Marjam Supply Company of Florida, LLC v. PLITEQ, Inc.

Court of Appeals for the Eleventh Circuit·Decided April 27, 2020·No. 18-13765·Unpublished

Opinion

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

No. 18-13765

D.C. Docket No. 1:15-cv-24363-KMW

MARJAM SUPPLY COMPANY OF FLORIDA, LLC, MARJAM SUPPLY COMPANY,

Plaintiffs - Appellants,

versus

PLITEQ, INC., PAUL DOWNEY,

Defendants - Appellees.

Appeal from the United States District Court for the Southern District of Florida

(April 27, 2020)

Before MARTIN, GRANT, and LAGOA, Circuit Judges. MARTIN, Circuit Judge:

Marjam Supply Company of Florida, LLC and Marjam Supply Company (“Marjam”) appeal the District Court’s order denying Marjam’s motion for judgment as a matter of law and for a new trial. Marjam challenges the sufficiency of the evidence of damages awarded to Pliteq, Inc. and Paul Downey, the owner of Pliteq, (collectively, “Pliteq”) and also takes issue with several of the District Court’s evidentiary rulings. After careful review, we affirm.

I. BACKGROUND

Pliteq manufactures and sells sound isolation products, including its

GenieMat RST (“GenieMat”) product. The GenieMat is a flat, rubber mat used in offices and apartment buildings to reduce sound transmission. In March 2014, Marjam (a building materials distributor) and Pliteq entered into an exclusive distributor agreement for GenieMat products. Under the terms of the agreement, Marjam was required to pay in advance for its GenieMat orders. It initially upheld its end of the bargain. Then in June 2015, Pliteq notified Marjam that Marjam was significantly late on payments totaling $160,000. Pliteq also discovered Marjam was selling competing products. Instead of immediately terminating the agreement, Pliteq refused to ship any product until Marjam paid the past due amount and gave Marjam a chance to respond to these issues. Marjam responded by threatening to take “swift and inordinate” and “extreme and unpleasant” action if Pliteq did not reconsider its position. Pliteq then terminated the agreement.

Mark Buller, Marjam’s owner, and James Metcalf, Marjam’s products manager, began discussing plans to get even with Pliteq. Mr. Buller directed Mr. Metcalf to cooperate with Ecore (one of Pliteq’s direct competitors), with the idea that the two companies intended to “cripple” and “bury” Pliteq. The owner of Ecore told Mr. Metcalf that Pliteq was intentionally mislabeling the thickness of its GenieMat products from one of its manufacturers, so the two companies hatched a plan. Marjam agreed to a distribution agreement with Ecore and began selling Ecore products. Then Mr. Metcalf emailed Pliteq saying that “some very ‘scary’ facts” regarding the thickness of GenieMats “have forced us to ‘resolve’ this ‘my’ way.” Mr. Metcalf in turn demanded reimbursement for Pliteq’s purported fraudulent advertising about the thickness of GenieMats.

Marjam sent a formal demand letter to Pliteq claiming that the GenieMats were not performing. As part of what Mr. Buller described as a “Blitzkrieg” attack on Pliteq, Marjam sent copies of this demand letter to Pliteq’s customers with a transmittal indicating that Marjam had “ceased selling GenieMat products” because of “recent information about illegal activity brought to our attention.” Marjam also sent copies of its Complaint to Pliteq’s customers, including Kast Construction (“Kast”), with the knowledge that Pliteq had an existing relationship with those customers. Marjam warned the customers, writing: “We are extremely concerned about current and future liability.” After receiving Marjam’s email,

Kast planned to avoid using Pliteq products until the dispute with Marjam was “sorted out.”

Marjam sued Pliteq for false advertising, breach of warranty, and breach of contract alleging Pliteq distributed and sold non-conforming GenieMats. Pliteq responded and asserted counterclaims against Marjam, saying that Marjam tortiously interfered with contracts and business relationships and engaged in false advertising, unfair competition, breach of contract, and copyright infringement. Each party moved for summary judgment, which the court granted, in part, on each of Pliteq’s and Marjam’s motions. Marjam proceeded to trial on breach of contract and breach of warranty claims based on its purported loss of the Met 3 project, which it claimed was terminated after the customer found out GenieMats “did not provide the required sound insulation attributes.” Pliteq proceeded to trial on its tortious interference, false advertising, and unfair competition claims.

At the close of evidence, Pliteq and Marjam each moved for judgment as a matter of law under Rule 50(a). Pliteq argued that Marjam had not presented sufficient evidence to support either a breach of warranty or a breach of contract claim related to the Met 3 project. The District Court agreed and entered judgment as a matter of law against Marjam on those claims.1 Marjam argued that Pliteq had

1 At trial, the evidence demonstrated that a range of thickness of the products, known as nominal thickness, was consistent with industry practice; was within Pliteq’s reported tolerances; and had no practical effect on the GenieMat’s performance. Pliteq also presented evidence that

not presented sufficient evidence to prove causation and damages on its counterclaims. The District Court denied Marjam’s motion and submitted Pliteq’s claims to the jury. The jury found for Pliteq on each of its remaining claims and awarded $310,000 in compensatory damages and $800,000 in punitive damages.

Marjam then filed a motion for judgment as a matter of law under Rule 50(b), “and/or alternatively” for a new trial under Rule 59. It stated four grounds it believed justified a judgment or a new trial: (1) Pliteq did not present sufficient evidence of causation to establish damages; (2) the District Court improperly excluded the testimony of Diana Manning Yankee, a Kast employee; (3) the District Court refused to admit the in-person testimony of Zach Young, one of Kast’s vice presidents; and (4) the District Court did not allow Marjam to call its acoustical sound expert, Bennett Brooks. The District Court denied Marjam’s motion. Marjam timely filed a notice of appeal and now challenges the compensatory damages award and the District Court’s denial of its motion for a new trial.

II. STANDARDS OF REVIEW

This Court reviews de novo the denial of a Rule 50 motion for judgment as a

matter of law. Nebula Glass Int’l, Inc. v. Reichhold, Inc., 454 F.3d 1203, 1210

no Pliteq customer had ever made a warranty claim or sought to return of any of its GenieMat product.

(11th Cir. 2006). “We consider the evidence in the light most favorable to the non- moving party, but we review all evidence in the record and draw all reasonable inferences in favor of the nonmoving party without making credibility determinations or weighing the evidence.” Mee Indus. v. Dow Chem. Co., 608 F.3d 1202, 1211 (11th Cir. 2010) (alterations adopted) (quotation marks and citation omitted). “When reviewing the record, we must disregard all evidence favorable to the moving party that the jury is not required to believe.” Id. (quotation marks omitted). “Therefore, we should give credence to the evidence favoring the nonmovant as well as that evidence supporting the moving party that is uncontradicted and unimpeached, at least to the extent that that evidence comes from disinterested witnesses.” Id. (quotation marks omitted).

We review a District Court’s denial of a Rule 59 motion for a new trial for abuse of discretion. Lamonica v. Safe Hurricane Shutters, Inc., 711 F.3d 1299, 1312 (11th Cir. 2013). “New trials should not be granted on evidentiary grounds unless, at a minimum, the verdict is against the great—not merely the greater— weight of the evidence.” Id. at 1312–13 (alteration adopted) (quotation marks omitted).

III. DISCUSSION

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Marjam Supply Company of Florida, LLC v. PLITEQ, Inc., (11th Cir. 2020).

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