US Fidelity v. Baker Material ( 1995 )


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    August 21, 1995
    UNITED STATES COURT OF APPEALS
    FOR THE FIRST CIRCUIT


    No. 94-2164

    UNITED STATES FIDELITY & GUARANTY COMPANY, ET AL.,

    Plaintiffs, Appellants,

    v.

    BAKER MATERIAL HANDLING CORPORATION,

    Defendant, Appellee.

    __________________



    ERRATA SHEET



    The opinion of this Court, issued August 9, 1995, is amended as
    follows:

    Cover sheet: "David A. Berry" in place of "David W. Berry"





































    UNITED STATES COURT OF APPEALS
    FOR THE FIRST CIRCUIT

    ____________________

    No. 94-2164

    UNITED STATES FIDELITY & GUARANTY COMPANY, et al.,

    Plaintiffs, Appellants,

    v.

    BAKER MATERIAL HANDLING CORPORATION,

    Defendant, Appellee.

    ____________________


    APPEAL FROM THE UNITED STATES DISTRICT COURT

    FOR THE DISTRICT OF MASSACHUSETTS

    [Hon. Richard G. Stearns, U.S. District Judge] ___________________

    ____________________


    Selya and Cyr, Circuit Judges, ______________

    and Schwarzer,* Senior U.S. District Judge. __________________________

    ____________________




    Michael J. McCormack, with whom Marc LaCasse and McCormack & _____________________ ____________ ____________
    Epstein were on brief for appellants. _______
    David W. Barry, with whom William L. Boesch and Sugarman, Rogers, ______________ _________________ _________________
    Barshak & Cohen, P.C. were on brief for appellee. _____________________

    ____________________

    August 9, 1995
    ____________________




    ____________________

    *Of the Northern District of California, sitting by designation.












    CYR, Circuit Judge. Plaintiffs United States Fidelity CYR, Circuit Judge. _____________

    & Guaranty Company ("USF&G")1 and Jennifer Chapman, administra-

    trix of the estate of Russell M. Chapman, Jr. ("Chapman"),

    challenge district court rulings precluding their introduction of

    certain evidence at trial and denying their motion for new trial

    or relief from judgment in a wrongful death action against

    defendant-appellee Baker Material Handling Corporation ("Baker").

    We affirm.


    I I

    BACKGROUND BACKGROUND __________

    On January 5, 1990, Chapman sustained fatal injuries in

    a phenomenon known as "rack underride" when he was crushed

    between a warehouse shelf and the back of the 1979 Baker Moto-

    Truck model XTR forklift ("XTR") which he was operating. The XTR

    was discontinued later in 1990 and replaced by the Baker Reach

    Truck forklift ("BRT"), first manufactured in 1987. Unlike its

    predecessor, the BRT-design repositioned the steering controls

    and incorporated vertical rear posts to protect the operator.

    Following Chapman's death, USF&G and Jennifer Chapman

    ("appellants") brought suit in Massachusetts Superior Court,

    claiming that 1) Baker had breached its duty to warn Chapman's

    employer of the danger of "rack underride"; and (2) the lack of

    vertical rear posts in the XTR (i) violated the implied warranty

    of merchantability and (ii) rendered the XTR-design unreasonably
    ____________________

    1USF&G is the workers' compensation insurance carrier for
    Chapman's employer.

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    dangerous. Following the removal of the action to federal court,

    see 28 U.S.C. 1332, 1441(a), Baker responded in the negative ___

    to interrogatories designed to disclose whether it had ever been

    sued for damages arising out of a similar XTR incident and

    whether it had ever modified an XTR forklift by installing

    vertical rear posts. Approximately two years later, shortly

    before trial, Baker again responded in the negative to similar

    supplemental interrogatories.

    As Baker now concedes, its responses were materially

    incorrect. It had installed vertical rear posts in two XTRs for

    Boston Edison in 1987, and later that year sold Boston Edison two

    new XTRs with vertical rear posts. And, for good measure, Baker

    had been sued in 1985 based on a similar XTR "rack underride"

    claim which settled in 1989. See DeMarzo v. Baker Material ___ _______ ______________

    Handling Corp, No. 477122 (Orange Cty. Sup. Ct. filed Dec. 20, ______________

    1985) ("DeMarzo"). _______

    Baker filed a motion in limine to preclude evidence of __ ______

    its incorporation of vertical rear posts in the BRT-design,

    asserting lack of relevance and undue prejudice, see Fed. R. ___

    Evid. 402, 403. It contended that incorporating posts in the

    earlier XTR-design would have impeded steering, as well as safe ___

    egress by the operator in the event of a crash or rollover. On

    the other hand, its repositioning of the steering controls in the

    BRT-design had alleviated the operational impediment and hazard ___

    associated with incorporating posts in its XTR-design. Conse- ___

    quently, urged Baker, the BRT-design would be irrelevant to the


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    determination whether the absence of vertical rear posts in the

    XTR-design created an unreasonably dangerous condition. The

    motion in limine was granted on the eve of trial. __ ______

    At trial, Baker incorrectly represented in its opening

    statement that the evidence would show that the XTR had never

    been involved in a "rack underride" accident and that Baker had

    never installed vertical rear posts in an XTR. Although appel-

    lants had already learned about the 1985 DeMarzo XTR litigation _______

    and Baker's undisclosed XTR modifications, they neither alerted

    the district court nor mentioned these matters in their opening

    statement.

    During trial, appellants elicited from Manfred Baumann,

    Baker's vice-president for engineering and the officer in charge

    of litigation, that company files contained no record of any

    prior "rack underride" incident involving the XTR forklift and

    that Baker had never installed vertical rear posts in an XTR,

    though it was in fact feasible to do so. Whereupon appellants

    confronted Baumann with depositions taken in the DeMarzo litiga- _______

    tion, and with Boston Edison records, indicating that Baumann's

    testimony on both points was inaccurate, as Baumann was forced to

    concede.2
    ____________________

    2According to Baumann, the DeMarzo litigation file had not _______
    been entered on the master-file list until after Baker responded
    to the initial interrogatories, and the information relating to
    the XTR modifications made by Baker at the request of Boston
    Edison had been placed in the Boston Edison client sales file,
    rather than the XTR file. He testified that there were more than
    100,000 client sales files, and that it was not until he had been
    told of the modifications to the Boston Edison XTRs that he had
    searched its client sales file. Further, Baumann admitted that

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    Notwithstanding their denudation of Baker's discovery

    lapses, appellants elected not to request sanctions or a continu-

    ance to pursue further discovery, choosing instead to capitalize

    on Baker's "cover-up" in their closing argument. Apparently

    unimpressed, the jury found for Baker on all three theories of

    liability; judgment entered; and appellants moved for a new

    trial, see Fed. R. Civ. P. 59(a), or for relief from judgment, ___

    id. 60(b)(3), alleging prejudice from the order precluding their ___

    BRT-design evidence and from Baker's responses to interrogato-

    ries.

    On appeal, appellants attack the district court judg-

    ment, asserting reversible error in the ruling precluding their

    BRT-design evidence. Their discovery abuse claim forms the basis

    for the appeal from the denial of their postjudgment motion.

    Appellants speculate that they were unfairly prejudiced by the

    inaccurate responses to interrogatories, notwithstanding their

    decision not to request Rule 37 relief, since it is impossible to

    determine what would have been disclosed in full discovery.


    II II

    DISCUSSION DISCUSSION __________

    A. Appeal from the Judgment A. Appeal from the Judgment ________________________

    The district court order precluding the BRT-design

    evidence is reviewed for abuse of discretion. Espeaignnette v. _____________

    ____________________

    Baker's responses to the initial interrogatories had been inaccu-
    rate and that he had not reexamined the Baker litigation files
    before responding to the supplemental interrogatories.

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    Gene Tierney Co., Inc., 43 F.3d 1, 5 (1st Cir. 1994) ("'Only _______________________

    rarely -- and in extraordinarily compelling circumstances -- will

    we, from the vista of a cold appellate record, reverse a district

    court's on-the-spot judgment concerning the relative weighing of

    probative value and unfair effect.'" Freeman v. Package Mach. _______ _____________

    Co., 865 F.2d 1331, 1340 (1st Cir. 1988). Notwithstanding this ___

    deferential standard of review, the Espeaignnette panel reversed _____________

    a similar ruling, Espeaignnette, 43 F.3d at 8-9, where the issue _____________

    was whether a lawn-edger design, which made no provision for a

    protective guard over the cutting blade, was unreasonably danger-

    ous. Id. at 4. The defendant-manufacturer conceded that it ___

    would be feasible to attach a protective guard, but maintained

    that normal operation of the edger would be impeded. Id. at 6. ___

    The district court precluded evidence that a third party had made

    a business of attaching protective guards to the identical lawn

    edger model, even though the evidence showed that the modifica-

    tion at issue was "both possible and practical". Id. The ___

    Espeaignnette panel reversed on the ground that the proffered _____________

    modification evidence was highly probative and entailed no unfair

    prejudice because, if credited, it directly controverted the

    defendant-manufacturer's claim that the proposed modification

    would impede normal edger functioning. Id. at 6-8. ___

    The superficial similarities between Espeaignnette and _____________

    the instant case are outweighed by more fundamental dissimilari-

    ties. First, both cases implicate Rule 403 rather than Rule 407,

    though for different reasons. Espeaignnette noted that Rule 407 _____________


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    has no application to third-party modifications, id. at 7; see ___ ___

    also Raymond v. Raymond Corp., 938 F.2d 1518, 1524-25 (1st Cir. ____ _______ ______________

    1991) (Rule 407 applies only to subsequent remedial measures by

    manufacturer, not by third parties), whereas Rule 407 does not

    apply to the instant case because the BRT-design modification

    preceded Chapman's accident. See id. at 1523-24 (Rule 407 does ___ ___

    not apply to design modifications made prior to accident in

    litigation) (upholding exclusion under Rule 403). Second, the

    modification in Espeaignnette had been performed on an edger _____________

    identical to the one which injured the plaintiff, Espeaignnette, _____________

    43 F.3d at 6, whereas the modification in the instant case was

    made to the BRT-design, which was substantially dissimilar to the

    XTR which injured Chapman. See also infra p. 8. ___ ____ _____

    The district court found that the BRT was not suffi-

    ciently similar to the XTR, a finding we review only for clear

    error. Cameron v. Otto Bock Orthopedic Indus., Inc., 43 F.3d 14, _______ _________________________________

    16 (1st Cir. 1994) (findings of fact integral to evidentiary

    rulings are reviewed for clear error). Its finding is amply

    supported. Appellants' own expert testified that vertical rear

    posts could not practicably be incorporated in the XTR unless it

    underwent major redesign. Whereas the record revealed that the

    BRT-design could accommodate vertical rear posts precisely

    because its steering controls had been repositioned in the

    operator's cabin so that the posts would not interfere with

    steering.

    The Raymond case, supra, provides sturdy support for _______ _____


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    the district court ruling.3 It involved a claim that a side-

    loader design was defective for lack of vertical rear posts.

    Raymond, 938 F.2d at 1522. The decedent had been fatally injured _______

    by a beam which penetrated the sideloader operator's cabin, id. ___

    at 1520, and the district court excluded evidence that rear posts

    were included in a later design that predated the accident. Id. ___

    at 1522-23. We upheld the exclusionary ruling, with the follow-

    ing explanation: "the introduction of evidence of pre-accident

    design modifications not made effective until after the manufac-

    ture of the allegedly defective product may reasonably be found

    unfairly prejudicial to the defendant and misleading to the jury

    for determining the question whether the product was unreasonably

    dangerous at the time of manufacture and sale." Id. at 1524. The ___

    Raymond logic is no less apt in this case. _______

    Finally, the evidence excluded in the instant case was

    by no means the most probative available on the ultimate jury

    issue; viz., whether the XTR-design should have included vertical

    rear posts. Whereas the best evidence relating to the safety and

    practicality considerations involved in Espeaignnette had been _____________

    that a third party was making a business of incorporating a

    protective guard on the identical edger, the best evidence that

    the XTR could accommodate vertical rear posts was the uncontro- ___ _____ ___________

    verted proof presented to the jury that Baker in fact had

    ____________________

    3Although Raymond involved New Hampshire law, 938 F.2d at _______
    1520, we recently held that its logic applies as well to "design
    defect" and "failure to warn" claims under Massachusetts law.
    Cameron, 43 F.3d at 18. _______

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    installed posts in the XTRs it modified at Boston Edison's

    request. The evidence that posts had been installed in XTRs

    diminished not only the need to establish their incorporation in

    the noncomparable BRT-design, but any unfair prejudice from its

    exclusion. Thus, the district court did not abuse its discretion

    in concluding that the required Rule 403 balancing tipped deci-

    sively in favor of preclusion. Espeaignnette, 43 F.3d at 6 _____________

    (centrality of disputed evidence to party's claim is strong

    factor in Rule 403 balancing test) (collecting cases).

    B. Appeal from the Denial of Postjudgment Relief B. Appeal from the Denial of Postjudgment Relief _____________________________________________

    We review orders disallowing postjudgment relief

    under rules 59 and 60(b)(3) for abuse of discretion. Perdoni _______

    Bros., Inc. v. Concrete Systems, Inc., 35 F.3d 1, 5 n.5 (1st Cir. ___________ ______________________

    1995) (Rule 59); Fernandez v. Leonard, 963 F.2d 459, 468 (1st _________ _______

    Cir. 1992) (Rule 59 and Rule 60(b)(3)); United States v. Parcel _____________ ______

    of Land & Res. at 18 Oakwood Street, 958 F.2d 1, 5 (1st Cir. ______________________________________

    1992) (Rule 60(b)(3)). The district court rulings that Baker's

    inaccurate responses to interrogatories neither constituted fraud

    nor resulted in substantial interference with the preparation and

    presentation of appellants' case are reviewed for clear error.

    Anderson v. Beatrice Foods, Co., 900 F.2d 388, 392 (1st Cir.), ________ ___________________

    cert. denied, 498 U.S. 891 (1990). _____ ______

    Appellants argue that the district court abused its

    discretion by not affording them postjudgment relief based on

    Baker's slipshod and misleading responses to interrogatories,




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    which denied them a fair trial.4 Among the available forms of

    relief from prejudice occasioned by discovery violations are

    curative measures such as continuances and stays pending compli-

    ance, orders tailored to effect issue preclusion, contempt

    orders, and default judgments. See R.W. Int'l Corp. v. Welch ___ _________________ _____

    Foods, Inc., 937 F.2d 11, 15-20 (1st Cir. 1991) (discussing ____________

    grounds for Rule 37 sanctions); Fed. R. Civ. P. 37(b)(2),(3).

    Appellants' claim fails, nonetheless, as they opted to

    proceed rather than request relief under Rule 37, presumably

    because the information Baker did not disclose had become known

    to appellants before or during trial. Moreover, though their

    gambit proved unsuccessful, there was both method potential

    advantage in their stratagem and little to lose. Since there

    is even now no concrete suggestion that further discovery would

    have benefited them, their prospects for obtaining Rule 37 relief

    appear all along to have been minimal compared with the potential

    jury impact their "cover-up" claim might reasonably have been

    expected to occasion. Thus, appellants' decision to use

    their hole card in an abortive gambit with the jury plainly

    waived any claim that their decision to forego Rule 37 relief

    rendered the trial unfair. The appropriate remedy for parties

    ____________________

    4Appellants rely on Anderson v. Cryovac, Inc., 862 F.2d 910, ________ _____________
    923 (1st Cir. 1988), for their contention that a district court
    may grant relief from judgment and a new trial even if the
    failure to provide requested discovery was inadvertent. Follow-
    ing our remand in Cryovac, the district court denied relief from _______
    judgment under Rule 60(b) notwithstanding its finding of deliber- ________
    ate discovery abuse. We nevertheless upheld its ruling. Beatri- ___ _______
    ce Foods Co., 900 F.2d at 391-92. ____________

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    who uncover discovery violations is "not to seek reversal after

    an unfavorable verdict but a request for continuance at the time

    the surprise occurs." Szeliga v. General Motors Corp., 728 F.2d _______ ____________________

    566, 568 (1st Cir. 1984); see United States v. Diaz-Villafane, ___ _____________ ______________

    874 F.2d 43, 47 (1st Cir.) (criminal case), cert. denied, 493 _____ ______

    U.S. 862 (1989). Here, of course, there appears to have been no

    genuine surprise. Nor can appellants plausibly suggest that the

    district court abused its discretion by declining their post-

    judgment motion for relief from the unwelcome consequences of

    their calculated decision. Ojeda-Toro v. Rivera-Mendez, 853 F.2d __________ _____________

    25, 29 (1st Cir. 1988) ("[A] party may not prevail on a Rule

    60(b)(3) motion . . . where [it] has access to disputed informa-

    tion or has knowledge of inaccuracies in an opponent's represen-

    tations at the time of the alleged misconduct.") (collecting

    cases).


    III III

    CONCLUSION CONCLUSION __________

    As the district court did not abuse its discretion in

    precluding the dissimilar BRT-design evidence nor in denying

    postjudgment relief under Rules 59 and 60(b)(3), its judgment is

    affirmed. ________











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