Unitherm Food Systems, Inc. v. Swift-Eckrich, Inc.

Brief Fact Summary.

Plaintiff sued, alleging that Defendant had violated the Sherman Antitrust Act by attempting to enforce a patent obtained by fraud. Defendant moved for judgment as a matter of law under FRCP Rule 50(a), asking the district court to dismiss the case based on insufficiency of evidence. The court denied the motion and sent the case to the jury, which returned a verdict for Plaintiff. Defendant appealed, without filing a post-verdict motion for relief with the district court. The circuit court found the evidence insufficient to support the jury’s verdict, so it reversed the verdict and ordered a new trial. Plaintiff appealed to the Supreme Court.

Synopsis of Rule of Law.

Under FRCP Rule 50, a court of appeals may not review a verdict for sufficiency of the evidence unless the party has file a post-verdict motion for relief (i.e., motion for new trial under Rule 59 or renew motion for judgment as a matter of law under Rule 50) with the district court.

Facts.

Plaintiff claimed that a patent of Defendant was invalid because Plaintiff’s president had invented the process six years before. Plaintiff sued, alleging that Defendant had violated the Sherman Antitrust Act by attempting to enforce a patent obtained by fraud. Defendant moved for judgment as a matter of law under FRCP Rule 50(a), asking the district court to dismiss the case based on insufficiency of evidence. The court denied the motion and sent the case to the jury, which returned a verdict for Plaintiff. Defendant appealed to the Circuit Court of Appeals for the Federal Circuit, arguing that the evidence was insufficient to prove an antitrust violation. However, Defendant did not renew the motion for judgment as a matter of law after the verdict, pursuant to Rule 50(b), or move for a new trial, pursuant to Rule 59. Plaintiff argued that since Defendant had failed to renew its motion under Rule 50(b) as a party would typically be required to do after an unfavorable verdict, the circuit court could not consider the insufficiency-of-evidence claim. Defendant took the position that renewal of the motion was optional. The circuit court noted that it must apply the precedent of the relevant regional Circuit Court (the Tenth), under which Rule 50(b) was indeed optional. The circuit court found the evidence insufficient to support the jury’s verdict, so it reversed the verdict and ordered a new trial. Plaintiff appealed to the Supreme Court.

Issue.

May a federal court of appeals review a verdict for sufficiency of evidence if the party did not file a post-verdict motion for relief with the district court?

Held.

No. The Court held that a party must renew its motion for judgment under Rule 50(b) if the motion is to be the basis for an appeal.

Dissent.

Justice Stevens and Kennedy

Justice Stevens and Justice Kennedy argued that in exceptional cases courts of appeals could consider substantive issues to prevent manifest injustice even when procedural oversights by appellants would normally preclude them, because lawyers can sometimes make errors. They noted that Congress had empowered appellate courts to correct plain errors despite procedural mistakes that might otherwise bar review. 28 U.S.C. § 2106. The majority’s opinion is based on precedent decided before the enactment of § 2106.

Discussion.

Under FRCP Rule 50, a court of appeals may not review a verdict for sufficiency of the evidence unless the party has file a post-verdict motion for relief (i.e., motion for new trial under Rule 59 or renew motion for judgment as a matter of law under Rule 50) with the district court. FRCP Rule 50(a) allows a party to move for judgment as a matter of law before the case is submitted to the jury for insufficiency of evidence. The party may challenge the sufficiency of the evidence after the verdict by renewing the motion or seeking a new trial under FRCP 50(b) and Rule 59. The Court noted that an appellate court had no power to direct entry of a different verdict unless a party has filed a FRCP 50(b) motion. See Cone v. West Virginia Pulp & Paper Co., 330 U.S. 212 (1947). The trial judge who “ha[d] the feel of the case” was in a better position to determine whether the evidence supported the verdict. Prompt review ensures fairness. Though the cases cited involved directing entry of a verdict, the principle applies to orders for new trials. An appellate court may only grant relief that was requested from the trial court.

Here, the cases Defendant had cited involved parties who made Rule 50(b) motions. Defendant was not, in truth, appealing the denial of its Rule 50(a) motion. Rather, Defendant was seeking a new trial. Defendant never asked the district court for a new trial, and the court had no power to grant one based on a Rule 50(a) motion. Defendant gave up its right to seek a new trial on appeal. Indeed, a district court is not obligated to enter judgment of a matter of law, even if the evidence is insufficient. Policy favors allowing the jury to decide. The district court did not abuse its discretion in denying the Rule 50(a) motion. The error was in Defendant’s failure to renew the motion under Rule 50(b). Therefore, the Court reversed the judgment of the court of appeals.