Jeff Goolsby v. Gain Technologies, Inc. , 362 F. App'x 123 ( 2010 )

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 08-16587 JAN 21, 2010
Non-Argument Calendar JOHN LEY
________________________ ACTING CLERK
D. C. Docket No. 07-01947-CV-ODE-1
JEFF GOOLSBY,
Plaintiff-Counter-
Defendant-Appellant,
versus
GAIN TECHNOLOGIES, INC.,
MIKE LADNEY, President, Individually,
EDWARD C. SMITH, Vice President, Individually,
JIM TEASDALE, CFO, Individually,
Defendants-Counter-
Claimants-Appellees,
PLASTIC MOLDED TECHNOLOGIES, INC.,
d.b.a. Gain Technologies, Inc.,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
_________________________
(January 21, 2010)
Before TJOFLAT, HULL and WILSON, Circuit Judges.
PER CURIAM:
Plaintiff Jeff Goolsby, who proceeds pro se, sued the Defendants for
negligence in connection with their design and construction of a steel mold
intended to be used for the manufacture of after-market rearview mirrors for
automobiles, for which Goolsby holds a patent. Goolsby appeals the district
court’s grant of summary judgment in favor of the Defendants and denials of his
motions to amend his complaint. After review, we affirm.
I. BACKGROUND
The rather convoluted factual and procedural history of this case requires
that we give a full background explanation before analyzing the issues on appeal.
A. The Parties
Plaintiff Goolsby is the record inventor and owner of U.S. Patent No.
6,270,225 B1, titled “Blind Spot Sideview Mirrors.” The patent covers a three-
plane side-view mirror for use on automobiles and is intended to “provide an
adequate display of vehicles in the regular view area, the overtaking area, and the
blind spot area in one single contiguous mirror.”
The Defendants are (1) Plastic Molded Technologies, Inc., d/b/a Gain
Technologies, Inc. (“Gain”), (2) Mike Ladney, Gain’s President, (3) Edward
2
Smith, Gain’s Vice President, and (4) Jim Teasdale, Gain’s Chief Financial
Officer. Gain is a manufacturer of plastic products using a “gas assist injection”
system.
B. 2003-2004
In June 2003, Goolsby contacted Gain by letter, stating, “I saw your website
and would like to get you to build some plastic mirrors for us.” Goolsby requested
that the mirrors be made of “Exterior Automotive Grade ABS plastic.” A chromed
mirrored finish and adhesive then would be applied to the plastic mirrors.
Goolsby and Gain negotiated the terms of a production agreement
throughout 2003 and 2004. On May 27, 2004, Defendant Vice President Smith
sent Goolsby a revised proposal for the mirror production contract, for the first
time proposing use of a “1-2 Cavity P20 Steel Production Family Injection Mold
(Base substrate with mirror finish on cavity).” The cost for manufacturing this
proposed 1-2 cavity P20 mold was $27,900.00. Goolsby later testified that he had
no role in Gain’s alleged decision to use P20 steel in creating the injection mold.1
On July 27, 2004, Defendant Smith again sent Gain’s proposal to Goolsby.
The July 27, 2004 proposal states: “The mirror includes a base substrate made with
1
The record does not clarify exactly what “P20” steel is or how it differs from stainless
steel. In an affidavit, Defendant Smith averred that, “P20 steel is commonly used to make molds
for products on which a mirror finish is to be applied. GAIN used P20 steel for Mr. Goolsby’s
mold in accordance with industry standards and practices.”
3
platable grade ABS. The substrate will then be sent out to be first surface chrome
plated. The parts will be returned to GAIN Technologies, inspected and
approximately 6 square inches of a peel and stick adhesive tape added to the back
for applying the aftermarket mirror to current OEM mirror.” The July 27, 2004
proposal listed as “Production Option 2” a “Primary Tooling” of “1-4 Cavity P20
Steel Production Family Injection Mold (Base substrate with mirror finish on
cavity)” at a cost of $39,800. The proposal listed the “Total Tooling Cost” for
Production Option 2 as $59,600. Gain proposed to begin production within “10
weeks to first shots from receipt [of] purchase order, full math data and 50%
tooling deposit.”
On August 27, 2004, Goolsby sent to Defendant Smith at Gain four checks
totaling $29,800, all drawn as cash advances on Goolsby’s credit cards,
representing half the total tooling cost of Gain’s proposal as the deposit for Gain to
build the molds necessary to produce the mirror.
On September 14, 2004, Goolsby sent back a signed acceptance to Gain of
its July 27, 2004 proposal, including the use of “Production Option 2” and a four-
cavity P20 steel production family injection mold.
C. 2005-2007
It is undisputed that Gain experienced difficulties in manufacturing a mirror
4
to meet Goolsby’s requirements. Correspondence between Goolsby and
individuals at Gain in 2004 and 2005 illustrated several quality issues that arose
during the production process.
On August 10, 2005, Jim Byrd, Gain’s Vice President and General Manager,
sent an email to Defendant Smith at Gain, stating:
I have attempted to do everything in our power and
expertise to perfect the mirror for Mr. Goolsby, I have
come to the conclusion we have no more option [sic] to
explore, every time we send him parts, he changes his
thoughts so many different directions it is very difficult
to understand what it is he wants. The gold mirror in
which [sic] we sent him is the best of the best. He liked
the appearance but as you can see by his e mail again we
go off on different tangents. What is the solution? ANY
THOUGHTS.
On March 23, 2006, Defendant Smith sent Goolsby a letter describing the
history of Gain’s production attempts and the various quality-control issues that
arose during production. Gain offered to reproduce the mirror molds in “420
stainless steel with a Rockwell [hardness] of 48-52 and then nickel plate the mold
once we have approved parts. Both of these are engineering changes. I have
verbally quoted the stainless steel pricing and can provide a hard quote for these
changes if you desire. The additional research and development have been done
for you at absolutely no cost to you.”
Gain eventually created a single-cavity mold out of stainless steel. Goolsby
5
rejected the mirror produced using this stainless steel mold as well, contending the
final product was insufficient. Goolsby asserted this error arose because Gain
polished the stainless steel mold to the point it was a “concave” surface no longer
fit for producing a flat optical quality mirror. But Goolsby admits he never
examined the mold itself.
On March 23, 2006, Goolsby sent a letter to Eric Kirkland, Engineering
Manager of Caprock Manufacturing in Lubbock, Texas. Goolsby included some
of the exterior mirrors manufactured by Gain. Goolsby explained his concerns
with Gain’s manufacturing process: “They [Gain] used P20 steel on the mirror
plates in the mold and they have not been able to remove the orange peel
appearance.” Goolsby sought a quote from Kirkland to make the mirrors, stating,
“If they [Gain] do not make the new mirror plates with suitable metal and start
making marketable mirrors in two weeks from last Monday, I will need to make a
change.”
In further correspondence, Goolsby informed Kirkland that he had discussed
his mirrors with “numerous experts” in optical finish and was told it would be
impossible to make an optical finish on the mirrors using P20 steel and that
stainless steel could produce an optical finish if correctly honed and polished.
Kirkland responded, “You’re correct. The cavity plates should be stainless, and
6
should be polished to a mirror finish.”
On April 21, 2006, Goolsby sent a letter to Defendants President Ladney and
Vice President Smith detailing his impressions of Gain’s mistakes in attempting to
produce the mirrors and threatening to file a lawsuit. Goolsby stated:
Clearly, you are encouraging me to file a lawsuit against
you, Mike Ladney, and Gain Technologies. [sic] Inc.,
since you have failed to respond to my compromise offer
to use some of my profits from my mirror sales to help
you pay for your “Errors and Omissions” mistake of
recommending, quoting, and ordering the wrong steel
(P20 steel) to be used in making the mold to produce my
exterior rearview mirrors, including the optical finish,
plus wasting at least fifteen (15) months attempting to
resolve the problems caused by your incorrect steel mold
mistake.
....
You and I both know now that had [sic] you should have
ordered Stainless Steel to be used in making the plates
for the mirror surface.
Throughout 2006 and 2007, Goolsby sent other letters to Gain explaining his
contentions that Gain breached legal duties to him through its alleged negligent
selection of P20 steel: “The legal term for the mold failure is that anyone
representing themselves as experts in the mold manufacturing business ‘either
knew or should have known that stainless steel was necessary for an optical quality
finish.’ It was the required duty of the mold maker to not accept the job without
requiring stainless steel be used for the required optical quality plates.”
7
D. Goolsby’s Complaint
On July 13, 2007, Goolsby, proceeding pro se, filed this action for “tort
damages” in the State Court of Henry County, Georgia. Goolsby alleged the
Defendants damaged him through their (1) “failure to fulfill their implied duties,”
(2) “errors and omissions,” (3) “gross negligence,” (4) “lack of due diligence,” and
(5) “inadequate management and supervision,” in their failure to manufacture
Goolsby’s mirrors within the proposed timeline and to Goolsby’s specifications.
Goolsby continued: “One major error was recommending, specifying, and ordering
the optical plates portion of the mold made with P20 steel because plaintiff has
later learned from other mold makers that P20 steel is too porous and can not
possibly produce an optical quality finish.”
Goolsby alleges Gain’s actions caused him to lose $5,400,000 in profits plus
$20,862.75 in interest in the amounts Goolsby borrowed to finance his initial
deposit to Gain.
The Defendants removed the action to the district court based on diversity
jurisdiction pursuant to 28 U.S.C. § 1332(a).2 Defendant Gain also asserted a
counterclaim against Goolsby for money allegedly still owed by Goolsby under his
2
Goolsby resides in Rex, Georgia. Gain is a Michigan corporation with its principal
place of business in Shelby Township, Michigan. Defendants Ladney, Smith, and Teasdale
reside in Michigan. Goolsby sought remand, which the district court denied.
8
contract for creation of the mold.
On October 29, 2007, Goolsby moved to amend his complaint to correct the
name of Defendant Gain to “Plastic Molded Technologies, Inc. d/b/a Gain
Technologies, Inc.,” which was granted by the district court.
E. Discovery And Goolsby’s Amendments
On November 14, 2007, the parties filed a Joint Preliminary Report and
Discovery Plan agreeing that discovery would be limited to four months and would
expire on February 8, 2008, which Plan the district court approved as its
Scheduling Order. The parties also agreed amendments to the pleadings could not
be submitted after thirty days following the (November 14, 2007) filing of the Joint
Preliminary Report and Discovery Plan, “unless otherwise permitted by law.” This
meant amendments to the complaint had to be filed by Friday, December 14, 2007.
On February 11, 2008, three days after the discovery period lapsed, Goolsby
filed a motion to extend the discovery period, stating that he recently obtained
evidence requiring an extension of discovery and amendments to his complaint.
The district court denied Goolsby’s motion as untimely because of the “simple
nature of this action, the fact that the parties had four months in which to conduct
discovery and the absence of good cause warranting an extension.”3
3
Goolsby filed a motion for reconsideration of the district court’s denial of his motion to
extend the discovery period. Goolsby argued he delivered his discovery extension motion to the
9
Also on February 11, 2008, nearly two months after the parties’ deadline for
amending the pleadings, Goolsby moved to amend his “Complaint For Tort
Damages,” seeking to add “an additional charge for a refund of the earnest money
deposit that Plaintiff paid to Gain . . . .”
F. Summary Judgment Motions And Goolsby’s Additional Amendments
On March 10, 2008, the Defendants moved for summary judgment. The
Defendants argued Goolsby had not shown any evidence to support his claims
against Defendants President Ladney and CFO Teasdale. The Defendants also
argued Goolsby could not succeed on his claims against Defendants Gain and Vice
President Smith for negligence because Goolsby failed to identify any expert
testimony that would support his claim that Gain’s recommendation to use P20
steel did not meet a reasonable standard of care.
On March 27, 2008, Goolsby responded to the Defendants’ summary
judgment motion but did not contest the substance of the motion or any of
Defendants’ asserted undisputed material facts.
On June 2, 2008, Goolsby again moved to amend his “Complaint for Tort
district court Clerk’s Office on February 6, 2008, two days before the end of the discovery
period. The district court denied Goolsby’s motion for reconsideration as well. Regarding
Goolsby’s argument about the filing date of his discovery extension motion, the district court
stated: “This is incorrect; the Clerk’s time-stamp clearly reads ‘February 11, 2008.’” Our
examination of Goolsby’s motion for extension, including the time-stamp affixed by the district
court Clerk’s Office, confirms this assessment.
10
Damages,” to include Jim Byrd, allegedly Vice President and General Manager of
Gain, as a defendant. Goolsby alleged Byrd “was one of the major causes of
Defendants’ failure to produce a mold that could manufacture Plaintiff’s
mirrors . . . .” On June 4, 2008, Goolsby filed a fourth motion to amend his
complaint, adding specific factual allegations against Byrd and amending his plea
for damages on the basis that the Defendants failed to respond to his request for a
second settlement conference. On June 25, 2008, Goolsby filed a fifth motion to
amend his complaint to “add CAD file manipulation damages to complaint for tort
damages” because “manipulation of the Cad [sic] file that appeared to be sabotage
and caused the necessity of remaking Plaintiff’s mirror mold by Kender Mould
Engineers.”
On June 25, 2008, Goolsby filed a motion for summary judgment.
Goolsby’s summary judgment motion included evidence from two individuals
Goolsby contends are experts in making molds for plastic mirrors. Regarding the
first individual, Eric Kirkland of Caprock Manufacturing, Goolsby submitted
unverified emails in which Kirkland stated his belief that the mold cavity plates for
making Goolsby’s mirrors should be made from stainless steel. The second
individual, Kwan Sik Kong, General Manager of Kender Mould Engineering Co.
11
in Hong Kong, China,4 submitted an affidavit averring that microscopic “orange
peel” defects on the sample mirrors he had examined produced by Gain were
caused by use of the “wrong type of mould [sic] base steel (P20) . . . .” Kong also
averred that his company could make satisfactory molds for Goolsby’s invention
through use of “a much higher density Steel mould base,” such as S136 steel from
Sweden. Goolsby’s summary judgment motion did not include descriptions of the
qualifications of either of these two individuals as experts.
G. District Court’s Order And Goolsby’s Reconsideration Motion
On July 14, 2008, the district court entered an order denying Goolsby’s
remaining four motions to amend his complaint, denying Goolsby’s motion for
summary judgment, and granting the Defendants’ motion for summary judgment.
On July 23, 2008, Goolsby filed a motion for reconsideration of the district
court’s grant of summary judgment to the Defendants. Goolsby reiterated his
claim that Kirkland and Kong qualified as experts and had presented sufficient
expert evidence to rebut the Defendants’ undisputed facts on summary judgment.
However, Goolsby did not file any additional materials detailing Kirkland’s or
Kong’s qualifications as experts or otherwise describing how they would testify at
4
Kong’s affidavit appears to be signed by Berry Yaneza, who is listed in the signature
block and the first sentence of the affidavit. Goolsby later clarified that Yaneza, the Sales
Manger for Kender, handled the affidavit and submitted it to the district court on behalf of his
boss, Kong. For the purposes of this opinion only, we assume the affidavit was filed by Kong.
12
trial. Goolsby also stated his lack of personal knowledge regarding the decision to
use P20 steel as opposed to stainless steel: “Plaintiff had no knowledge or
involvement in decisions regarding material to use or how to build any of the
manufacturing equipment no more than the Court would know which brand of
spark plugs should be used in the Court’s next new car.”
Goolsby also filed two affidavits averring that he hand-delivered his
discovery extension motion to the district court Clerk’s Office on February 6, 2008
(two days before discovery ended) but that the Clerk’s Office failed to file the
motion until the following Monday, February 11, 2008.
The Defendants responded that Goolsby’s reconsideration motion was
another attempt to re-litigate issues already decided by the district court in its
previous orders. The Defendants argued that Goolsby’s characterizations of
Messrs. Kirkland and Kong as experts failed because he had not filed expert
reports, had not submitted original affidavits, and had not identified his experts
before the close of discovery, as required by Fed. R. Civ. P. 26 and Northern
District of Georgia Local Rules 26.2 and 56.1.
Goolsby filed an extensive reply in support of his reconsideration motion,
arguing, among other things, that he was not required to identify expert witnesses
because Defendant Smith “admitted that Stainless [steel] was mandatory to
13
adequately remove orange peel on March 23, 2006,” citing a March 23, 2006 letter
from Smith to Goolsby. In the letter, Smith states:
As you are aware, in an ongoing effort to get the best
possible finish on the first surface of the cavities, I had
them benched three different times . . . . The end result is
that we now believe the best possible answer is to
reproduce the cavities in a 420 stainless steel with a
Rockwell of 48-52 and then nickel plate the mold once
we have approved parts. Both of these are engineering
changes. I have verbally quoted the stainless steel
pricing and can provide a hard quote for these changes if
you desire. The additional research and development
have been done for you at absolutely no cost to you.
Goolsby also, for the first time, filed brief descriptions of the professional
qualifications for Messrs. Kirkland and Kong.
On October 20, 2008, the district court denied Goolsby’s reconsideration
motion. In response, Goolsby filed a motion to “re-reconsider” the district court’s
summary judgment order and to rectify the district court’s “violations of law and
apparent vendetta against pro se litigants.”
On December 5, 2008, the district court denied Goolsby’s motion to “re-
reconsider” the district court’s grant of summary judgment to the Defendants.5
H. Appellate Proceedings
On November 19, 2008, Goolsby filed a notice of appeal of the district
5
On November 14, 2008, Defendant Gain filed a motion to dismiss its counterclaim
against Goolsby without prejudice, which the district court granted on December 5, 2008.
14
court’s orders denying his motion for summary judgment and denying
reconsideration of that order. On January 16, 2009, this Court dismissed
Goolsby’s initial appeal for lack of jurisdiction because, at the time the appeal was
filed, the district court’s judgment was not “final or immediately appealable”
because Defendant Gain’s counterclaim remained pending. The district court then
dismissed Gain’s remaining counterclaim. On April 8, 2009, this Court reinstated
Goolsby’s appeal.6
II. DISCUSSION
A. Goolsby’s Arguments On Appeal
Appellant Goolsby’s initial brief, filed on April 27, 2009, contains 13
enumerations of error. On November 3, 2009, Goolsby filed an amended brief and
motion “to file corrected brief to include standard of reviews [sic] and corrected
pro se errors.”7 Goolsby’s amended brief purports to raise 10 issues, which
although overlapping substantially with what Goolsby argued initially, are
completely reworded.8
6
On April 29, 2009, this Court again dismissed Goolsby’s appeal, pursuant to 11th Cir. R.
42-3(c), for want of prosecution because Goolsby failed to file a corrected appellant’s brief
within the time fixed by the rules. On June 4, 2009, this Court reinstated Goolsby’s appeal.
7
On December 30, 2009, the Court granted Goolsby’s motion to file an amended brief.
8
Rule 28 of the Federal Rules of Appellate Procedure requires an appellant’s brief to
contain the appellant’s argument(s), which must contain the appellant’s contentions of error, and,
for each issue, a statement of the standard of review and citations to authorities and portions of
15
We liberally construe Goolsby’s amended brief to argue these six issues: (1)
the district court erred in denying Goolsby’s motions to amend the complaint; (2)
the district court erred in granting summary judgment to the Defendants and
denying Goolsby’s motion for summary judgment; (3) the district court erred by
not addressing Gain’s alleged breach of its contract with Leasing Capital Partners,
Inc.; (4) the district court improperly “suppressed” evidence supporting Goolsby’s
claims; (5) the district court improperly “refused to accept” electronic records; and
(6) the district court and the Defendants’ counsel committed misconduct. After
review, we conclude all six issues have no merit and only the first two warrant
further discussion.
B. Motions To Amend The Complaint
Federal Rule of Civil Procedure 15 provides a party may amend a pleading
once as a matter of course before being served with a responsive pleading. Fed. R.
Civ. P. 15(a)(1)(A) (2007).9 A party otherwise may amend its pleading only with
the record supporting the appellant’s arguments. Fed. R. App. P. 28(a)(9). Goolsby is
proceeding pro se, and we construe pro se filings liberally and hold pro se litigants to a less-
stringent standard than those represented by counsel. Boxer X v. Harris, 437 F.3d 1107, 1110
(11th Cir. 2006). Yet even with the leniency afforded to pro se litigants, a court should not serve
as de facto counsel to a pro se party and rewrite otherwise deficient arguments, GJR
Investments, Inc. v. County of Escambia, Fla., 132 F.3d 1359, 1369 (11th Cir. 1998), and issues
not briefed by a pro se litigant on appeal are deemed abandoned. Horsley v. Feldt, 304 F.3d
1125, 1131 n.1 (11th Cir. 2002).
9
Effective December 1, 2009, Rule 15 was amended to alter the time limits and
requirements for amended pleadings. In this Opinion, we quote from the previous version of the
Federal Rules of Civil Procedure that applied when Goolsby filed his proposed amendments to
16
the opposing party’s written consent or the court’s leave, which should freely be
granted if justice so requires. Id. 15(a)(2).10 A district court ordinarily should
grant motions to amend a complaint unless the movant’s conduct demonstrates
“undue delay, bad faith or dilatory motive . . . , repeated failure to cure deficiencies
. . . , undue prejudice to the opposing party . . . , [or] futility of the
amendment . . . .” Foman v. Davis, 371 U.S. 178, 182, 83 S. Ct. 227, 230 (1962);
accord Hall v. United Ins. Co. of Am., 367 F.3d 1255, 1262-63 (11th Cir. 2004)
(concluding district court may properly deny untimely amendment if the
amendment would be futile).
The district court is required to enter a scheduling order, which limits the
time “to join other parties and to amend the pleadings.” Fed. R. Civ. P. 16(b)(1)
(2007). “A schedule may be modified only for good cause and with the judge’s
consent.” Id. 16(b)(4). The good cause standard for modification of a scheduling
order “precludes modification unless the schedule cannot be met despite the
diligence of the party seeking the extension.” Sosa v. Airprint Sys., Inc., 133 F.3d
1417, 1418 (11th Cir. 1998) (quotation marks omitted). In cases where a plaintiff
seeks leave to amend the complaint outside of deadlines set in the scheduling
the complaint.
10
We review a district court’s refusal to grant a motion to amend the pleadings for abuse
of discretion. Diesel “Repower”, Inc. v. Islander Invs. Ltd., 271 F.3d 1318, 1321 (11th Cir.
2001).
17
order, the plaintiff must show “good cause” for the district court to modify its order
and allow the amendment. Id. at 1419.
As discussed above, the parties’ Scheduling Order provided amendments to
the pleadings would not be filed after December 14, 2007 (thirty days from
November 14, 2007), “unless otherwise permitted by law.” Goolsby filed
amendments to his complaint – on February 11, June 2, June 4, and June 25, 2008
– all well outside the time for amendments fixed by the Scheduling Order. Thus
Goolsby must show “good cause” to justify the amendments.
After full review, we conclude the district court did not abuse its discretion
in refusing to allow the amendments.11 More specifically, the district court did not
abuse its discretion in concluding that Goolsby did not give good cause for his
failure to add additional claims, factual allegations, and an additional party12 at an
earlier date.
11
Construed liberally, Goolsby’s appeal brief argues the district court also erred in
denying his motion to extend the discovery period. Matters pertaining to discovery are
committed to the sound discretion of the district court, which we review for abuse of discretion.
Patterson v. U.S. Postal Serv., 901 F.2d 927, 929 (11th Cir. 1990). “The abuse of discretion
standard has been described as allowing a range of choice for the district court, so long as that
choice does not constitute a clear error of judgment.” United States v. Kelly, 888 F.2d 732, 745
(11th Cir. 1989). We see no abuse of discretion in the district court’s determination that
Goolsby’s motion to extend the discovery period was untimely or the district court’s denial of
Goolsby’s motion to extend the discovery period.
12
Goolsby listed Byrd as a Defendant-Appellee in this case, but, as the district court
properly denied Goolsby’s request to make Byrd a party to this case, we do not consider him an
Appellee in this appeal.
18
C. Summary Judgment Motions
The district court granted summary judgment to the Defendants on two
separate grounds. First, the district court granted summary judgment to
Defendants President Ladney and CFO Teasdale because Goolsby had not shown
evidence that these two corporate officers were involved in the alleged negligence,
other than through their general status as officers of Gain. The district court
granted summary judgment to Defendants Gain and Vice President Smith because
it determined Goolsby was required to present expert testimony supporting his
claim of Gain’s negligent use of P20 steel, which he failed to do. After review, we
affirm on both grounds.13
1. Defendants President Ladney and CFO Teasdale
Goolsby sued the Defendants for their “failure to fulfill their implied duties,”
“errors and omissions,” “gross negligence,” “lack of due diligence,” and
“inadequate management and supervision.” These claims all rely on a negligence
13
This Court reviews a district court’s grant or denial of summary judgment de novo.
Brinson v. Raytheon Co., 571 F.3d 1348, 1350 (11th Cir. 2009). Summary judgment is
appropriate when the pleadings, discovery and disclosure materials on file, and any affidavits,
when viewed in the light most favorable to the nonmoving party, present no genuine issue as to
any material fact and show that the movant is entitled to judgment as a matter of law. Fed. R.
Civ. P. 56(c); Holloman v. Mail-Well Corp., 443 F.3d 832, 836-37 (11th Cir. 2006). “For issues
. . . on which the non-movant would bear the burden of proof at trial, the moving party is not
required to support its motion with affidavits or other similar material negating the opponent’s
claim . . . . Instead, the moving party simply may show . . . that there is an absence of evidence
to support the non-moving party’s case.” Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115-16
(11th Cir. 1993) (internal quotation marks and emphasis omitted).
19
theory.14 To state a cause of action for negligence in Georgia,15 the plaintiff must
show (1) a legal duty to conform to a standard of conduct; (2) a breach of this
standard; (3) a causal connection between the conduct and the resulting injury; and
(4) some loss or damage to the plaintiff’s legally protected interest. City of
Douglasville v. Queen, 514 S.E.2d 195, 197 (Ga. 1999).16
Goolsby asserts claims for negligence against Defendants President Ladney
and CFO Teasdale, both individually, based on their status as corporate officers of
Gain. Under Georgia law, a corporation such as Gain is a separate and distinct
legal entity from its officers and is held vicariously liable for the torts of its officers
that are committed in the prosecution of and within the scope of the corporation’s
business. Smith v. Hawks, 355 S.E.2d 669, 675 (Ga. Ct. App. 1987) (citing
O.C.G.A. § 51-2-2). “As a general rule, however, one who merely occupies the
capacity of a corporate officer cannot be held to be vicariously liable for such
damages as would otherwise be recoverable from his corporate principal.” Id.
14
Plaintiff repeatedly confirmed that he seeks “tort damages” in this action and is not
suing for breach of contract.
15
A federal court exercising diversity jurisdiction applies the substantive law of the state
in which the case arose. Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 427, 116 S. Ct.
2211, 2219 (1996).
16
This Court analyzes this case through the lens of a negligence claim because that is the
claim Goolsby asserts and the manner in which the parties and the district court litigated the
case. See Marsh v. Butler County, Ala., 268 F.3d 1014, 1023 n.4 (11th Cir. 2001) (en banc)
(construing complaint in the manner litigated by the parties and district court).
20
“‘[A]n officer of a corporation who takes no part in the commission of a tort
committed by the corporation is not personally liable unless he specifically
directed the particular act to be done or participated or co-operated therein.’”
Mitcham v. Blalock, 447 S.E.2d 83, 88 (Ga. Ct. App. 1994) (quoting Lincoln Land
Co. v. Palfery, 203 S.E.2d 597, 603 (Ga. Ct. App. 1973)). It follows that
Defendant President Ladney and CFO Teasdale cannot be individually liable for
negligence unless Goolsby can show some evidence connecting them specifically
to the negligence alleged in this case.
Goolsby has not shown any evidence connecting either Defendant President
Ladney or Defendant CFO Teasdale to the conduct that forms the basis of his
claims. The gravamen of Goolsby’s claim is that Gain, through the actions of the
individual Defendants, negligently recommended P20 steel for the mold used to
manufacture his patented rearview mirrors. In his deposition, Goolsby asserted
that Gain and the individual Defendants “did not do enough research to determine
what kind of material the plates should be made out of,” that they recommended
the use of P20 steel, and that this conduct was “negligence because they should
have researched it sufficiently to determine what they should have been
recommending.”
However, when asked specifically about Defendant President Ladney,
21
Goolsby admitted that he has never spoken with Ladney:
Q. Had you had any discussions by the time Exhibit
Number 12 was created and this mention of P20 steel
occurred with Mr. Ladney?
[Goolsby]. With who?
Q. Mike Ladney.
[Goolsby]. I never had any conversation with him at all.
Q. You never have spoken with him?
[Goolsby]. Not one word.
Goolsby testified similarly regarding Defendant CFO Teasdale, stating that
he did not believe Teasdale was involved in, or even knew of the reasons
supporting, Gain’s recommendation to use P20 steel, and that he had not discussed
the use of P20 steel with Teasdale:
Q. Did you ever have any discussion with Mr.
Teasdale about the use of P20 steel as the material out of
which the mold was created?
[Goolsby]. I don’t imagine he knows anything about it.
He’s the financial officer. He’s the CFO.
Q. You don’t have any reason to believe that he’s the
one who made the decision to use P20 steel?
[Goolsby]. No. He – well, I don’t know because I don’t
know the different in price other than somebody told me
that it was only about $2 a pound more than – I mean
stainless steel was about $2 a pound more than P20 steel,
and it wasn’t going to be that many pounds of material
used, so it was a negligible thing.
Q. So the answer to my question is you have no
information that would lead you to believe that Mr.
Teasdale had any input in the decision to use P20 steel
for the mold?
[Goolsby]. Other than the fact that he wouldn’t – he
wouldn’t release any money to go with stainless steel
22
until after I –
Nor do the various documents and communications Goolsby relies on
implicate Defendants President Ladney or CFO Teasdale in Gain’s
recommendation to use P20 steel.17 None of the documents in the record show any
communication whatsoever from Defendant Ladney to Goolsby. And the only
documents that purport to implicate Defendant Teasdale are communications from
Goolsby to Defendants Smith, Ladney, and Teasdale in 2006 and 2007 accusing
them generally of negligence in Gain’s performance under its obligations to
Goolsby, and one email, dated October 4, 2006, from Defendant Teasdale to
Defendant Smith, discussing Teasdale’s discussions with Goolsby about splitting
the cost of charges for the mold. None of these documents indicates Defendant
Teasdale had any role in the recommendation to use P20 steel to make Goolsby’s
mirrors, which is the only factual allegation supporting Goolsby’s claim in this
case. At best, this evidence shows Teasdale was aware of financial matters
involving Goolsby’s mirror project over two years after Gain allegedly made the
17
In his motion for summary judgment, Goolsby speculates that “Jim Teasdale, CFO,
withheld funding of the order for the stainless steel mold plate . . . from March 20, 2006 until
either September 15, 2006 or likely near the middle of November, 2006 . . . . This is a partial
assumption because Defendant Smith promised on March 20, 2006 to have the mold plate made
using stainless steel . . . but did not issue its purchase order until November 13, 2006 . . . .
Obviously, Defendant Teasdale must have been withholding the necessary funds.” The evidence
in the record does not support this speculation or Goolsby’s broader contention that Defendant
CFO Teasdale was involved in the decision to recommend use of P20 steel.
23
negligent recommendation to use P20 steel. This is not enough to create a genuine
issue of material fact.
Accordingly, the district court did not err in granting summary judgment to
Defendants Ladney and Teasdale because Goolsby has not shown any evidence
supporting their direct participation in the negligent acts he alleges in this case.
2. Defendants Gain And Vice President Smith
Goolsby’s claim against Defendants Gain and Vice President Smith likewise
is based entirely on a negligence theory and the assertion that the recommendation
to use P20 steel fell below the required standard of care. The district court granted
summary judgment to Defendants Gain and Vice President Smith because Goolsby
failed to present expert witness evidence in support of his allegation that use of
P20 steel in this context was negligent.
We agree with the district court that Goolsby was required to present expert
testimony in this case. Under Georgia law, “[u]nless no other conclusion is
permissible, questions of negligence are matters for jury resolution . . . .” Johnson
v. Crews, 299 S.E.2d 99, 100 (Ga. Ct. App. 1983) (internal quotation omitted).
Jurors are the ultimate triers of fact, and “where it is possible for them to take the
same elements and constituent factors which guide [an] expert to his conclusions
and from them alone make an equally intelligent judgment of their own,
24
independently of the opinion of others, then undoubtedly this should be done.”
Metro. Life Ins. Co. v. Saul, 5 S.E.2d 214, 221 (Ga. 1939).
“However, ‘[e]xpert opinion testimony on issues to be decided by the jury,
even the ultimate issue, is admissible where the conclusion of the expert is one
which jurors would not ordinarily be able to draw for themselves; i.e., the
conclusion is beyond the ken of the average layman.’” Baise v. State, 502 S.E.2d
492, 496 (Ga. Ct. App. 1998) (quoting Smith v. State, 277 S.E.2d 678, 683 (Ga.
1981)). Expert testimony is required in cases of professional negligence where the
subject matter is beyond the familiarity of the average layperson. See Marquis
Towers, Inc. v. Highland Gp., 593 S.E.2d 903, 906 (Ga. Ct. App. 2004)
(negligence of professional consultant); Dep’t of Transp. v. Mikell, 493 S.E.2d
219, 223 (Ga. Ct. App. 1997) (negligence of traffic engineers); H. Elton Thompson
& Assocs., P.C. v. Williams, 298 S.E.2d 539, 540 (Ga. Ct. App. 1982) (“Expert
testimony is required because the court and jury are not permitted to speculate as to
the standard against which to measure the acts of the professional in determining
whether he exercised a reasonable degree of care.”) (negligence of architect and
contractor).18
18
In granting summary judgment in favor of the Defendants, the district court relied in
part on Georgia’s professional malpractice statute, O.C.G.A. § 9-11-9.1, which requires a
plaintiff alleging professional negligence to file, contemporaneous with the complaint, an expert
affidavit specifically averring “at least one negligent act or omission claimed to exist and the
25
The gravamen of Goolsby’s negligence claim is that Gain’s use of P20 steel
to fabricate a mold for gas-assisted injection molding fell below the required
standard of care in this particular industry. That technical question is beyond the
expertise of an ordinary juror, and Goolsby was required to identify expert
evidence to prove negligence in this case. In his deposition, Goolsby was asked
whether he had “any specific training or experience or knowledge that would allow
[him] to draw a conclusion about what steel is appropriate for creating a mold for
[the mirrors at issue in this case].” Goolsby responded that he did not have any
academic knowledge other than what was told to him by third parties. The record
does not contain any expert description of the physical differences and salient
properties between P20 and stainless steel, certainly not enough for the average lay
juror to be able to evaluate whether the use of P20 steel in this fabrication context
was professionally negligent.
factual basis for each such claim.” Id. While we acknowledge O.C.G.A. § 9-11-9.1 properly
may be applied to the engineering profession, see Adams v. Coweta County, 430 S.E.2d 599,
601 (Ga. Ct. App. 1993), the 1997 amendments to § 9-11-9.1 narrowed the section’s application
to specific groups of professionals officially licensed by the State of Georgia. Minnix v. Dept. of
Transp., 533 S.E.2d 75, 78-79 (Ga. 2000). Section 9-11-9.1 currently applies to “[p]rofessional
engineers” that are “licensed by the State of Georgia.” O.C.G.A. § 9-11-9.1(a)(1), (g)(21);
accord Dockens v. Runkle Consulting, Inc., 648 S.E.2d 80, 82 (Ga. Ct. App. 2007) (applying
O.C.G.A. § 9-11-9.1 to claim against “licensed professional engineer”). Gain and the individual
Defendants all reside in Michigan. Goolsby does not allege, and the Defendants do not state in
their filings in the district court or on appeal, that any of the Defendants are professional
engineers licensed by the State of Georgia such that § 9-11-9.1 would apply in this case.
26
Goolsby argues expert testimony is not required in this case because
Defendant Vice President Smith admitted to professional negligence. To support
this argument, Goolsby relies on the letter from Defendant Smith, dated March 23,
2006, in which Smith states in part: “The end result is that we now believe the best
possible answer is to reproduce the cavities in a 420 stainless steel with a Rockwell
[hardness] of 48-52 and then nickel plate the mold once we have approved parts.
Both of these are engineering changes.”
This communication from Defendant Smith does not establish negligence
and excuse Goolsby from his obligation to produce expert testimony. At best, it
establishes Smith and Goolsby both believed as of March 2006, nearly two years
into the contract, that stainless steel may have been a better engineering choice to
manufacture the mirrors (although subsequent evidence shows that even when
using stainless steel, Gain was unable to meet Goolsby’s specifications). Goolsby
claims Gain was negligent in its initial recommendation to use P20 steel. The fact
that two years later, after several attempts to meet Goolsby’s specifications,
Defendant Smith admitted that an engineering change might improve matters does
not establish negligence without some expert evidence showing Gain’s original
recommendation was professionally negligent.
Goolsby also argues that, if expert testimony is required, he satisfied these
27
requirements through the affidavits and supporting documentation of Eric Kirkland
and Kwan Sik Kong. Our review shows Goolsby failed to follow the requirements
of the Federal Rules of Civil Procedure and the U.S. District Court for the Northern
District of Georgia’s Local Rules, and the district court properly concluded
Goolsby had failed to submit expert evidence.19
Federal Rule of Civil Procedure 26(a)(2) requires a party to disclose “the
identity of any witness it may use at trial to present” expert testimony at the time it
files its initial disclosure, which are due within 14 days after the parties’ Rule 26(f)
conference. Fed. R. Civ. P. 26(a)(1)(C), (a)(2). The district court docket does not
reflect that Goolsby filed initial disclosures. On December 29, 2007, however,
Goolsby filed responses to the Defendants’ interrogatories, in which he stated:
“There are no plans at this time to call experts, but will [sic] call experts if
Defendants plan to use experts.” The Northern District of Georgia’s Local Rules
additionally require that any designations of experts shall occur during the
discovery period and that failure to identify expert witnesses in a timely manner
prohibits the use of experts at trial. N.D. Ga. R. 26.2C.20
19
We review a district court’s rulings on the admissibility of expert testimony for abuse
of discretion. Allison v. McGhan Med. Corp., 184 F.3d 1300, 1306 (11th Cir. 1999).
20
“Any party who desires to use the testimony of an expert witness shall designate the
expert sufficiently early in the discovery period to permit the opposing party the opportunity to
depose the expert and, if desired, to name its own expert witness sufficiently in advance of the
close of discovery so that a similar discovery deposition of the second expert might also be
28
Goolsby’s identification of experts occurred well outside these time periods.
Even construed liberally, Goolsby did not identify Kirkland and Kong as proposed
experts until he filed his summary judgment motion on June 25, 2008, over four
months after discovery closed on February 8, 2008. Goolsby did not file any
description of Kirkland’s and Kong’s credentials until August 19, 2008. See Fed.
R. Civ. P. 26(a)(2)(B). The district court did not abuse its discretion in concluding
Goolsby failed to offer proper expert testimony in this case.
Without expert testimony, Goolsby cannot prove the Defendants acted
outside the legally-required standard of care and thus cannot establish a required
element of his claim, and the district court properly granted summary judgment to
the Defendants.
3. Goolsby’s Summary Judgment Motion
For a plaintiff to succeed on a summary judgment motion, he “must
demonstrate that on all essential elements of [his] case on which [he] bears the
burden of proof at trial, [that] no reasonable jury could find for the non-moving
party.” Irby v. Bittick, 44 F.3d 949, 953 (11th Cir. 1995) (internal quotations
omitted). For the same reasons discussed above that Goolsby cannot show a
conducted prior to the close of discovery. Any party who does not comply with the provisions of
the foregoing paragraph shall not be permitted to offer the testimony of the party’s expert, unless
expressly authorized by court order based upon a showing that the failure to comply was
justified.” N.D. Ga. R. 26.2C.
29
genuine issue of material fact as to the Defendants’ summary judgment motion,
Goolsby also cannot prove all required elements of his case and is not entitled to
summary judgment.
In conclusion, we affirm the district court’s orders dated July 14, 2008,
October 20, 2008, and December 5, 2008.
AFFIRMED.
30