McDonald Apiary, LLC v. Starrh Bees, Inc., et al

Filing 187

ORDER denying 141 Motion for Partial Summary Judgment; denying 158 Motion in Limine. Ordered by Judge John M. Gerrard. (DCD)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
MCDONALD APIARY, LLC, a
Nebraska Limited Liability Company,
8:14-CV-351
Plaintiff,
vs.

ORDER

STARRH BEES, INC., a California
Corporation, et al.,
Defendants.
This matter is before the Court on the defendants' motion for summary
judgment (filing 141) and their motion in limine (filing 158). Both motions
will be denied.
BACKGROUND
The plaintiff, McDonald Apiary, LLC, is in the beekeeping and honey
production business in, among other places, western Nebraska. Filing 142 at
5.1 Defendant Starrh Bees is in the same business. Filing 142 at 5. In 2014,
McDonald Apiary and Starrh agreed that Starrh would bring about 6,000
beehives to Oklahoma and Nebraska to place them at locations chosen by
McDonald Apiary. Filing 142 at 5-6. The parties agreed to share
transportation costs (although they now disagree about what those costs
entail), McDonald Apiary would extract the resulting honey at its extraction
facilities, and McDonald Apiary and Starrh would split the proceeds. Filing
142 at 6.
After the parties moved their activity from Oklahoma to Nebraska,
their relationship fell apart. See filing 142 at 6-7. McDonald Apiary accuses
Starrh of misappropriating McDonald Apiary's database of foraging locations
in western Nebraska. Filing 142 at 7. McDonald Apiary also accuses
Pursuant to NECivR 56.1, a party moving for summary judgment must include in its brief
a statement of material facts about which the movant contends there is no dispute, and the
party opposing summary judgment must include in its brief a concise response to that
statement of facts, noting any disagreement. Properly referenced material facts in the
movant's statement are considered admitted unless controverted in the opposing party's
response. NECivR 56.1(b)(1).
1

Jonathan Gonzalez, a Starrh employee, of trespassing and vandalism at
McDonald Apiary's Lisco, Nebraska extraction facility. Filing 142 at 10. And
McDonald Apiary contends that Starrh is tortiously interfering with
McDonald Apiary's business relationships with the landowners on whose
land it has placed its hives. Filing 142 at 11-12.
McDonald Apiary's Second Amended Complaint (filing 59) alleges 12
claims for relief against Starrh; Gonzalez; Starrh's owner, Anne Ashley; and
Anne's husband Dale Ashley, a Starrh employee (collectively, Starrh).2 See,
filing 59; filing 142 at 5. Two of McDonald Apiary's claims were dismissed at
the pleading stage, see filing 40, and Starrh's motion for summary judgment
seeks dismissal of nine of the remaining ten, see filing 142.
DISCUSSION
Summary judgment is proper if the movant shows that there is no
genuine dispute as to any material fact and that the movant is entitled to
judgment as a matter of law. See Fed. R. Civ. P. 56(a). The movant bears the
initial responsibility of informing the Court of the basis for the motion, and
must identify those portions of the record which the movant believes
demonstrate the absence of a genuine issue of material fact. Torgerson v. City
of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (en banc). If the movant
does so, the nonmovant must respond by submitting evidentiary materials
that set out specific facts showing that there is a genuine issue for trial. Id.
On a motion for summary judgment, facts must be viewed in the light
most favorable to the nonmoving party only if there is a genuine dispute as to
those facts. Id. Credibility determinations, the weighing of the evidence, and
the drawing of legitimate inferences from the evidence are jury functions, not
those of a judge. Id. But the nonmovant must do more than simply show that
there is some metaphysical doubt as to the material facts. Id. In order to
show that disputed facts are material, the party opposing summary judgment
must cite to the relevant substantive law in identifying facts that might
affect the outcome of the suit. Quinn v. St. Louis County, 653 F.3d 745, 751
(8th Cir. 2011). The mere existence of a scintilla of evidence in support of the
nonmovant's position will be insufficient; there must be evidence on which
the jury could conceivably find for the nonmovant. Barber v. C1 Truck Driver
Training, LLC, 656 F.3d 782, 791-92 (8th Cir. 2011). Where the record taken
McDonald Apiary has since, with leave of the Court, filed a Third Amended Complaint
(filing 181), which is its operative complaint for purposes of trial. But Starrh's motion for
summary judgment (filing 141), and the briefing on that motion (filing 142; filing 164; filing
171), are directed at the Second Amended Complaint (filing 59), and this order does not
address the additional allegations of the Third Amended Complaint (filing 181) except
where expressly noted.
2

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as a whole could not lead a rational trier of fact to find for the nonmoving
party, there is no genuine issue for trial. Torgerson, 643 F.3d at 1042.
TRADE SECRETS
McDonald Apiary claims that Starrh violated the Nebraska Trade
Secrets Act, Neb. Rev. Stat. § 87-501 et seq., in connection with its alleged
misappropriation of McDonald Apiary's database. Filing 59 at 9-11. Starrh
claims that McDonald Apiary's database is not a "trade secret" because it is
ascertainable by proper means, and was not the subject of reasonable efforts
to maintain its secrecy. Filing 142 at 17. Starrh also argues that there is no
evidence that the database was misappropriated. Filing 142 at 17.
Under Nebraska law, a "trade secret" is defined as information that:
(a)

(b)

Derives independent economic value, actual or potential,
from not being known to, and not being ascertainable by
proper means by, other persons who can obtain economic
value from its disclosure or use; and
Is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy.

Neb. Rev. Stat. § 87-502(4). That definition is narrow; it means that if an
alleged trade secret is ascertainable at all by any means that are not
improper, the would-be secret is excluded from coverage under the Act. First
Express Servs. Grp., Inc. v. Easter, 840 N.W.2d 465, 474 (Neb. 2013).
So, for instance, in Easter, the Nebraska Supreme Court concluded that
the Trade Secrets Act did not protect the customer list of a company that sold
crop insurance, which included "customers' names and their 2009
information: what crops the farmers had, what counties the crops were
located in, what insurance plan the farmers bought, what percentage of
coverage each farmer had, and what commission [the insurer] had earned."
Id. at 469. The court explained that "simple Internet searches could identify
which farmers farmed what land and could provide contact information for
those farmers." Id. at 475. And the other
information on the list essentially reflected the farmers' previous
insurance coverage on their crops. It is undisputed that the
individual farmers had all of that information and that [the
defendant] could have obtained the information from them
through a simple telephone call. Also, once a customer changed
agencies, all of the customer's prior insurance information
became available from the insurance carrier's Web site. Though
the exact information required to transfer a customer is a bit
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unclear, the record shows that, at most, all that is required is the
customer's name, address, type of crops, and signature, all of
which are ascertainable by proper means.
Id. So, because the information on the customer list was ascertainable
through proper means, the court concluded as a matter of law that it was not
a trade secret. Id. at 476.
On the other hand, in Home Pride Foods, Inc. v. Johnson, the Nebraska
Supreme Court held that there was sufficient evidence to find that the
customer list of a food service company was a trade secret, because "the
customer list contained information not available from publicly available
lists." 634 N.W.2d 774, 782 (Neb. 2001). The court explained that, while
courts "are reluctant to protect customer lists to the extent that they embody
information that is readily ascertainable through public sources[,]" a
customer list will be protected "where time and effort have been expended to
identify particular customers with particular needs or characteristics,"
because "[s]uch lists are distinguishable from mere identities and locations of
customers that anyone could easily identify as possible customers." Id. at
781-82.
Starrh argues that McDonald Apiary's location database was not a
trade secret because, among other things, its beehive locations can be
ascertained by looking for them while driving by on the road. Filing 142 at
26. And then, by observing the area and using Internet searches, an observer
could collect information about the landowner and the crops in the area,
which was also information that McDonald Apiary compiled. Filing 142 at 27.
But the Court is not persuaded that the information identified by the
parties is "ascertainable" just because beehives are not invisible. There is a
difference between information that is readily ascertainable and that which
is realistically ascertainable. It might have been possible, one supposes, to
reconnoiter every highway, county road, and deer path in western Nebraska
looking for every one of the approximately 23,000 beehives that McDonald
Apiary placed in the summer of 2014. See filing 143-1 at 24. But the Court is
not convinced that such a theoretical possibility is enough to make the
location database "ascertainable" within the meaning of Easter.
Starrh also argues that McDonald did not use reasonable efforts to
maintain the secrecy of its information. Filing 142 at 20. Starrh points out
that McDonald Apiary shares its location information with competitors, does
not hide its hives, did not require confidentiality agreements, and did not
password-protect its GPS devices or lock the vehicles in which the devices
were often kept. Filing 142 at 20-25.

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But the Court cannot conclude that the measures McDonald Apiary did
take were unreasonable as a matter of law. Ed McDonald testified that while
there were no signed confidentiality agreements, he did instruct people with
whom information was shared that the information was secret and that they
shouldn't tell anyone. Filing 143-1 at 42. Bryan Addington, McDonald
Apiary's foreman, testified that sharecroppers were only given location
information for their own bees, and that McDonald Apiary "didn't want a
sharecropper knowing any other locations than what they needed to know to
tend to their own hives." Filing 143-3 at 32. McDonald even threatened to fire
Addington after Addington allowed Starrh to copy the entire database. Filing
143-3 at 32.
It may be that a handshake agreement on secrecy and failing to lock
the car door may be found unreasonable. But, the Court finds, it is a question
that the jury must decide. Whether information sought to be protected by the
Trade Secrets Act rises to the level of a trade secret is a question of fact.
Home Pride Foods, 634 N.W.2d at 708. And there is a genuine issue of
material fact here.
Starrh also contends that there is not enough evidence that McDonald's
location information was misappropriated. "Misappropriation" means
(a) Acquisition of a trade secret of another by a person who knows
or has reason to know that the trade secret was acquired by
improper means; or
(b) Disclosure or use of a trade secret of another without express
or implied consent by a person who:
(i) Used improper means to acquire knowledge of the trade
secret;
(ii) At the time of the disclosure or use, knew or had reason
to know that his or her knowledge of the trade secret was:
(A) Derived from or through a person who had
utilized improper means to acquire it;
(B) Acquired under circumstances giving rise to a
duty to maintain its secrecy or limit its use; or
(C) Derived from or through a person who owed a
duty to the person seeking relief to maintain its
secrecy or limit its use; or
(iii) Before a material change of his or her position, knew or
had reason to know that the information was a trade secret
and that knowledge of it had been acquired by accident or
mistake[.]

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§ 87-502(2). "Improper means" are "theft, bribery, misrepresentation, breach
or inducement of a breach of a duty to maintain secrecy, or espionage through
electronic or other means[.]" § 87-502(1).
Starrh argues that Addington, an agent of McDonald Apiary, gave the
information to Starrh willingly. Filing 142 at 28-31. But the evidence does
not compel that finding. Addington certainly intended to give some
information to Starrh—the locations for Starrh's own hives. Filing 143-3 at
21-23. But Addington explained that he doesn't know how to run a computer,
and did not expect that when Gonzalez asked to connect Addington's GPS
device to Starrh's computer, that Gonzalez would copy the entire database.
Filing 143-3 at 21-23. The same is true of a later, similar incident with Anne
and Dale Ashley. Filing 143-3 at 22-23.
That evidence could, if credited by the jury, support a conclusion that
Starrh obtained the information from Addington under false pretenses or, at
least, knew that more information was being taken than Addington or
McDonald intended. And there may also be a question as to whether the
information was later used by Starrh, or is still being used by Starrh, despite
knowing that it was meant to be secret and was mistakenly provided. In
short, a jury could find that Starrh's acquisition of the database was
"misappropriation" within the meaning of the Trade Secrets Act.
TRESPASS
McDonald Apiary alleges that Gonzalez trespassed on McDonald
Apiary's property, damaging its equipment and spilling its honey. Filing 59
at 11. Starrh contends there is insufficient evidence that Gonzalez (or anyone
else associated with Starrh) was responsible for the alleged incident. Filing
142 at 31-32. And, Starrh argues, there could have been no "trespass"
because Starrh had permission to enter the Lisco property. Filing 142 at 32.
But, to begin with, there is enough circumstantial evidence to support a
finding that Gonzalez was the vandal—specifically, there is evidence that he
threatened precisely the sort of vandalism that occurred, and was seen in the
area shortly after the incident wearing black clothing and a ski mask. See,
filing 143-3 at 52; filing 143-5 at 64-65.
Nor is Starrh's permission to enter the property necessarily fatal to a
trespass claim. It is true that a trespasser is a person who enters or remains
upon premises in possession of another "without the express or implied
consent of the possessor." Guzman v. Barth, 552 N.W.2d 299, 301 (Neb.
1996). But Nebraska generally adheres to the Restatement (Second) of Torts
with respect to trespass. See, e.g., Lambert v. Holmberg, 712 N.W.2d 268, 273
(Neb. 2006); Kenney v. Barna, 341 N.W.2d 901, 905 (Neb. 1983); Connolley v.
Omaha Pub. Power Dist., 177 N.W.2d 492, 497 (Neb. 1970). Under the
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Restatement, "[a] conditional or restricted consent to enter land creates a
privilege to do so only in so far as the condition or restriction is complied
with." Restatement (Second) of Torts § 168 (1965). And "[o]ne whose presence
on land is pursuant to conduct of a certain sort, is a trespasser if he
intentionally conducts himself in a different manner[.]" Id., cmt. d.; see
Restatement (Second) of Torts § 171(a) (1965); see generally, Desnick v. Am.
Broad. Companies, Inc., 44 F.3d 1345, 1352-53 (7th Cir. 1995); Council on
Am.-Islamic Relations Action Network, Inc. v. Gaubatz, 793 F. Supp. 2d 311,
345 (D.D.C. 2011).
Whether Starrh's permission to enter McDonald Apiary's property was
intended for a particular purpose, and whether Gonzalez's alleged conduct on
the property was consistent with that purpose, are questions for the jury.
BREACH OF CONTRACT
McDonald Apiary alleges that Starrh breached the parties' sharecrop
agreement. Filing 59 at 12. Starrh does not challenge this claim on summary
judgment. See filing 141.
TORTIOUS INTERFERENCE WITH A BUSINESS EXPECTANCY
McDonald Apiary alleges that Starrh has tortiously interfered with
McDonald Apiary's business expectancies—specifically, its business
relationships with landowners on which McDonald Apiary has placed hives
for honey production. Filing 59 at 12-13. Starrh argues that the claim should
be dismissed because Starrh is engaged in lawful competition, not tortious
interference. Filing 142 at 33-37. And, Starrh argues, McDonald Apiary has
no evidence that any business relationship was actually harmed. Filing 142
at 37-38.
To succeed on a claim for tortious interference with a business
relationship or expectancy, a plaintiff must prove (1) the existence of a valid
business relationship or expectancy, (2) knowledge by the interferer of the
relationship or expectancy, (3) an unjustified intentional act of interference
on the part of the interferer, (4) proof that the interference caused the harm
sustained, and (5) damage to the party whose relationship or expectancy was
disrupted. Sulu v. Magana, 879 N.W.2d 674, 681-82 (Neb. 2016). Starrh's
first argument takes aim at the element of an "unjustified intentional act of
interference": Starrh argues that its competition is justified. See filing 142 at
33-34.
To assist in determining whether interference is "unjustified,"
Nebraska has adopted the seven-factor balancing test of the Restatement
(Second) of Torts § 767 (1979). Sulu, 879 N.W.2d at 682. Under the
Restatement's general test, factors to consider in determining whether

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interference with a business relationship is "improper" include: (1) the nature
of the actor's conduct, (2) the actor's motive, (3) the interests of the other with
which the actor's conduct interferes, (4) the interests sought to be advanced
by the actor, (5) the social interests in protecting the freedom of action of the
actor and the contractual interests of the other, (6) the proximity or
remoteness of the actor's conduct to the interference, and (7) the relations
between the parties. Id.
The key to McDonald Apiary's tortious interference claim is that
Starrh's competition is allegedly supported by its acquisition of McDonald
Apiary's location database. In other words, McDonald Apiary has evidence
suggesting that Starrh misappropriated its database and then used that
information to contact McDonald Apiary's landowners—or, in other cases, to
place hives in proximity to McDonald Apiary's landowners in order to hurt
their yield and kill their hives. See, e.g., filing 143-1 at 59-66; filing 143-3 at
46. Such evidence, if credited by the jury, could support a finding of
unjustified interference.
The same evidence supports McDonald Apiary's claimed damages.
Starrh contends that "McDonald Apiary will not be able to produce any
evidence establishing a causal link between any of Starrh Bees' alleged
behavior and any supposed harm to McDonald Apiary." Filing 142 at 38. But,
to the contrary, the Court concludes that McDonald Apiary's evidence could
support such a finding.
CONVERSION
McDonald Apiary alleges that Starrh has converted honey that
belonged to McDonald Apiary. Filing 59 at 13-14. Starrh contends that there
is no evidence to support those allegations. Again, the Court disagrees. Ed
McDonald described how he believed that honey had been taken by Starrh.
Filing 143-1 at 34-37. And there is little dispute—particularly considering
Starrh's counterclaim for an accounting, see filing 186 at 24-25—that some
honey is unaccounted for by someone. The jury will resolve whether Starrh
took any of it unlawfully.3
COMPUTER CRIMES ACT
McDonald Apiary alleges that Starrh's taking of McDonald Apiary's
database violated the Nebraska Computer Crimes Act, Neb. Rev. Stat. § 281341 et seq. Filing 59 at 14-15. That claim was dismissed at the pleading
stage, filing 40 at 6-7, and remains dismissed.

Starrh also complains about the evidence of damages from the alleged conversion. Filing
142 at 39. The Court will address the evidence of damages below.
3

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UNIFORM DECEPTIVE TRADE PRACTICES ACT
McDonald Apiary alleges that Starrh's conduct violates the Nebraska
Uniform Deceptive Trade Practices Act (UDTPA), Neb. Rev. Stat. § 87-301 et
seq. Filing 59 at 15. Starrh contends that its alleged conduct is not a
"practice," which Starrh argues is a habitual or customary performance or
operation. See filing 142 at 39 (citing Bruno v. Sunglass Hut Trading Corp.
No. A-07-745, 2008 WL 2277550, at *3 (Neb. Ct. App. June 3, 2008)). The
Court recognizes Bruno, but is not bound by an unpublished (and therefore
nonbinding) decision of a state intermediate appellate court. King v. Order of
United Commercial Travelers of Am., 333 U.S. 153, 161 (1948). And the Court
is not persuaded that the Nebraska Supreme Court would read a "habitual or
customary" requirement into the UDTPA when it expressly provides, for
instance, that
[a] person engages in a deceptive trade practice when, in the
course of his or her business, vocation, or occupation, he or
she . . . [u]ses any scheme or device to defraud by means of: (i)
Obtaining money or property by knowingly false or fraudulent
pretenses, representations, or promises; or (ii) Selling,
distributing, supplying, furnishing, or procuring any property for
the purpose of furthering such scheme[.]
§ 87-302(a)(16). The statute, in other words, is quite specific about what
conduct supports a "deceptive trade practice," and does not require that the
conduct be repeated by any particular defendant.
Starrh also argues that there is no evidence of future harm that
McDonald Apiary will suffer without the injunctive relief that is the only
available relief under the UDTPA. See Stenberg v. Consumer's Choice Foods,
Inc., 755 N.W.2d 583, 587 (Neb. 2008). But McDonald Apiary has evidence
suggesting the harm it is allegedly continuing to suffer as a result of Starrh's
conduct. Whether any of that harm is caused by conduct that is a "deceptive
trade practice" within the meaning of the UDTPA is a matter that the Court
will decide based on the evidence presented at trial.
The Court notes McDonald Apiary's argument that its UDTPA claim
should be decided by the jury. See filing 164 at 40. But the private remedy
under the UDTPA is "an action for . . . an injunction under the principles of
equity. . . ." § 87-303(a). This is not a claim for the jury. See Wooddell v. Int'l
Bhd. of Elec. Workers, Local 71, 502 U.S. 93, 97-98 (1991). Accordingly, the
Court will decide the UDTPA claim after the jury renders its verdict. See
Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 580 (1959).

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FRAUD
McDonald Apiary claims that Starrh committed fraud by allegedly
entering into the sharecrop agreement on false pretenses—McDonald Apiary
alleges that Starrh actually intended, from the outset, to use the sharecrop
agreement to acquire McDonald Apiary's location information and then take
those locations for itself. Filing 59 at 16-17. Starrh argues, very generally,
that there is no competent evidence establishing the elements of fraud. Filing
142 at 41-42. The Court finds, however, that the evidence is sufficient to at
least circumstantially suggest that Starrh misrepresented its actual intent in
entering into the sharecrop agreement, thus supporting McDonald Apiary's
claim of fraud.
NEGLIGENCE
McDonald Apiary alleges that Starrh acted negligently in operating its
machinery and equipment on property that McDonald Apiary owned or
leased. Filing 59 at 17-18. Starrh argues that there is insufficient evidence to
support such a claim. Filing 142 at 42-43. But the Court finds evidence
sufficient to support McDonald Apiary's claim on at least one incident—the
alleged vandalism at its Lisco facility. The record suggests that at the time of
the incident, McDonald Apiary and Starrh were involved in a dispute over
pallets that belong to Starrh and were allegedly at the Lisco facility. See
filing 143:5 at 64-65. It is at least plausible, from the evidence, that the
"honey tipping" incident could been seen as a negligent consequence of an
attempt by Starrh to retrieve its pallets. Accordingly, there is enough
evidence (at least at this point) to warrant instructing the jury on negligence.
JUNKIN ACT
McDonald Apiary alleges that Starrh violated Nebraska's unlawful
restraint of trade statutes (the "Junkin Act"), Neb. Rev. Stat. § 59-801 et seq.,
by appropriating McDonald Apiary's database. Filing 59 at 18-19. That claim
was dismissed at the pleading stage, filing 40 at 8-10, and remains dismissed.
McDonald Apiary has alleged a substantively new Junkin Act claim in its
Third Amended Complaint, filing 181 at 21-24, and the new Junkin Act claim
is not challenged on summary judgment.
QUANTUM MERUIT AND UNJUST ENRICHMENT
McDonald Apiary asserts claims for quantum merit and unjust
enrichment, as "alternative[s]" to its breach of contract claim, based on the
value of the services and materials McDonald Apiary allegedly provided
Starrh. Filing 59 at 19-20. Starrh argues that those claims sound in implied
contract, and are unsupportable where both sides agree that an expressed

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contract exists. See filing 142 at 43-44. McDonald Apiary responds that the
parties do not agree on the supposed terms of that contract, raising the
possibility that the contract may not be enforceable. See filing 164 at 40-41.
Accordingly, McDonald Apiary resists dismissing these claims at this point.
See filing 164 at 40-41.
The problem for the Court is that at no point has either side moved to
dismiss the other's contract claims. Accordingly, the precise nature of the
contract claims, and the parties' disagreement, has not been made clear to
the Court. As a result, the Court is in a poor position to evaluate a quasicontract claim where the parties' contract claims themselves are uncertain.
The Court will, therefore, not dismiss the quasi-contract claims at this time.
Whether those claims will ultimately be submitted to the jury is a question
for a later time.4
DAMAGES
Starrh argues, at length, that McDonald Apiary should be precluded
from seeking damages for "lost profits" because, according to Starrh, such
damages cannot be established with reasonable certainty. The Court agrees
with Starrh to the extent that some of McDonald's evidence of damages could
be considered speculative. But the Court finds that there is enough evidence
of damages to warrant submission to the jury.
A plaintiff's evidence of damages may not be speculative or conjectural
and must provide a reasonably certain basis for calculating damages: the
general rule is that uncertainty as to the fact of whether damages were
sustained at all is fatal to recovery, but uncertainty as to the amount is not if
the evidence furnishes a reasonably certain factual basis for computation of
the probable loss. Pribil v. Koinzan, 665 N.W.2d 567, 572 (Neb. 2003). The
initial question of law for the Court is whether the evidence of damages
provides a basis for determining damages with reasonable certainty, i.e., the
evidence of damages is not speculative or conjectural. Id. at 573. If the
evidence does provide such a basis, the issue of damages can be submitted to
the jury. Id.
On the evidence before the Court, there is certainly enough evidence to
support a finding that McDonald Apiary sustained some damages. And, the
Court concludes, Ed McDonald's experience is sufficient foundation for his

And, the Court notes—despite their equitable appearance, these are actions at law
seeking legal relief, and therefore are claims for the jury. See, City of Scottsbluff v. Waste
Connections of Nebraska, Inc., 809 N.W.2d 725, 739 (Neb. 2011); Collection Bureau of
Grand Island, Inc. v. Fry, 610 N.W.2d 442, 448 (Neb. Ct. App. 2000); see also Grabinski v.
Blue Springs Ford Sales, Inc., 136 F.3d 565, 571 (8th Cir. 1998).
4

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testimony regarding the damage that McDonald Apiary's honey production
allegedly suffered as a result of Starrh's conduct.
Starrh's motion in limine (filing 158) is based on similar grounds:
Starrh argues that McDonald's testimony, and that of Janet Labenz, should
be precluded pursuant to Fed. R. Evid. 702 and Daubert v. Merrell Dow
Pharm., Inc., 509 U.S. 579 (1993). The Court disagrees.
The objective of the Daubert inquiry is to make certain that an expert,
whether basing testimony upon professional studies or personal experience,
employs in the courtroom the same level of intellectual rigor that
characterizes the practice of an expert in the relevant field. Am. Auto. Ins.
Co. v. Omega Flex, Inc., 783 F.3d 720, 722 (8th Cir. 2015). This is a flexible,
case-specific inquiry: the Court must decide whether this particular expert
had sufficient specialized knowledge to assist the jurors in deciding the
particular issues in the case. Id. at 723.
Daubert established a non-exclusive checklist for trial courts to use in
assessing the reliability of expert testimony, including whether the theory or
technique can and has been tested, whether it has been subjected to peer
review, whether there is a high known or potential rate of error, and whether
the theory or technique enjoys general acceptance within a relevant scientific
community. See United States v. Holmes, 751 F.3d 846, 850 (8th Cir. 2014)
(citing Daubert, 509 U.S. at 592–94). But the "theory or technique" at issue
here is simple and well-established: McDonald Apiary's evidence is based on
comparing its previous yields with yields after Starrh's alleged misconduct.
Starrh's contention that there are "no financial data or records"
supporting the opinion testimony, see filing 159 at 3, is misplaced for two
reasons. First, it is better characterized as a foundational objection than a
Daubert-based inquiry into the theory or technique on which the opinions are
based. Second, McDonald's personal knowledge of his business is, contrary to
Starrh's argument, sufficient foundation for him to opine on damages. Starrh
is, of course, free to cross-examine him about the accuracy of his information,
and alleged inadequacy of his record-keeping. But the Court is not aware of
any legal obligation of a beekeeping business to keep written records of its
yields for every location and hive, and declines to implicitly impose such an
obligation as a condition precedent to any legal recovery for its losses.
In sum, the Court finds enough evidence of damages, at this point, to
warrant submission to the jury.5 How to instruct the jury on damages—

The Court also notes that, to the extent that prospective damages are sought, the jury will
be instructed that damages may only be recovered for injuries that are reasonably certain
to occur. Pribil, 665 N.W.2d at 574.
5

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specifically, what measure of damages will be warranted by the evidence
presented at trial—is a matter for later determination.6
CLAIMS AGAINST INDIVIDUAL DEFENDANTS
Finally, Starrh claims that McDonald Apiary's claims should be
dismissed to the extent they are asserted against Gonzalez and the Ashleys:
Starrh contends that they acted in their capacities as agents of Starrh. Filing
142 at 54-55. McDonald Apiary generally disagrees. Filing 164 at 50.
The problem for the Court is that both sides may be right to an extent,
and neither side addresses the claims in any detail. For instance, Starrh is
likely correct that the individual defendants are not party to any contract
reached with McDonald Apiary. On the other hand, the corporate veil is no
defense to claims such as conversion or fraud, even if the defendant acted on
behalf of the company, if the defendant knew of or participated in the conduct
that resulted in the injury. See, e.g., Oriental Trading Co. v. Firetti, 236 F.3d
938, 946 (8th Cir. 2001); LOL Fin. Co. v. Paul Johnson & Sons Cattle Co., 758
F. Supp. 2d 871, 895 (D. Neb. 2010); Carlson v. Metz, 532 N.W.2d 631, 635
(Neb. 1995); Hecker v. Ravenna Bank, 468 N.W.2d 88, 95–96 (Neb. 1991);
Vogt v. Town & Country Realty of Lincoln, 231 N.W.2d 496, 502 (Neb. 1975);
Allied Bldg. Credits, Inc. v. Damicus, 93 N.W.2d 210, 214 (Neb. 1958); Victory
Lake Marine, Inc. v. Velduis, 621 N.W.2d 306, 311 (Neb. Ct. App. 2000).
Because neither side has addressed in any particularity which claims
may subject the individual defendants to liability, and which may not, the
Court will not dismiss claims as to any of the defendants at this point. Again,
how the jury should be instructed as to liability for each claim is a matter the
Court will address later.
IT IS ORDERED:
1.

Starrh's motion for summary judgment (filing 141) is
denied.

2.

Starrh's motion in limine (filing 158) is denied.

Starrh also argues, briefly, that certain aspects of McDonald's alleged damages should be
precluded because no documents were produced supporting them. The Court will address
that argument if it is shown that such documents exist and should have been produced.
6

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Dated this 10th day of October, 2016.
BY THE COURT:

John M. Gerrard
United States District Judge

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