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Sean Michael Swendsen; and v. Richard I. Corey

June 6, 2012


The opinion of the court was delivered by: B. Lynn Winmill Chief Judge United States District Court



The Court has before it Richard Corey's Motion to Amend Pleadings to Conform to Evidence and to Alter or Amend or For New Trial (Dkt. 170), Plaintiffs' Motion for Altering or Amending Judgment on Jury Verdict ($150,000 Additur Request) (Dkt. 175), and Plaintiffs' Motion for Allowance of Attorney Fees (Dkt. 176). The motions are fully briefed. For the reasons expressed below, the Court will (1) deny Defendant's motion to amend the pleadings or for a new trial; (2) deny Plaintiffs' motion to alter or amend the judgment; and (3) grant Plaintiffs' motion for attorney fees.


Plaintiffs filed this lawsuit in May 2009 alleging breach of trust and fiduciary duty against defendant Richard Corey in his role as trustee of the Richard Swendsen Trust. In February 2012 a jury found in favor of Plaintiffs on two claims for breach of fiduciary duty, awarding Plaintiffs $532,776.77 in damages.


1.Defendant's Motion to Amend

One month before trial, Defendant Richard Corey asked the Court for leave to amend his Answer to add affirmative defenses, including a statute of limitations defense. See Dkt. 135. The Court denied the motion as untimely. (Dkt. 135). Now, Corey wants to try again. He asks the Court to amend the pleadings to add the statute of limitations defense pursuant to Federal Rule of Civil Procedure 15(b)(2). In turn, he wants the Court to amend the Judgment to conform with the amended pleading.

Rule 15(b)(2) provides that "[w]hen an issue not raised by the pleadings is tried by the parties' express or implied consent, it must be treated in all respects as if raised in the pleadings." Fed. R. Civ. P. 15(b)(2). Corey argues that evidence on the statute of limitations defense was raised throughout the course of the trial without objection from Plaintiffs. That simply is not true.

First of all, the Court made it clear in denying Defendant's pre-trial motion that the statute of limitations defense could not be asserted at trial. Second, although Plaintiffs were forced to respond to some statute of limitations arguments during trial because of Corey's counsel's persistence, Plaintiffs never consented to trying the issue. Trial is often a fluid process, where the purpose of counsel's questions is not always clear to the other party. Plaintiffs' counsel cannot be said to have consented to trying the statute of limitations issue simply because he may not have consistently objected to a question which was somehow related to the statute of limitations. Plaintiffs' counsel made it clear on the record during trial, and in his filings in opposition to Corey's motion to amend, that Plaintiffs did not consent to trying the statute of limitations issue. Furthermore, when the issue did arise at trial, the Court ruled that even if the statute of limitations was before the Court, it did not apply in this case because it did not begin to run until Corey resigned in late 2010. Under these circumstances, the Court will deny Corey's motion. In turn, the Court will deny his request to alter the judgment.

Finally, the Court will also deny Corey's alternative request for a new trial where he could present the statute of limitations issue. As the Court noted in its earlier decision, Corey should have asserted the statute of limitations defense when the Amended Complaint was filed over a year and a half before trial, or at the very least when he "joined" in Clayne Corey's motion for summary judgment. (Dkt. 135). Corey's failure to timely assert the statute of limitations defense does not justify putting the parties to the expense and delay of retrying this case.

2.Plaintiffs' Motion to Alter Judgment

A judgment notwithstanding the verdict "is proper if the evidence, construed in the light most favorable to the nonmoving party, permits only one reasonable conclusion, and that conclusion is contrary to the jury's verdict." Pavao v. Pagay, 307 F.3d 915, 918 (9th Cir. 2002). "Although the court's ruling on an alternative motion for a new trial involves the exercise of some discretion, a stringent standard applies when the motion is based on insufficiency of the evidence." E.E.O.C. v. Pape Lift, Inc., 115 F.3d 676, 680 (9th Cir. 1997). A motion will be granted on this ground only if the verdict "is against the great weight of the evidence, or it is quite clear that the jury has reached a seriously erroneous result." Id.

A jury's verdict must be upheld if it is supported by substantial evidence. Wallace v City of San Diego, 479 F.3d 616 (9th Cir. 2007). "Substantial evidence is evidence adequate to support the jury's conclusion, even if it is also possible to draw a contrary conclusion from the same evidence." Id. at 624. In making this determination, the Court must not weigh the evidence, but should simply ask whether the party has presented sufficient evidence to support the jury's conclusion. Id. While the Court must review the entire evidentiary record, it must disregard all evidence favorable to the moving party that the jury is not required to ...

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