Seubert v. FFE Transportation Services, Inc. et al
MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that Defendants motion for reconsideration of this Courts January 29, 2013 Order denying summary judgment with respect to Plaintiffs claim for lost profits and business income is DENIED. (Doc. No. 74. ) IT IS FURTHER ORDERED that on or before March 13, 2013, Plaintiff shall file a supplement to his Rule 26 disclosures clearly stating the amount of lost profits claimed, the basis for the calculation, and identifying all documents supporting that calculation. IT IS FURTHER ORDERED that on or before March 13, 2013, Plaintiff shall respond to Defendants motions in limine as set forth in Document No. 74, and Defendants shall file their reply if any, not later than March 18, 2013. (Response to Court due by 3/13/2013.) Signed by District Judge Audrey G. Fleissig on 3/6/2013. (KSM)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
JAMES G. SEUBERT,
SERVICES, INC., et al.,
Case No. 4:11CV01651 AGF
MEMORANDUM AND ORDER
This matter is before the Court on the motion of Defendants William James Beaty,
and FFE Transportation Services, Inc., for reconsideration of this Court’s January 29, 2013
Order (Doc. No. 73) denying Defendants’ motion for partial summary judgment with respect
to Plaintiff James G. Seubert’s claim for lost profits and lost business income. For the
reasons set forth below, Defendants’ motion will be denied. (Doc. No.74.)
Federal Rule of Civil Procedure 54(b) sets forth the standard applicable to this motion
and provides that an interlocutory order “may be revised at any time before the entry of
judgment adjudicating all claims and all the parties’ rights and responsibilities.” Under Rule
54(b), “a district court may, in its discretion, reconsider an interlocutory order to correct any
clearly or manifestly erroneous findings of fact or conclusions of law.” Munroe v. Cont’l W.
Ins. Co., No. 4:10CV1942 CDP, 2012 WL 4358642, at *2 (E.D. Mo. Sept. 24, 2012)
In support of their motion for reconsideration, Defendants contend that the Court, in
its previous Order, mischaracterized the inadequacy of Plaintiff’s discovery responses and
therefore incorrectly determined that there was sufficient evidence on the record before it to
permit Plaintiff’s claim for lost profits business income to go forward.
Contrary to Defendants’ assertion, the Court agrees that Plaintiff’s discovery
responses with respect to calculation of lost profits and expert testimony are inadequate. In
his initial disclosures Plaintiff failed to provide a method or formula for calculation of lost
profits and failed to supplement his disclosures and discovery responses to redress this
failing. See Fed. R. Civ. P. 26(a)(1)(A)(iii) (requiring as part of the initial disclosures “a
computation of each category of damages claimed by the disclosing party”); Fed. R. Civ. P.
26(e)(1)(A) (requiring party to supplement his disclosures “in a timely manner”). In
addition, Plaintiff stated that expert opinion testimony would be necessary to establish lost
profits or business income but failed to identify an expert to offer such an opinion.
Pursuant to Rule 37(c), “[i]f a party fails to provide information or identify a witness
as required by Rule 26(a) or (e), the party is not allowed to use that information
. . . to supply evidence on a motion, at a hearing, or at trial, unless the failure was
substantially justified or is harmless.” Fed. R. Civ. P. 37(c). “Rule 37 does not provide for
mandatory sanctions,” inasmuch as a court may determine “that a party’s failure to include
[information] in the initial Rule 26(a)(1) disclosures was substantially justified or harmless.”
Davis v. U.S. Bancorp, 383 F.3d 761, 765 (8th Cir. 2004) (citing Trost v. Trek Bicycle
Corp., 162 F.3d 1004, 1008 (8th Cir.1998). The offending party has the burden to
demonstrate that the failure to disclose was substantially justified or harmless. Fu v. Owens,
622 F.3d 880, 883-84 (8th Cir. 2010).
The Court previously concluded and continues to hold that Plaintiff did not show that
his failures to disclose were either substantially justified or harmless. The Court does not
agree, however, that this determination mandates the entry of summary judgment for
Defendants on Plaintiff’s claim for lost profits and business income. The authorities cited by
Defendants in favor of such a ruling make a persuasive case for restricting Plaintiff’s
presentation of evidence with respect to lost profits and business income, but not for the
entry of summary judgment in favor of Defendants on that claim. See, e.g., Metro. Exp.
Servs., Inc. v. City of Kansas City, Mo., 71 F.3d 273, 274 (8th Cir. 1995) (refusing to award
damages for lost profits following a two-day evidentiary hearing at which the evidence
presented with respect to damages was deemed insufficient); TCF Inventory Finance, Inc. v.
Northshore Outdoor, Inc., No. 1:11 CV 85, 2012 WL 2576367, at *4-5 (N.D. Ohio Jul. 30,
2012) (restricting the presentation of damages evidence at trial where plaintiff failed to
provide a computation of damages in discovery responses); Curtis v. Daviess-Dekalb
Regional Jail Dist., No. 08–6075–CV–SJ–GAF, 2009 WL 3382930, at *1-2 (W.D. Mo. Oct.
19, 2009) (denying a motion to strike the damages claim and requiring plaintiff to provide
both a computation of those damages and the supporting documents); White v. Pruiett, 39
S.W.3d 857, 864 (Mo. Ct. App. W.D. 2001) (upholding circuit court’s issuance of directed
verdict in favor of defendant because plaintiff’s testimony regarding lost profits was a “mere
estimate or opinion of loss of profits, unsupported by factual evidence”).
Unlike the authorities cited by Defendants in support of a grant of summary
judgment, this is not a case where there is no competent evidence to support the claim of lost
profits and income. See Bessemer & Lake Erie R.R. Co. v. Seaway Marine Trans., 596 F.3d
357 (6th Cir. 2010) (holding that district court did not abuse its discretion in granting
summary judgment on a lost profits claim because it had no evidence of lost profits left to
consider) (emphasis supplied); Rich v. Eastman Kodak Co., 583 F.2d 435, 436-37 (8th Cir.
1978) (upholding grant of summary judgment with respect to claim for lost profits because
evidence established that the plaintiff corporation was not making a profit before problems
developed with the equipment supplied by the defendant) (emphasis supplied). That
evidence may be slim and ultimately determined to lack a sufficient foundation but in order
to grant summary judgment for Defendants at this juncture the Court would be required to
invade the province of the jury and weigh the parties’ evidence. That is not the Court’s
proper function on a motion for summary judgment. Nunn v. Noodles & Co., 674 F.3d 910,
914 (8th Cir. 2012) (stating that “[a]t summary judgment, the court’s function is not to weigh
the evidence”) (citation omitted).
Although some of Plaintiff’s discovery responses are inadequate, he has offered
evidence of lost profits by way of tax returns and a business valuation. Defendants’
contentions that some of that evidence is speculative, lacks proper foundation, fails to
exclude variable expenses, or is inadmissible under Federal Rule of Evidence 702 are more
properly considered in the context of motions in limine or evidentiary rulings at trial.
In their motion for reconsideration Defendants offer, in the alternative, that the
Court consider their arguments regarding the inadequacy of the discovery responses and
evidence proffered by Plaintiff as the basis for motions in limine to restrict the introduction
of certain evidence related to lost profits and business income. The Court agrees that this is
the proper mode for the consideration of these issues, but will withhold ruling on them until
the parties have had an opportunity to brief these issues in that context. The Court shall also
require Plaintiff to provide a clear calculation of his claimed damages, including the method
of calculation, and identify any documents supporting that calculation.
IT IS HEREBY ORDERED that Defendants’ motion for reconsideration of this
Court’s January 29, 2013 Order denying summary judgment with respect to Plaintiff’s claim
for lost profits and business income is DENIED. (Doc. No. 74.)
IT IS FURTHER ORDERED that on or before March 13, 2013, Plaintiff shall file
a supplement to his Rule 26 disclosures clearly stating the amount of lost profits claimed, the
basis for the calculation, and identifying all documents supporting that calculation.
IT IS FURTHER ORDERED that on or before March 13, 2013, Plaintiff shall
respond to Defendants’ motions in limine as set forth in Document No. 74, and Defendants
shall file their reply if any, not later than March 18, 2013.
AUDREY G. FLEISSIG
UNITED STATES DISTRICT JUDGE
Dated this 6th day of March, 2013.
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