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FINEMAN v. ARMSTRONG WORLD INDUSTRIES

United States District Court, District of New Jersey


June 25, 1991

ELLIOT FINEMAN AND THE INDUSTRY NETWORK SYSTEMS, INC., PLAINTIFFS,
v.
ARMSTRONG WORLD INDUSTRIES, INC., DEFENDANT.

The opinion of the court was delivered by: Bissell, District Judge.

OPINION

I. FACTS AND BACKGROUND

The present matter arises pursuant to several remaining motions in this action. First, defendant Armstrong has moved under Fed.R.Civ.P. 59 for a new trial, as an alternative to its motion for J.N.O.V. Second, Armstrong has separately moved under Rule 49 (pertaining to inconsistent verdicts) for a new trial. Finally, the plaintiffs have moved for "reformation of the judgment," requesting this Court to allow them to recover both the tort and antitrust awards.

The latter motion, even if it was not rendered moot by this Court's Opinion granting defendant's motion for J.N.O.V., would be (and is) denied for the reasons enunciated in its Opinion Regarding Entry of Judgment filed on May 6, 1991. Nothing presented in the papers supporting this motion has persuaded the Court that its prior determination is incorrect.

Armstrong's motion under Rule 49*fn1 may be disposed of as quickly as plaintiffs' motion concerning the judgment. This motion relates to jury answers to interrogatories concerning "overlap" amounts between compensatory awards for the tort claims and the antitrust claims.*fn2 This motion is denied without further discussion. This Court has vacated the judgment based upon the verdict in its earlier Opinion granting defendant's motion for J.N.O.V. Furthermore, even if the verdict remained, this Court grants defendant's motion for a new trial on the grounds enunciated below, and thus denies the motion under Rule 49 because such motion is unnecessary.

This Court issued its Opinion as to the motion for J.N.O.V. on June 20, 1991, granting defendant's motion in full. The present Opinion is to be considered in conjunction therewith, and so will not repeat the pertinent facts and background contained therein as such discussion is hereby incorporated by reference.

The present opinion is required in light of the fact that this Court granted the defendant's motion for J.N.O.V. in its entirety:

  If the motion for judgment notwithstanding the
  verdict, provided for in subdivision (b) of this
  rule, is granted, the court shall also rule on the
  motion for a new trial, if any, by determining
  whether it should be granted if the judgment is
  thereafter vacated or reversed, and shall specify
  grounds for granting or denying the motion for the
  new trial. If the motion for a new trial is thus
  conditionally granted, the order thereon does not
  affect the finality of the judgment. . . .

(Fed.R.Civ.P. 50(c)(1)).

The defendant asserts three grounds for its motion under Rule 59. First, it contends that the verdict is contrary to the clear weight of the evidence. Second, Armstrong asserts that it is entitled to a new trial because of improper, prejudicial arguments made to the jury by the plaintiffs' counsel. Third, Armstrong asserts that both the compensatory and punitive awards in this case are so grossly excessive as to shock the conscience, thus requiring a new trial.

II. DISCUSSION

A. Standards Governing Motions for a New Trial

In general, a trial court should grant a motion for a new trial when, in its opinion, "the verdict is contrary to the great weight of the evidence, thus making a new trial necessary to prevent a miscarriage of justice." Roebuck v. Drexel University, 852 F.2d 715, 736 (3d Cir. 1988). "The authority to grant a new trial . . . is confided almost entirety to the exercise of discretion on the part of the trial court." (Id. at 735 (quoting American Bearing Co. v. Litton Industries, 729 F.2d 943, 948 (3d Cir.), cert. denied, 469 U.S. 854, 105 S.Ct. 178, 83 L.Ed.2d 112 (1984)). Such discretion reflects the fact that "the district court was able to observe the witnesses and follow the trial in a way that [the Appellate Court] cannot replicate by reviewing a cold record." (Id., citing Semper v. Santos, 845 F.2d 1233, 1237 (3d Cir. 1988)).

The discretion of the court is not unlimited, however. Necessarily, when a motion for a new trial based on the weight of the evidence is granted, the court has:

  to some extent at least substituted his judgment
  of the facts and the credibility of the witnesses
  for that of the jury. Such an action effects a
  denigration of the jury system and to the extent
  that new trials are granted the judge takes over,
  if he does not usurp, the prime function of the
  jury as the trier of facts.

  Williamson v. Consolidated Rail Corp., 926 F.2d 1344, 1352 (3d Cir. 1991) (quoting Lind v. Schenley Indus., Inc., 278 F.2d 79, 90 (3d Cir.) (in banc), cert. denied, 364 U.S. 835, 81 S.Ct. 58, 5 L.Ed.2d 60 (1960)). As with a motion for J.N.O.V., "[a] district court may not substitute its own judgment for that of the jury simply because the court might have come to a different conclusion." Grace v. Mauser-Werke Gmbh, 700 F. Supp. 1383, 1387 (E.D.Pa. 1988) (citing Douglas W. Randall, Inc. v. A.F.A. Protective Systems, Inc., 516 F. Supp. 1122, 1124 (E.D.Pa. 1981), aff'd mem., 688 F.2d 820 (3d Cir. 1982)). However, a careful analysis of permissible inferences the jury could reasonably draw from the evidence presented at trial does not invade the exclusive domain of the jury. Nebel v. Avichal Enterprises, Inc., 704 F. Supp. 570, 574 (D.N.J. 1989) (citing Roebuck, 852 F.2d at 736). Where the verdict is based on inferences which are "mere speculation", a new trial becomes necessary. (Id.) Thus, "the district court ought to grant a new trial on the basis that the verdict was against the weight of the evidence only where a miscarriage of justice would result if the verdict were to stand." Williamson, 926 F.2d at 1352 (citing EEOC v. Delaware Dep't of Health & Social Servs., 865 F.2d 1408, 1413 (3d Cir. 1989)).

B. The Weight of the Evidence

As this Court's J.N.O.V. opinion demonstrates, the record in this matter is critically devoid of that quantity and quality of evidence from which a jury might reasonably afford relief for the plaintiffs. Of necessity, the verdict is therefore also contrary to the great weight of the evidence for the same reasons as detailed in the J.N.O.V. Opinion. The verdict in this matter is the product of impermissible speculation, sympathy, and emotion. The jury decided this case with its viscera, not its reasoning, and therefore permitting the verdict to stand would constitute the gravest miscarriage of justice. Accordingly, the defendant's motion for a new trial on the basis that the verdict is contrary to the weight of the evidence is granted.

C. Attorney Misconduct

Although the first ground for the new trial is sufficient on its own, this Court also chooses to consider the defendant's arguments concerning the conduct of plaintiffs' counsel. This conduct, particularly the repeated appeals to sympathy, speculation and passion rather than reason, is undoubtedly what produced the jury's verdict. Furthermore, conduct such as that engaged in by plaintiffs' counsel requires judicial attention, even if only to award a new trial. The Court determines, whether considered separately or in conjunction with the lack of evidence to support the verdict, Mr. Kramer's conduct demands the granting of a new trial.

In considering a motion for a new trial based on attorney misconduct, "the trial judge has considerable discretion in determining whether conduct by counsel is so prejudicial as to require a new trial." Draper v. Airco, Inc., 580 F.2d 91, 97 (3d Cir. 1978) (citing Lewis v. Penn Central, 459 F.2d 468 (3d Cir. 1972); Corbett v. Borandi, 375 F.2d 265 (3d Cir. 1967)). The Third Circuit has noted:

  [W]e wish to emphasize that we do not expect
  advocacy to be devoid of passion. . . . But jurors
  must ultimately base their judgment on the
  evidence presented and the rational inferences
  therefrom. Thus, there must be limits to pleas of
  pure passion and there must be restraints against
  blatant appeals to bias and prejudice. These
  bounds of conduct are defined by the Code of
  Professional Responsibility and the case law.

(Draper, 580 F.2d at 95); see e.g. Salas by Salas v. Wang, 846 F.2d 897, 907-908 (3d Cir. 1988) (Draper standard reiterated and distinguished because there was only one "impassioned" statement). Of particular concern to this Court is Rule 3.4(e):

  A lawyer shall not . . . (e) in trial, allude to
  any matter that the lawyer does not reasonably
  believe is relevant or that will not be supported
  by admissible evidence, assert personal knowledge
  of facts in issue except when testifying as a
  witness, or state a personal opinion as to the
  justness of a cause, the credibility of a

  witness, [or] the culpability of a civil litigant

(RPC 3.4(e)) (emphasis added). Violations of this rule and others, when the court determines that there is a "reasonable probability" that the jury's verdict has been influenced by the improper conduct of counsel, require the court to grant the motion for a new trial. See e.g. Commercial Credit Business Loans, Inc. v. Martin, 590 F. Supp. 328, 332-335 (E.D.Pa. 1984) (Trial court granted plaintiff's motion for new trial where counsel offered his opinion, expressed indignation and outrage at the accused conduct, commented upon the conduct of witnesses and vouched for their credibility, all to the extent that there was a reasonable probability that the verdict was influenced by such conduct.); Polansky v. CNA Insurance Co., 852 F.2d 626, 628 (1st Cir. 1988) ("Courts have long recognized that statements of counsel's opinions or personal beliefs have no place in a closing argument of a criminal or civil trial.") (Citations omitted).

Cautionary instructions may be used to attempt to eliminate the prejudice resulting from improper statements by counsel. This Court made several such instructions, both immediately following the conduct and during its final instructions as to the relevant law.*fn3 It is beyond refute, however, that cautionary instructions do not necessarily remove the probability of prejudice:

  [T]he bench and the bar are both aware that
  cautionary instructions are effective only up to a
  certain point. There must be a line drawn in any
  trial where, after repeated exposure of a jury to
  prejudicial information . . . cautionary
  instructions have little, if any, effect in
  eliminating the prejudicial harm.

City of Cleveland v. Peter Kiewit Sons' Co., 624 F.2d 749, 759 (6th Cir. 1980) (quoting O'Rear v. Fruehauf Corp., 554 F.2d 1304, 1309 (5th Cir. 1977)); Draper, 580 F.2d at 96-97.

For the most part, this Court adopts the arguments of the defendant as they pertain to plaintiffs' counsel's conduct during the course of this trial, and particularly throughout his closing arguments. Armstrong has exhaustively briefed the issue, and quoted extensively from the transcripts.*fn4 Accordingly, this Court only summarizes the prejudicial conduct for purposes of this Opinion. See e.g. Draper, 580 F.2d at 97 ("In reaching this decision, we do not rely on any of the individual instances or types of impropriety. Rather, we have assessed the argument as a whole").

Mr. Kramer, during the course of his closing arguments in particular, repeatedly testified as to his own truthfulness and trustworthiness, although of course he was not a witness. (See Tr. quoted at Defendants' Main Br. at 36-38). His testimony on summation included supplying "facts" not in the record about what he knew, didn't know, found out, etc. (Defendants' Reply Br. at 31-34). He also expressed his opinion, on countless occasions, that Armstrong concealed information and lied during the course of the trial. (Defendants' Main Br. at 38-43). Furthermore, Mr. Kramer repeatedly referred to a crime and to a conspiracy in which Armstrong supposedly engaged, despite the fact that this Court directed a verdict in Armstrong's favor as to plaintiffs' civil conspiracy claims and there are, of course, no criminal claims involved in this civil lawsuit. (Id. at 70-72). References to crimes and criminals (often comparing witnesses to such celebrated figures as Jack Palance) undoubtedly persuaded the jury to fictionalize the claims herein and act out of a sense of drama rather than reality. (See e.g. Henker v. Preybylowski, 216 N.J. Super. 513, 518-519, 524 A.2d 455 (App. Div. 1987)) (In granting the motion for a new trial, court described plaintiff's attorney's use of defendant's attorney as a target; "[p]erhaps none of these comments standing alone is out of bounds, but taken together they represent a deliberate effort by plaintiffs' attorney to have the jurors see themselves as destroyers of evil forces, personified by defendant and his attorney, that have been depriving his clients of justice . . .").

Throughout his closing argument, Mr. Kramer repeatedly expressed his opinion as to the merits of Armstrong's case, the credibility of witnesses, and the culpability of Armstrong even as to claims not legitimately set forth by the plaintiffs. (Id. at 43-50; 70-72). On more than one occasion, this Court admonished Mr. Kramer to refrain from including his personal opinion in his argument;*fn5 despite such orders, he continued to assert his views with vigor.

During his closing, Mr. Kramer continuously asserted that all of Armstrong's witnesses were liars and perjurers, while emphasizing that this was a federal Court and the jury a federal jury. (Id. at 50-58). At the same time, Mr. Kramer accused the witnesses and Armstrong itself of various crimes, including theft and conspiracy (as noted above).

Perhaps most troubling to this Court is the unadorned, disparaging attack upon defense counsel throughout Mr. Kramer's closing argument. See e.g. Draper, 580 F.2d at 96 ("The final category of improper conduct committed by counsel is the repeated vituperative and insulting references to the defendants and defendants' counsel") (citations omitted); see also RPC 3.2 ("A lawyer . . . shall treat with courtesy and consideration all persons involved in the legal process.")*fn6 Indeed, he began his closing by pointing out the "misrepresentations" made by defense counsel in his closing argument, and continued to refer to defense counsel as liars despite this Court's admonition and cautionary instruction to the jury. (Defendants' Br. at 58-67). Mr. Kramer's argument to the contrary, that "[a]t no point in his closing argument did plaintiffs' counsel ever say that Mr. Wilson had lied," (Plaintiffs' Br. at 55), is contrary to the record. Indeed he pressed his own personal credibility and, having disparaged that of Mr. Wilson, then asked the jurors to contrast them. (Tr. 40.7:5-9).

Mr. Kramer even went so far, in a particularly egregious example of misconduct, as to infer that one defense attorney either counselled a witness to lie (as was suggested by the language he used), or engaged in sexual misconduct with a witness (as was suggested by his tone and the inuendo inherent in his statements):

    [Referring to defense witness Alan Abrahamson]:
  Look, when he got up here on the witness stand
  after spending 22 hours with Edith Payne, hold
  [sic] up in a conference room God knows what he
  was doing for 22 hours for three hours of
  testimony?

  That's perjury. He's admitting it. I cannot
  believe my ears. I really cannot. This is the same
  Alan Abrahamson, yeah, Ms. Payne's in the room.
  She's in the second row. There, flower dress. She
  spent 22 hours held up in a conference with Alan
  Abrahamson.

  Now, what, ladies and gentlemen of the jury, Mr.
  Abrahamson's direct examination with Mr. Wilson
  was maybe three hours, three and a half hours? But
  they had to spend 22 hours with Mr. Abrahamson

  to prepare him. And ask yourself something.

  Now, I'm the first to admit you get up on the
  witness stand, it's your first time. Of course
  you're going to be nervous, that's natural. The
  first time I got up to do this I was scared to
  death. That's natural.

  But I mean, if you're going to tell the truth, why
  do you have to be terrified? Why do you have to
  spend 22 hours preparing if all you're going to do
  is get up there, tell it the way it is, as they
  say, right?

Do you need 22 hours to prepare? To do what?

  I know what they did. You know what they did. I
  don't have to tell you what they did during those
  22 hours.

(Tr. 39.12:10-13; 39.74:5-24).*fn7

Thus, the essence of Mr. Kramer's closing concerning defense counsel was that counsel had lied to the jury, had suborned perjury from witnesses (flavoring these comments with the titilating remarks regarding Ms. Payne), and had done it for money. He argued further that the jury could and should award punitive damages against Armstrong based in large measure upon such alleged conduct. Indeed, on the chart he placed before the jury, Mr. Kramer included "misrepresentations by counsel" as one of the reasons the jury should award punitive damages. At the next recess, this Court expressed concern with the propriety of alleged trial conduct as a basis for punitive damages, and asked plaintiffs' counsel to remove it from the chart. He did so, but continued to assert in his arguments that "perjury" and the misconduct of counsel constituted a basis for an award of punitive damages.

Mr. Kramer's opposition to this portion of the defendant's motion is singularly unconvincing. For example, Mr. Kramer quotes himself saying "To me, I'm not the smartest guy in the world. But I think overlap and compete are pretty close to me." (Tr. 39.20), and argues that this does not constitute opinion. Instead, he says, the statement is only a "rhetorical device" which defendant has taken literally. (Plaintiff's Br. in Opp. to Rule 59(b) Motion at 14-15). Mr. Kramer argues that his use of mere sarcasm could not work to inflame the jury and that many of his statements are "inferences," not testimony. (Id.) Considered with the other improprieties in his summation, however, these remarks also add to its prejudicial impact.

Contrary to Mr. Kramer's assertions, defense counsel did object to Mr. Kramer's conduct throughout the trial. Motions in limine were filed to limit certain prejudicial evidence and testimony; a motion was filed to limit closing argument;*fn8 a motion requesting a restraining order was filed, and numerous objections were made throughout. Requiring defense counsel to object to every single instance in this over-laden record in which plaintiffs' counsel acted objectionably would cause considerable prejudice in the eyes of the jury. This is particularly true where so much of the accused conduct occurred during plaintiffs' closing argument. Furthermore, even if this Court found that defense counsel failed to make timely objections to Mr. Kramer's conduct, it would nonetheless grant the new trial motion in light of the extremely prejudicial conduct which occurred and the gross miscarriage of justice which resulted. In this regard, the Second Circuit has stated:

    We are of the opinion that even absent these
  objections a new trial should have been granted in
  this case. It was the trial judge's affirmative
  duty to protect appellants from the grossly
  improper tactics

  adopted by counsel for the appellee. This he
  failed to do.

    The single most important task of a district
  judge presiding at a trial before a jury is to
  exercise that degree of control required by the
  facts and circumstances of each case to assure the
  litigants of a fair trial. This obligation does
  not arise only when objections are raised by one
  of the litigants or his counsel. Repeated
  improprieties by one counsel severely prejudice
  his adversary. Every trial lawyer knows that
  frequent objection is a potentially dangerous
  course of action the effect of which upon the jury
  cannot be estimated. Thus, the burden falls on the
  federal district judge to use his authority,
  whenever it becomes necessary, in such a way that
  the proceedings in the courtroom remain devoted to
  a reasoned and reasonable search for justice
  between the parties. Brown v. Walter, 62 F.2d 798
  (2d Cir. 1933).

Koufakis v. Carvel, 425 F.2d 892, 900-901 (2d Cir. 1970).*fn9 Furthermore, contrary to Mr. Kramer's assertions, this Court was acutely aware of the fact that objections to closing argument are undesirable: "I might add Mr. Wilson that as far as objections on the summations are concerned, this goes to both sides obviously anybody ought to be reluctant to object to anyone else's summation." (Tr. 37.137).*fn10

Particularly unconvincing is plaintiffs' counsel's effort to distinguish Draper on the question of attacking opposing counsel. In Draper, the attack on counsel was "without provocation or basis in fact." 580 F.2d at 95. Mr. Kramer therefore argues that his attack against defense counsel herein was based on evidence, including "factual discrepancies and inaccuracies to [defense counsel's] argument to the jury." (Plaintiffs' Br. at 29). Thus, he claims, it has a basis in fact and so was not prejudicial. (Id. at 37). Furthermore, he claims that because he raised the issue of credibility of counsel, "[t]his issue could be `prejudicial' to a defendant only if the jury was more likely to find that defense counsel had been untruthful . . ." (Id. at 38). This is a ludicrous argument. First, Mr. Kramer launched a full assault against the credibility and tactics of defense counsel without any basis whatsoever, except that he, Mr. Kramer, disagreed with Mr. Wilson's assessment of the evidence. It is one thing to dispute an adversary's position and argue that it is incorrect; it is quite another to accuse an attorney of making intentional misrepresentations for pecuniary gain or to justify his fee to his client. Second, in no way was counsel's veracity ever an "issue" upon which the jury could make "findings." Mr. Kramer, however, encouraged the jury to balance his and Mr. Wilson's personal credibility. (Tr. 40.7:5-9). The only issues for the jury to decide were those it was instructed to consider; plaintiffs' counsel could not suddenly create an "issue" for the jury in his closing argument.

Mindful of the considerable time and resources expended by the parties and the Court itself, this Court attempted to cure the numerous improprieties by instructions to the jury.*fn11 As is evidenced by the verdict in this matter, such instructions were to no avail. There is no doubt in this Court's mind that the verdict in this matter is the result of passion, prejudice, sympathy and totally unjustified outrage, instilled and fertilized by plaintiffs' counsel. The inferences which counsel asked the jury to make were unreasonable and illogical; only by prejudicing the jurors (as exemplified most dramatically in Mr. Kramer's summation) were plaintiffs able to obtain a verdict. Disparaging witnesses and defense counsel to such an extent undoubtedly added fuel to the flames of the jury's passion engendered by the other colorful yet prejudicial arguments of counsel. This Court's opinion regarding the defendant's motion for J.N.O.V., particularly those portions analyzing the evidence and the reasonable inferences therefrom, demonstrates the considerable extent to which this jury was led by the inflammatory rhetoric of plaintiffs' counsel down a path that fatally diverged from the evidence.

This Court notes that Mr. Kramer's conduct throughout the course of this trial has led to the imposition of a restraining order, consideration of motions for a mistrial,*fn12 delays resulting therefrom, and more. The defense counsel, as a result of plaintiffs' counsel's acts, were required to commit substantial time and energy to addressing tangential issues at key points during the trial.*fn13 For example, upon the close of plaintiffs' case and the motions for directed verdict, counsel and this Court were distracted from trial issues by Mr. Kramer's meddlesome letters to the New York Stock Exchange and the Securities and Exchange Commission. (See Tr. before Magistrate Haneke, March 4, 1991, and this Court's Opinion affirming, March 19, 1991 (Tr. 25.1-25.8)). Similarly astounding were this attorney's inexcusable letters directly to the directors of Armstrong which delayed summations by one week.*fn14 (See Op. Regarding Entry of Judgment filed May 6, 1991 at 14). The only conclusion that this Court is able to reach is that plaintiffs' counsel deliberately set out to sabotage Armstrong's defense in every way possible, without regard to rules of conduct, rules of law, and orders and directions from this Court.

Other actions by Mr. Kramer are pertinent to the circumstances under which a new trial may be conducted. He effected a unilateral de facto cancellation of a date before this Court to settle the form of judgment upon the jury verdict, in order to attend a press conference (with Mr. Fineman) at Armstrong's corporate headquarters. (Id. at 15-16). In a further, bizarre development which just came to the Court's attention, a circumstance which might even be considered humorous if presented in isolation, the Court has learned that, since October 11, 1990, Mr. Kramer has been unauthorized to practice law in the State of New Jersey for failure to make his required contributions to the Clients' Security Fund.*fn15 Considered in the context of Mr. Kramer's other conduct in connection with this case, however, both inside and outside the courtroom, this development is but further evidence of Mr. Kramer's complete disregard for rules and procedures governing the propriety and civility of an attorney's conduct. Regretfully, his transgressions of this sort have not been limited to the present matter.*fn16

Of course this Court is not going to void the present verdict and grant a new trial solely because of the lack of Mr. Kramer's authority during the trial to practice law before the courts of the State of New Jersey. If, as and when any new trial transpires in this matter the issue of his standing before the bar can be addressed at that time. Once again, however, considered in connection with his other conduct in this case which (given its pervasivness) is substantially likely to recur upon any retrial, this Court, should this action be remanded for a new trial on any issue, will then entertain a motion, and might even issue its own order to show cause, as to why Mr. Kramer should not be replaced as plaintiffs' trial counsel, in the event that the plaintiffs don't make that choice voluntarily.*fn17

CONCLUSION

This Court was present during the entire trial and has carefully reviewed the record herein. It observed the conduct and demeanor of plaintiffs' trial counsel, and recalls vividly both the contents and tone of his remarks. Based on this experience with the record, and with the atmosphere which pervaded this trial, this Court finds that failure to grant the defendant's motion for a new trial would constitute a gross miscarriage of justice. The Court's curative instructions were to no avail in the face of Mr. Kramer's pervasive and flagrant appeals to speculation, sympathy, outrage and revenge from the jury. The cumulative effect of all such conduct is far greater than that experienced by the Court on a day-to-day basis. Indeed there could be no stronger testament to the success of plaintiffs' improprieties than the indefensible verdict reached by the jury. For all the reasons set forth above, the defendant's new trial motion is granted.*fn18


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