and all purposes. However, there is nothing
clearly erroneous or contrary to law in withholding such a
declaration until the exhibit's relevance can be considered in
light of the circumstances at trial.
Second, Daewoo objects to the Magistrate Judge's denial
without prejudice of its motion to exclude Logistec's Exhibit
23, an unsigned agreement between Daewoo and Global Green
Engineered Fuels LLC. See NJ Order 22-23. At the motions
hearing, the Magistrate Judge reasoned that while the unsigned
agreement cannot be used to show that Daewoo and the other party
are bound by that agreement, it would tend to show that Daewoo
was negotiating with other parties. Hearing Trans. 74:3-12. In
the end, the Magistrate Judge determined that a judge sitting
multiple weeks prior to trial could not foresee all of the trial
circumstances and testimony for which the Exhibit could be used
to support or rebut. Id. at 75:13-76:4. Any relevancy
determination, then, would be premature. The Magistrate Judge
concluded that the Exhibit was neither admitted nor denied at
that time, and this conclusion is not clearly erroneous or
contrary to law.
Daewoo's objections to the Magistrate Judge's rulings on
these Exhibits, then, are OVERRULED.
AO 72A
(Rev. 8/82)

1

16

III. Conclusion

Daewoo has failed to show that any of the Magistrate
Judge's rulings to which it objects were clearly erroneous or
contrary to law. Going into trial, then, the Court ADOPTS in its
entirety the Magistrate Judge's rulings on the motions in limine
as stated in his Order, Dkt. no. 124.

SO ORDERED, this 31ST day of July, 2015.

LISA GODDEY WOOD, CHIEF JUDGE
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA

AO 72A
(Rev. 8/82)

17
17
I