Brief Fact Summary. A breach of contract action and an action for damages involving a RICO claim was brought originally in 1993 and, after the jury returned its verdict in 1996, the verdict and award were vacated by the presiding judge, who then ordered a new trial. After the second trial, the jury returned a verdict favorable to the same party as in the first trial; that verdict was also vacated by the judge, based on insufficient evidence of damages, and judgment entered for the party against which the jury had found.
Synopsis of Rule of Law. When an objection is not raised at the proper time it is waived; Rule 408 of the Federal Rules of Evidence forbids admission of evidence of statements made during settlement talks when those statements are offered to prove the existence (or non-existence) of liability only; and it is error that requires a new trial for a judge to fail to properly instruct a jury when the jury considers the evidence during deliberations.
Does a party waive its objection to the presentation of exhibits to a jury by failing to object at the time the evidence is presented to the jury for deliberations?
Under Federal Rule of Evidence 408, may testimony concerning settlement talks be admitted into evidence?
Is it error for a judge to fail to include in his or her instructions to the jury a statement that certain specific acts require a particular level of intent, such as when the overlying cause of action requires an intent to defraud, and is a new trial warranted when those specific acts are nonetheless presented to a jury lacking such instructions?
Yes; because the point of the “waiver rule” is to avoid mistakes before they occur by requiring that objections be made when they become relevant, Defendant-Appellant / Cross-Appellee waived its right to object to the 21 exhibits by not raising such an objection prior to the submission of the evidence to the jury and at the conclusion of the case.
Yes; Rule 408 of the Federal Rules of Evidence forbids admission of evidence of statements made during settlement talks when those statements are offered to prove the existence (or non-existence) of liability only; it does not forbid the admission of evidence of statements offered to prove other items, such as a witness’s bias.
Yes; when an act must have been done with an intent to defraud in order to qualify as a predicate act and the judge fails to instruct the jury as such, it is error that warrants a new trial.
Ultimately, the court’s decision in the present action:
o Affirms the lower court’s grant of a new trial on the RICO claim;
o Reverses the lower court’s grant of a new trial on the breach of contract claim following the first trial;
o Affirms the jury’s verdict rejecting Defendant’s RICO claim at the second trial;
o Denies the award of attorneys fees and/or costs to both sides; and, finally:
o Remands the case to the district court for entry of an amended judgment.
The court states that without the “waiver rule,” “litigants would sit on their hands, wait to see the result of the litigation, and then if the outcome is unfavorable to come back and complain about a problem that could have been avoided.” Accordingly, the court found that objections, when not raised at the appropriate time, are waived.
The court cites the “spirit and purpose” of Federal Rule of Evidence 408 and states that settlement efforts will be “chilled” if evidence of such talks are able to be admitted at trial. Therefore, the court reasons, when relevant to liability, Rule 408 prohibits admission of such evidence.
The court reasons that when the jury is not instructed that certain acts require a specific level of intent, that error “cannot be deemed harmless,” and that a new trial was the proper method of resolution for the error.