Unpublished Disposition, 860 F.2d 1088 (9th Cir. 1981)

MEMORANDUM^* 

Goethals appeals the district court's grant of Medical Computer Systems, Inc.'s (MCSI) motion for a new trial based on its finding that the jury's verdict was against the weight of the evidence and the damages awarded excessive. We affirm the judgment.

* We review the district court's grant of a new trial only for an abuse of discretion. Seymour v. Summa Vista Cinema, Inc., 809 F.2d 1385, 1387, as amended, 817 F.2d 609 (9th Cir. 1987). The district court may order a new trial, "if, in its opinion, the jury's verdict was clearly contrary to the weight of the evidence," William Inglis & Sons Baking Co. v. ITT Continental Baking Co, Inc., 668 F.2d 1014, 1027 (9th Cir. 1981), cert. denied, 459 U.S. 825 (1982), if the verdict is excessive, Seymour, 809 F.2d at 1387, or if "for other reasons, the trial was not fair to the party moving," Montgomery Ward & Co. v. Duncan, 311 U.S. 243, 251 (1940). Fed. R. Civ. P. 59(a). In this regard, a motion for new trial is to be distinguished from a motion for a directed verdict or judgment n.o.v.: a new trial motion is addressed to the "sound discretion" of the trial court, which may set aside the verdict as contrary to the weight of the evidence, although a directed verdict or JNOV is not justified. See Inglis, 668 F.2d at 1026-27; 6A Moore's Federal Practice, Sec. 59.08 at 59-141-43 (2d ed. 1987).

II

Under California law, common law fraud requires proof that (1) the defendant made a false representation, (2) that he had knowledge of the falsity, (3) that he intended to induce reliance, (4) that plaintiff actually and reasonably relied, and (5) that plaintiff suffered actual damages. Crocker-Citizens National Bank v. Control Metals Corp., 566 F.2d 631, 636-37 (9th Cir. 1978) (citing California cases); Glovatorium, Inc. v. NCR Corp., 684 F.2d 658, 660 (9th Cir. 1982).

At trial, Goethals claimed that certain misrepresentations, made by MCSI representative Joey Pate during a pre-employment interview, induced him to accept a position as a salesman with the company. The alleged misrepresentations related to: (1) the training Goethals would receive; (2) the readiness for marketing of the new IBM Series I and MCSI software product; and (3) MCSI's sales and general competitive position in the field of computerized medical services. Review of the record indicates that although Goethals presented some evidence which may have supported a verdict of fraudulent misrepresentation, the weight of the evidence suggested otherwise.

First, on the matter of training, Goethals testified that Joey Pate assured him that MCSI had a training program "encapsulated" over a four to six week period, which would commence immediately when he arrived at the company in Dallas, and that "included a significant part of hands-on-training." However, substantial evidence was presented, much of it through Goethals' own testimony, that such training was received. This evidence included: expense reports by Goethals, listing trips for "training," "seminars" and "sales meetings"; a videotape of a seminar attended by Goethals discussing the capabilities and applications of the IBM Series I and PDS software; and copies of Goethals' itinerary, indicating that on August 14, 1981, appellant had a "hands-on" opportunity to use the system. Thus, the record indicates that training was received, though not of the sort Goethals anticipated.

Second, Goethals contends the company's representations regarding the readiness of the IBM Series I product were untrue. Evidence introduced at trial, however, supports Joey Pate's assertion that the product was "ready to sell," though again, perhaps not as "ready" as Goethals would have liked. This evidence included: the preparation of a "proposal" to sell the product to Cajon Valley Radiology, an existing customer of MCSI, in September 1981; Goethals' own testimony regarding his "attempts to sell" the product in November and December of 1981, particularly to Physicians' Radiology, a potential client in San Bernardino; and demonstrations of the product to potential clients at two industry conventions, one in New Orleans in October, the second in California in November, both attended by Goethals. Goethals does not refute this evidence, other than to state that although the product was being shown, it was not in its "completed form". This showing fails to demonstrate that Pate's representations were false.

Finally, Goethals contends that Joey Pate's account of the strength of MCSI's competitive position and appellant's prospects during the interview misrepresented material facts, such as declining new sales and the high turnover of sales personnel. The record clearly demonstrates, however, that Pate's representations concerning the financial and professional status of MCSI were not false. Further, insofar as Pate's assertions consisted of "puff talk" or predictions as to future events, these are properly regarded as nonactionable expressions of opinion. See, e.g., Corbett v. Otts, 205 Cal. App. 2d 78, 22 Cal. Rptr. 849, 853 (1962); 34 Cal.Jur.3d, Fraud & Deceit, Secs. 12-15.

In sum, although Goethals presented some evidence that false representations were made to him during his pre-employment interview and that he suffered damages as a result, given the considerable discretion of the district court on a motion for new trial, wherein it may consider the credibility of witnesses and the weight of the evidence, see Fount-Wip, Inc. v. Reddi-Wip, Inc., 568 F.2d 1296, 1302 (9th Cir. 1978); Wright & Miller, Federal Practice and Procedure: Civil Sec. 2531, there was no abuse in granting the motion as to the fraud claim.

III

The first jury awarded $50,000 compensatory and $50,000 punitive damages for fraud, and $50,000 in damages for breach of contract. The district court found that the award was so excessive as to "shock the conscience of the court and to indicate passion and prejudice on the part of the jury."

Goethals concedes that the jury's award on the contract claim was excessive. [Appellant's Reply Brief at 5]. Following the first trial, Goethals stated he would agree to a remittitur to $5,623; in the second trial, the jury awarded $4,040 on the contract claim. Thus, there can be no abuse claimed as to the grant of a new trial on the basis of the excessiveness of the award for breach of contract.

Nor can we say the district court abused its discretion in finding the damages awarded on the fraud claim excessive. If substantial evidence supported the district court's ruling that the verdict as to the fraud claim was against the weight of the evidence, then serious doubt, of course, is cast over the award of actual compensatory damages on the same claim. Further, to sustain a verdict for punitive damages, the defendant must not only have committed a tort but also must have been guilty of malice, fraud or oppression. Hale v. Farmers Ins. Exchange, 42 Cal. App. 3d 681, 117 Cal. Rptr. 146, 153 (1975). Here, Goethals has made a rather inconclusive showing that the company or Pate acted with intent to cause injury, as required under Cal.Civ.Code Sec. 3294(c) (3) (West Supp.1988)¹ . Thus, where the damages award for breach of contract was clearly excessive and insufficient evidence was presented to support the award on the fraud claim, the district court did not abuse its discretionary power in awarding a new trial. See Institute of Veterinary Pathology, Inc. v. California Health Laboratories, Inc., 116 Cal. App. 3d 11, 125, 172 Cal. Rptr. 74, 81 (1981) (even though sufficient evidence presented to support a punitive damage award in action for tortious destruction of business, Court of Appeal deferred to trial court's exercise of discretion in granting new trial); Seymour, 809 F.2d at 1387 (affirming grant of new trial on damages only); 6A Moore, Sec. 59.08 n. 12 at 59-160.

IV

The district court did not abuse its discretion in granting a new trial. The judgment entered after the second trial is AFFIRMED.