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Bright Harvest Sweet Potato Company, Inc. v. Hj Heinz Company, Lp

United States District Court, D. Idaho

March 12, 2015

BRIGHT HARVEST SWEET POTATO COMPANY, INC., Plaintiff,
v.
H.J. HEINZ COMPANY, L.P., Defendant.

MEMORANDUM DECISION AND ORDER

B. LYNN WINMILL, Chief District Judge.

INTRODUCTION

The Court has before it three motions in limine filed by Plaintiff Bright Harvest Sweet Potato Company, Inc. (Dkts. 85, 86, 110). The Court will address each motion below.

ANALYSIS

1. Plaintiff's First Motion in Limine Re: Conduct of Plaintiff.

Bright Harvest requests the Court exclude evidence that it breached or failed to adequately perform under the Co-Pack Agreement ("CPA"). (Dkt. 85). The May 3, 2011 Settlement Agreement indeed bars claims of breach before April 25, 2011. However, evidence of documents, statements, and actions prior to that date may be relevant for another purpose. At this point, the Court is unable to rule on the admissibility of such evidence. Bright Harvest insufficiently describes the evidence it wishes to exclude in order for the Court to make an informed ruling. As such, the Court will reserve ruling on the motion until trial.

Both parties stated they will not claim a breach occurred prior to April 25, 2011. To the extent that Heinz seeks to introduce evidence of Bright Harvest's actions and statements for another purpose, it should be prepared to show why such evidence is otherwise admissible. The Court will resolve any dispute on this issue outside the presence of the jury.

The Court will note, however, its concern that such evidence may result in re-litigating a previously settled claim. If necessary, the Court will instruct the jury on the limited purpose for such evidence. Additionally, the Court will consider the rule of completeness when determining the admissibility of evidence at trial. Exhibits may not be redacted to change the exhibit's meaning. The Court must tread carefully to avoid redacting necessary context to ensure that events and decisions are not misleading to the jury. Finally, the Court will balance the prejudicial effect of the evidence with its probative value.

Bright Harvest also claims four exhibits are inadmissible compromise statements and settlement offers. Specifically, Bright Harvest asks the Court to exclude BH003902-03 (Ex. 2105), BH004318-25 (Exs. 2093, 2094), and Heinz002417-19 (Ex. 2098). The Court will address each of these exhibits in turn.

Rule 408 prohibits evidence of conduct or statements made during compromise negotiations "to prove or disprove the validity or amount of a disputed claim or to impeach by a prior inconsistent statement or a contradiction." FED. R. EVID. 408. However, "[t]he court may admit this evidence for another purpose, " so long as it weighs the policy considerations behind Rule 408 with the need for the evidence. Id. Rule 408 is founded on two main policies: (1) "[t]he evidence is irrelevant since the offer may be motivated by a desire for peace rather than from any concession of weakness of position, " and (2) "promotion of the public policy favoring the compromise and settlement of disputes." FED. R. EVID. 408 advisory committee's note; see also Philadelphia's Church of Our Savior v. Concord Township, No. Civ. A. 03-1766 2004 WL 1824356 (E.D. Pa. July 27, 2004).

The Court applies Rule 408 to avoid deterring compromise and settlement of disputes. Nevertheless, Rule 408 does not apply to all statements made during compromise negotiations-only statements about the claim. FED. R. EVID. 408. Additionally, these statements must be made during negotiations and not made in the regular course of business. Id.

Exhibit 2093 is a letter from Rex King to Jonathan Bailey discussing Heinz's production volumes. Def.'s Opp'n, Dkt. 97, at 19-26. Exhibit 2094 is an annotated copy of that letter. Id. Bright Harvest argues that Exhibits 2093 and 2094 are compromise communications because "Mr. King offers to resolve the dispute through Defendant restoring the current 2010 crop year production to the previously forecasted level while dropping the production level for the 2011 crop year." Pl.'s Reply, Dkt. 106, at 5. However, Bright Harvest mischaracterizes the letter. The letter is not a statement made during compromise negotiations; it is a performance letter demanding Heinz comply with its commitments and other obligations under the CPA. In the letter, King discusses production volumes, rolling forecasts, and Heinz's requests to procure additional raw sweet potatoes. As evidenced by the line "[w]e cannot accept however that Heinz feels that it can walk away' from commitments to Bright Harvest for the 2010 crop year, " Bright Harvest sent this letter to demand performance from Heinz. Def.'s Opp'n, Dkt. 97, at 19-26. Although Bright Harvest states that it may "have to explore [its] legal position, " it did not propose a settlement to a pending claim. Id. Instead, it engaged in business communications with Heinz regarding Heinz's commitment to purchase potatoes in 2010. Therefore, the letter is not a "statement made during compromise negotiations about the claim." Consequently, the Court will not exclude Exhibits 2093 and 2094 under Rule 408.

Next, Exhibit 2098 is an April 5, 2011 letter from Donald Kerr to Jonathon Bailey. Heinz does not object to exclusion of this Exhibit, so long as Plaintiff's identical Exhibit 1041 is also excluded. Def.'s Sur-Reply, Dkt. 119, at 9. Accordingly, the Court grants Bright Harvest's motion.

Finally, Exhibit 2105 includes two e-mails - one from Rex King addressed to Tim Hensley and Johnathan Bailey, and the other sent from Jonathan Bailey to Rex King in response. The e-mails were written on April 26, 2011 as a follow up to April 25, 2011 settlement negotiations between Bright Harvest and Heinz. Bright Harvest contends that these e-mails discuss "a significant contractual dispute between Bright Harvest and Heinz" and were sent "during negotiations [commenting] on Bright Harvest's claim and damages." Pl.'s Reply, Dkt. 106, at 5. In particular, Bright Harvest focuses on the language in the first e-mail that reads, "there has been a violation of the agreement and that needs to be remedied." Def.'s Opp'n, Dkt. 97, at 27. Heinz, in response, maintains that the ...


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