National Music Museum: America's Shrine to Music v. Johnson et al
Filing
72
ORDER denying 68 Motion to Alter or Amend Judgment, Motion to Amend Court's Findings, Motion for New Trial, and Motion for Further Action. Signed by U.S. District Judge Karen E. Schreier on 6/2/17. (SLW)
UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
SOUTHERN DIVISION
NATIONAL MUSIC MUSEUM:
AMERICA'S SHRINE TO MUSIC,
4:14-CV-04113-KES
Plaintiff,
vs.
ROBERT JOHNSON and
LARRY MOSS,
ORDER DENYING DEFENDANT'S
MOTION TO ALTER OR AMEND
JUDGMENT, MOTION TO AMEND
COURT’S FINDINGS, MOTION FOR
NEW TRIAL, AND MOTION FOR
FURTHER ACTION
Defendants.
Defendant Larry Moss challenges the court’s memorandum opinion and
order holding that plaintiff, National Music Museum: America’s Shrine to Music
(NMM), is the legal owner of a Martin D-35 guitar once owned by Elvis Presley.
Moss moves to alter or amend the judgment under Fed. R. Civ. P. 59(e), to
amend the court’s findings under Fed. R. Civ. P. 52(b), for a new trial under
Fed. R. Civ. P. 59(a)(1)(b), and for further action after a nonjury trial under Fed.
R. Civ. P. 59(a)(2). The court denies Moss’s motions.
BACKGROUND
The facts below relate to Moss’s arguments on res judicata and collateral
estoppel. For a further recitation of the facts, see the court’s Memorandum
Opinion and Order (Docket 66).
This case stems from the sale of a Martin D-35 guitar once owned by
Elvis Presley. NMM and Moss both claim ownership of the Elvis guitar based on
their respective agreements with defendant Robert Johnson, the guitar’s
previous owner. Moss entered into a contract with Johnson for the Elvis guitar
on February 12, 2008, and NMM entered into its contract with Johnson on
February 6, 2013.
Litigation surrounding the guitar began February 13, 2014, when Moss
filed a counterclaim against Johnson in Tennessee Chancery Court for specific
performance, breach of warranty, breach of contract, and fraud. NMM was not
a party to the suit. About five months later, NMM began this case in South
Dakota state court, naming Johnson and Moss as defendants. Moss later
removed this case to federal court.
While this case was pending before this court, the Tennessee Chancery
Court held a hearing on December 16, 2014, in the case between Moss and
Johnson. At the conclusion of the Tennessee hearing, the court orally ordered
that “Mr. Moss is -- has the right to ownership of the [Elvis guitar].” Docket
49-1 at 74-75. The court did not discuss which section of Tennessee’s
commercial code applied to the transaction. The court did not discuss the
applicability of Tenn. Code Ann. § 47-2-401(2) or Tenn. Code Ann. § 47-2401(3). After the court entered its oral order, Moss’s attorney replied:
If the Court, please, this is going to be a little tricky for me because
this order would be submitted to the Court in South Dakota, so I
want to make certain that I get the order in a fashion that I need it
to be if the Court, please. But assuming that the Court agrees with
me. But that Moss has the right to enforce the contract all the way
back until 2008, he is therefore, the equitable owner of that guitar.
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Docket 49-1 at 75.
The court responded, “So ordered. . . . That Mr. Moss is the rightful -- the
equitable owner of the --.” Id. Moss’s attorney agreed to draft the court’s order.
Again, no one discussed the application of Tennessee’s commercial code or the
exact date title passed from Johnson to Moss.
About a month after the hearing, on January 8, 2015, the Tennessee
Chancery Court issued its written order stating in part that “Mr. Moss holds
legal and equitable title to the Martin D-35 guitar and the Gold Top ES-295
Gibson guitar, which were specifically identified to the contract, relating back
to the date of contracting, February 12, 2008.” Exhibit 54 at 2. The order
provided no legal citation for this conclusion.
In the case before this court, the parties previously filed cross motions
for summary judgment, and the court denied both motions. Docket 43. The
court’s order also held that res judicata and collateral estoppel did not apply to
this case. A bench trial was held on August 2, 2016, and the parties filed posttrial briefs. The court issued its memorandum opinion and order along with a
judgment on January 23, 2017. Moss now asks the court to reconsider its
rulings.
LEGAL STANDARD
The decision to grant or deny Moss’s motions is at the court’s discretion.
See Coterel v. Dorel Juvenile Grp., Inc., 827 F.3d 804, 807 (8th Cir. 2016)
(stating “[w]e review the district court’s evidentiary rulings and its denial of a
new trial for clear and prejudicial abuse of discretion” (citation omitted));
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Burckhard v. BNSF Ry. Co., 837 F.3d 848, 857 (8th Cir. 2016) (stating “[w]e
accord a district court broad discretion in determining whether to grant a
motion to alter or amend judgment, and we will not reverse absent a clear
abuse of discretion” (citation omitted)); Brewer v. Jonesboro Police Dep’t, 653 F.
App’x 853 (8th Cir. 2016) (indicating post-trial motions made under Fed. R.
Civ. P. 59(a)(2) are reviewed for an abuse of discretion (citations omitted)). The
court should grant Moss’s motions only if the court’s prior rulings were in
error. See Burckhard, 837 F.3d at 857.
DISCUSSION
This court previously ruled on Moss’s arguments regarding res judicata
and collateral estoppel. Docket 43 at 3-9. This court also has already ruled that
NMM is the legal owner of the Elvis guitar. Docket 66. The court stands by its
rulings and adds the following in response to Moss’s pending motions.
Under Tennessee law, the doctrines of res judicata and collateral
estoppel do not apply to dicta. Mullins v. State, 294 S.W.3d 529, 535 (Tenn.
2009); see Regions Fin. Corp. v. Marsh USA, Inc., 310 S.W.3d 382, 397 (Tenn.
Ct. App. 2009) (stating “[b]ecause res judicata does not apply to dicta . . . .”).
The Tennessee Supreme Court has explained collateral estoppel applies when
an issue was actually litigated and necessary to the judgment. Mullins, 294
S.W.3d at 535. The court stated, “Determinations of an issue or issues that are
not necessary to a judgment have the characteristics of dicta and will not be
given preclusive effect.” Id. (citing Restatement (Second) of Judgments § 27
cmt. h (1982)).
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Moss argues the doctrines of res judicata and collateral estoppel prohibit
this court from finding that Moss never acquired title to the guitar. Moss
argues that because the Tennessee Chancery Court ruled that Moss held title
to the guitar relating back to the date of contracting, this court is bound by the
Tennessee decision. For Moss to prevail on his argument, this issue—when title
passed from Johnson and Moss—must be necessary to the Tennessee
judgment. The issue must be essential to the Tennessee Chancery Court’s
findings. Closer scrutiny of Moss’s argument, however, shows that it is
inaccurate.
Moss’s counterclaim in the Tennessee Chancery Court consisted of four
counts: (1) specific performance; (2) breach of warranty; (3) breach of contract;
and (4) fraud. None of these claims required Moss to hold title to the guitar to
prevail. The Tennessee Chancery Court could have ruled in Moss’s favor on
each claim without finding that Moss held title to the guitar. Thus, the court’s
statement that “Mr. Moss holds legal and equitable title to the Martin D-35
guitar and the Gold Top ES-295 Gibson guitar, which were specifically
identified to the contract, relating back to the date of contracting, February 12,
2008” is dicta. Because that finding is dicta, res judicata and collateral
estoppel do not apply. The record from the court’s hearing provides further
evidence of this fact. Docket 49-1.
In its oral ruling, the Tennessee Chancery Court simply stated, “All right.
The Court is satisfied that Mr. Moss is – has the right to ownership of the
guitar in question. So ordered.” Docket 49-1 at 75-76. The court made no
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statement on when title passed from Johnson to Moss. This was because the
date when title passed was not relevant to the court’s determination. The only
issue before the court was whether Johnson was required to sell the guitar to
Moss, and that question could be answered without determining when or even
if title passed from Johnson to Moss.
After the Tennessee Chancery Court entered its oral ruling, Moss’s
attorney interjected with the following:
If the Court, please, this is going to be a little tricky for me because
this order would be submitted to the Court in South Dakota, so I
want to make certain that I get the order in a fashion that I need it
to be if the Court, please.
But assuming that the Court agrees with me. But that Moss has
the right to enforce the contract all the way back until 2008, he is
therefore, the equitable owner of the guitar.
Docket 49-1 at 76. The court responded, “So ordered.” Id.
The statements by Moss’s attorney and the court’s response also do not
support Moss’s argument that title passed from Johnson to Moss on the date of
contracting. The Tennessee Chancery Court merely indicated that Moss could
have enforced the contract in 2008. This ruling is consistent with this court’s
rulings because no one disputes that the contract was valid in 2008. The
narrower issue before this court is whether Tenn. Code Ann. § 47-2-401(2) or
Tenn. Code Ann. § 47-2-401(3) applies to the Johnson-Moss contract, and this
narrower issue was never before the Tennessee Chancery Court. The parties
never discussed the difference between Tenn. Code Ann. § 47-2-401(2) or Tenn.
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Code Ann. § 47-2-401(3). The court’s oral and written orders make no reference
to Tenn. Code Ann. § 47-2-401(2) or Tenn. Code Ann. § 47-2-401(3).
The reason why the Tennessee code provisions were not referenced by
the parties and the court is because neither section was relevant to the
Tennessee litigation. As discussed above, Moss could prevail on his claims
without holding title to the guitar. Thus, Johnson also could not have raised
the argument as a defense, and Johnson would have had no interest in arguing
that Tenn. Code Ann. § 47-2-401(2) applied instead of Tenn. Code Ann.
§ 47-2-401(3). The distinction would have had no impact on his case. Only
NMM would have had an interest in making the distinction between the
application of Tenn. Code Ann. § 47-2-401(2) or Tenn. Code Ann.
§ 47-2-401(3).1
The last thing to note is that a factual error in the Tennessee judgment
also indicates that the disputed issue—when title passed from Johnson to
Moss—was not before the Tennessee Chancery Court. In the court’s order it
states that title to a Gold Top ES-295 Gibson guitar also passed from Johnson
to Moss on February 12, 2008. Moss does not dispute, however, that Johnson
never owned the Gold Top guitar. Docket 58 at 180; Exhibit 4. Thus, title to the
Gold Top guitar could not have transferred from Johnson to Moss because
Johnson never had title to transfer. The Tennessee Chancery Court’s order is
inaccurate in this respect because the title issue for the Gold Top Guitar—like
This further supports this court’s earlier ruling that NMM did not have a full
and fair opportunity to litigate their claims. Docket 43 at 7-9.
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the title issue for the Elvis guitar—was never before the court. The language is
dicta. Res judicata and collateral estoppel do not apply.
CONCLUSION
The Tennessee judgment entered on January 8, 2015, is not binding on
this court. The issue of whether or when title passed from Johnson to Moss
was not before the Tennessee Chancery Court and was not litigated by the
parties. The statement “Mr. Moss holds legal and equitable title to the [Elvis
guitar] . . . relating back to the date of contracting, February 12, 2008” is dicta,
and res judicata and collateral estoppel do not apply. Thus, it is
ORDERED that defendant’s motions to alter or amend the judgment, to
amend the court’s findings, for a new trial, and for further action after a
nonjury trial (Docket 68) are denied.
DATED this 2nd day of June, 2017.
BY THE COURT:
/s/ Karen E. Schreier
KAREN E. SCHREIER
UNITED STATES DISTRICT JUDGE
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