Park West Galleries, Inc. v. Bruce Hochman

692 F.3d 539, 83 Fed. R. Serv. 3d 639, 2012 WL 3828103, 2012 U.S. App. LEXIS 18626
CourtCourt of Appeals for the Sixth Circuit
DecidedSeptember 5, 2012
Docket19-6035
StatusPublished
Cited by13 cases

This text of 692 F.3d 539 (Park West Galleries, Inc. v. Bruce Hochman) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Park West Galleries, Inc. v. Bruce Hochman, 692 F.3d 539, 83 Fed. R. Serv. 3d 639, 2012 WL 3828103, 2012 U.S. App. LEXIS 18626 (6th Cir. 2012).

Opinions

GIBBONS, J., delivered the opinion of the court in which ALARCÓN, J., joined, and MOORE, J., joined only in the judgment. MOORE, J. (pp. 549-50), delivered a separate opinion concurring in the judgment.

OPINION

JULIA SMITH GIBBONS, Circuit Judge.

Defendants-appellants Theresa Franks, Global Fine Art Registry, LLC, and David Charles Phillips appeal the district court’s denial of their motion to reinstate the jury verdict. Defendants-appellants filed the motion after the district court granted the motion for a new trial filed by Park West Galleries, Inc. (“Park West”). In denying the motion, the district court found that it was unclear whether this court’s waiver doctrine as enunciated in Jones v. Illinois Central Railroad Co., 617 F.3d 843 (6th Cir.2010), extended to requests for a new trial brought under Federal Rule of Civil Procedure 59. The district court certified for interlocutory appeal the issue of whether Park West waived its right to a Rule 59(a) motion for a new trial by failing to move for a mistrial, before the case was submitted to the jury, on the basis of the known misconduct in which Franks and counsel for defendants engaged during the course of the entire trial. For the following reasons, we conclude that Park West’s failure to move for a mistrial based on misconduct occurring during the trial did not waive its right to seek a new trial under Federal Rule of Civil Procedure 59, and we affirm the district court’s order denying the motion to reinstate the jury verdict.

I.

Park West is an independently owned gallery and art dealer headquartered in Southfield, Michigan. Park West sells art from its Southfield gallery, over the internet, through its catalog, and over the phone, and also conducts art auctions in different cities in North America and on cruise ships around the world. Among the works sold by Park West are works by Salvador Dali.

In May 2007, Theresa Franks, who is the CEO of Global Fine Art Registry (“GFAR”), began publishing articles on Fine Art Registry (“FAR”), the website run by GFAR, which alleged that Park West engaged in suspect business practices in running its auctions aboard cruise ships and that Park West sold inauthentic or fake works of art to unsuspecting customers — particularly citing the works by Dali as an example. David Phillips, a [542]*542FAR employee, authored several of the articles published on the FAR website which described alleged cruise ship art auction scams run by Park West and conducted several interviews with alleged victims, all of which were published on the FAR website. Bruce H'ochman, who runs the Salvador Dali Gallery, agreed to be interviewed and quoted by Phillips on behalf of FAR regarding his view that the Dali prints purchased by Park West customers in the auctions at sea did -not contain authentic artist signatures.

In April 2008, Park West filed a complaint in Michigan state court against Franks, Hochman, and GFAR alleging defamation, tortious interference, interference with prospective business advantage, and civil conspiracy to destroy Park West’s goodwill and reputation. The action was removed to federal court. Park West had also filed a similar defamation case against Phillips, and the, cases were consolidated.

The consolidated case was tried before a jury between March 15, 2010 and April 19, 2010. During trial, Park West frequently objected to what it viewed as misconduct on the part of Franks and counsel for the defendants. The district court gave several warnings to defense counsel regarding the misconduct and sanctioned Franks’s defense counsel Jonathan Schwartz for his failure to honor the court’s rulings regarding improper lines of questioning. Despite the repeated instances of misconduct, Park West did not request a mistrial and the case was submitted to the jury on April 19. On April 21, the jury returned a verdict in favor of defendants Franks, Phillips, Hochman, and GFAR on the defamation, tortious interference with business expectancies, and civil conspiracy claims. However, the jury did not find in favor of the defendants on their counterclaims of defamation, tortious interference with business expectancies, and conspiracy to tortiously interfere with business expectancies. Nonetheless, the jury did find in favor of defendant GFAR on its Lanham Act counterclaim against Park West and awarded $500,000.00 in damages.

On May 11, 2010, Park West filed a motion for judgment as a matter of law and/or for a new trial. Park West’s motion requested several forms of post-trial relief, including a new trial under Federal Rule of Civil Procedure 59 on Park West’s defamation, tortious interference with business expectancies, and civil conspiracy claims as well as GFAR’s counterclaim for a violation of the Lanham Act. Park West argued that the district court should set aside the verdict and grant a new trial in light of the “persistent and insidious misconduct of the defendants and their counsel [which] deprived Park West of a fair trial, and caused the jury to reach a seriously erroneous result that is against the weight of the (admissible) evidence.” Park West argued that Franks and defense counsel persistently violated the district court’s orders resolving the motions in limine and the district court’s evidentiary rulings, and that defense counsel made inappropriate and inflammatory remarks throughout trial, posed improper and objectionable questions to witnesses, and failed to control their clients.

On August 16, 2010, the district court found that Franks and counsel for the defendants engaged.in contumacious conduct. After considering the factors enumerated in City of Cleveland v. Peter Kiewit Sons’ Co., 624 F.2d 749, 756 (6th Cir.1980), for determining whether there is a reasonable probability that the jury’s verdict was influenced by the improper conduct and a grant of the motion for a new trial is therefore warranted, the district court decided that the misconduct engaged in by Franks and defense counsel was serious enough and permeated the [543]*543entire trial to such an extent that there was at least a reasonable probability that the verdict was influenced by the misconduct. The district court granted Park West’s motion for a new trial as to GFAR, Franks, and Phillips.1

On October 7, 2010, GFAR, Franks, and Phillips (collectively, the “defendants”) filed a Motion to Reinstate the Unanimous Jury Verdict, Based Upon the Recent 6th Circuit Published Decision in Jones v. Illinois Central Railroad Company, 617 F.3d 843 (6th Cir.2010).2 The defendants’ motion to reinstate argued that under Jones, Park West waived its right to seek a new trial when it failed to seek a mistrial before the jury rendered its verdict despite the fact that the alleged misconduct or instances of potential or actual prejudice were known to Park West prior to jury deliberations.

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692 F.3d 539, 83 Fed. R. Serv. 3d 639, 2012 WL 3828103, 2012 U.S. App. LEXIS 18626, Counsel Stack Legal Research, https://law.counselstack.com/opinion/park-west-galleries-inc-v-bruce-hochman-ca6-2012.