The opinion of the court was delivered by: Magistrate Judge Cole
On February 6, 2012, I issued a memorandum opinion discussing the question of the admissibility of plaintiff's Exhibit 40 under Rules 901 and 803 (6), Fed. R. Evid. See Minemyer v. R-Boc Representatives, Inc., 2012 WL 379904, *4 (N.D.Ill. 2012). Exhibit 40 is a 16-page document in power point form that was produced by Verizon during discovery pursuant to subpoena. It purports to be a report generated by Verizon in connection with its purchase in October 2006 of underground couplers, pursuant to a bid by defendant, Dura-Line Corporation. It is the plaintiff's theory that Dura-Line bid the plaintiff's Lozon coupler, never intending to use it, but rather to use its own B&C coupler, which did not then exist. The plaintiff contends that he was unaware that the corporate defendants had bid his product and that they had taken efforts previously to assure that he did not bid directly with Verizon.
The purpose of the claimed deception was to enable Dura-Line and R-Boc to use the B&C coupler, which they had begun to manufacture and which, the plaintiff contends, infringed his '726 patent. At the time of the bid in August 2006, the B&C coupler was not even in existence. Later, after the award of the bid in late October 2006, the allegedly infringing B&C coupler was to be provided when Dura-Line had sufficient inventory. (See generally Plaintiff's Exs. 12,13,17, 18,19, 27, 29, 36, 41, 44, 45, 46, 47, 50). Plaintiff's Exhibit 40, the Verizon Report, is entitled "Innerduct Couplers/Caps, RFP No. R0603358, Contract - Recommendations" and contains an entry on page 8 (and another on page 5) that arguably supports the theory.*fn1
The document briefly describes the product involved (innerduct couplers), the product history, the "incumbent suppliers" (one of which is defendant, Dura-Line Corporation), adverts to the RFP issued to 12 suppliers, and, in a few brief single-line sentences, summarizes the perceived "advantages" and "disadvantages" of each bidder and the Cross Functional Team's recommendations, by bidder. The report sets forth in chart form a "savings analysis," and in bullet-point, single-line statements which gives the rationale for supplier selection, and the "next steps" to be taken in light of the Team's recommendations for the vendors' bids that had been accepted. On the page devoted to Dura-Line, there appears the word "Advantages," followed by "Bid Lozon products." There is another terse mention on page 5 that Lozon products had been bid.
The defendants' 2009 motion in limine objected to the introduction of the document on two grounds: that it was not properly authenticated under Rule 901and that it was inadmissible hearsay. Rule 802, Federal Rules of Evidence. The February 6 opinion concluded that it was beyond debate that the report was properly authenticated. Minemyer, 2012 WL 379904, 6-7.
The opinion noted that despite the plaintiff's expert's clear reliance in his July 16, 2009 expert report (at 35-36) on Exhibit 40's reference to Lozon products having been bid, the defendants never filed a Daubert motion challenging that aspect of the report, or seeking to bar his testimony insofar as it relied on those statements. Instead, the defendants' expert's September 14, 2009 report simply noted that "much of Mr. Degan's rational [sic] regarding acceptability [to Verizon of the Lozon coupler] comes from a document produced by Verizon [Exhibit 40], but of unsubstantiated authenticity. The document is undated and its author unknown." (Report at 20).
The defendants' December 2011 motion's only mention of the issue came as an afterthought in the last eight words of the last sentence of the "CONCLUSION" section of the motion and simply asked that the expert not be allowed to base his opinion in any way on the Verizon report. Pursuant to the basic principle, adhered to throughout the federal system -- including the Federal Circuit, Radar Industries, Inc. v. Cleveland Die & Mfg. Co., 424 Fed.Appx. 931, 936, 2011 WL 1150534, 5 (Fed Cir.2011) -- that perfunctory, skeletal, and unsupported motions are waived, the opinion concluded that the point had been waived by the defendants. Minemyer, 2012 WL 379904, 6-7. This is not a principle with which the defendants were unfamiliar, having run afoul of it a few months earlier. See Minemyer, 2011 WL 1099265, 3.
In addition to the cases cited in the February 6 opinion on the waiver question, see Beamon v. Marshall & Ilsley Trust Co., 411 F.3d 854, 862 (7th Cir.2005)(single sentence argument insufficient); Perry v. Sullivan, 207 F.3d at 383 (7th Cir.2000)("Even if this argument made sense, Perry cited no authority for this proposition and devoted less than one sentence in the brief to it. Therefore, it is deemed waived."); United States v. Cusimano, 148 F.3d 824, 828 n. 2 (7th Cir. 1998)(same); Sternberg v. Debuys, 1992 U.S.App. LEXIS 14606 (9th Cir. 1992)(one sentence was insufficient to raise issue).
Still, the question of the independent admissibility of Exhibit 40 under the hearsay rule was not resolved by the fact that the plaintiff's expert would be permitted to rely on Exhibit 40, even though the document itself may not have been admissible. See Rule 703, Federal Rules of Evidence.*fn2 While the February 6, 2012 opinion continued to exclude Exhibit 40, further reflection and evidence admitted at trial over the past few days has warranted a re-examination of that evidentiary decision.
It cannot be too strongly stressed that nothing in the following discussion is based on any factual finding or credibility determination by the court. Those are tasks exclusively for the jury. Rather, the sole purpose is to explore the evidence that was admitted at trial as it bears upon the admissibility of plaintiff's Exhibit 40 and the limitations, if any, that ought to be placed on its use by the jury. The significance and import of the evidence of necessity could not have been fully assessed except in the informing context of a trial.
The February 6 opinion held that if the Verizon report was offered to prove the truth of the entry on page 5 that Lozon products were bid and the entry on page 8, which deals with Dura-Line and has the entry, "Advantages" "Bid Lozon products" it was hearsay, and absent a showing that the requirements of a hearsay exception, such as Rule 803(6) were satisfied. However, if the entries were offered for some relevant, non-hearsay purpose, such as to show Verizon's perception of the merits of the Lozon coupler, the hearsay rule would not bar to its admissibility. See the discussion in Minemyer, 2012 WL 379904, 4-5 and earlier in 678 F. Supp.2d 691, 709 (N.D.Ill. 2009). I adhered to the ruling excluding the Verizon report for the reasons expressed more than two years ago in the opinion granting summary judgment to the defendants on the plaintiff's trade dress claim. Minemyer, 678 F.Supp.2d at 710-- 711.
There, it was noted that the defendants had submitted the affidavit of Clifford Ginn, who was responsible for approving the technical aspects of coupler bids at Verizon. (Defendants' summary judgment motion, Ex. 19, ¶ 2). Mr. Ginn's affidavit said he was familiar with the bid, that defendants provided samples of their couplers -- as opposed to plaintiff's couplers, which they had previously supplied -- to indicate what they were bidding, and that there was no confusion at Verizon about the source of the product. (Ex. 19, ¶¶ 3-7). His affidavit was never challenged and thus stood unrebutted, as the summary judgment opinion pointed out.
The evidence at trial added a new dimension to the story. The defendants were bidding the B&C coupler to Verizon before it existed and made numerous representations regarding the coupler they were bidding that the jury could reasonably find misleading, if not false. (See Plaintiff's Exs. 12, 26, 27, 29, 36, 45, 46, 47). For example, Dura-Line represented to Verizon, in answers to precise questions asked by Verizon regarding the coupler that was bid, that it had used its own couplers in the field for several years with great success. (Plaintiff's Ex. 36 at 8). That statement was, the plaintiff argued, untrue since the B&C coupler did not exist. The picture of the coupler included with Dura-Line's submission was that of the Lozon coupler. (Plaintiff's Ex. 47). In answer to another question, Mr. Grimsley said that Dura-Line represented that its coupler offers pull a out strength that was twice the value of the standardized requirement. (Plaintiff's Ex. 36 at p.10). DuraLine's representation, the jury could conclude, was not true since the B&C coupler did not exist at the time. By contrast, in Dura-Line's submissions to AT&T, there was express mention of the B&C coupler. (See also Answers to Questions by Dura-Line in Defendant's Ex. 101).
The jury learned that at Mr. Grimsley's deposition, he testified in elaborate detail how he was certain that samples of the B&C coupler were submitted to Verizon on August 28, 2006, in response to Verizon's demand for samples for field testing. (Plaintiff's Ex. 41). He said that he conducted an extensive inspection of the couplers and could say with certainty that they were B&C couplers. On the witness stand he conceded that that could not have happened because the B&C couplers did not exist.
E-mails between defendant, Mr. Lundeen, and defendant, Mr. Grimsley, showed that they were aware early on that Verizon was going to issue an RFP. Plaintiff's exhibit 12 revealed that Mr. Grimsley and Mr. Lundeen planned to talk to "Carl" (Ginn), who was the Verizon employee who would be drafting the specification for the RFP, and expressed the view that they might be able to get him to "eliminate the other people on technical specs. Food for thought." Shortly thereafter in February 2006, even before the RFP went out, Mr. Grimsley again e-mailed Mr. Lundeen and told him that Mr. Ginn attended a meeting at which he said that the anticipated RFP was likely going to require "dielectric couplers "like the Lozon."
Ginn asked Grimsley to send him information on the Lozon couplers "so he can write the spec favorably towards" Lozon. (Plaintiff's Ex. 13.). The e-mails are susceptible of being read to show that Mr. Lundeen, acting through a business affiliate, Carl Bauz, had prevailed on Mr. Ginn to write the specifications for Verizon's RFP with the Lozon coupler in mind and in favor of it. (Plaintiff's Exs. 12, 13). Indeed, on the witness stand when questioned by plaintiff's counsel about this, Mr. Lundeen, referring to Bauz and the meeting where Mr. Ginn made his announcement and agreed with counsel's statement that Bauz certainly earned his money that day." Mr. Grimsley and Mr. Ginn were to have dinner that night.*fn3
Verizon documents were introduced without objection by the defendants that the jury could find affirmatively stated that Dura-Line had in fact bid Lozon products. These exhibits came in the form of e-mail's between Verizon and the plaintiff's president of sales, Mark Maynard, e-mails between Mr. Lundeen and Mr. Grimsley, and evidence obtained from the defendant's books and records. Plaintiff's Exhibits 63 and 64 are e-mails between Mr. Maynard and Kathy O'Neil, a senior Verizon employee, with whom Mr. Grimsley testified he spoke constantly. Ms. O'Neil is part of Verizon's Strategic Sourcing and is also the Verizon representative who signed the contract with Dura-Line in October 2006 and in earlier years, and was the person who informed Mr. ...