FILED United States Court of Appeals UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT February 21, 2019 _________________________________ Elisabeth A. Shumaker Clerk of Court CREW TILE DISTRIBUTION, INC.,
Plaintiff Counter Defendant - Appellant,
v.
PORCELANOSA LOS ANGELES, INC.; PORCELANOSA NEW YORK, INC.; PORCELANOSA TEXAS, CORP.; PORVEN, LTD,
Defendant Counterclaimants - No. 18-1029 Appellees, (D.C. No. 1:13-CV-03206-WJM-KMT) (D. Colo.) v.
RYAN A. DAVIS; DARLYNE A. DAVIS; PARADIGM TILE & STONE DISTRIBUTORS, LLC,
Counterclaim Defendants - Appellants,
and
GLENN L. DAVIS; SHANA L. BASTEMEYER; G&D DAVIS HOLDINGS, LLC,
Counter Defendants.
_________________________________ ORDER AND JUDGMENT* _________________________________
Before BRISCOE, HOLMES, and McHUGH, Circuit Judges. _________________________________
This appeal is from a jury verdict which resolved a contract dispute between
two businesses. The district court had jurisdiction under 28 U.S.C. § 1332. Plaintiff-
Counter Defendant-Appellant Crew Tile Distribution, Inc. sued Defendants-
Counterclaimants-Appellees Porcelanosa Los Angeles, Inc., Porcelanosa New York,
Inc., Porcelanosa Texas, Inc., and Porven, Ltd. (collectively, “Porcelanosa”) for
breach of contract. Porcelanosa filed an abuse of process counterclaim against Crew
Tile Distribution, Inc., Ryan Davis, Darlyne Davis, and Paradigm Tile & Stone
Distributors, LLC (collectively, “Crew Tile”). Prior to trial, Crew Tile filed two
motions in limine to exclude other acts evidence and testimony from a handwriting
expert. The district court denied both motions. The jury returned a verdict in favor
of Porcelanosa on Crew Tile’s breach of contract claim and Porcelanosa’s abuse of
process counterclaim. Crew Tile timely appealed. Exercising jurisdiction pursuant
to 28 U.S.C. § 1291, we AFFIRM.
I
Crew Tile is a Denver-based business that sold tile manufactured by
Porcelanosa, a Spanish company that specializes in high-end tile. Crew Tile is
* This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
2 operated by Ryan Davis, a former Porcelanosa employee, and his parents, Glenn and
Darlyne Davis. Jack Handley was the Porcelanosa sales representative assigned to
Colorado. Crew Tile became one of Handley’s clients in 2008.
As Ryan Davis worked to expand Crew Tile, he repeatedly told Handley that
he wanted Crew Tile to be Porcelanosa’s exclusive distributor in Colorado. In 2009,
Crew Tile began to spend money to build a showroom in Denver. At trial, Darlyne
Davis testified that Porcelanosa required Crew Tile to build the showroom before
Porcelanosa would make Crew Tile its exclusive distributor. Conversely, Handley
testified that Crew Tile constructed the showroom on its own initiative, without
Porcelanosa’s direction.
Regardless of the precise motivation for building the showroom, its
construction spurred a meeting between Crew Tile and Porcelanosa on
December 14, 2009. The parties dispute whether an exclusive distribution agreement
resulted from that meeting. According to Porcelanosa, Handley and his boss toured
the Crew Tile showroom with Ryan and Darlyne Davis before having lunch with
Ryan and one of his investors. Handley testified that he and Ryan Davis reached “a
verbal agreement” “that [Porcelanosa] would support [Crew Tile], as [they] would
any customer.” App. Vol. VII at 1904. In Crew Tile’s version of events, Ryan
Davis, Darlyne Davis, and Handley signed three copies of an exclusive distribution
agreement after the tour of the showroom.
The document at the heart of this case is the seven-page “Distributor
Agreement” that was purportedly executed by Crew Tile and Porcelanosa on
3 December 14, 2009 (the “2009 Agreement”). The 2009 Agreement states that Crew
Tile will be the exclusive distributor of Porcelanosa tile in Colorado, excluding
Aspen and Pitkin County (where another distributor was active). In exchange, Crew
Tile agreed “not to represent or sell other products” that competed with Porcelanosa’s
tiles. App. Vol. XV at 3886. The 2009 Agreement could be terminated by
Porcelanosa “at the end of the [f]ifth year of [the a]greement” if Porcelanosa paid
Crew Tile “the sum of [t]wo and [one] half million [dollars] ($2,500,000.00) or [the]
present . . . value [of Crew Tile,] whichever is greater.” Id. at 3890.
Assuming the 2009 Agreement was signed, Crew Tile possesses the only
remaining copy. Ryan Davis testified that, of the three copies signed in December
2009, Crew Tile kept two copies and Porcelanosa kept one. Darlyne Davis later lost
one of Crew Tile’s copies. Consistent with its theory that the 2009 Agreement never
existed, Porcelanosa claims that it first received a copy of the 2009 Agreement as
part of this litigation. Ryan Davis testified that there are no other drafts or copies of
the 2009 Agreement because all negotiations took place over the phone and Handley
only brought three hard copies to the December 2009 meeting.
Regardless of which party’s testimony about the 2009 Agreement is true, the
parties agree that Crew Tile sold Porcelanosa-brand tile from 2009 through the
beginning of this lawsuit. In April 2013, Porcelanosa notified Crew Tile that it
planned to build its own showroom in Denver and sell its tile directly to customers in
Colorado. Ryan Davis objected, telling Porcelanosa that selling directly to customers
in Colorado violated the 2009 Agreement. This did not dissuade Porcelanosa. On
4 October 31, 2013, Porcelanosa notified its customers “that the Colorado [m]arket
[would] now be serviced by Porcelanosa . . . as of November 1, 2013.” App. Vol. I at
78.
In November 2013, Crew Tile initiated this action by suing Porcelanosa for
breach of the 2009 Agreement. Porcelanosa counterclaimed for abuse of process,
alleging that Crew Tile knew the 2009 Agreement was invalid when it filed its breach
of contract claim. Porcelanosa’s theory is that Crew Tile knew the 2009 Agreement
was invalid because Crew Tile drafted the document itself in April 2013 in an effort
to prevent Porcelanosa from opening its own Denver showroom.
Crew Tile filed two motions in limine prior to trial. The first sought to
exclude, pursuant to Federal Rule of Evidence 404, testimony about a contested
contract between Infinite Flooring & Design Corporation—Ryan Davis’s previous
company—and Porcelanosa (the “2004 Agreement”). Porcelanosa contends that
Ryan Davis forged the 2004 Agreement. In its motion in limine, Crew Tile argued
that Porcelanosa’s only purpose in seeking admission of the 2004 Agreement was to
prove that Ryan Davis is a serial forger, making it more likely that he forged the
2009 Agreement. The district court denied the motion because it found that the 2004
Agreement could be admitted for non-propensity purposes “to prove, among other
things, the parties’ knowledge of one another’s business goals or practices, the
existing relationship between the parties, and the parties’ opportunity to modify or
expand an (allegedly) pre-existing distribution agreement to encompass different or
additional products.” App. Vol. III at 747.
5 Crew Tile’s second motion in limine sought to exclude, pursuant to Federal
Rule of Evidence 702, Porcelanosa’s handwriting expert’s testimony that Handley’s
signature on the 2009 Agreement was a forgery, that the Porcelanosa representative’s
signature on the 2004 Agreement was a forgery, that it is “highly probable that” Ryan
Davis wrote Handley’s signature on the 2009 Agreement, and that Ryan Davis wrote
the dates on the 2004 Agreement. As is relevant for this appeal, Crew Tile argued
that Porcelanosa’s expert, Wendy Carlson, failed to reliably apply her methodology
and improperly offered opinions about the authorship of the 2004 and 2009
Agreements. The district court denied the motion, finding that Carlson could testify
about the authorship of the Agreements and that Crew Tile could use any deficiencies
in Carlson’s methodology to impeach her testimony at trial.
The case proceeded to trial. At the close of evidence, Crew Tile moved,
pursuant to Federal Rule of Civil Procedure 50(a), for judgment as a matter of law on
Porcelanosa’s abuse of process counterclaim. The district court denied the motion
because it found that Porcelanosa had offered sufficient evidence to prove the
elements of its counterclaim.
After a nine-day trial, the jury returned a verdict in favor of Porcelanosa on
Crew Tile’s breach of contract claim and Porcelanosa’s abuse of process
counterclaim. The jury awarded Porcelanosa $460,000.00 in damages. Crew Tile
then moved, pursuant to Federal Rule of Civil Procedure 59(a)(1), for a new trial.
Crew Tile argued that, at trial, Porcelanosa used evidence of the 2004 Agreement for
improper character purposes, in violation of Federal Rule of Evidence 404. The
6 district court denied the motion because it found that Porcelanosa primarily used
evidence of the 2004 Agreement for permissible non-propensity purposes and that,
even if some discussion of the 2004 Agreement was improper, Crew Tile did not
suffer prejudice warranting a new trial.
On appeal, Crew Tile argues that it is entitled to a new trial because the district
court erred in denying its motions in limine to exclude evidence of the 2004
Agreement, to exclude Carlson’s expert handwriting testimony, and for judgment as a
matter of law on Porcelanosa’s abuse of process counterclaim.
II
Before discussing the merits of this appeal, we briefly address whether we are
presented with a final appealable order. We ordered supplemental briefing about
whether “the district court ha[d] . . . resolved Crew Tile[’s] . . . fifth claim for relief:
a claim for declaratory relief against Porcelanosa.” Dkt. No. 10534168 at 2. Upon
review of the parties’ briefing, we conclude that we have jurisdiction. In its fifth
claim for relief, Crew Tile sought a declaration that the 2009 Agreement was “valid
and enforceable.” App. Vol. I at 67. The district court “entered [judgment] in favor
of [Porcelanosa] and against [Crew Tile] on all of [Crew Tile]’s equitable claims.”
App. Vol. IV at 1053 (emphasis added). Moreover, the jury found in Porcelanosa’s
favor on Crew Tile’s breach of contract claim. Awarding Crew Tile its requested
declaratory relief would have been inconsistent with the jury verdict. Because the
district court resolved Crew Tile’s claim for declaratory relief, and all of the parties’
other claims have also been adjudicated, we have a final appealable order for
7 purposes of 28 U.S.C. § 1291. Anderson Living Tr. v. WPX Energy Prod., LLC., 904
F.3d 1135, 1139 (10th Cir. 2018) (“A ‘final decision’ is one which ends the litigation
on the merits and leaves nothing for the court to do but execute the judgment.”).
III
The two primary issues on appeal are (1) whether evidence of the 2004
Agreement was admissible under Federal Rule of Evidence 404(b) and (2) whether
Porcelanosa’s handwriting expert’s testimony was admissible under Federal Rule of
Evidence 702. We will only grant a new trial “based on an evidentiary error if the
error had a substantial influence on the outcome or leaves one in grave doubt as to
whether it had such effect.”1 Abraham v. BP Am. Prod. Co., 685 F.3d 1196, 1202
(10th Cir. 2012) (quotation marks omitted). “When determining whether an error
was harmless, we review the record as a whole.” Hill v. J.B. Hunt Transp., Inc., 815
F.3d 651, 659 (10th Cir. 2016) (quotation marks omitted).
A. Other Acts Evidence
Crew Tile argues that the district court erred by finding that evidence of the
2004 Agreement was admissible to prove the parties’ prior business relationship and
1 Crew Tile does not argue that the cumulative effect of the two alleged evidentiary errors warrants remand for a new trial. See Estate of Trentadue ex rel. Aguilar v. United States, 397 F.3d 840, 860 (10th Cir. 2005) (“Cumulative-error analysis . . . aggregates all the errors that individually have been found to be harmless, and therefore not reversible, and it analyzes whether their cumulative effect on the outcome of the trial is such that collectively they can no longer be determined to be harmless.” (quotation marks omitted)). Crew Tile only mentions cumulative error twice, without any analysis or citation to case law. See Aplt. Br. at 40; Aplt. Reply Br. at 15. These passing references are insufficiently developed for us to consider. Bronson v. Swensen, 500 F.3d 1099, 1104–05 (10th Cir. 2007).
8 concomitant knowledge of each other’s business practices. We review the admission
of other acts evidence, pursuant to Federal Rule of Evidence 404(b), for abuse of
discretion. Tanberg v. Sholtis, 401 F.3d 1151, 1167 (10th Cir. 2005). “The
admission of evidence may constitute an abuse of discretion only if based on an
erroneous conclusion of law, a clearly erroneous finding of fact[,] or a manifest error
in judgment.” Owner-Operator Indep. Drivers Ass’n, Inc. v. USIS Commercial
Servs., Inc., 537 F.3d 1184, 1193 (10th Cir. 2008) (quotation marks omitted).
“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.” Fed. R. Evid. 404(b)(1). But “[t]his evidence may
be admissible for another purpose, such as proving motive, opportunity, intent,
preparation, plan, knowledge, identity, absence of mistake, or lack of accident.” Fed.
R. Evid. 404(b)(2). Other acts evidence “is admissible if four factors are satisfied:
(1) the evidence is offered for a proper purpose; (2) the evidence is relevant; (3) the
probative value of the evidence is not substantially outweighed by its potential for
unfair prejudice; and (4) the district court provides an appropriate limiting instruction
upon request.” Chavez v. City of Albuquerque, 402 F.3d 1039, 1046 (10th Cir. 2005).
The district court denied Crew Tile’s motion in limine because it found that
evidence of the 2004 Agreement was “admissible under Rule 404(b) to prove, among
other things, the parties’ knowledge of one another’s business goals or practices, the
existing relationship between the parties, and the parties’ opportunity to modify or
expand an (allegedly) pre-existing distribution agreement to encompass different or
9 additional products.” App. Vol. III at 747. The district court reasoned that “if the
2004 [Agreement] was contemplated or proposed by the Davises[,] but not agreed to
by Porcelanosa, that fact would tend to prove Porcelanosa’s business practices did
not include exclusivity agreements, and that the Davises were aware of that practice”
when they filed suit to enforce the 2009 Agreement.2 Id. at 746.
While the district court did state a basis for admission of Rule 404(b)
evidence, its ruling is divorced from Porcelanosa’s theory of its case—that Ryan
Davis forged the 2004 and 2009 Agreements. See App. Vol. III at 570 (arguing that
evidence of the 2004 Agreement “tends to make the forgery of the [2009] Agreement
. . . more probable”). There is no indication that Porcelanosa ever planned to offer
evidence of a failed 2004 negotiation to show that Crew Tile knew Porcelanosa had a
policy against exclusivity agreements. In fact, Porcelanosa never identified any
proper purpose for which it sought to admit evidence of the 2004 Agreement.3 In its
2 The district court also stated that Crew Tile might seek to admit evidence of the 2004 Agreement to “disprove Porcelanosa’s claim that it does not enter into exclusive distribution contracts.” App. Vol. III at 746. The problem is that Crew Tile did not want to admit evidence of the 2004 Agreement. Crew Tile moved to exclude “[e]vidence of the 2004 [Agreement because it was] not admissible for any purpose.” Id. at 534 (emphasis omitted). 3 On appeal, Porcelanosa argues evidence of the 2004 Agreement shows that “the Davises may have carried out a scheme or plan” because of “the many similarities” between the 2004 and 2009 Agreements, including the parties involved, the fact that the Davises benefited from both agreements, and the fact that Ryan Davis signed both agreements. Aple. Br. at 38–39; see also id. at 36 (arguing that the 2004 Agreement was “admissible to prove intent, motive and plan, as well as to establish there was no accident”). Porcelanosa’s after-the-fact attempts to justify Continued . . . 10 opposition to Crew Tile’s motion in limine, Porcelanosa merely parroted Rule 404 by
asserting that evidence of the 2004 Agreement was admissible to “demonstrate[ Ryan
Davis’s] plan, motive, intent, absence of mistake, and lack of accident.” Id. (citing
Fed. R. Evid. 404(b)(2)).
Therefore, the district court allowed Porcelanosa to introduce evidence of the
2004 Agreement for purposes not “implicated [by] the facts presented” in this case.
Chavez, 402 F.3d at 1046. Because the district court failed to identify a proper
relevant purpose for the evidence, it erred in denying Crew Tile’s motion in limine.
Id.
Any question about how Porcelanosa planned to use evidence of the 2004
Agreement could have been answered by consulting the expected testimony of
Porcelanosa’s witnesses. For example, Porcelanosa intended to call one of its former
employees, whose signature purportedly appears on the 2004 Agreement, to testify
that he had never discussed or negotiated the 2004 Agreement with Ryan Davis.
Porcelanosa’s handwriting expert also planned to testify that the Porcelanosa
representative’s signature on the 2004 Agreement was forged, and that Ryan Davis
wrote the dates on the 2004 Agreement. By Porcelanosa’s own admission, they
wanted to admit this evidence because it “tend[ed] to make the forgery of the [2009]
Agreement . . . more probable.” App. Vol. III at 570. Once Porcelanosa offered
(Cont’d) admission of the 2004 Agreement do not affect our analysis of the purposes identified by the district court in its order denying Crew Tile’s motion in limine.
11 evidence suggesting that Ryan Davis forged the 2004 Agreement, there was a
substantial risk the jury would make the impermissible propensity inference that
Ryan Davis also forged the 2009 Agreement because forgery is part of his character.
However, the district court’s error was harmless because of the limited scope
of the order denying the motion in limine. The district court’s order only allowed
Porcelanosa to admit evidence of the 2004 Agreement to prove the parties’ prior
business relationship. If Porcelanosa had complied with the district court’s order, the
jury would have heard little about the 2004 Agreement. Porcelanosa claims that
there were no negotiations regarding the 2004 Agreement, and that it only discussed
the 2004 Agreement with Crew Tile once. Any further use of the 2004 Agreement at
trial was not contemplated by the district court’s denial of the motion in limine.
However, as will be discussed, Porcelanosa strayed from the limits imposed by the
district court’s order. But any prejudice from Porcelanosa’s unapproved use of the
2004 Agreement is not attributable to the district court’s error in denying the motion
in limine. See Huddleston v. United States, 485 U.S. 681, 691–92 (1988) (explaining
that other “acts evidence is to be considered only for the proper purpose for which it
was admitted”).
In addition to challenging the district court’s denial of its motion in limine,
Crew Tile also argues that, at trial, Porcelanosa used the 2004 Agreement to prove
that forgery fits within Ryan Davis’s character. Crew Tile is correct. See, e.g., App.
Vol. XIII at 3396 (Porcelanosa’s attorney stating, during closing argument, that he
was “calling [Ryan Davis] a forger” based on “the evidence [admitted] . . . over the
12 course of the last eight days”). But Crew Tile neither objected in district court nor
argues for plain error review on appeal. If a party fails to object before or at trial, he
“waives appellate review absent plain error.” Mathis v. Huff & Puff Trucking, Inc.,
787 F.3d 1297, 1308 (10th Cir. 2015) (quotation marks omitted). We will not correct
an error otherwise reversible under plain error review if the party “fail[s] to argue for
plain error and its application on appeal.” Id. (quotation marks omitted).
Crew Tile’s attorneys apparently did not think Crew Tile “was obligated to
renew [its] objections each and every time evidence about the 2004 [A]greement was
introduced” because the district court denied its motion in limine “prior to trial.”
Aplt. Reply Br. at 9–10. It is true that “a party need not renew an objection . . . to
preserve a claim of error for appeal” “[o]nce the court rules definitively on the
record” before trial. Fed. R. Evid. 103(b). But the district court’s ruling on the
motion in limine did not, and in fact could not, admit evidence of the 2004
Agreement to prove Ryan Davis’s propensity for forgery. “Evidence of a[n] . . .
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) (emphasis added).
The district court’s ruling on the motion in limine allowed evidence of the
2004 Agreement for limited non-propensity purposes. When Porcelanosa strayed
from these purposes at trial, Crew Tile needed to object. Instead, Crew Tile went
along with Porcelanosa’s strategy and attempted to counter it by proving that Ryan
Davis was not a forger. See, e.g., App. Vol. V at 1159 (Crew Tile’s attorney stating,
13 during opening argument, that “one way [Porcelanosa is] going to try to [prove its
case] is they’re going to try to claim that Mr. Davis is a forger[,] . . . a serial forger”);
App. Vol. VI at 1432 (Crew Tile’s attorney asking Ryan Davis, on direct
examination, “Are you a forger?”); App. Vol. XIII at 3372 (Crew Tile’s attorney
stating, during closing argument, “If someone’s a forger, they’re a forger.”); id. at
3393 (Crew Tile’s attorney, during closing argument, characterizing Porcelanosa’s
theory of the case as, “We’re going to say you’re forgers. You’re a forger.”).
“Having failed to make a timely objection to the evidence at the time that it was
presented and having personally developed [the challenged evidence] . . . , [Crew
Tile] waived any right that [it] might have otherwise had to challenge this evidence
on appeal.” Kloepfer v. Honda Motor Co., 898 F.2d 1452, 1460 (10th Cir. 1990).
B. Expert Testimony
Crew Tile argues that the district court erred by admitting Porcelanosa’s
handwriting expert’s testimony about the 2009 Agreement, and that the error was
prejudicial because the validity of the 2009 Agreement was the central issue in this
case.
To determine whether an expert’s opinion is admissible, the district court must undertake a two-step analysis. United States v. Nacchio, 555 F.3d 1234, 1241 (10th Cir. 2009) (en banc). First, the court must determine whether the expert is “qualified ‘by knowledge, skill, experience, training, or education’ to render an opinion.” Id. (quoting Fed. R. Evid. 702). Second, “the court must determine whether the expert’s opinion is reliable by assessing the underlying reasoning and methodology, as set forth in Daubert[ v. Merrell Dow Pharm., Inc., 509 U.S. 579 (1993)].” Id.
Mathis, 787 F.3d at 1307.
14 “[W]e review whether the district court applied the proper legal test in
admitting expert testimony de novo and the court’s application of that standard for
abuse of discretion.” Id. Crew Tile appropriately does not argue that the district
court applied an improper legal test. The district court understood its gatekeeping
role. App. Vol. II at 490–91 (noting the requirements that an expert witness be
qualified and her opinion reliable). Nor does Crew Tile renew its objections to
Carlson’s qualifications as a handwriting expert. Therefore, the only question before
us is whether the district court abused its discretion in determining that Carlson’s
testimony was reliable. “The admission of evidence may constitute an abuse of
discretion only if based on an erroneous conclusion of law, a clearly erroneous
finding of fact or a manifest error in judgment.” Owner-Operator, 537 F.3d at 1193
(quotation marks omitted).
When considering reliability, “the purpose of the . . . inquiry is always ‘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.’” Dodge v. Cotter
Corp., 328 F.3d 1212, 1222–23 (10th Cir. 2003) (quoting Kumho Tire Co. v.
Carmichael, 526 U.S. 137, 152 (1999)).
To assist in the assessment of reliability, the Supreme Court [has provided] . . . four nonexclusive factors that the trial court may consider: (1) whether the opinion at issue is susceptible to testing and has been subjected to such testing; (2) whether the opinion has been subjected to peer review; (3) whether there is a known or potential rate of error associated with the methodology used and whether there are standards controlling the technique’s operation;
15 and (4) whether the theory has been accepted in the scientific community.
Id. at 1222 (citing Daubert, 509 U.S. at 593–94). “[A] district court does[ not] have to
discuss . . . all of the reliability factors” in every case; “[a] district court’s gate-keeping
function is more flexible than that, requiring the court to focus its attention on the specific
factors implicated by the circumstances at hand.” Storagecraft Tech. Corp. v. Kirby, 744
F.3d 1183, 1190 (10th Cir. 2014). “[O]ther things equal, more complicated challenges
demand lengthier discussions while less complicated challenges require less discussion.”
“Generally, the district court should focus on an expert’s methodology rather
than the conclusions it generates.” Dodge, 328 F.3d at 1222. “Under Daubert, ‘any
step that renders the analysis unreliable renders the expert’s testimony inadmissible.
This is true whether the step completely changes a reliable methodology or merely
misapplies that methodology.’” Id. (alterations omitted) (quoting Mitchell v.
Gencorp, Inc., 165 F.3d 778, 782 (10th Cir. 1999)).
Carlson’s expert report states that “[t]he scientific methodology used in [her]
examination consist[ed] of the ‘ACE-V’ method, which means ‘Analyze, Compare,
Evaluate[,] and Verify.’” App. Vol. I at 266. “Verification, the fourth stage,
involves having a second examiner look at the [samples] being compared.” United
States v. Baines, 573 F.3d 979, 983 (10th Cir. 2009). “[T]he verification stage of the
ACE-V process is not the independent peer review of true science.” Id. at 990.
Carlson did not complete the verification step before submitting her expert report
16 because she was concerned that she would not have enough time to get verification
before her deadline to provide her report to Porcelanosa’s counsel.
The district court found that Carlson’s testimony was admissible, even though
she did not complete the ACE-V methodology, because her failure to verify only
“bears on the weight and credibility of [her] testimony.” App. Vol. II at 499. The
district court justified its finding by citing Baines for the proposition that expert
testimony based on an ACE-V methodology is admissible even though “verification
adds little to reliability.”4 Id. at 498–99 (citing Baines, 573 F.3d at 987)).
Essentially, the district court reasoned that, because verification is not a significant
step in the ACE-V methodology, it is not a necessary step. On the record developed
in the district court, this was error.
Almost by definition, when Carlson chose not to verify her opinions so she
could meet counsel’s deadline, she “completely change[d] a reliable methodology or
. . . misapplie[d] that methodology.” Dodge, 328 F.3d at 1222 (quotation marks
omitted). In effect, Carlson based her opinions on an ACE methodology, not an
ACE-V methodology. Because Carlson chose to deviate from the methodology
identified in her expert report, it was incumbent on Porcelanosa to establish that her
opinion was still reliable. See Attorney Gen. v. Tyson Foods, Inc., 565 F.3d 769, 780
(10th Cir. 2009) (“[W]hen experts apply methodologies in novel ways, they may
arrive at conclusions that result in ‘too great an analytical gap between the data and
4 Notably, the fingerprint expert in Baines verified his opinion, per the ACE-V methodology. 573 F.3d at 983.
17 the opinion proffered’ to be determined reliable.” (quoting Hollander v. Sandoz
Pharm. Corp., 289 F.3d 1193, 1205 (10th Cir. 2002))). Porcelanosa’s only attempt to
satisfy this burden was its assertion, based on thirteen conclusory lines of Carlson’s
deposition testimony, that “independent verification review is not required under
ACE-V, only suggested.” Supp. App. Vol. VI at 955.
A district court can “satisf[y]” “its gatekeeper obligation” “only if ‘[it] has
sufficient evidence to perform the task.’” Dodge, 328 F.3d at 1228 (quoting Goebel
v. Denver & Rio Grande W. R.R. Co., 215 F.3d 1083, 1087 (10th Cir. 2000)). Here,
the district court assessed the reliability of Carlson’s testimony without the aid of a
Daubert hearing. Moreover, Porcelanosa did not offer any evidence to support its
contention that Carlson’s ACE methodology satisfied Rule 702. As a result, the
district court based its finding on one Fourth Circuit case and two district court cases
in which expert testimony was admitted despite a failure to complete the verification
step of the ACE-V methodology. But none of these cases explain why the ACE
methodology is reliable, and certainly none discuss the lack of verification with
respect to Carlson’s analysis in this case.
It may be that verification adds so little to the reliability of an expert’s opinion
that there is no real difference between the ACE and ACE-V methodologies. But it
might also be true that verification adds just enough to the reliability of the ACE-V
methodology to push handwriting analysis over the line from worthless
pseudoscience to valuable expert testimony. Porcelanosa’s attempt to resolve this
uncertainty was lacking. Accordingly, the district court did not have sufficient
18 evidence to perform its gatekeeping function and its decision to admit Carlson’s
testimony was error. Dodge, 328 F.3d at 1228–29.
Crew Tile also argues that Carlson’s testimony is unreliable because she did
not properly compare and evaluate the various handwriting samples (steps two and
three of ACE-V methodology). In contrast to Carlson’s failure to verify her results,
the district court did not abuse its discretion when it found that the quality of
Carlson’s analysis was less a question of reliability and more an issue of credibility.
See In re Urethane Antitrust Litig., 768 F.3d 1245, 1263 (10th Cir. 2014) (“[A]
district court must admit expert testimony as long as it is based on a reliable
methodology. It is then for the jury to evaluate the reliability of the underlying data,
assumptions, and conclusions.”). Crew Tile does not argue that Carlson failed to
compare or evaluate the relevant data, just that her comparison and evaluation were
inadequately rigorous. “Vigorous cross-examination, presentation of contrary
evidence, and careful instruction on the burden of proof are the traditional and
appropriate means of attacking shaky but admissible evidence.” Daubert, 509 U.S. at
596. Crew Tile was free to raise the perceived shortcomings in Carlson’s analysis at
trial.
Because we conclude that the district court erred when it admitted Carlson’s
testimony, we need not reach the subsidiary issue of whether Carlson was qualified to
testify that it was in fact Ryan Davis who forged Handley’s signature on the 2009
Agreement.
19 We must now determine whether the admission of Carlson’s testimony “had a
substantial influence on the outcome [of the trial] or leaves one in grave doubt as to
whether it had such effect.” Abraham, 685 F.3d at 1202 (quotation marks omitted).
We “may set aside a jury verdict due to erroneously admitted evidence only if [we]
reasonably conclude[] that a trial without that evidence would have had a contrary
result.” Racher v. Westlake Nursing Home Ltd. P’ship, 871 F.3d 1152, 1161 (10th
Cir. 2017). “[A]n ‘important factor in determining whether an error was harmless is
the strength of the case in support of the verdict. The risk is greater that a particular
error tipped the scales in a close case than in one in which the evidence was
extremely one-sided.’” Sims v. Great Am. Life Ins. Co., 469 F.3d 870, 886 (alteration
omitted) (10th Cir. 2006) (quoting 11 Charles Alan Wright & Arthur R. Miller,
Federal Practice and Procedure § 2883 (2d ed. 1995 & Supp. 2005)).
The prominence and probative value of Carlson’s testimony weighs in favor of
finding prejudice.5 Goebel, 215 F.3d at 1089 (finding prejudice where wrongfully
admitted “testimony was a large part of plaintiff’s case because it helped to establish
5 The district court found that “[a]lthough . . . Carlson was credible as a witness in explaining her opinions and how she reached them, . . . Crew Tile’s cross- examination was effective in showing these opinions should be given comparatively lesser weight.” App. Vol. IV at 1024 n.8. But the parties still highlighted her testimony for the jury. And, if accepted, her opinion that Ryan Davis forged Handley’s signature on the 2009 Agreement would determine the outcomes of Crew Tile’s breach of contract claim and Porcelanosa’s abuse of process counterclaim. Therefore, even if impeached, Carlson’s testimony still had the potential to cause prejudice. See Adamscheck v. Am. Family Mut. Ins. Co., 818 F.3d 576, 589–90 (10th Cir. 2016) (“[N]on-expert evidence [that] support[s a litigant’s] theory” is “not a substitute for or cumulative of” an expert’s opinion that can tie together the evidence “based on . . . expertise and training.”).
20 the . . . causal link between the incident [at issue] . . . and the alleged . . . injury”);
see also Abraham, 685 F.3d at 1203 (“‘[C]onsiderable use of inadmissible evidence
during the taking of evidence and during argument’ may be sufficient to demonstrate
substantial prejudice.” (alterations omitted) (quoting Sanjuan v. IBP, Inc., 160 F.3d
1291, 1297 (10th Cir. 1998))). At trial, the parties acknowledged the significance of
Carlson’s testimony. In its closing argument, Crew Tile described Carlson as “one of
the most important witnesses in this case.” App. Vol. XIII at 3371. Crew Tile went
so far as to tell the jury, “If you believe her, that she can figure this out from those
signatures and that Ryan Davis is a forger, then we’re going to lose.” Id. At the end
of its closing argument, Porcelanosa twice reiterated Carlson’s testimony that
Handley did not sign the 2009 Agreement. Id. at 3448, 3449.
That being said, “the presentation of [wrongly admitted expert testimony]
might still qualify as harmless error ‘if other competent evidence is “sufficiently
strong” to permit the conclusion that the improper evidence had no effect on the
decision.’” Storagecraft, 744 F.3d at 1191 (quoting Goebel, 215 F.3d at 1089).
Wrongly admitted expert testimony is more likely to be harmless when “the record
contain[s] independent, admissible evidence establishing the same proposition to
which the expert had testified.” Adamscheck, 818 F.3d at 589. The district court
found that, “even without considering . . . Carlson’s testimony,” App. Vol. IV at
1024 n.8, “a preponderance of the evidence shows that at the time Crew Tile filed
this lawsuit, [it] . . . knew or should have known that the [2009] Agreement was not a
valid or enforceable contract,” id. at 1016.
21 For example, Porcelanosa elicited expert testimony from Michael “Kent”
McSparran, a business management consultant with experience reviewing
commercial distribution agreements. He testified that the 2009 Agreement “was . . .
illogical . . . in terms of what you typically see [in] a distributor agreement.” App.
Vol. XII at 3126. Further, he was able to locate a template agreement on the internet
and, after comparing the template to the 2009 Agreement, offered his expert opinion
that the 2009 Agreement was “taken from” the template. Id. He also testified that
the $2.5 million termination payment in the 2009 Agreement was “unbelievable,”
“irrational,” and “ma[de] no business sense to [him] at all.” Id. at 3136–37.
Also, Crew Tile’s description of the negotiation and execution of the 2009
Agreement was implausible. Ryan Davis testified that there were no written drafts of
the 2009 Agreement because all negotiations took place over the phone and Handley
brought the only three copies of the document to the December 2009 meeting. Ryan
Davis then testified that only one copy of the 2009 Agreement now exists because
Crew Tile lost its second copy shortly before filing suit. Moreover, the first time the
2009 Agreement appears in the record, other than the single copy purportedly
executed in December 2009, is in an email from a Crew Tile employee to the Davises
from April 2013—just after Porcelanosa informed Crew Tile of its intention to build
a Denver showroom. As the district court noted, Crew Tile’s description of the
December 2009 meeting can only be corroborated by testimony from interested
parties. The only other person who testified to seeing the 2009 Agreement prior to
22 April 2013 was Shana Bastemeyer, a former Crew Tile employee and Ryan Davis’s
fiance. She testified that she saw the 2009 Agreement in June 2011.
In making its findings, the district court “determin[ed] that the testimony
offered by the Davises . . . was on the whole less credible than the testimony of the
witnesses who established and corroborated Porcelanosa’s factual contentions.” App.
Vol. IV at 1032. Generally, “we give great deference to the district court judge who
observed the trial.” Polson v. Davis, 895 F.2d 705, 711 (10th Cir. 1990). The district
court’s credibility finding is significant here because the only way to make sense of
the parties’ competing narratives is to conclude that at least two witnesses—either
Ryan and Darlyne Davis or Handley and his boss—perjured themselves on the stand.
Ultimately, we cannot reasonably conclude that the jury would have reached a
different verdict if Carlson had not testified. Crew Tile effectively impeached
Carlson’s testimony, thereby reducing its prejudicial impact. The nine-day trial
offered ample other evidence about the parties’ business relationship, allowing the
jury to form an opinion about the validity of the 2009 Agreement without relying on
Carlson’s testimony. The jury also heard testimony from all the individuals who
attended the meeting at which the 2009 Agreement was purportedly signed. Based
on this testimony, and the other evidence offered by the parties, the jury was able to
decide whether Crew Tile’s or Porcelanosa’s narrative was more credible.
IV
Crew Tile argues that the district court erred by denying its Rule 50(a) motion
for judgment as a matter of law on Porcelanosa’s abuse of process counterclaim.
23 Crew Tile maintains that Porcelanosa did not offer sufficient evidence of damages.
“The precise subject matter of a party’s Rule 50(a) motion—namely, its entitlement
to judgment as a matter of law—cannot be appealed unless that motion is renewed
pursuant to Rule 50(b).”6 Elm Ridge Expl. Co. v. Engle, 721 F.3d 1199, 1219 (10th
Cir. 2013) (alteration omitted) (quoting Unitherm Food Sys., Inc. v. Swift-Eckrich,
Inc., 546 U.S. 394, 404 (2006)). This means that a party may not “raise a sufficiency
of the evidence claim on appeal without having [renewed it in] a Rule 50(b) motion.”
Id. at 1219 n.11. Crew Tile did not renew its sufficiency of the evidence claim in a
Rule 50(b) motion. Therefore, Crew Tile did not preserve the issue for appeal. Id. at
1219 & n.11.
V
We AFFIRM.
Entered for the Court
Mary Beck Briscoe Circuit Judge
6 In some circumstances, a party may also preserve an issue for appeal by renewing a Rule 50(a) motion via a Rule 59(e) motion that is “filed within the deadline for a Rule 50(b) motion and contain[s] all the information required for a Rule 50(b) motion.” Elm Ridge, 721 F.3d at 1220 (quotation marks omitted). Crew Tile did not file a Rule 59(e) motion.
24 18-1029, Crew Tile Distribution v. Porcelanosa, et al. McHUGH, Circuit Judge, concurring:
I join in much of the majority’s thoughtful analysis and in its conclusion that the
district court’s judgment should be affirmed. I write separately, however, to explain
where my analysis differs.
I. OTHER ACTS EVIDENCE
To begin, I am in accord with much of the majority’s criticism of the district
court’s treatment of the 2004 Agreement. But, unlike the majority, I would hold the 2004
Agreement was properly admissible to place the parties’ business relationship in context.
The 2004 Agreement is part of the comprehensive history of the parties’
relationship and is relevant to the ultimate question of whether the 2009 Agreement is
genuine. In its opposition to the motion in limine, Porcelanosa explained that it
terminated Ryan Davis’s employment with Porcelanosa due to an “undisclosed conflict
of interest” based on his involvement with Infinite Flooring. App. at 566. Yet, nine days
later, Porcelanosa purportedly executed the 2004 Agreement with Ryan Davis. And
Infinite Flooring allegedly placed the signed agreement in a folder and took no further
action on it at that time. Then three months before the 2009 Agreement was allegedly
signed, Crew Tile Distribution (through Ryan Davis) claimed in a letter to Porcelanosa
that Crew Tile was aggressively pushing ventilated facades and “will continue to do so,
per our exclusivity agreement with Porcelanosa on the system.” Suppl. App. at 1979.
When Ryan Davis later forwarded a copy of the 2004 Agreement to Porcelanosa as
support for the referenced “exclusivity agreement,” Jack Handley and Paco Montilla determined the agreement invalid. Thus, in Porcelanosa’s view, Ryan Davis had
produced a fake 2004 Agreement in an attempt to leverage an exclusivity agreement.
That understanding is relevant to the likelihood that Porcelanosa would have entered into
an even larger exclusivity agreement with the Davises and Crew Tile just months later.
And because the 2004 Agreement had a seven-year term, Porcelanosa argued that its
existence would further call into question the 2009 Agreement, which had an exclusivity
provision that was in direct conflict with the exclusivity provision in the 2004
Agreement. Further, Ryan Davis’s knowledge that Porcelanosa disputed the veracity of
the 2004 Agreement, and that it conflicted with the terms of the 2009 Agreement, would
be relevant to whether he knew the 2009 Agreement was not genuine. So, I would
conclude that the district court was correct that the 2004 Agreement had some limited
proper evidentiary purpose under Federal Rule of Evidence 404(b).
I agree with the majority, however, that Crew Tile waived any right to challenge
that evidence on appeal by failing to object when Porcelanosa strayed from those proper
purposes at trial. But I see no need to determine when or whether Porcelanosa strayed
from those proper purposes because I would hold that Crew Title waived any objection to
the use of the 2004 Agreement for propensity purposes by “opening the door” to that use
during its opening statement.
“Generally, a party introducing evidence cannot complain on appeal that the
evidence was erroneously admitted.” Ohler v. United States, 529 U.S. 753, 755 (2000).
This is true even when a party that sought to keep evidence out in an unsuccessful motion
in limine offers the evidence itself to draw the sting from the opposing party’s potential
2 use of the evidence. Id. at 758. The Supreme Court reached this conclusion for two
relevant reasons. First, “in limine rulings are not binding on the trial judge, and the judge
may always change his mind during the course of a trial.” Id. at 758 n.3. Allowing a party
to proactively draw the sting “would deprive the trial court of the opportunity to change
its mind after hearing all of the [party opposing the evidence’s] testimony.” Id. Second,
“[a]ny possible harm flowing from a district court’s in limine ruling permitting
[admission of the objected-to evidence] is wholly speculative.” Id. at 759 (quoting Luce
v. United States, 469 U.S. 38, 41 (1984)). It is only when the opposing party exercises its
option to admit the evidence that “an appellate court [is] confronted with a case where,
under the normal rules of trial, the [allegedly aggrieved party] can claim the denial of a
substantial right if in fact the district court’s in limine ruling proved to be erroneous.” Id.
Therefore, a party who “preemptively introduces [the objectionable evidence] on direct
examination may not on appeal claim that the admission of such evidence was error.” Id.
And “[u]nder Ohler, the party introducing the evidence waives—rather than forfeits—
any objection to its admission, meaning we do not consider the claim at all, even under
the forgiving plain error standard.” Vehicle Market Research, Inc. v. Mitchell Int’l, Inc.,
839 F.3d 1251, 1258 (10th Cir. 2016) (internal quotation marks omitted). If a party
“preemptively elicited [the offending] testimony on direct examination, it cannot now
appeal either the district court’s ruling in limine” or the opposing party’s use of the
evidence. Id. (internal quotation marks omitted).
3 Although Ohler was decided in the criminal context, we have explicitly held it
applies in the civil context. Vehicle Market Research, 839 F.3d at 1258 n.5. Additionally,
while Ohler discusses “opening the door” during direct examination, we have held the
same rule applies to opening statements. EEOC v. JetStream Ground Servs., Inc., 878
F.3d 960, 964 (10th Cir. 2017); see also United States v. Chavez, 229 F.3d 946, 952 (10th
Cir. 2000) (“It is widely recognized that a party who raises a subject in an opening
statement ‘opens the door’ to admission of evidence on that same subject by the opposing
party.”).
In its opening statement here, Crew Tile discussed the 2004 Agreement, indicated
that Porcelanosa claimed it was forged, and explained that Porcelanosa would argue that
the alleged 2004 forgery was proof that the 2009 Agreement was also forged:
Now, so why are we here? Because the defendants think they can convince you to shut your eyes, close your ears, and ignore the actual facts in this case. And one way they’re going to try to do that is they’re going to try to claim that Mr. Davis is a forger. In fact, they’re going to try to claim that he’s a serial forger. That not only did he forge the contract in this case, but that when he worked as an employee years ago, that he forged the contract back then. .... In fact, ladies and gentlemen, when you hear the evidence -- when you hear the opening statement of defense counsel . . . he [will] talk[] about this so called first forgery from years ago . . . .
App. at 1159–60.
I would conclude that Crew Tile affirmatively waived any error in the district court’s
ruling in limine by opening the door to use for propensity purposes during its opening
statement. Thus, I would hold Crew Tile has waived any right to challenge the alleged
improper use of the 2004 Agreement.
4 II. EXPERT TESTIMONY
Where I depart most significantly from the majority is in the assessment of the
district court’s admission of Ms. Carlson’s expert testimony under Federal Rule of
Evidence 702. I would hold the district court did not exceed its broad discretion in
admitting this testimony.
A. Lack of Verification
The district court admitted Ms. Carlson’s testimony despite the lack of the
“verification” step of ACE-V, because the absence of actual verification could be
addressed through cross examination. Thus, I would not characterize the district court as
concluding that “because verification is not a significant step in the ACE-V methodology,
it is not a necessary step.” Maj. Op. at 17. Instead, I read the district court’s opinion as
concluding the methodology requires only that the ACE steps be peer reviewable--not
that they have been peer reviewed.
In reaching that conclusion, the district court relied on a technical note published
in the Journal of Forensic Identification discussing the proper use of ACE-V. The court
recognized that “‘[m]any sources have described the verification process of the ACE-V to
be a repeat of the ACE process done by another examiner,’ while ‘[o]ther sources
describe verification as a confirmation of the original examiner's conclusion.’” App. at
496 (alterations in original) (quoting Michele Triplett & Lauren Cooney, Technical Note:
The Etiology of ACE-V and its Proper Use: An Exploration of the Relationship Between
ACE-V and the Scientific Method of Hypothesis Testing, 56 (3) Journal of Forensic
Identification 350 (2006)). “The goal should be ‘to assess whether a conclusion was
5 arrived at accurately, using procedures that are tested and accepted.’” Id. (quoting Triplett
& Cooney at 348). To this end, “conclusions do not always need to be peer reviewed, but
they need to be peer reviewable.” Id. at 497 (quoting Triplett & Cooney at 349). The
district court noted that “testing” and “peer review” are only two of the factors set out in
Daubert, and “independent testing is not the sine qua non of admissibility under
Daubert.” Id. at 498 (quoting McCoy v. Whirlpool Corp., Nos. Civ.A. 02-2064-KHV,
Civ.A. 02-2229-KHV, Civ.A. 02–2230-KHV, Civ.A. 02-2231-KHV, 2003 WL 1923016,
at *3 (D. Kan. Apr. 21, 2003).
Based on this analysis, the district court concluded that “the role of verification in
[the ACE-V] context is primarily to make the expert’s work ‘reviewable,’ even if it is not
actually reviewed.” Id. at 499. And the verification step would not “directly alter the
examination and review completed under the first three steps of ACE-V.” Id. at 499–500.
The district court further noted that Crew Tile did “not argue that Ms. Carlson’s work is
not ‘reviewable,’ nor that an expert of [Crew Tile’s] choosing could not have reviewed
and critiqued the analysis based on the work shown in her report and supporting
materials.” Id. at 499. Therefore, to the extent that Ms. Carlson's analysis was “flawed or
flimsy,” the district court determined the lawyers could “bring that fact to the jury’s
attention” and it would be up to the jury to decide for itself whether it agreed with the
expert. Id. at 500 (quoting United States v. Crisp, 324 F.3d 261, 271 (4th Cir. 2003)).
Crew Tile does not challenge the district court’s conclusion that the verification
stage requires only that an expert’s work and conclusion be reviewable. Rather, it
continues to argue on appeal that the failure to obtain actual verification renders the
6 application of the ACE-V methodology unreliable. For me, resolution of this issue turns
on the standard of review.
The district court “has wide latitude in deciding whether to exclude expert
testimony.” Hall v. Conoco Inc., 886 F.3d 1308, 1311 (10th Cir. 2018) (internal quotation
marks omitted). Because of the district court’s thorough analysis and reliance on
technical papers in determining that the verification step of ACE-V requires only that a
conclusion be reviewable, I would not conclude that the district court’s decision was
“arbitrary, capricious, whimsical or manifestly unreasonable,” or “that the district court
made a clear error of judgment or exceeded the bounds of permissible choice in the
circumstances.” United States v. Chapman, 839 F.3d 1232, 1237 (10th Cir. 2016)
(quotation marks omitted). Thus, I would hold that the district court did not exceed its
broad discretion in admitting the expert testimony.
B. Testimony that Ryan Davis Forged 2009 Signature
Because I would conclude the district court did not abuse its discretion in
admitting Ms. Carlson’s testimony, I would reach the issue of whether the district court
abused its discretion in allowing Ms. Carlson to testify that Ryan Davis likely forged
Mr. Handley’s signature on the 2009 Agreement. But I would not resolve this question on
the merits; I would instead reject it for lack of preservation. Although Crew Tile argued
to the district court that Ms. Carlson should not be permitted to opine that the dates on the
2004 Agreement were authored by Ryan Davis (Ms. Carlson’s proposed opinion number
4), it did not object to Ms. Carlson’s opinion that Ryan Davis likely forged Mr. Handley’s
signature on the 2009 Agreement (Ms. Carlson’s proposed opinion number 3). Because
7 Crew Tile does not argue for plain error review on appeal, it has waived this argument
and I would not consider it further. United States v. Roach, 896 F.3d 1185, 1192 (10th
Cir. 2018).
III. CONCLUSION
Although I reach different conclusions on individual issues, I agree with the majority
that the district court’s judgment should be affirmed. Accordingly, I concur.