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Tax Matrix Technologies, LLC v. Wegmans Food Markets, Inc.

United States District Court, E.D. Pennsylvania

April 19, 2017

TAX MATRIX TECHNOLOGIES, LLC, Plaintiff,
v.
WEGMANS FOOD MARKETS, INC., Defendant.

          MEMORANDUM

          EDUARDO C. ROBRENO, J.

         On June 6, 2016, following the conclusion of a six-day jury trial and the rendering of a jury verdict, the Court entered judgment in favor of Plaintiff Tax Matrix Technologies, LLC (“Tax Matrix”) and against Defendant Wegmans Food Markets, Inc. (“Wegmans”) in the amount of $351, 551.86. Tax Matrix now seeks a new trial on damages, or, in the alternative, to mold the verdict to apply pre-judgment interest. Wegmans opposes the motion for a new trial on damages on both procedural and substantive grounds. Wegmans does not oppose the alternative motion to mold the verdict to apply interest, but it disputes the proper amount of that interest. For the reasons that follow, the Court will deny Tax Matrix's motion for a new trial on damages but grant in part and deny in part its motion to mold the verdict to apply pre-judgment interest.

         I. BACKGROUND

         The dispute in this case arose out of a business relationship between Tax Matrix, a tax consulting firm, and Wegmans, a regional supermarket chain. Pursuant to a written contingency fee arrangement (the “Letter Agreement”), Tax Matrix was to provide certain tax consulting services to Wegmans. The lawsuit concerned Tax Matrix's defense of Wegmans during an audit by the State of Maryland that commenced in October 2011 and closed in July 2013 (the “Maryland audit”). The issue before the Court was whether the work performed by Tax Matrix in connection with the Maryland audit fell within the scope of work contemplated by the Letter Agreement, or whether some other, unwritten fee arrangement applied.

         Tax Matrix brought state law claims against Wegmans for breach of contract or, in the alternative, unjust enrichment. Wegmans, in exchange, filed counterclaims against Tax Matrix for breach of an implied covenant of good faith and fair dealing, breach of fiduciary duty, and breach of contract. Both parties moved for summary judgment.

         The Court ultimately concluded that the Letter Agreement was fairly susceptible to different reasonable interpretations as to whether it governed Tax Matrix's services in connection with the Maryland audit, and accordingly, the Court (1) denied summary judgment to Tax Matrix on Tax Matrix's breach of contract claim; (2) denied summary judgment to Wegmans on Tax Matrix's breach of contract claim; and (3) granted summary judgment in favor of Tax Matrix on all of Wegmans' counterclaims.

         II. STANDARDS OF REVIEW

         A. Motion for New Trial on Damages

         After a jury trial, a court “may, on motion, grant a new trial on all or some of the issues--and to any party--. . . for any reason for which a new trial has heretofore been granted in an action at law in federal court.” Fed.R.Civ.P. 59(a)(1). In diversity cases in which state law “governs the claims for relief, ” state law also “suppl[ies] the test for federal-court review of the size of the verdict.” Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 426 (1996)[1]; see also Browning-Ferris Indus. of Vt., Inc. v. Kelco Disposal, Inc., 492 U.S. 257, 279 (1989) (“In reviewing an award of . . . damages, the role of the district court is to determine whether the jury's verdict is within the confines set by state law, and to determine, by reference to federal standards developed under Rule 59, whether a new trial or remittitur should be ordered.”).

         Under Pennsylvania law, which supplies the applicable standard for use in making a Rule 59(a) determination in this case, “[a] trial court may only grant a new trial when the jury's verdict is so contrary to the evidence that it ‘shocks one's sense of justice.'” Neison v. Hines, 653 A.2d 634, 636 (Pa. 1995) (quoting Kiser v. Schulte, 648 A.2d 1, 4 (Pa. 1994)). A damages award “shocks the conscience” if it “simply is not reasonable and bears no rational relationship to the evidence presented at trial.” Davis v. Steigerwalt, 822 A.2d 22, 28 (Pa. Super. Ct. 2003); see also Kiser, 648 A.2d at 4 (“A jury verdict is set aside . . . when it appears to have been the product of passion, prejudice, partiality, or corruption, or where it clearly appears from uncontradicted evidence that the amount of the verdict bears no reasonable relation to the loss suffered by the plaintiff.”).

         B. Award of Pre-Judgment Interest

         28 U.S.C. § 1961(a) provides, in relevant part, that “[i]nterest shall be allowed on any money judgment in a civil case recovered in a district court. . . . Such interest shall be calculated from the date of the entry of the judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding[] the date of the judgment.” 28 U.S.C. § 1961(a). “Under Pennsylvania law, the award of prejudgment interest in a contract action is not discretionary; it is a legal right to which a prevailing party is entitled.” ECEM European Chem. Mktg. B.V. v. Purolite Co., 451 F. App'x 73, 79 (3d Cir. 2011) (citing Fernandez v. Levin, 548 A.2d 1191, 1193 (Pa. 1988)).

         III. MOTION FOR NEW TRIAL ON DAMAGES

         Tax Matrix moves for a new trial on damages pursuant to Federal Rule of Civil Procedure 59 on the basis that “(a) the amount of the verdict was against the weight of the evidence presented at trial; (b) the amount of the verdict was substantially less than was unquestionably proven by Plaintiff's uncontradicted and undisputed evidence; (c) statements made by counsel for Defendant in his opening statement were not supported by evidence submitted at trial; (d) arguments made by counsel for Defendant in his closing argument ...


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