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USCA1 Opinion

January 27, 1995

UNITED STATES COURT OF APPEALS


UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT
__________________

No. 94-1490
FLEET NATIONAL BANK,
Plaintiff,
v.
ANCHOR MEDIA TELEVISION, INC.,
AND KOVR OF DELAWARE, INC.,
Defendants, Appellants.
__________________
NARRAGANSETT CAPITAL, INC.,
AND EDWIN PFEIFFER,
Defendants, Appellees.
__________________

ERRATA SHEET
ERRATA SHEET
The opinion of
amended as follows:

this court

issued on January

26, 1995,

is

The second sentence of the first full paragraph on page 25


should be deleted, and the following two sentences should be
inserted in its place:
And the only other evidence of
a representation
regarding commercialization levels at KOVR introduced
by Anchor at the second trial was the so-called
July/August 1988 day-part summary, a document that
summarized commercialization levels and commercialgenerated income by day and time (e.g., 7/25, 8:00-9:00

p.m.) for July and August 1988.


The July/August 1988
day-part summary allegedly misrepresented that KOVR was
undercommercialized in July
and August 1988
and
___________________
understated commercial-generated income during this
same period.

UNITED STATES COURT OF APPEALS


UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT
____________________
No. 94-1490
FLEET NATIONAL BANK,
Plaintiff,
v.
ANCHOR MEDIA TELEVISION, INC.,
AND KOVR OF DELAWARE, INC.,
Defendants, Appellants.
___________________

NARRAGANSETT CAPITAL, INC.,


AND EDWIN PFEIFFER,
Defendants, Appellees.
____________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Francis J. Boyle, Senior U.S. District Judge]
__________________________
____________________
Before
Cyr, Circuit Judge,
_____________
Bownes, Senior Circuit Judge,
____________________
and Stahl, Circuit Judge.
_____________
____________________

Stephen M. Sacks, with whom Tim Atkeson, Arnold & Porter, Anth
________________
____________ _______________ ____
F. Muri, and Goldenberg & Muri were on brief for appellants.
_______
_________________
Charles I. Poret, with whom Richard M. Sharfman, Mark J. Kenn
________________
____________________ _____________
A. Lauriston Parks, Sharfman, Shanman, Poret & Siviglia, P.
____________________
____________________________________________
Severson & Werson, and Hanson, Curran, Parks & Whitman, were on br
_________________
_______________________________
for
defendants-appellees Narragansett
Capital, Inc.
and Ed
Pfeiffer.
____________________
January 26, 1995

____________________

BOWNES,
BOWNES,
appellants

Senior Circuit Judge.


Senior Circuit Judge.
_____________________

Anchor

Media

Television,

In

Inc.

this appeal,

("Anchor"), and

KOVR-TV of Delaware, Inc. ("KOVR"), contend that the district


court committed several legal and discretionary errors in the
course of two trials of their
contract

against

("Narragansett"),

claims of fraud and breach

appellees

Narragansett

KOVR's former

KOVR's former general manager.

owner, and

Capital,

of
Inc.

Edwin Pfeiffer,

After carefully reviewing the

record and considering appellants' arguments, we affirm.


I.
I.
__
BACKGROUND
BACKGROUND
__________
The
litigation
opinion

by

complicated

has been

factual

predicate

meticulously rehearsed

the district

court.

See

in a

Fleet Nat'l

of

this

published
Bank v.

___

_________________

Anchor Media Television, Inc., 831 F. Supp. 16, 21-31 (D.R.I.


_____________________________
1993).

It

will be

reiterated

here

only

to the

extent

necessary to resolve the issues before us.


The case
Anchor of KOVR, an
in Sacramento,

arises

of

California.

1988.

Anchor was awarded

high bid

at a closed

The sale price

by the parties was $162 million.


a

Narragansett's

ABC-affiliate television station

after submitting the


late September

out

sale

to

located

the station

auction held

in

eventually agreed upon

The deal

was structured as

merger of an Anchor subsidiary into the corporate owner of

KOVR, and became final on January 25, 1989.

The terms of the

-22

merger

were

memorialized

in

Agreement") dated October 12, 1988.


district court

merger

("the

The case came before the

as an interpleader action

Fleet National Bank ("Fleet").

agreement

filed by plaintiff

Fleet controlled a $5 million

escrow account established by the Agreement to address claims


that might arise from
asked the
the

KOVR's sale.

district court

escrow funds.

In its

complaint, Fleet

to determine proper

allocation of

and Narragansett,

among others,

Anchor

were named as defendants to the action.


Subsequently,

Anchor

Narragansett and Pfeiffer,


and

common

allegations
cash

law

alleging breach of

fraud.1

the

actually running
while

commercials

cross-claims

Underlying

against

the Agreement

these

claims

were

that Narragansett had fraudulently increased its

flow in

industry

filed

than

months preceding

the

auction by:

more commercials than was


representing

that

was customary

it

was

(1)

customary in the
running

fewer

("the overcommercialization

allegation"); (2) running local commercials at a time when it


was

contractually obliged

("the
shifting

ABC
to

newsbrief
subsequent

to

be running

allegation");
years

certain

an ABC

(3)

newsbrief

surreptitiously

operating

expenses

____________________
1. Pfeiffer also brought a cross-claim against Anchor for
breach of his employment contract. The subject matter of
this claim is not before us.
-33

incurred

as

result

Research2

("the

political

candidates

advertisements

of

Nielson

a contract

with

allegation");

and

too

much

money

Nielson
(4)

to

run

Media

charging
political

("the political advertising allegation").

We

discuss the particulars of these allegations infra.


_____
Anchor claimed that these
effect

upon

its

bid,

accordance

with

i.e.,

taking

by

standard
the

(essentially, profit)
multiplier")

which

which

practices had a damaging

was

largely

industry

formulated

valuation

projected

appropriately

it by a

accounted

from January 1,
information
September 1,

enabled

flow

number ("the
certain

In projecting

used actual cash flow figures

1988 through August 31,

which

cash

for

characteristics inhering in the target market.


year-of-sale cash flow, Anchor

practices --

year-of-sale

and multiplying

in

it

1988, and financial

to project

1988 through the end

cash

of the year.

flow

from

All of the

information on which Anchor relied in formulating its bid was


generated prior to September 28,

1988, the day on which

the

bid was submitted.


Put

in

Narragansett's
(quantified

concrete

terms,

fraudulent inflation

at trial

as being

Anchor
of its

at least

argued

that

1988 cash

flow

$1,943,000) caused

Anchor to bid at least $27 million more for

the station than

____________________
2. Nielson Media Research is a rating service that monitors
audience viewership of a television station.
Fleet Nat'l
___________
Bank, 831 F. Supp. at 28.
____
-44

it would have absent


by taking

the amount

and multiplying it
valuing the

the fraud.

Anchor reached

this number

of improperly-obtained 1988

by 13.6,

the multiplier it

Sacramento market.

This "effect

cash flow

had used
on the

in
bid"

constituted Anchor's theory of damages.3


____________________
3. We have some doubts about the viability of Anchor's
"effect on the bid" damages theory in the context of this
case. The parties agree that Rhode Island law, which governs
Anchor's fraud claim, applies the "benefit of the bargain"
rule in assessing damages for fraudulent misrepresentations
inducing a party to contract for the purchase of property.
See Barnes v. Whipple, 68 A. 430 (R.I. 1907).
Under this
___ ______
_______
rule, the defrauded purchaser is entitled to recover the
difference between the actual value of the purchased item and

its value

had the seller's

representations been true.

Learjet Corp. v. Spenlinhauer,


______________
____________
1990) (applying Kansas law);

901 F.2d 198,

See
___
203 (1st Cir.

see also J. F. Rydstrom,


___ ____
Annotation, "Out of Pocket" or "Benefit of Bargain" as Proper
________________________________________________
Rule of Damages for Fraudulent Representations Inducing
_____________________________________________________________
Contract for the Transfer of Property, 13 A.L.R. 3d 875, 885
______________________________________
(1967). This value differential is measured at the time of
the sale. Learjet Corp., 901 F.2d at 203.
_____________
When (as is usually the case) the negotiation of the sale
price immediately precedes the consummation of the sale, the
effect of the seller's fraud on the purchase price will
almost invariably quantify the difference between the actual
value of
the purchased item
and its value
had the
representations been true. Here, however, the consummation
of the sale (i.e., the merger) took place nearly four months
after the negotiation of the sale price, at a time when fluid
_____
market conditions (there was much testimony to this effect)
might have led a buyer to utilize a different multiplier than
_________
the one Anchor used in formulating its bid.
Moreover, the
merger took place in a calendar year different from the one
_________
in which the sale price was negotiated.
A buyer applying
Anchor's valuation theory at the time of merger therefore
__ ___ ____ __ ______
would presumably have been looking at a different period of
time in projecting cash flow than the one at which Anchor
looked. Thus, it strikes us as somewhat speculative to infer
that the effect Narragansett's fraud had on Anchor's 1988 bid
accurately quantifies the difference between the actual value
of KOVR on January 25, 1989 (the date of the merger) and its
putative
value
on
that
date
had
Narragansett's
representations been true.
-55

A. The First Trial


A. The First Trial
___________________
A jury trial commenced on April 2, 1991, and lasted
fourteen

trial

days.

In

the

course

of

the trial,

the

district court ruled, as a matter of law and for a variety of


reasons,
the

that a reasonable jury

Agreement

or

fraud

advertising allegation.

on

could not find

the

basis

of

a breach of

the

political

The court did, however, allow Anchor

to present to the jury, as the predicate for its contract and


fraud

claims,

overcommercialization,
allegations.4

At the

the

evidence
ABC

It also

newsbrief,

and

trial's conclusion, the

Anchor $4.5 million for breach


for fraud.

underlying

its
Nielson

jury awarded

of contract and $13.5 million

awarded Anchor $1

million in

punitive

damages.
Subsequent to this verdict, and
then-Fed. R.
for

judgment

Civ. P. 50(b), Narragansett


notwithstanding

the

in accordance with
and Pfeiffer moved

verdict

or,

in

the

____________________
In any event, Narragansett has not raised the absence of
proof of damages as an alternative ground for affirmance.
Because this issue is somewhat involved and has not been
argued, and because we believe that affirmance is otherwise
compelled on the record and briefs before us, we do not delve
further into the damages question at this time.

4. In so stating, we reject Anchor's contention on appeal


that the Nielson allegation did not constitute part of its
breach of contract claim.
In fact, we find this argument
difficult to fathom. In his closing argument, Anchor's trial
counsel
clearly asserted
that the
alleged subterfuge
involving the Nielson contract constituted a breach of the
Agreement.
-66

alternative, for a new


the

record,

advisement

the

trial.

district

For reasons not

court

kept

disclosed by

this

motion

for more than two years, until June 1993, when it

issued Fleet Nat'l Bank.


________________
In

addressing

See 831 F. Supp. 16.


___
the

Rule 50(b)

motion,

the court

first held that Narragansett and Pfeiffer were entitled


new trial on
34-38.

based

Anchor's breach of contract claim.

While

sufficient
on

under

the

court

believed

evidence to support
the ABC

newsbrief

that

the jury's

to a

See id. at
___ ___

there

had

been

contract verdict

allegation, id.
___

at

34-36, it

determined that the evidence did not permit a reasonable jury


to

find

breach

of contract

on

the

basis

of either

the

overcommercialization
and

43 n.6.

that

In

or Nielson

allegations, id.
___

making this determination,

Narragansett

and

Pfeiffer

the court ruled

had

not

representations or warranties in the Agreement


__ ___ _________
number

made

any

regarding the

of commercials KOVR had broadcast in 1988, id. at 36___

37, and
Anchor

at 36-37

that the Nielson


had

alleged

failed

to

allegation was not


prove justifiable

misrepresentation, id. at 43
___

ordered because

the general verdict

n.6.

viable because

reliance
A

on

the

new trial was

form did not

allow the

court to ascertain whether the jury had relied on the legally


defective allegations in reaching
at

37-38

(citing,

inter
_____

its contract verdict.

alia, Sunkist Growers, Inc.


____ _______________________

Id.
___
v.

Winckler & Smith Citrus Prods. Co., 370 U.S. 19, 29-30 (1962)
__________________________________

-77

and Brochu v. Ortho Pharmaceutical Corp., 642 F.2d


______
___________________________

652, 662

(1st Cir. 1981)).


The court also held that Narragansett was
to a

new trial on Anchor's

While

the

court believed

evidence to
regard

fraud claim.

to

that

there

support the jury's


the

ABC

and

id. at 38-44.
___

had been

verdict on

newsbrief

allegations, it ruled

See
___

entitled

sufficient

this claim

with

overcommercialization

that the defective Nielson

allegation

may have poisoned the general fraud verdict beyond cure.

Id.
___

at 42-43.
Finally,
damages award

the

court

as lacking

negated

the

jury's punitive

evidentiary support.

Id.
___

at 45.

Anchor does not challenge this ruling on appeal.


B. The Second Trial
B. The Second Trial
____________________
In accordance with the district
second jury

trial commenced

eleven trial days.


the

court ruled

on March

court's opinion, a

21, 1994, and

Prior to submitting the case to the jury,


as a

50(a), that Anchor's

matter of

law, see
___

Fed. R.

jury in support of its fraud

and

newsbrief

Anchor's ABC

presented to the jury in support


court based
not

proven

Civ. P.

overcommercialization allegation

not be presented to the


that

lasted

allegation

in

claim,

could not

of its contract claim.

these rulings on determinations


damages

could

connection

be
The

that Anchor had


with

its

overcommercialization

allegation,

and that

Anchor

had not

notice of

the ABC

-88

provided

Narragansett and

newsbrief

allegation

contemplated
Anchor's

by the

attempt

allegation at

Pfeiffer with

within

the

fifteen-day

Agreement.5
to

revive

this time.

The
its

time

court also
political

Thus, only Anchor's

period
rebuffed

advertising
fraud claim,

now based solely on the ABC newsbrief allegation, went to the


jury.

The jury

and Pfeiffer on
took

the

returned a verdict in favor


this claim.

apparently

After the

unprecedented

verdict's beneficiaries judgment


same claim.
on

verdict, the

step

of

as a matter

court

granting

the

of law on

the

In so doing, the court stated that it was ruling

the reserved

instructions

of Narragansett

motion

could be

so

that

ignored

This appeal followed.


II.
II.

in

any

error

subsequent

in

the

jury

proceedings.

___
STANDARD OF REVIEW
STANDARD OF REVIEW
__________________
We
matter.

first

Rule

proceedings

deal

50 was

before

the

with

amended

technical,
during

district

the

court.

nomenclature
course of

The

the

amendments

abandoned the terms "directed verdict" and "judgment n.o.v.,"


which were commonly associated with the former Rule, in favor
of the phrase

"judgment as a matter of law."

See generally
___ _________

____________________
5. Section 8.5 of the Agreement required any party with a
claim arising out of the Agreement to send a notice of claim
to the breaching party within fifteen business days of coming
to the belief that it had suffered damages in connection with
the claim.
-99

Fed. R. Civ. P. 50 advisory committee's note.


did

not,

however,

affect

either

the

district courts review motions brought


standard

The amendments

standard

by

which

under the Rule or the

by which we review a district court's rulings.

See

___
id.
___

("If

a motion

verdict

or for

party's

error is

treated

as

motions,

denominated

judgment

however

Such

for judgment

with this
refer to

a motion

notwithstanding

merely formal.

a motion

accordance
therefore

is

rule.").

For

Narragansett's
denominated

as

at

for

directed

the verdict,
a motion

a matter

should be
of

law in

simplicity's sake,
and

Pfeiffer's

the time

of

the

we

various

filing,

as

motions for judgment as a matter of law.


To

the

district court's
Pfeiffer

extent

that

post-trial

were entitled

Anchor

is

rulings that

to judgment

certain issues, our review is de


__

as a

novo.
____

challenging

the

Narragansett

and

matter of

See Lama v.
___ ____

law on
Borras,
______

16 F.3d 473, 477 (1st Cir. 1994) (affirming denial of a postverdict Fed. R. Civ. P. 50(b) motion for judgment as a matter
of law); Rolon-Alvarado v.
______________
74,

77 (1st Cir.

Municipality of San Juan,


________________________

1993) (affirming grant of

50(a) motion for judgment as a


plaintiff's case).

scrutinizing

therefrom

in

the

light

Fed. R. Civ. P.

matter of law at the close of

Thus, we will affirm

if, after

1 F.3d

the proof
most

these rulings only

and inferences
hospitable

to

derivable
Anchor,

we

determine that a reasonable factfinder could have reached but

-1010

one conclusion:
to judgment.
order

that Narragansett and Pfeiffer were entitled


See Lama, 16 F.3d at 477.
___ ____

granting Narragansett

and

Because the court's

Pfeiffer a

new trial

was

based solely upon its legal conclusions that defective claims


______
had been allowed

to go to the

jury, we first

determine the

correctness of the court's rulings in this regard.


If
were

we decide

correct,

our

circumscribed.

that the
review

Where

the

court's legal

becomes
trial

conclusions

significantly
court

has

more

correctly

determined that legal error infected a claim presented to the


jury, we will defer to the
was called for on
See
___

court's judgment that a new trial

that claim absent an abuse

Allied Chem. Corp. v.


___________________

Daiflon, Inc.,
_____________

of discretion.
449 U.S.

33, 36

(1980) (per curiam); see also Payton v. Abbott Labs. 780 F.2d
___ ______
___ ____ ______
____________
147, 152 (1st
Miller,

Cir. 1985); 11

Charles A. Wright &

Federal Practice and Procedure,


_______________________________

(1973) (deference

is appropriate because

2818,

Arthur R.
at 119-20

"[t]he trial judge

was on the spot and is better able than an appellate court to

decide whether

the error affected the

substantial rights of

the parties").
Deference in this
for

two reasons.

First,

case is particularly appropriate


in

its published

district court explicitly cited as controlling


cases

which make

verdicts

clear

that courts

in only the most

opinion,

the

authority two

should set

aside jury

compelling of circumstances.

See
___

-1111

Fleet Nat'l Bank, 831


__________________

F. Supp.

at

32 (citing

Coffran v.
_______

Hitchcock Clinic, Inc., 683 F.2d 5, 6 (1st Cir.) (trial judge


______________________
may not set aside jury verdict merely because s/he would have
reached a different conclusion

than the jury), cert. denied,


_____ ______

459 U.S. 1087 (1982), and Borras v. Sea-Land Serv., Inc., 586
______
____________________
F.2d 881, 886 (1st Cir. 1978) (trial court may set aside jury
verdict only

where verdict

(1) is

against clear weight

of

evidence; (2) is based


will

upon evidence which is false;

result in a miscarriage

of justice)).

or (3)

And second, in

that same opinion, the

court clearly stated its

reasons for

ordering a new trial.

See id. at 37-38 and 43


___ ___

(court could

not

tell

whether

erroneously

jury

submitted

had

awarded

evidence

or

Anchor

damages

improperly

on

allowed

arguments).
Finally,
excluding

we review

evidence

the

offered by

discretion standard.

district court's

Anchor

under

to

affirm

the abuse

of

E.g., Fairfield 274-278 Clarendon Trust


____ _________________________________

v. Dwek, 970 F.2d 990, 995 (1st Cir. 1992).


____
free

rulings

the

trial

judge's

Moreover, we are

decisions

"on

any

independently sufficient ground made manifest by the record."


See,
___

e.g., Ticketmaster-New York, Inc.


____ ____________________________

v. Alioto,
______

26 F.3d

we review

Anchor's

201, 204 (1st Cir. 1994).


With these

criteria

in mind,

claims.
III.
III.
____

-1212

DISCUSSION
DISCUSSION
__________
Anchor makes
which we

a number

rearrange for ease

trial, Anchor contends:


the evidence was
found fraud

of arguments, the

of analysis.

As to

the first

(1) the court erred in deciding that

insufficient for a reasonable

based on the

could not, at any

order of

Nielson allegation;

jury to have
(2) the

jury

rate, have relied upon this

allegation in

reaching its contract and fraud verdicts;6 and

(3) the court

erred in ruling post-trial


allowed

to

raise

the

that Anchor should not have

issue

of

been

overcommercialization

in

connection with its breach of contract claim.

district

As to

the second trial,

court

improperly

Anchor asserts:

prohibited

its

(1) the

witnesses

from

testifying regarding customary levels of commercialization in


the industry;
the jury

its

allegation; (4)
of mind"
learned

otherwise erred in

the fraud claim based

allegation; (3)
renewing

(2) the court

based

on

the

precluded Anchor from


political

advertising

the court improperly excluded certain "state

evidence relevant
that

on the overcommercialization

the court erroneously


claims

taking from

it had

to the question

suffered damages

as

of when

Anchor

a result

of the

improper

running

of

local

commercials

during

the

ABC

____________________
6. We have already rejected Anchor's argument that the
district court erred in assuming that the Nielson allegation
partially undergirded the breach of contract claim.
See
___
supra note 4.
_____
-1313

newsbrief time slot; (5) the court


from the jury the breach

of contract claim based on

newsbrief allegation; (6) the


jury on the

one issue --

otherwise erred in taking


the ABC

court erred in instructing the

fraud based on

the ABC

newsbrief

allegation -- the jury was permitted to consider; and (7) the


court was without the power to grant
law to Narragansett

judgment as a matter of

and Pfeiffer after the jury had returned

a verdict in their favor on this issue.


A. Alleged First Trial Errors
A. Alleged First Trial Errors
______________________________
1. Legal Viability of the Nielson Allegation
_____________________________________________

Anchor
determining

that

reasonable jury
allegation.
involved

As

first

argues

that

the

evidence

was

to have

found

court

surreptitious

erred

in

for

insufficient

fraud based

previously stated,

the claimed

the

on the

Nielson

the Nielson

allegation

shifting to

subsequent

years of certain 1988 operating expenses incurred as a result


of

contract

Research.

between

Narragansett

and

Nielson

Media

The specifics of the allegation are as follows.


Sometime after

August 3, 1988, at

the time Anchor

was preparing to submit its bid, Narragansett supplied Anchor


with

a box

KOVR.

One

monthly

that contained

contracts involving

of these was the Nielson contract,

amount

service.

hundreds of

that KOVR

would

Attached to the contract

On the first

page of

pay

which set the

for Nielson's

rating

was a two-page appendix.

the appendix, in

a section

captioned

-1414

"Base

Rate per Month," the figure "$10,000" was typed in the

space provided
1989.

An

asterisk

corresponding
read

for the

time period May


was

note, typed

"see attached

letter

next

to

1988 through

this

at the bottom

figure,
of the

dated 4/7/88."

April
and

same page,

No letter

was

attached to the contract.


The

second

page

computation worksheet.

The

"Base Rate per Month."


space.

of

the

appendix

included

worksheet included a

space for

The figure "$3,000" was typed in this

Further down the page was a space captioned "Monthly

Adjustment (estimated) as of May 1988."


which represented 3% of
this space.
"Estimated

Directly

the base monthly rate, was


beneath

this was

Monthly Net Charge as

"$3,090.00," which

The figure "$90.00,"

a space

of May 1988."

represented the Base Rate

typed in
captioned
The figure

per Month plus

the Monthly Adjustment, was typed in this space.


The
provided

for on the first

was explained
only

discrepancy

between

the

and second pages

in the 4/7/88 letter,

after taking control of KOVR.

of the appendix

This letter memorialized


request to defer until

following year $7,000 per month in payments owed for the

period

May

through

Narragansett's failure
box

monthly rates

which Anchor discovered

Nielson's agreement to Narragansett's


the

base

of contracts

December

1988.

to include

involving

Anchor

the 4/7/88 letter

KOVR amounted

-1515

alleged

to a

that
in the

fraudulent

concealment of the deferral of 1988


attempt

to

inflate

misrepresentations
figure

typed on

1988

were
the

appendix,

and

officials

(including

cash

the

first

subsequent

operating expenses in an
flow.

"$10,000"
page

The

base

of the

Pfeiffer),

Agreement, that Narragansett had

both

monthly

Nielson

representations

alleged

by

oral

rate

contract

Narragansett
and

in

the

provided Anchor with a true

and complete set of contracts relating to KOVR.


In its order on the motions filed subsequent to the
first trial, the district court stated that, in order to make
out a

fraud

here),

claim under

Anchor was

Rhode

Island law

required to

prove that

(which

governs

Narragansett and

Pfeiffer knowingly misrepresented a material fact with intent


to deceive,
the

thereby inducing

misrepresentation to

Bank, 831 F. Supp. at 38.


____
light

of the

4/7/88
the

its

Anchor to rely
detriment.

The court then

asterisk referring

letter and the two

Nielson contract

justifiably on
See Fleet Nat'l
___ ____________

concluded that, in

interested readers

statements on the

appendix

referencing

to the

second page of
a

$3,000

base

monthly
found

rate for
that

Anchor

representation on
appendix.

May 1988,

no

reasonable jury

justifiably

the first

relied

page of the

on

could have
the

$10,000

Nielson contract's

See Fleet Nat'l Bank, 831 F. Supp. at 42-43.


___ ________________
Regardless

justifiable,

we

of

whether

regard

as

Anchor's

independently

reliance
supported

was
the

-1616

district court's conclusion that the fraud claim based on the


Nielson

allegation was not

F.3d at 204.

Under

cannot attach

unless

intentionally

made with

legally viable.

Rhode Island law,

Providence Loan Co.,


____________________
Clothing Co., Inc. v.
____________________

the

236

liability for

misrepresentation
an

intent to
A.2d

at 641;

Di Santo,
________

148

1959); Campanelli v. Vescera, 63

See Alioto, 26
___ ______

at

issue

was

See
___

East
____

deceive.
see
___

also
____

A.2d 273,

fraud

Cliftex
_______
275 (R.I.

A.2d 722, 723 (R.I.

1949);

__________

_______

Cheetham v. Ferreira, 56 A.2d


________
________
view,

the same

asterisk,

representations

reference

statements of the
court

was not

to

the

that

justifiable compel

deceive.

could reasonably

letter --

to

such an
the

on the
__ ___

there
the

forth on the very


____

intent

box

of

Accordingly, we

documents

(i.e.,

the

and

same page
____ ____

led the district


on the

that the
made with

document

as the

jury
is

--

an
the

crucial alleged

base monthly rate is twice


_____

involving

-1717

$10,000

where there

the addendum, and where

the exclusion of

affirm the court's

correct

not think a

term-altering

next page of
____ ____

is no evidence that

our

the conclusion

put, we do

misrepresentation, where the true


set

letter,

In

were not intentionally

Simply

infer

explicit reference
4/7/88

4/7/88

Anchor's reliance

alleged misrepresentations
an intent to

and references

base monthly rate) which

to determine

figure

861, 864 (R.I. 1948).

KOVR

the letter from


was

grant of

intentional.
judgment as

matter of law to Narragansett and

Pfeiffer on Anchor's fraud

claim based on the Nielson allegation.


2. Effect of the Nielson Allegation on the Verdict
___________________________________________________
Anchor

makes

Nielson allegation,

an

alternative

and its

argument

that

the

supporting evidence, could

not

possibly have influenced the jury's verdict on its


contract

and

introduced

fraud

little

claims.

Anchor

evidence

in

breach of

contends

support

of

that

the

it

Nielson

allegation at trial, and that it did not quantify the damages


arising

out of

it

during its

contention,

Anchor

asserts

jettisoning

the contract

closing.

that

the

and fraud

Relying
district

verdicts,

on
court,

this
by

allowed "the

tail to wag the dog."


Although the Nielson allegation was not the primary
focus

of Anchor's case, a

shows

that

opening and

first trial record

Anchor specifically

mentioned

closing arguments.

Moreover, Anchor

the allegation by having


Officer,

review of the

testify

incompleteness

contract and explain

to the

jury that the

4/7/88

the

from

fraudulently "presented to
they should have because

in both

its

supported

Patrick Murphy, its Chief Financial


the

letter

to

it

of

the

Nielson

omission of

the

involving

KOVR

cash flow than

what

of the shifting of expenses."

And

box of

contracts

us a larger

while Anchor

did

arising out

of the

not

quantify

for the

Nielson allegation,

jury

the

damages

it did provide

the

-1818

jury with a

damages theory

cash flow multiplied


arriving

at

(i.e., improperly-obtained

by 13.6, the multiplier Anchor

its bid)

by which

the

jury could

rationally have quantified the damages for itself.


of all this, and in the

that the district court

used in

easily and
In

absence of any suggestion on

that a remittitur would have been appropriate, we

1988

light
appeal

cannot say

abused its discretion in determining

that the general fraud and contract verdicts

returned at the

conclusion

been

infected

of
by

the
the

first
legally

trial

may

deficient

have

Nielson

incurably
allegation.

Accordingly, we affirm the district court's decision to award


Narragansett and Pfeiffer new trials on Anchor's contract and
fraud claims.
3.
The Breach of Contract Claim Based on the
___________________________________________________
Overcommercialization Allegation

________________________________
As

we have noted,

a second basis

aside of the contract verdict


trial

determination that

warranties

in

commercials

the

had

submission of its bid.


reaching

this

there were

been

no representations

regarding
running

the

prior

number
to

or
of

Anchor's

Anchor claims that the court erred in

conclusion,

provisions which,

was the district court's post-

Agreement

KOVR

for the setting

denoting

three

contractual

in its view, a reasonable juror could have

construed as pertaining to 1988 commercialization levels.


The first

of these provisions, which

at paragraph 5.1(a) of the

can be found

Agreement, and which is captioned


-1919

"Conduct
"Except as
the

of

the

Business

Until Effective

[Anchor] may otherwise consent

Effective

Time

[Narragansett]

will
____

Time,"

states:

in writing, until
(i)

operate

its

business only in the usual, regular and ordinary manner . . .


."

(Emphasis supplied).

Plainly,

through its

use of

the

future

tense "will,"

this

representation

covers only

the

period of time between the date of the Agreement, October 12,


1988, and the date the
1989.

Thus,

otherwise,7
pertaining
prior
_____

despite

paragraph

Anchor's
5.1(a)

attempts

simply

to Anchor's submission of
__

inflated

cannot

convince
be

its bid) when

too many commercials at KOVR

amount Anchor bid for the station.

damages

to

read

25,
us
as

to the period of time (i.e., that portion of 1988

running of
the

merger became effective, January

theory

involved

only

the sale and

might have affected


And because Anchor's

the effect

of

artificially

1988 cash flow on its bid, conduct which took place


__ ___ ___

after the submission of the

bid is completely irrelevant

to

its claims.
The second provision, found at paragraph 5.1(e) and
captioned "Preservation
for the same reason.

of Business,"

does not

The provision states:

help Anchor

"[Narragansett]

____________________
7. In what appears to be an attempt to avoid paragraph
5.1(a)'s temporal limitations, the citation to paragraph
5.1(a) in Anchor's brief omits paragraph 5.1(a)'s caption
("Conduct of Business Until Effective Time") and alters the
phrase "will (i) operate" to read "operat[ed]." If this was
deliberate, it
was deceptive;
if a mistake,
it was
inexcusable.
-2020

shall
_____

conduct the

diligently and

business

in the

and operations

ordinary course in

same manner

as heretofore conducted."

Through its

use of the future tense

also only covers a


1988, the date of

of the

substantially the

(Emphasis supplied).
"shall," this provision

period of time subsequent to


the Agreement.

Station

And as we

October 12,

have explained,

any improper actions taken by Narragansett or Pfeiffer during


this

time period

are

irrelevant under

the damages

theory

pursued by Anchor.
The
paragraph

final

provision

4.1(f), simply

upon

by

cannot be construed

"customary"

commercialization

"Absence of

Certain Changes

forth a number of

relied

levels

as warranting

at KOVR.

or Events," the

Anchor,

Captioned

provision sets

illustrative asset-dissipating and capital

structure-altering

events

and

transactions, warranting

an

absence of such events or transactions "since the date of the


Unaudited

Financial

Statements

[August

31,

1988]."

The

proviso upon which Anchor seizes states that "the Company has
not

. .

(v)

entered

into

. .

any

other

commitment, contractual obligation or transaction


in the ordinary course of business . . . ."

material
other than

Leaving

aside

the

fact

that

Anchor

did

introduce specific evidence of overcommercialization


from August

31, 1988 through

period of time prior

September 28,

at KOVR

1988 (the

to Anchor's submission of its

not

only

bid that

-2121

this provision can be read to cover), we are at a loss to see


how it would be reasonable to regard the sales of commercials
challenged

here

as

"ordinary

course

observed,

paragraph 4.1(f)'s

of

being

transactions

business."

As

outside
the

of KOVR's

district

"ordinary course

court

of business"

proviso, when read in context, should be construed

as simply

warranting

into

that

Narragansett

had

not

entered

any

transactions (1) of an unusual type for a television station;


or (2) that would
alter

tend to unduly dissipate KOVR's

its capital structure.

Supp. at 37.

Certainly,

unusual transactions

for a

assets or

See Fleet Nat'l Bank, 831 F.


___ _________________

sales of commercial

time are

not

television station; indeed,

the

revenues

generated

lifeblood.

by

Moreover,

such sales

constitute

the record is devoid

station's

of evidence that

the number of such sales entered into by

Narragansett during

the relevant time

excess of

norms

period --

-- threatened

to

even if in

unduly dissipate

industry

KOVR's assets

or

alter its capital structure.


To
provision

be sure,

which

interpretations

can

the actual
reasonably
__________

should be

left

meaning of
accommodate
to the

Cir.

question

1987)
whether

(applying
a

two

jury.

Bushkin Assocs., Inc. v. Raytheon Co., 815


______________________
____________
(1st

a contractual

See,
___

can

more
e.g.,
____

F.2d 142, 148-49

Massachusetts law).

provision

or

reasonably

But
support

the
a

proffered interpretation is a legal one, to be decided by the

-2222

court.
1076,

See Fashion House, Inc. v. K Mart Corp.,


___ ____________________
_____________
1083

(1st

Cir.

1989)

(applying

892 F.2d

Michigan

law)

("Determining whether or not a contract is ambiguous is, like


other questions
court.").

of contract

for the

Here, we think that the court correctly determined

that Anchor's proffered


"ordinary
proviso

construction, a matter

course of

interpretation of paragraph 4.1(f)'s

business"

proviso --

as warranting customary

which reads

the

commercialization levels at

KOVR during 1988 -- was not one that a reasonable juror could
accept.

Accordingly, we affirm the court's ruling.


In

sum,

we agree

Anchor should not have been


allegation
allowed

to

that

determining
well

the

district court

that

permitted to present the Nielson

to the jury, and that Anchor should not have been


raise

connection with
rule

with

the

the

issue

its breach of
court

that these

have affected

the

did

of

overcommercialization

contract claim.
not

abuse

its

improperly asserted
jury's general

verdicts at the first trial.

We

in

further

discretion

in

allegations may

contract and

fraud

We therefore affirm the court's

post-trial order, see Fleet Nat'l Bank, 831 F. Supp.


___ _________________

16, in

all respects.8
____________________
8. Because of these rulings, we need not discuss whether the
court's new
trial order
on the fraud
claim against
Narragansett can be alternatively upheld on the basis of the
court's post-trial determination that it should not have
submitted to
the jury the question
of Narragansett's
vicarious
liability as
Pfeiffer's
alter ego
or coconspirator. See Fleet Nat'l Bank, 831 F. Supp. at 44-45.
___ ________________
-2323

B. Alleged Second Trial Errors


B. Alleged Second Trial Errors
_______________________________
1.
Exclusion of Witness
Testimony Regarding
___________________________________________________
Customary Levels of
Commercialization in
the
___________________________________________________
Anchor complains that, at the second trial,

Industry
________
the

district

foundation,
Lawrence

court

improperly

testimony

by

Clamage,

Anchor's

regarding

commercialization in

excluded,

the industry.

for

Senior

of

Vice President,

customary
Anchor

lack

levels

of

underscores this

plaint by pointing out that Clamage was permitted to testify,


over

objection, to

industry norms

that the court offered


at

the second trial.

in the first

no rationale for its

contrary ruling

Anchor further contends that the court

committed legal error in not allowing it to read


testimony regarding
by John

trial, and

industry norms given at

Sheehan, who was

unavailable for the

to the jury

the first trial


second trial.

In the alternative, Anchor asserts that the court


discretion

by

denying

it

a one-day

continuance

abused its
so

that

Sheehan

could appear.

erroneous,
because

Anchor claims that all three of these

discretionary

rulings

were

highly

the court's award of judgment as

Anchor's

fraud

premised upon

claim

based

on

an absence of

prejudicial

a matter of law on

overcommercialization

evidence by which

was

Anchor could

"structure the amount of damages for overcommercialization."


While

the

equities

of

the

situation

involving

Sheehan are not nearly as one-sided as Anchor represents them

-2424

in its

brief,9 we

the court's
admissible

can understand Anchor's

failure to
in

the

frustration with

explain why Clamage's

first

trial

but

not

testimony was

in

the

second.

Especially in light of the two-year delay in deciding the new


trial

motion,

we

think

that Anchor

was

explanation for the court's change of mind.

entitled

to

an

The fact of the

matter is, however, that evidence regarding commercialization


norms in the industry was completely irrelevant in the second

trial.
As we have explained, the court properly ruled that
the Agreement could not
commercialization
examined
of a

be construed as warranting customary

levels

during

in developing its bid.

representation

Anchor at

called July/August

1988

period

Anchor

And the only other evidence

the second trial

day-part summary,

summarized commercialization

and

time

regarding commercialization

KOVR introduced by

income

the

levels
was the

a document

at
sothat

levels and commercial-generated

by day and time (e.g., 7/25, 8:00-9:00 p.m.) for July

August

1988.

The

July/August

1988 day-part

summary

allegedly misrepresented that KOVR was undercommercialized in


___________________
July

and August

1988

and understated

commercial-generated

____________________
9. Anchor had more than a month's notice that the second
trial would begin on March 21, 1994.
Despite this notice,
Anchor apparently did not ascertain Sheehan's availability as
a witness until it was in the middle of presenting its case.
Indeed, Anchor did not communicate with Sheehan at all
between January 27, 1994 and March 25, 1994, the date on
which it learned of Sheehan's unavailability.
-2525

income

during this same period.

in the second trial

Thus, there was no evidence

of a representation to Anchor

that KOVR

was commercialized in accordance with industry norms in 1988,


and

Anchor

had no

basis for

arguing

that it

was damaged

because it bid too much in reliance on such a representation.


Accordingly, we affirm the court's exclusion of the testimony
regarding industry

standards on the independent

ground that

it was irrelevant.

See Alioto, 26 F.3d at 204; see also Fed.


___ ______
___ ____

R.Evid.402("Evidence whichisnotrelevantis notadmissible.").10


____________________
10. After the district court excluded evidence regarding
industry norms at the
second trial, Anchor argued an
alternative "expectancy" damages theory.
Under this latearising theory, Anchor sought to recover the revenue it
expected to generate by running more commercials on KOVR,
which it had been fraudulently induced to believe was
substantially undercommercialized at the time of the sale.
In a throw-away line in its reply brief, Anchor contends that
evidence of industry norms was relevant to proof of damages
under its expectancy damages theory.
An expectancy damages theory which would look to the
difference between the revenue Narragansett falsely claimed
to have been generating in July/August 1988, and the revenue
that a station commercialized in accordance with industry
norms would have been generating at that time, is not
implausible. Indeed, it strikes us as being much more in
line with the fraud damages to which Anchor actually was
entitled under Rhode Island law than the "effect on the bid"
theory pursued throughout this litigation. See supra note 3.
___ _____
The problem is, however, that Anchor never sought to quantify
its expectancy damages in this way until its reply brief. In
_____
fact, Anchor represented to the district court on at least
three occasions
that evidence of
industry norms
was
irrelevant to its expectancy damages theory.
See Second
__________
___
Trial Transcript, 3/29/94, at 13 (two representations to this

effect), and 3/30/94 at 18.


Instead, Anchor sought to
quantify its expectancy damages as the difference between the
actual 1988 revenues generated by the overcommercialized KOVR
(a fact of which it learned only subsequent to taking over
__________ __
the station), and the far lower revenues the false day-part
summary indicated that KOVR was realizing.
We discuss the
-2626

2. The Fraud Claim Based on the Over______________________________________


commercialization Allegation
____________________________
As noted, subsequent to
case

in

the

second

Narragansett and
Anchor's
allegation
this

fraud

claim

ruling, arguing

generated

the

district

Pfeiffer judgment

for failure

demonstrating

trial,

the conclusion of Anchor's

the

based

on

to prove
that it

difference

as a
the

court

matter

of law

on

overcommercialization

damages.

Anchor contests

proved expectancy
between

granted

the

damages by

actual

revenue

by the "too many" commercials run in 1988, and the

lower revenue

the July/August 1988 day-part

indicated was being generated.


Throughout

both

summary falsely

See supra note 10.


___ _____
trials,

Anchor

consistently

maintained that KOVR was


excess

of

examined in

industry

covertly running commercials far in

norms

during the

formulating its

bid.

time

Anchor

period

Anchor

also consistently

contended that, after taking over the station in 1989, it had


to

reduce commercialization

station

into conformity

levels

in order

with industry

to bring

norms.

the

Given these

positions, Anchor would have been estopped from raising, near


the conclusion of its

case in the second trial,

an explicit

____________________
legal viability of this quantification in the next section of
our opinion; suffice it to say at this point that Anchor has
waived any argument that evidence of industry norms was
relevant to its expectancy damages theory.
See, e.g.,
___
____
Sandstrom v. Chemlawn Corp., 904 F.2d 83, 86 (1st Cir. 1990)
_________
______________
(deeming waived an argument not made below or in appellant's
opening brief).
-2727

alternative

argument

levels commensurate
____________

that it

expected to

commercialize at

with those actually employed


____

at KOVR in

1988.

Cf. Desjardins
___ __________

21, 23 (1st
apply to

v. Van Buren Community Hosp.,


_________________________

Cir. 1994) (doctrine

bar a litigant

contradiction

as a

(citations omitted).

of judicial estoppel

from engaging in

means

of

37 F.3d
"may

intentional self-

obtaining unfair

advantage")

Such an argument was, however, implicit

in Anchor's alternative damages theory.


In

quantifying

subtracting the

its

expectancy

damages

lower, misrepresented revenues

by

set forth in

the July/August day-part summary from the higher, actual 1988


revenues

that

repudiating

KOVR

any

was

generating,

suggestion that

and

the

in

explicitly

lower, misrepresented

revenues more properly should be subtracted from the revenues


the station
in

would have generated had

accordance with industry

that,

at

the time

generate the

it been commercialized

norms, Anchor implicitly argued

it bought

the

station, it

same commercial revenues it

the station had generated

in 1988.

expected to

later learned that


_____

Absent a proffer that it

somehow anticipated earning these revenues by commercializing


in accordance with industry norms, however, (and there was no
such proffer
to earn

here), the only way Anchor

the higher revenues


commercials

was if it

same

number of

been

running in July/August 1988.

could have expected


expected to

that Narragansett

-2828

run the

actually had

In other words, given the

state of the record at the second trial, necessarily subsumed


within

Anchor's

alternative

damages

theory

was

tacit

argument -- i.e., that Anchor expected to run the same number


of

commercials that

relevant

time in 1988 --

the stance Anchor had


levels.

Narragansett

had been

running at

which was completely

the

at odds with

taken regarding 1988 commercialization

The district court did

not err in prohibiting

Anchor from altering its litigation position in this way.

It

follows, therefore, that the court did not err in ruling that
Anchor had failed to prove expectancy
any fraudulent misrepresentation of
by

Narragansett or Pfeiffer.

(proof of fraud includes

law).

disadvantage
____________

commercialization levels

See Campanelli, 63 A.2d at 724


___ __________

proof of damage-causing reliance by


______________

plaintiff); Cheetham, 56 A.2d


________
his/her

damages arising out of

at 863 (purchaser defrauded to

has fraud

action

under

Rhode Island

3. The Political Advertising Allegation


________________________________________
Having granted Narragansett

and Pfeiffer

judgment

as

a matter

based
first

on

the

trial,

of law

on Anchor's

contract and

fraud claims

political advertising

allegation

during the

the

summarily11

precluded

district

court

Anchor from arguing at the second trial that Narragansett had


artificially inflated 1988 revenues by overcharging political
____________________
11. Prior to opening arguments in the second trial, the
court stated that it was "likely" to rule out the allegation
for the same reasons that it had ruled it out at the first
trial. The next day, without elaborating, the court notified
the parties that the allegation was indeed out of the case.
-2929

candidates for commercial time.

Anchor assigns error only to


____

this second trial ruling, arguing that it was improper unless


"there
of

the

is no theory of the facts under which the allegations


complaint state

a cause

Monsanto Co., 14 F.3d 697,


_____________
argument completely

of

action.

700 (1st Cir.

Vartanian v.
_________

1994)."

overlooks the procedural posture

Anchor's
of its

political advertising allegation at the second trial.


Perhaps

nothing

better

misapprehension of this issue


as

supporting authority.

Vartanian
_________

summarizes the

propriety

of the

under

Fed.

R.

Anchor's

than its citation to Vartanian


_________
The above-quoted

standard

a district
Civ. P.

highlights

by which

language

from

we review

the

court's dismissal

12(b)(6).

The

of a

claim

exclusion of

the

political advertising allegation at the second trial was not,


___
however, a Rule 12(b)(6) dismissal.
allegation

out of the second

When the court ruled the

trial, Anchor had already been

afforded a complete opportunity to substantiate and argue it,


and

the court had

Thus, despite

deemed it insufficient

Anchor's attempts to depict

court's exclusion

of

the political

to go to

a jury.

it otherwise, the

advertising

allegation

from the second trial was tantamount to a denial of a Fed. R.


Civ. P. 60(b)
order.

See
___

circumstances

motion to set
Fed.
in

R.

Civ.

which a

aside a properly-entered
P.

60(b)

court may

-3030

(setting
relieve

forth

a party

prior
the
or a

party's

representative

review

from

such denials only for

final

order).12

an abuse of

And

discretion.

we
See,
___

e.g., de la Torre v. Continental Ins. Co., 15 F.3d 12, 14-15


____ ___________
_____________________
(1st

Cir. 1994) (orders denying relief under Fed. R. Civ. P.

60(b) -- which

allows for "extraordinary relief".

under exceptional

circumstances" --

. . "only

reviewed solely

for an

abuse of discretion) (citations omitted).


Because it failed to understand the procedural path
it had to follow, Anchor did not present the trial court (and
has

not presented us) with an argument that a revival of its

political
the

advertising allegation

criteria

excusable

e.g.,

mistake,

of

arguments on

Rule 60(b).

surprise,

the
[the

second

Instead, Anchor argues


trial, it

"had

political advertising]

marshalled new evidence in support


this is

inadvertence,

any of

neglect, newly-discovered evidence, fraud, etc. --

delineated in
the time

--

was required under

an inadequate

reconsidered
issue

and

of its claim."

foundation upon

request for relief under Rule 60(b).

that, by

which

its
[had]

Plainly,

to premise

Cf. Rothwell Cotton Co.


___ ___________________

v. Rosenthal & Co., 827 F.2d 246, 251 (7th Cir.) ("Rothwell's
_______________
brief

is long

on support

for why

summary judgment

is not

____________________
12. Apparently
believing itself entitled to renew its
political advertising allegation at the second trial as of
right, Anchor never formally moved the court for relief from
the prior order under Rule 60(b). Its arguments in support
of its position were instead set forth in its opposition to
Narragansett's pretrial motion in limine to exclude the
__ ______
allegation from the second trial.
-3131

appropriate in light of all the

evidence and legal arguments

it

now presents, but short on explaining why Rothwell should

be

able to begin presenting

almost six

weeks after the district court

against Rothwell."),
710

(7th Cir.

record
have

reveals
made

those arguments --

in waves --

had already ruled

reh'g denied, opinion amended, 835 F.2d


_____ ______ _______ _______

1987).

Furthermore, our

no "exceptional

relitigation

of

own review

circumstances"
the

allegation

appropriate.

acted well

within its discretion in

political

Accordingly, the

of the

which would
advertising

district

court

prohibiting Anchor from

pursuing this allegation at the second trial.

4. Remaining Appellate Issues


______________________________
The
appeal

relate

connection
13-14.

four remaining

We

arguments,

to

arguments

decisions

the

Anchor

district

court

with the ABC newsbrief allegation.


need not and

do not

because our review

reach the

of the

presses
made

on
in

See supra at
___ _____
merits of these

record compels

us to

conclude that, for an independent reason, Anchor's claims for


breach

of

contract and

legally deficient.

fraud

based on

these

claims were

See Alioto, 26 F.3d 204.13


___ ______

____________________
13. While we do not address the merits of Anchor's argument
that the court was without the power to grant judgment as a
matter of law to Narragansett and Pfeiffer on the one issue
that went to the jury after the jury had returned a verdict
_____
in their favor, we do note that this type of order is utterly
superfluous. The beneficiary of a jury verdict may, after
all, always assert on appeal (as an alternative basis for
upholding the verdict) a properly preserved argument that the
claim underlying the verdict was legally deficient. And we,
-3232

As already explained,
newsbrief

allegation

increased its cash


by

running

was

the essence of Anchor's

that

Narragansett

flow in the months

local

commercials

at

ABC

fraudulently

preceding the auction


a

time

when

contractually obliged to be running an ABC newsbrief.

it

was

Anchor

quantified the damages arising out of this fraudulent conduct


in accordance with
See
___

its "effect on

supra at 4-5.
_____

That is

proper measure of damages


amount

of 1988

times the

the bid" damages

to say, Anchor

theory.

argued that the

arising from this conduct was

revenue generated

multiplier (13.6)

by the

the

improper practice

Anchor used in

formulating its

bid.
As

the

district

Narragansett and Pfeiffer

court

noted

in

judgment as a matter

granting

of law after

the jury verdict on the fraud claim based on this allegation,


see supra
___ _____

at 9

and note 13,

the problem with

this damages

theory in context is that most, if not all, of the revenue at


issue still would have
alleged fraud.
admitted:

been generated in the absence

Anchor's

own damages witness,

of the

Martin Ross,

(1) few, if any, local commercials are sold to run

at a specific point

in time; (2) most local

commercials are

____________________
of

course, would

review such

a legal

argument de novo -__ ____


i.e., without deference to the trial court's opinion as to
its merits. Thus, there is no practical reason for the court
to resolve a reserved motion for judgment as a matter of law

where the jury has found in favor of the party or parties who
initially filed the motion.
-3333

"preemptable"
discretion,
have

(i.e.,

able

to

be

run,

in

the

station's

outside of the general time frame for which they

been sold); and (3)

always going to be

on a given

day, "there's probably

some commercial availability."

Moreover,

Mr. Ross conceded that Anchor had failed to go through KOVR's


1988 program
commercials

logs and determine which


could

not

have

been

of the improperly-run
run

elsewhere,

thus

generating irreplaceable revenue.


Anchor does not dispute
appears to recognize that
by

fraud

in connection

any of this.

its bid was not


with

the

ABC

concomitant

breach of

the Agreement

engendered)

except to

the extent

irreplaceable
_____________
order to prove

revenue.

Anchor

its damages, all

Narragansett's ill-gotten revenue.

In

fact, it

actually affected
newsbrief (and

such fraud

that the
argues,
it had to

any

would have

fraud generated

however, that,
do was

in

quantify

In its view, once it had

quantified

such

Pfeiffer's burden

revenue,

it

to prove the

was replaceable (as part

became

Narragansett's

extent to which

of their burden of

and

the revenue

proving failure

to mitigate damages).
This argument
contemplate

that a

is unconvincing.

party victimized by

contract prove, without reference to


the narrow effects of
party to

prove, as
__

The law
fraud or

breach of

the rest of the record,

the fraud or breach; it


an element
__ _______

does not

of its
__ ___

requires that

case, the
____

extent to

-3434

which it was damaged by the fraud or breach.


_______
the uncontroverted
have generated

evidence

most of the

local commercials when


newsbrief, it

showing that

KOVR still

revenues it obtained

it should have

is apparent that

amount of revenue traceable

In the face of

by running

been running the

Anchor, by proving

would

ABC

only the

to the improper practice, failed

to provide
reasoned

the jury

with a basis

damages finding.
_______

upon which

to premise

Thus, Anchor failed

to prove an

element of its case.


While ingenious,
Narragansett

and Pfeiffer

it is incorrect
bore

the burden

to suggest

that

of proving

the

extent to which the ill-gotten income was replaceable as part


of

their duty

to prove

failure to

doctrine of mitigation of damages

mitigate damages.

The

imposes on a party injured

by either a breach of contract or a tort the duty to exercise


reasonable

diligence

minimize its damages.


1990).

and

ordinary

care

in attempting

Black's Law Dictionary 1002 (6th


_______________________

to
ed.

The doctrine thus presupposes, as a threshold matter,


___________

the existence of

a causal nexus

between the damages

sought

and the breach or tort, looking at whether and to what extent


an intervening cause (i.e., a plaintiff's own negligence) may
have contributed to these damages.
whether and
to

Here, the question is not

to what extent Anchor's

its damages;

it

whether the damages

is, rather,

own conduct contributed

the threshold

question of

Anchor sought were caused by the conduct

-3535

of

which Anchor

complained.

Accordingly, the

doctrine of

mitigation of damages is completely inapposite.


In sum,

we think

it clear that

and fraud

claims based on the ABC

deficient

because of

an absence

therefore reject Anchor's


of which pertain

Anchor's contract

newsbrief allegation were


of proof

of damages.

We

remaining appellate arguments, all

to the district

court's handling of

these

claims.
IV.
IV.
___
CONCLUSION
CONCLUSION
__________
For the

reasons stated above, the

district court is affirmed in all respects.


Affirmed. Costs to appellees.
Affirmed. Costs to appellees.
______________________________

judgment of the

-3636