Hutton v. Nyhart

Filing 120

ORDER granting in part and denying in part 44 Motion in Limine; granting 108 Combined Motion for Permission to File Second Motion in Limine and Second Motion in Limine. Signed by Judge Brian Morris on 6/7/2019. (ASG)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
BUTTE DIVISION
CV-17-82-BU-BMM

PETER B. HUTTON,
Plaintiff,

ORDER
vs.
JERALD L. NYHART,
Defendant.

Defendant/Counterclaimant Jerald L. Nyhart (“Nyhart”) filed the following
motions: (1) Motion in Limine (Doc. 44); and (2) Combined Motion for
Permission to File Second Motion in Limine, and Second Motion in Limine (Doc.
108). Defendant/Counterclaimant Peter B. Hutton (“Hutton”) opposes the Motions.
The Court addresses both pending Motions.
MOTION IN LIMINE LEGAL STANDARDS
A motion in limine constitutes “a procedural mechanism to limit in advance
testimony or evidence in a particular area. Frost v. BNSF Ry. Co., 218 F. Supp. 3d
1122, 1133 (D. Mont. 2016). A motion in limine “reduces the likelihood that
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unduly prejudicial evidence will ever reach the jury.” Jackson v. Cty. Of San
Bernardino, 194 F. Supp. 3d 1004, 1008 (C.D. Cal. 2016) (citing Brodit v.
Cambra, 350 F.3d 985, 1004-05 (9th Cir. 2003). District courts possess “wide
discretion in considering a motion in limine.” Frost, 218 F. Supp. 3d at 1133.
I.

Motion in Limine (Doc. 44)
Nyhart seeks to exclude the following evidence: (1) communications

pursuant to Rules 402, 403, and 408; and (2) prior litigation in which Nyhart was
involved, pursuant to Rules 402, 403, 404, and 608. (Doc. 44 at 1.) The Court
addresses each argument in turn.
1. Communication & Negotiation
Hutton and Nyhart engaged in communication and negotiation beginning in
fall of 2016. (Doc. 45 at 4.) These discussions concerned the Farm Lease, the
payment of rent, and Side Letter Agreement. Id. at 5 (citing Ex 2; Ex 1, p 102:14).) These discussions occurred between the fall of 2016, and October of 2017.
Nyhart filed his lawsuit in this Court on November 3, 2017. Nyhart seeks to
exclude the negotiations and deposition testimony.
Rule 408 excludes compromise negotiations when offered “either to prove
or disprove the validity or amount of a disputed claim or to impeach a prior
inconsistent statement or contradiction[.]” Fed. R. Evid. 408(a). A litigant asserting
a motion in limine under Rule 408 must demonstrate a “substantial showing” that
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the communications were part of the attempts to settle the dispute. United States v.
Mirama Enterprises, Inc., 185 F. Supp. 2d 1148, 1156 (S.D. Cal. 2002). Offers
made in exchange for a release of claims after the commencement of litigation
must be excluded under Rule 408. See Coleman v. Quaker Oats, 232 F.3d 1271,
1290 (9th Cir. 2000). Statements made before a formal claim is filed are not made
in furtherance of settlement and generally should be admitted. See Cassino v.
Reichhold Chem., Inc., 817 F.2d 1338, 1342 (9th Cir. 1987).
Nyhart asserts that the communications between the parties constituted
“compromise communication.” (Doc. 45 at 4.) The record demonstrates, however,
that the communication between the parties constitutes prelitigation
communication. These conversations reflect the parties’ business negotiations
before Nyhart filed his lawsuit on November 3, 2017. The purpose of Rule 408
serves to encourage the compromise and settlement of “existing disputes.” Josephs
v. Pacific Bell, 443 F.3d 1050, 1064 (9th Cir. 2006). Communications between the
parties before Nyhart filed the lawsuit fall outside of the Rule 408 exclusion and
purpose.
Nyhart’s Motion in Limine concerning communications made before Nyhart
filing the lawsuit with this Court on November 3, 2017 is therefore denied.
Evidence of communications concerning the Farm Lease, payment of rent, and the

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Side Letter Agreement is admissible. Nyhart’s deposition testimony concerning the
parties’ negotiations is similarly admissible.
2. Prior Litigation
Nyhart next asserts that evidence of prior lawsuits in which Nyhart was a
party proves inadmissible. (Doc. 45 at 9.) Nyhart argues that such evidence
constitutes improper character evidence under Rule 404. Id. at 11. Nyhart further
argues that such evidence is unfairly prejudicial under Rule 403. Id. Hutton asserts
that his purpose in the use of prior litigation evidence involving Nyhart would be
to demonstrate that Nyhart possesses knowledge and experience with real estate
contracts. (Doc. 71 at 16.)
Rule 404 prohibits “[e]vidence of a person’s character or character trait . . .
to prove that on a particular occasion the person acted in accordance with the
character or trait.” Fed. R. Evid. 404(a)(1). Further, “[e]vidence 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.” Fed. R.
Evid. 404(b)(1). Such evidence may be admissible to prove motive. A district court
may exclude evidence if its probative value is substantially outweighed by the
potential for “unfair prejudice, confusing the issues, [or] misleading the jury[.]”
Fed. R. Evid. 403.

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Nyhart’s involvement in prior litigation constitutes improper Rule 404(b)
evidence. “As a general matter, unless the prior lawsuit[] [has] been shown to be
fraudulent, the probative value of evidence pertaining to a plaintiff’s litigation
history is substantially outweighed by the danger of jury bias.” Henderson v.
Peterson, 2011 U.S. Dist. LEXIS 76799, *5 (N.D. Cal. July 15, 2011). Nyhart’s
involvement in prior lawsuits, none of which Hutton alleges to have been
fraudulent, does not prove distinguishable from the general rule that such evidence
risks confusion. The prejudicial effect for such confusion outweighs Hutton’s
interest in demonstrating that Nyhart possesses knowledge of litigation experience
with real estate contracts. Nyhart’s motion in this regard shall be granted.
II.

Nyhart’s Combined Motion for Permission to File Second Motion in
Limine and Second Motion in Limine (Doc. 108)
Nyhart has moved for permission to file and grant his Second Motion in

Limine. As an initial matter, the Court grants Nyhart’s motion for permission to
file his Second Motion in Limine. The Court evaluates in this Order the merits of
Nyhart’s second Motion in Limine.
Nyhart asserts that Hutton served, but failed to file, a “First Amended Initial
Disclosure” on March 26, 2019. (Doc. 109 at 3.) Nyhart further asserts that Hutton
served, but failed to file, a “Second Amended Initial Disclosure” on March 29,
2019. Hutton asserts a new “Computation of Damages” in these disclosures.
Hutton’s original computation of damages read “on the basis of one thousand
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(1,000x) the amount of monthly rent being paid hereunder at the date of
termination.” Hutton alleges that this figure constitutes a scrivener’s error and
should instead read: “on the basis of one hundred times (100x) the amount of
monthly rent being paid hereunder at the date of termination.”
Nyhart first asserts that Hutton’s untimely disclosure constitutes unfair
prejudice. (Doc. 109 at 5.) Rule 26(a)(1) requires a party to provide an initial
disclosure that identifies “a computation of each category of damages claimed by
the disclosing party.” Id. Hutton filed his initial disclosure on February 14, 2018
(Doc. 21.) This disclosure asserted the 1,000x increase in rent provision, and
further asserted a claim for $7,951,000. Hutton failed to mention the alleged
“scrivener’s error” in the February 14, 2018 disclosure. Hutton first disclosed this
alleged “scrivener’s error” in his amended initial disclosure approximately five
months after the close of discovery. Nyhart’s inability to investigate and test this
claim through the discovery process proves untimely and prejudicial.
Nyhart next asserts that Hutton’s amended disclosures constitute an attempt
to amend his complaint without leave of court or good cause. (Doc. 109 at 7.)
Nyhart argues that Hutton’s disclosure seeks to assert a reformation of contract
claim. Id. Hutton’s amended disclosure constitutes an attempt to engage the Court
in a rewriting of the contract. Montana law provides the circumstances for which a
contract may be reformed. See Mont. Code Ann. § 28-2-1611. Hutton has not pled
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a claim for reformation of contract. Nyhart has not consented to any amended
pleading pursuant to Fed R. Civ. P. 15(a). Hutton has further failed to seek leave to
amend his Complaint. Any attempt by Nyhart to provide such a disclosure as an
amended complaint proves improper and untimely.
CONCLUSION
Nyhart’s Motion in Limine regarding communications and negotiations
between the parties before Nyhart his lawsuit with this Court on November 3, 2017
is denied. Hutton may present evidence of communications regarding the Farm
Lease, payment of rent, and the Side Letter Agreement before November 3, 2017.
Nyhart’s deposition testimony concerning the parties’ negotiations is similarly
admissible. Nyhart’s Motion in Limine is granted regarding evidence of Nyhart’s
involvement in prior litigation. Nyhart’s Second Motion in Limine regarding
Hutton’s Amended Initial Disclosure is granted.
ORDER
ACCORDINGLY, IT IS ORDERED that Nyhart’s Motion in Limine
(Doc. 44) is GRANTED IN PART with respect to evidence of Nyhart’s
involvement in prior litigation, and DENIED IN PART with respect to evidence
of communications before November 3, 2017, including the Farm Lease, payment
of rent, and Side Letter Agreement.

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IT IS FURTHER ORDERED that Nyhart’s Combined Motion for
Permission to File Second Motion in Limine and Second Motion in Limine (Doc.
108) is GRANTED.
DATED this 7th day of June, 2019.

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