United States District Court, E.D. Louisiana
SMITTY'S SUPPLY, INC.
LINDSAY MORGAN HEGNA
ORDER AND REASONS
ANN VIAL LEMMON, UNITED STATES DISTRICT JUDGE.
HEREBY ORDERED that the Motion for Judgment as a Matter of
Law, or Alternatively, for a New Trial, filed by plaintiff,
Lindsay Morgan Hegna (Rec. Doc. 454), is DENIED;
FURTHER ORDERED that the Motion for Judgment as a Matter of
Law, or Alternatively, for a New Trial, filed by plaintiff,
Stephen Kelley (Rec. Doc. 453), is DENIED.
matter is before the court on motions for judgment as a
matter of law, or alternatively, for a new trial, filed by
plaintiffs, Stephen Kelley (Rec. Doc. 453) and Lindsay Morgan
Hegna (Rec. Doc. 454). Plaintiffs move the court to set aside
the jury's verdict in favor of the defendant,
Smitty's Supply, Inc.
Kelley and Hegna (hereinafter, sometimes collectively
“plaintiffs”) filed suit against Smitty's
alleging that Smitty's breached an oral employment
agreement to establish a Phantom Stock Plan and a Stock
Appreciation Rights Plan (collectively, “Stock
Plans”), implement the Stock Plans, and designate
plaintiffs as participants in the Stock Plans. In addition,
Kelley alleged that Smitty's had breached a severance
agreement made with him, which guaranteed him a severance
payment if he resigned for good cause or was terminated
a five-day jury trial, the jury returned a verdict in favor
of defendant. The jury found that neither Hegna nor Kelley
had proved by a preponderance of the evidence that they had
an oral contract with Smitty's which granted them rights
under the Stock Plans. The jury further found that Stephen
Kelley had proved that he had a valid contract with
Smitty's that granted him rights for severance payment,
but that he had not proved that he resigned for good reason.
have moved for judgment as a matter of law, arguing that the
verdict was against the great weight of the evidence.
Alternatively, they seek a new trial based on alleged
erroneous evidentiary rulings at trial. Finally, as an
additional ground for a new trial, Kelley argues that he was
unfairly prejudiced by evidence and testimony related to
to Rule 50(b), if the court does not grant a motion for
judgment as a matter of law during a jury trial, the movant
may file a renewed motion for judgment as a matter of law,
and include an alternative or joint request for a new trial
under Rule 59. “In evaluating [a Rule 50(b)] motion ...
the court is to view the entire record in the light most
favorable to the non-movant, drawing all factual inferences
in favor of ... the non-moving party, and leaving credibility
determinations, the weighing of the evidence, and the drawing
of legitimate inferences from the facts to the jury.”
Conkling v. Turner, 18 F.3d 1285, 1300 (5th
Cir.1994) (citing Anderson v. Liberty Lobby, Inc.,
477 U.S. 242 (1986)). A Rule 50(b) motion for judgment as a
matter of law is granted
only if the facts and inferences point so strongly and
overwhelmingly in favor of one party that the Court believes
that reasonable men could not arrive at a contrary verdict .
. . . On the other hand, if there is substantial evidence
opposed to the motions, that is, evidence of such quality and
weight that reasonable and fair-minded men in the exercise of
impartial judgment might reach different conclusions, the
motions should be denied.
Brown v. Bryan County, OK, 219 F.3d 450, 456 (5th
Cir. 2000) (citations omitted).
a Rule 50 motion “is not a matter of discretion, but a
conclusion of law based upon a finding that there is
insufficient evidence to create a fact question for the
jury.” In re Litterman Bros. Energy Sec.
Litig., 799 F.2d 967, 972 (5th Cir.1986) (citing
Lubbock Feedlots, Inc. v. Iowa Beef Processors,
Inc., 630 F.2d 250, 269 n. 22 (5th Cir.1980), cert.
denied, 107 S.Ct. 1373 (1987)).
of the Federal Rules of Civil Procedure provides that the
court may grant a motion for a new trial on some or all of
the issues “after a jury trial, for any reason for
which a new trial has heretofore been granted in an action at
law in federal court.” Fed.R.Civ.P. 59(a)(1)(A). Rule
59 does not enumerate the specific grounds for which a new
trial can be granted. See Id. However, “a
district court may grant a new trial if the court finds that
the verdict is against the weight of the evidence, the
damages awarded are excessive or inadequate, the trial was
unfair, or prejudicial error was committed in its
course.” McFadden v. Wal-Mart Stores, 2006 WL
3087164, *2 (E.D. La. Oct. 27, 2006) (citing Smith v.
Transworld Drilling Co., 773 F.2d 610, 613 (5th
Cir.1985)). Whether to grant a motion for new trial is within
the sound discretion of the trial court. Id. (citing
Pryor v. Trane Co., 138 F.3d 1024, 1026 (5th
Cir.1998)). However, “[c]ourts do not grant new trials
unless it is reasonably clear that prejudicial error has
crept into the record or that substantial justice has not
been done, and the burden of showing harmful error rests on
the party seeking the new trial.” Del Rio Distrib.,
Inc. v. Adolph Coors Co., 589 F.2d 176, 179 n. 3 (citing
11 Charles Alan Wright & Arthur R. Miller, Federal
Practice and Procedure § 2803, at 31-33 (3d ed.1973)).
Kelley's Motion for Judgment as a Matter of Law
sued for severance benefits based on a provision which
granted him severance benefits in the event that Kelly should
"be terminated by employer without cause or by employee
with good reason." Kelley contends that he is entitled to
judgment as a matter of law on his severance claim, because
the weight of the evidence does not support a finding that he
lacked good reason for his resignation. In fact, Kelley
alleges that Smitty's presented no evidence at trial that
Kelley's resignation was not for good reason, and thus
reasonable jurors could not arrive at a verdict for
Smitty's on this question.
at trial, Smitty's owner Edgar Smith, III ("Ed
Smith") testified that Kelley did not resign for good
reason, but rather because he knew he was about to be
terminated for cause.Thus, the jury was tasked with making a
factual determination of Kelley's motivation in resigning
at the time he did. The trial testimony reflects that on
cross-examination, Kelley admitted that he had been counseled
several times for poor performance. Smitty's also introduced
into evidence Kelley's personal notebooks in which he
noted that Smitty's was dissatisfied with his
performance. For instance, in one entry Kelley acknowledges
Smith's dissatisfaction with Kelley's furnishing him
financials that were off by four million
dollars. In addition, two Employee Performance
Counseling Forms were introduced into evidence,
including one which stated:
Your overall performance has been unacceptable to this point
in your employment relationship with us and I consider your
performance to be harmful to the company, which should be
remedied and cured immediately. You are being advised that if
I see future infractions following this notice in any area of
concern as outlined above, further disciplinary action will
be taken which may result in termination of
than one month after execution of that counseling form,
on this evidence, the court cannot conclude that the facts
and inferences point so strongly and overwhelmingly in favor
of Kelley on the issue of his motivation that the court
believes that reasonable jurors could not arrive at a verdict
in favor of Smitty's. A finding that Kelley resigned
because he anticipated his termination for cause, rather than
for good reason, is a reasonable conclusion. Moreover,
Kelley's argument that the fact that Smitty's may
have had cause to terminate Kelley, does not necessarily mean
that Kelley also did not have good reason to resign, fails.
The jury was asked to resolve the following interrogatory: Do
you find by a preponderance of the evidence that Stephen
Kelley has carried his burden of proving that he resigned
from Smitty's for ...