The opinion of the court was delivered by: Ambrose, Chief District Judge
OPINION and ORDER OF COURT
Before the Court is Defendants' Motion in Limine to exclude evidence of prior "bad acts" by Defendant Freidt. In particular, Defendants seek to exclude evidence regarding Freidt's use of internal replacement practices, as well as other evidence that does not relate to the sales at issue here. This matter involves external replacement, and therefore, Defendants assert, Plaintiff's exhibits 34 through 39 are irrelevant and inadmissible under Fed. R. Evid. 401 and 402, or otherwise inadmissible under Fed. R. Evid. 403 or 404(b).*fn1
In addition, Defendants challenge the relevance of Plaintiff's exhibits 26, 27, 32, and 40, as unrelated to Plaintiff's allegations. In response, Plaintiff argues that evidence of replacement practices generally, whether internal or external, are relevant and admissible.*fn2
Relevant evidence is evidence that tends to make the existence of any fact that is of consequence to the determination of the action more or less probable than in would be without the evidence. Fed. R. Evid. 401. This definition of relevance is very broad, and does not raise a high standard. Gibson v. Mayor & Council of Wilmington, 355 F.3d 215, 232 (3d Cir. 2004).
Relevant evidence, however, may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury. Fed. R. Evid. 403. Evidence is unfairly prejudicial if it "may cause a jury to base its decision on something other than the established propositions in the case." Carter v. Hewitt, 617 F. 2d 961, 972 (3d Cir. 1980).
Moreover, "[e]vidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show action in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident." Fed. R. Evid. 404(b). This list is not intended to be exclusive; the plain language of Rule 404(b) states that it may be satisfied whenever "other bad act" evidence is offered for a purpose other than proving character and conforming conduct. Our Court of Appeals has recognized that Rule 404(b) is a rule of "inclusion, rather than exclusion," and that the admission of such evidence is favored when offered for any purpose other than propensity. United States v. Daraio, 445 F.3d 253, 263 (3d Cir. 2006).
I first address Defendants' relevance and prejudice arguments under Fed. R. Evid. 401, 402, 403, and 404(b), which relate to evidence of Freidt's replacement practices.
Plaintiff contends that the overall business practice of replacement, or "churning" generally, is relevant to establish the context of the practices at issue, and is also relevant to knowledge, intent, and his claim for punitive damages. Defendants have not explained why the difference in the company originating an existing policy, which is used to fund a new Met Life policy, is significant in terms of the present litigation. Under the liberal definition of relevance that I must apply, the challenged evidence is admissible under Rules 401 and 402. Moreover, I find no reason to exclude the evidence under Rule 403. The danger of unfair prejudice does not outweigh the probative value of the evidence. Any potential prejudice may be cured by cross-examination regarding the difference between the two subcategories of replacement practice. I will also consider a proposed limiting instruction to the jury, if necessary.
Defendants also, however, argue that the evidence is prohibited under Rule 404(b). Of course, Plaintiff does not contend that the evidence of Freidt's internal replacements will be offered to prove that he engaged in internal replacement in this case.*fn3 Plaintiff argues instead that evidence of replacement practices generally are relevant here, and that at a minimum, the evidence goes to Defendants' knowledge and intent, and to Plaintiff's claim for punitive damages. These are proper purposes under Rule 404(b), and an inference of Freidt's propensity is ...