NOT RECOMMENDED F OR FUL L -TEXT PUB L I CATI ON File Na me: 12a0306n.06
No. 10-6459
UNI TED STATES COURT OF A PPEAL S FOR THE SI XTH CI RCUI T

ACUI TY MUTUA L I

NSURANCE COMPANY, Plaintiff-Appellant,

v. DARREL L FRYE, e t al., Def endants-A

ppellees. )

) ) ) ) ) ) ) ) ) ON APPEALFROM THE U NI TED STATES DI STRI CT COURT FOR THE EASTERN DI STRI CT OF TEN NESSEE

OPI NI ON

Before: M OORE, S UTTON, and DONALD, Circ uit Jud ges
. BERNICE BOUIE DONALD, Circuit Judge

. Acuity Mutual I nsurance C o m p any (“A cuity ”) appea ls from the district court’s order g ranting a new trial in the above- sty led case solely

on the i ssue of damag es. Acuity arg ues t hat t he dis trict cou rt err ed in finding the j ury ’s valuation of damag es unrea sonable and that g ranting a new trial on t h e issue of damag es was improper. Finding no err or or abuse of discretion and deeming arg ument unnece ssary , Fe d. R. A pp. P. 34( a),

we a ffirm.
I. BACKG ROUND On Feb ru ary 9, 2009, a fire occur red in a building located at 621 Shallowford Road in Chattanoog a, Tenne ssee. Def endant- Appellee Dar

rell Fr y e (“Mr

. Fr

y e”) owned the subject proper ty and Def endant- Appellee L afonne Fr y e (“Ms. Fr

y e” or, collectively , “the Fr y es”) , d/b/a Trinity
L ear ning Center, opera ted a day car e cente r out of the building. As a result of the fire, the Fr y esNo. 10-6459

Acuity Mutual Ins. Co. v. Fry e suffe red a loss of proper

ty

. Mr. Fr

y e filed a claim for pay

ment of the loss pursuant to an insurance policy cover ing the premises issued by Acuity

. Acuity denied the claim and subsequently filed an action in United States district court to dete rm i n e t h e rig hts and obliga tions of the parties with
respe ct to the fire damag e. Acuity alleg ed that Darre l l Fr y e intentionally set the fire at 621 Shallowford and that,
conseque ntly , Acuity was not obliga ted under the policy to cover the Fr y es’ losses. Acuity alleg ed

numerous other rea sons for the denial o f co v era g e, including that “ther e wer e materia l misrepre sentations in the application for insurance voiding cover ag e under the policy of insurance from it s inception” and “that the defe ndant Darrell Fry e was not the owner of t he busi ness an d is, there fore , not the proper

insured under the policy

of insuranc e.” T he F ry es denie d any culpability for the fire and alleg ed that their claim was proper ly made in acc ordanc e with the terms and conditions of the insurance policy

. The Fr y es acknow ledg ed that Ms. Fr y e should have been named

as an insured in the policy , but alleg ed that it was the fault of Acuity and its ag ents that she was not named a s an insured. The case proce eded to trial on April 13, 2010. Both sides prese nted evidenc e and arg ument with reg ard to the nature , cause , and origin of the fire. I n addition, numerous contra ctors testified
reg arding estimates they

provided the F ry es to make the nece ssary structura l and electrica l repa irs
to the building afte r the fire. The estimates themselves, which totaled $226,377, wer e also admitted into evidenc e. Acuit y d id not obtain independe nt estimates, but did cross-e x amine the Fr y es’
contra ctors reg arding the adequa cy of their inspections and their knowledg e of pre- exis ting damag e to the building. Ac uity

also prese nted evidenc e that the r oof at 621 Shallowfor d had been leaking

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Acuity Mutual Ins. Co. v. Fry e for some time prior to the fire, there by raising the possibili ty that the estimates included repa irs for damag es unre lated to the fire

. On April 16, 2010, the jury rende red a unanimous verdic t in favor of the Fr y es, finding that
Mr. Fr y e did not intentionally set fire to the building at 621 Shallowford. The jury further found that Mr. Fry e proved the value of t he fire l oss and damag e t o t h e b u ilding to be $35,000, and that Ms.
Fr y e proved the value of th e fi re loss of business proper ty and business income to be $4,500 and $18,000, respe ctively

. Following the entry of j udg ment on the j ury ’s verdict, both part i es filed post-trial motions which form the basis of t he present appeal. The Fry es fi l ed a motion for new t rial on the i ssue of damag es, arg uing that the jury verdic t w as inadequa te to c ompensate them for their proven losses

1
and that there was insufficient evidenc e to suppor t the amount of the jury ’s verdic t. Acuity filed a motion for judgme nt notwithstanding the ver dict or, alter natively , to alter or a

mend the judg ment, seeking a judgme nt in its favor on the issues o f ar s o n an d d amag es. The district court denied Acuity ’s m o t i on, finding that rea sonable jurors could draw more than one conclusion from the evidenc e and thus, that the jury ’s verdic t with reg ard to liability should not be disturbed. As to the
Fr y es’ motion for new trial, the district court g rante d the motion only on the issue of deter mining the

rea sonable va lue of the f

ire loss and da mag e to the building. I n its order dated July

30, 2010, the 2

T h e F r y e s ’ m o t i o n r e q u e s t e d , i n t h e a l t e r n a t i v e , t h a t t h e c o u r t s u g g e s t a n a d d i t u r p u r s u a n t t o T e n n . C o d e A n n . 1 § 2 0

- 1 0

- 1 0 1

. C i t i n g t h e S e v e n t h A m e n d m e n t t o t h e U n i t e d S t a t e s C o n s t i t u t i o n a n d D i m i c k v
. S c h i e d t , 2 9 3 U

. S

. 4 7 4 , 4 8 6

- 8 7 ( 1 9 3 5 ) , t h e d i s t r i c t c o u r t d e c l i n e d t o m a k e a s u g g e s t i o n o f a d d i t u r . T h i s p o r t i o n o f t h e d i s t r i c t c o u r t ’ s r u l i n g i s n o t c h a l l e n g e d o n a p p e a l

.

W i t h r e g a r d t o t h e r e a s o n a b l e v a l u e o f t h e d a m a g e t o T r i n i t y L e a r n i n g C e n t e r ’ s b u s i n e s s p r o p e r t y a n d i t s l o s s 2
o f b u s i n e s s i n c o m e , t h e d i s t r i c t c o u r t f o u n d t h a t t h e j u r y ’ s v e r d i c t w a s r e a s o n a b l e a n d n o t a g a i n s t t h e c l e a r w e i g h t o f t h e - 3 -No. 10-6459

Acuity Mutual Ins. Co. v. Fry e district court found that the Fr y es prese nted uncontrove rted evidenc e of proper ty damag e exceeding the policy limit of $218,500 and that Acuity did not dispute the acc urac y or the validity of the Fr y es’ estimates. The dist rict court conclude d that “[a] new trial on the i ssue of damag es t o the bui lding is appropr iate beca

use the jury ’s awa

rd of $35,000 bear s no rea sonable rela tion to the uncontrove rted evidenc e.” A new tria l was set for November

16, 2010.
On October 13, 2010, roug hly a month befor e the new trial on damag es was to beg in, Acuity filed a document titled “Stipulation of the Parties.” The contents of this document rea d as follows:

Comes now the parties to the above sty led litigation and stipulate that the damag es to be proven in this case will exceed the policy limit s of the insurance policy insuring the defe ndan t s in the case . Pursuant to this Court’s order and previous instructions to the jury that the amount of damag es are limit ed by the limit s of i nsuranc e covering the defendants buil ding the parties stipulate that the proof t o be off ere d at trial re g arding

damag e to the building w ill ex cee d the policy limit s of the policy of insuranc e. By making the stipulation neither party waives any leg al arg ument made during the trial o r af

t er the completion of the trial in any pleading , in any oral arg ument, or in any statement, or offe r of evidenc e to any witness or document in the trial. The parties, further

more, do not waive any rig ht of appea l or any rig ht to waive any arg ument reg arding t h e circ umstances and ruling s throug hout the trial of this case . There afte r, the district court order ed eac h party to file a statement advising the court whether it was

nece ssary to proce ed with trial. Both parties filed statements to the eff ect that the value of the fire loss and damag e to the building exceede d the policy limit s and that a new trial on the i s s u e of damag es was unnece ssary . Acc ording l y , o n November 12, 2010, the court enter ed an amende d

e v i d e n c e . T h e c o u r t t h e r e f o r e d e c l i n e d t o g r a n t a n e w t r i a l a s t o t h e v a l u e o f t h e s e d a m a g e s .

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Acuity Mutual Ins. Co. v. Fry e judgme nt in favor of Darre ll Fr y e in the amount of $225,565.25. Ten day s later, Acuity initiated 3
an appe al of the judg ment. II. ANALYSIS A. Waiver of Acuity’s Right to A ppeal
At the outset, we addre ss the Fr y es’ a rg ument that, in light of the Stipulation of the Parties and Acuity ’s S tatement R eg arding Nec essity of P roce eding Towar d Trial, Acuity waived i t s rig ht
to appea l the amende d judgme nt and dismiss al is thus appropr iate. We acknow ledg e that the unusual post-trial filin gs i n this case indeed muddy the water s with reg ard to the propriety of the instant
appea l. Upon piecing toge ther the Stipul ation and the Statement , it would appea r that afte r the district court’s order g ranting a new trial for damag es Acuity 1) con ce d ed that the Fr y es’ proof would show that their damag es exceede d the policy limit ; 2) ag ree d that there was no fac tual dispute with reg ard to damag es and thus, no need for a new trial; and, 3) acknow ledg ed, at least implicitl y , that the Fr y es wer e entitled to an amende d judgme nt in the amount of the policy limit

. I t would then
ap p ea r that, upon entry of t he amended judgment, Acuity promptly and inex plicably appea led t h e judgme nt to which they had just c onsented. Equally perple x ing, Acuity ’s Br ief makes no mention
at all of its post-trial stipulation or its statement deeming a new trial unnece ssary , nor does it addre ss the potential or pe rce ived ef fec t of these doc uments on its right to appe al.
I n its Reply Br ief, Acuity addre sses for the first time the effec t of t he p o s t -trial st ipulation

as it rela tes to the Fr

y es’ waiver arg ument. First, Acuity corr ectly points out that the stipulation itself

T h e p a r t i e s a l s o a g r e e d b y s t i p u l a t i o n t h a t t h e p o l i c y l i m i t s h o u l d b e a m e n d e d p e r i t s t e r m s f r o m $ 2 1 8 , 5 0 0 3 t o $ 2 2 5 , 5 6 5

. 2 5

. - 5 -No. 10-6459

Acuity Mutual Ins. Co. v. Fry e contains an anti-wa iver provision, which expli citly states that Acuity did not intend to waive its rig ht
to appea l any ruling s made during or afte r t ri al , t h e s t ipulation reg arding the dollar amount of damag es notwithstanding. Acuity arg ues that this provision prese rves its rig ht to appea l the district
court’s order g ranting a new trial on damag es and explains that “the prac tical eff ect of the stipulation is tha t if [t he appellate court] f inds tha t the order g ranting a new trial is corr ectly based on law and fac t,” then Acuity will conce de that “the amount of damag es exceeds the policy limit s and there [wil l be] no need for a new trial. I f, howeve r, [t he appellate court] finds that t h e t rial Court’s order
g ranting a new

trial . . . is inappropriate [t hen] the orig inal jury verdic t must be upheld.” We find that Acuity ’s interpre tation of the anti-wa iver provision i s corr ect and that Acuity
p ro p er l y prese rved its rig ht to appea l the trial court’s order g ranting a new trial on damages

. W e
proce ed, there fore , to the merits of Acuity ’s arg ument that the district court abused its discretion in
g ranting the Fr

y es’ motion for ne w trial on dama g es. B. Order G ranting New Trial on Dam ages We revie w a district court’s ruling on a motion for a new trial for abuse of discretion. United
States ex rel. A+ Homec are, Inc. v. Medshare s Mgmt. Group, In c. , 4 00 F.3d 428, 450 (6th Cir. 2005); Brooks v. Toyotomi, Co. , 86 F.3d 582, 588 (6th Cir. 1996). “Abuse of discretion is de fined

as a definite and firm conviction that the trial court committed a clea r err or of judgme nt. A district
court abuses its discretion when it relies on clea rly err oneous finding s of fac t, or when it improperly applies the law or uses an err oneous leg al standard.” Tompkin v. Philip Morris USA, Inc. , 362 F.3d 882, 891 (6th Cir. 2004).

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Acuity Mutual Ins. Co. v. Fry e Under Rule 59, afte r a jury trial a court may g rant a new trial on all or some of the issues “for
any rea son for whic h a new trial has heretofore been g rante d in an ac tion at law in fede ral c ourt.”
Fe d. R. Civ. P. 59(a) (1)( A). Gene rally , courts have interpre ted this Rule to permit a new trial in circ umstances wher e: 1) the verdic t is ag ainst the weig ht of the evidenc e; 2) the d amage s are excessive; or 3) the t rial proceeding s were influence d by prejudice , bias, or some other unfairne ss
to the moving party

. Conte v. Gene ral Housewares Corp. , 215 F.3d 628, 637 (6th Cir. 2000). A trial
court may not g rant a new trial on the g round of insufficient damag es unless the jury verdic t is one that could not rea sonably have been rea ched. W alker v. B a i n , 2 5 7 F.3d 660, 674 (6th Cir. 2001) (citing Anchor v. O ’Toole , 94 F.3d 1014, 1021 ( 6th Cir. 1996); TCP Indus., Inc. v. Uniroyal, Inc. , 661 F.2d 542, 546 (6 t h C i r. 1 9 81)). “The reme dy of a new trial for inadequa te damag es is
appropr iate only wher e the evide n ce i n d i ca tes that the jury awa rded damag es in an amount substantially less than unquestionably proved by the plaintiff’s uncontra dicted and undispu ted evidenc e.” Id. (citing Anchor v. O’Toole , 94 F.3d 1014, 1021 (6th Cir. 1996)). Thus, if the verdic t is supported by some competent, cre dible evidenc e, the motion for new trial should be denied. Id. The dis t ri ct co u rt articula ted and applied the proper standard in considering the Fr y es’ motion. I n concluding that a new trial on the issue of damag es was war rante d, the district court summarized the Fr

y es’ pr oof as f

ollows: When all of the[] estimates are added toge ther, Dar rell Fr y e has prese nted evidenc e that the fire los s and damag e to his building excee ds the insuranc e policy limit of $218,500.
L awson Elec tric Company $27,000 Millwright Construction and Maintena nce $26,677 J ones Construction $162,444
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Acuity Mutual Ins. Co. v. Fry e

J .D. Helton Roofing Company , I nc. $10,256 Total $226,377 Acuity at trial did not dispute the acc urac y and validity of these estimates for repa iring the fire damag e to the insured building. I nstead, Acuity conce ntrated its eff orts on seeking to prove that Da rre ll Fry e deliber ately

set fire to the building. After revie wing the evidenc e, the Court conclude s that the jury ’s verdic t and awa rd of $35,000 is unrea sonable and ag ainst the clea r weig ht of the evidenc e. The uncontrove rted evidenc e established that the loss and damag e to the insured building exceede d the maxi mum cover ag e limit of $218,500 in the insurance policy

. A rea sonable jury could not rea ch the verdic t that the fire loss and damage to the insured building is an extremely low $35,000. The verdic t of $35,000 is inadequa te to compensa te Dar

rell Fr y e beca use it is substantially less than the amo u n t of damag es that was unquestionably proved by the undisputed evidenc e. A new trial on the issue of damag es to the b u i l d ing is appropr iate beca use the jury ’s awa

rd of $35,000 bear s no rea sonable re lation to the uncontrover ted evidenc e. The district court essentially found that beca use Acuity did not prese nt its own estimates of the fire damag e to the building, the Fr y es’ pr oof with respe ct to damag es wa s conclusive. I n other wor ds, if the jury found that Acuity was li able, it was r equire d to awar d the Fr y es dama g es in the amount of their e stimates in the absenc e of a ny other e vidence reg arding the cost of r epair s. On appea l, Acuity acknow ledg es that it did not dispute th e d o l l ar amount s of the Fr y es’ estimates, but arg ues that “the rea sonablene ss of the dollar amounts was cl early broug ht into question by the totality of the evidenc e prese nted at trial.” I n particula r, Acuity arg ues that the testimony it elicited from the Fr y es’ contra ctors on cross-e x amination sug g ested potential bias, the
Fr y es’ failure to mitig ate damag es, and the c ontrac tors’ fa ilure to ac count for pr e-e x isting damag e
to t h e b u i lding in their estimates. All of this, Acuity arg ues, called the cre dibilit y of the Fr y es’
contra ctors and the re liability of their estimates into que stion a nd provided the jury with suf ficient information from whic h it could rea sonably rende r a ve rdict in the amount of $35,000.

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Acuity Mutual Ins. Co. v. Fry e Acuity ’s ar g ument fails bec ause the re is simply no evidenc e in the rec ord to suppor t a jury verdic t of $35,000. The Fr y es prese nted evidenc e that the fire damag e to the bui l ding totaled $226,337. Whil e a rea sonable jury could perha ps find that the Fr

y es wer e entitled to less than this, the amount of the jury ’s awa rd, to be rea sonable, still must be supported by some competent, cre dible evidenc e. Acuity offe red neither arg ument nor evidenc e at trial with r eg ard to the dollar amount it would actua lly cost the Fr y es to repa ir the fire damag e to their building. Moreove r, the verdic t form
g ives no indication of the brea kdown of the awa

rd, i.e., an explanation of how the jury arr ived at the fig ure of $35,000. Upon revie w of the rec ord, the fig ure appea rs to be arbitra

ry , bear ing no rela tion
to the Fry es’ estim at es, which were the only evidenc e produced at trial of t he actual cost to repa ir the fire damag e. Thus, while Acuity may have, in the ey es of the jury , succe ssfully discounted the reliability of the Fr

y es’ witnesses and evidenc e, it failed to produce any evidenc e of its own. I n light of this absenc e of evidentiar y support for the jury ’s awa rd of $35,000, we find that the district court did not abuse its discretion in g ranting a new trial on the issue of damag es to the building.
C. The F ryes’ Motion for San ctions Finally , we address the Fr y es’ moti on for sanctions. The Fry es arg ue that Acuity ’s appeal is frivolous, and therefo re t h at Acuity should be order ed to pay their attorney s’ fee s and costs on
ap p ea l , b eca

use i ts brief fails to cite any authority that war rants reversa l of t he dis trict court. I t is
true that the only citations to leg al authority in Acuity ’s brief appea r in the extended excerpts of the district court’s order

. The essenc e of Acuity ’s arg ument on appea l, howeve r, is that the district court incorre ctly conclude d that the jury ’s v er d i ct was unrea sonable in light of the evidenc e. Thus, Acuity ’s brief cites t o the t estimony and evidence of rec ord which, in Acuity ’s v iew, supports the - 9 -No. 10-6459

Acuity Mutual Ins. Co. v. Fry e

rea sonablene ss of the jury ’s verdic t. I n pursuing the instant appea l, Acuity asked this court to revie w that evidenc e and deter

mine whether the district court abused its discretion in finding that the jury ’s verdic t was unrea sonable. Although we have answe red this question in the neg ative, we do not find that Acuity ’s appe al was f rivolous. Accor dingly , the Fr y es’ motion for sa

nctions is DENIED

. III. CONCLUSION
For the fore g oing rea sons, we AF F IRM the district court’s g rant of a new trial on the issue of damag es and its a mended judgme nt. The Fr y es’ motion to dismiss the appea l a nd for sanctions is DENIED

.

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