In the

United States Court of Appeals

For the Seventh Circuit ____________

No. 03-1592

TY INC.,

Plaintiff-Appellee, Counterdefendant-Appellee,

v.

SOFTBELLY’S, INC., et al.,

Defendants-Appellants, Counterplaintiffs-Appellants,

v.

TY WARNER,

Counterdefendant-Appellee.

____________

Appeal from the United States District Court for the

Northern District of Illinois, Eastern Division.

No. 00 C 5230—Charles R. Norgle, Sr., Judge.

____________

ARGUED OCTOBER 20, 2003—DECIDED DECEMBER 22, 2003

____________

Before POSNER, KANNE, and WILLIAMS, Circuit Judges.

POSNER, Circuit Judge. Ty Inc., the manufacturer of

“Beanie Babies,” brought suit for trademark infringement

against Softbelly’s, Inc. and affiliated companies and individuals unnecessary to discuss separately. Softbelly’s
2 No. 03-1592

manufactures a very similar looking and feeling product

that it calls “Screenie Beanies.” They differ from Beanie

Babies mainly in having chamois bellies and being sold to

the public through computer stores for use in wiping computer screens. The case was tried to a jury, but rather than

allow it to render a verdict the judge entered judgment as a

matter of law for Ty under Fed. R. Civ. P. 50. He awarded

Ty both injunctive relief and some $700,000 in damages. He

also dismissed Softbelly’s counterclaims, which Softbelly’s

had abandoned in the district court and (though it is anyway too late) seeks halfheartedly to resuscitate on appeal.

Cf. Sokaogon Gaming Enterprise Corp. v. Tushie-Montgomery

Associates, Inc., 86 F.3d 656, 658 (7th Cir. 1996); Colburn v.

Trustees of Indiana University, 973 F.2d 581, 593 (7th Cir.

1992). Later he denied Softbelly’s motion to vacate the

judgment under Fed. R. Civ. P. 60(b)(3) on the ground of

witness tampering. Softbelly’s challenges this denial as well

as the judgment.

The issues at the trial were three. The first was whether

“Beanies,” which Ty claims to be a common law trademark

owned by it (it has a registered trademark on “Beanie

Babies”), has become a generic term for small plush toys, in

the shape of animals, that are filled with bean-like materials

to give the toys a soft and floppy feel. If “Beanies” has

become a generic term—has become, that is, beanies— it

cannot be a legally protected trademark. The second issue

is whether, if “Beanies” has not become generic, the designation “Screenie Beanies” is likely to make consumers think

that Softbelly’s product is actually a Ty brand. The third

issue is whether “Screenie Beanies” dilutes the Beanies or

Beanie Babies trademarks.

On the first issue, on which the burden of proof rested on

Ty because “Beanies” is not a registered mark, Mil-Mar Shoe
No. 03-1592 3

Co. v. Shonac Corp., 75 F.3d 1153, 1156 (7th Cir. 1996); Filipino

Yellow Pages, Inc. v. Asian Journal Publications, Inc., 198 F.3d

1143, 1146 (9th Cir. 1999); Blinded Veterans Ass’n v. Blinded

American Veterans Foundation, 872 F.2d 1035, 1041 (D.C. Cir.

1989), Ty presented the following evidence in an effort to

prove that “Beanies” is not generic:

(1) A survey by Dr. Henry Ostberg of 220 men and

women over the age of 18, interviewed at nine different

malls throughout the country, found that 60 percent of

the respondents thought “Beanies” a brand name.

Ostberg selected the age-18 cutoff because he was told

by Ty that most of the purchasers of beanbag toys are

over 18. If 60 percent of the relevant consuming public

thinks “Beanies” a brand name, as many of 40 percent

may think it generic—and in fact 36 percent of the

respondents in Ostberg’s survey did. But the legal test

of genericness is “primary significance,” Kellogg Co. v.

National Biscuit Co., 305 U.S. 111, 118-19 (1938); WesleyJessen Division of Schering Corp. v. Bausch & Lomb Inc.,

698 F.2d 862, 865 (7th Cir. 1983); King-Seeley Thermos Co.

v. Aladdin Industries, Inc., 321 F.2d 577, 581 (2d Cir.

1963); 2 J. Thomas McCarthy, McCarthy on Trademarks

and Unfair Competition § 12:6 (4th ed. 2003); 5 id.

§ 32:192; and Ostberg’s results are evidence that the

primary significance of “Beanies” is still as the name of

Ty’s brand. 

(2) A linguist testified that 98 percent of the references

in news articles to the word “Beanie” were to Ty’s

products and that dictionaries do not list it as a generic

(lower-case) word.

(3) A statistician sampled eBay and Yahoo auctions and

found that more than 80 percent of all references to

“beanie(s)” were to Ty’s products.
4 No. 03-1592

(4) In a phone survey conducted in 1999, more than 60

percent of the respondents identified “Beanies” as

relating to Ty or Beanie Babies.

(5) Ty polices the use of “Beanie(s)” vigorously by filing

lawsuits, sending cease and desist letters, and opposing

trademark applications for the word or its cognates.

This evidence was not conclusive. But Softbelly’s presented very little contrary evidence. In fact, the only evidence it placed before the jury was a survey of 13- to 18-

year-old girls which found that many of them consider

“beanies” the name of the product rather than just Ty’s

brand name; the testimony of a teenage girl that she considers “beanies” the name of the product; and a statement

by Ty Warner, Ty’s CEO, that refers to another firm’s

having sold a “Zoo Beanies” product in 1998. The judge was

right that Softbelly’s evidence was not enough, in the face of

Ty’s evidence, to create a triable issue whether “Beanies” is

generic. The testimony of one teenager proves nothing at all,

and the survey was worthless— 13- to 18-year-old girls

being an arbitrary subset of consumers of beanbag stuffed

animals. See Universal City Studios, Inc. v. Nintendo Co., 746

F.2d 112, 118 (2d Cir. 1984); 5 McCarthy, supra, § 32:159;

Robert C. Bird, “Streamlining Consumer Survey Analysis:

An Examination of the Concept of Universe in Consumer

Surveys Offered in Intellectual Property Litigation,” 88

Trademark Rep. 269 (1998). Softbelly’s argues that Ty Warner

has identified teenage girls as his product’s largest group of

consumers. Not so; in the testimony Softbelly’s cites, Warner

states that his prime market consists of girls 5 to 14, followed by girls/women 14 to 80. (Of course, this testimony

also casts a shadow over Dr. Ostberg’s testimony for Ty.)

And Warner’s reference to “Zoo Beanies” proves nothing at

all, for the name might be an infringement of Ty’s trademark.
No. 03-1592 5

To determine that a trademark is generic and thus pitch it

into the public domain is a fateful step. It penalizes the

trademark’s owner for his success in making the trademark

a household name and forces him to scramble to find a new

trademark. And it may confuse consumers who continue to

associate the trademark with the owner’s brand when they

encounter what they thought a brand name on another

seller’s brand. (Think of Ostberg’s 60 percent—and there

would be a problem even if they were only 10 percent.) The

fateful step ordinarily is not taken until the trademark has

gone so far toward becoming the exclusive descriptor of the

product that sellers of competing brands cannot compete

effectively without using the name to designate the product

they are selling. Imagine the pickle that sellers would be

in if they were forbidden to use “brassiere,” “cellophane,”

“escalator,” “thermos,” “yo-yo,” or “dry ice” to denote

products—all being former trademarks that have become

generic terms. The problem is not that language is so

impoverished that no other words could be used to denote

these products, but that if no other words have emerged as

synonyms it may be difficult for a seller forbidden to use

one of the trademarked words or phrases to communicate

effectively with consumers.

Sometimes a trademark owner will sponsor a generic term

precisely in order to avoid its mark becoming generic. Xerox

succeeded with “copier,” and “Sanka” was saved from

becoming generic by the emergence of “decaf” to denote the

product of which Sanka was for long the best-known brand.

But because “beanies” is so much shorter and punchier than

the alternatives that have emerged so far for designating the

product, such as “plush beanbag animals,” Ty may be

fighting a losing war to keep its “Beanies” trademark from

becoming “beanies” a generic term. But it won this battle.

More precisely it won this battle on the basis of the evidence that the judge permitted to be presented to the jury,
6 No. 03-1592

as distinct from that evidence plus the evidence that the

judge excluded. The excluded evidence consisted of (1) the

results of a LEXIS search that revealed generic uses of the

term “beanie(s)” in newspapers; (2) an internal Ty memo

written by Warner himself in which he said “we want to

emphasize our Beanies are not just any Beanies—But special. Set us apart from our competitors’ Beanies;” and (3)

other internal memos, reporting on trade shows, in which

employees of Ty used “Beanies’ ” in a generic sense,

as in: “Ganz—has product called FLOPPIES. They are a

larger version of the Beanies concept. Heard through rumor

mill that they are sold out of their ‘beanies’ until

November.” Or: “Plush Images Booth #3350—They had

‘beanies’ that were similar in look, but fabric was inexpensive and it looked like a cheap knockoff of product.” The

judge excluded all this (and more) evidence tendered by

Softbelly’s because Softbelly’s had failed to include it in

the list of exhibits attached to the pretrial order. He also

excluded eBay screens indicating widespread use of

“beanies” in a generic sense on the separate ground that

Softbelly’s had failed to summarize these exhibits. The

source of his authority is unclear. It is not Fed. R. Evid. 1006,

as the judge thought, because that provision merely authorizes summaries and empowers the judge, if summaries are

introduced, to require production of the materials summarized. But we may assume that ordering the making of

summaries is inherent in a trial judge’s authority to manage

a lawsuit in an efficient manner.

Nevertheless the judge was too severe in these rulings,

especially when his lenity toward Ty is weighed in the balance. The suit had been filed in 2000, but no trial date was

set until December 17 of the following year, when the judge

announced that trial would begin on February 1, 2002, only

six weeks later. The parties were surprised and jointly
No. 03-1592 7

moved for a postponement of the trial to October 31 at the

earliest. The judge agreed only to postpone the trial date to

March 4, with the final pretrial order due on February 22,

though on Ty’s motion that deadline was postponed to

March 1. Although Ty had retained its expert witnesses long

before December 17 when the trial date was announced, it

did not disclose those witnesses to Softbelly’s until January

28.

Rule 26(a)(2)(C) of the Federal Rules of Civil Procedure

requires disclosure of experts to the opposing party no later

than 90 days before trial. In a case such as this in which the

parties don’t learn the date of trial until fewer than 90 days

remain, literal compliance with the rule is not possible. But

it doesn’t follow that the parties should feel free to wait

until the eve of trial to disclose their experts. Ty took more

than a month to disclose its expert witnesses to Softbelly’s,

which as a result was unable to depose four of Ty’s experts,

though it might have been able to depose two of them the

week before the trial began.

The district judge agreed that Ty had delayed unreasonably in disclosing its experts but he was content to administer a slap on the wrist in the form of a $20,000 fine payable

by Ty to Softbelly’s, a payment that didn’t help Softbelly’s

prepare for trial. It would have been better had the judge

fixed a new deadline for Ty to disclose its experts, once the

90-day deadline had gone by the board. Indeed, in the

absence of such a deadline, it is not clear what rule Ty

violated that would authorize the imposition of a fine. But

that is a side issue (Ty is not protesting the fine); the

pertinent point is that the fine did nothing to repair the

harm to Softbelly’s from Ty’s last-minute disclosure. Yet

when Softbelly’s inadvertently omitted documents from the

exhibit list attached to the pretrial order, the judge, rather

than slapping Softbelly’s on the wrist, excluded so much of
8 No. 03-1592

its evidence—even though there was no indication of any

prejudice to Ty, which was well aware of the documents

because they had been produced in discovery—as to make

the trial a farce.

Now it is possible that because the final pretrial order was

due only three days before the trial was scheduled to begin,

Ty would not have had time to prepare fully to deal with

the additional documents that Softbelly’s wanted to present.

But the judge could have postponed the trial a few days and

should have done so anyway to enable Softbelly’s to

complete deposing Ty’s experts. Expedition in the conduct

of litigation is highly praiseworthy, but here passed over

into unjustifiable impatience. Ungar v. Sarafite, 376 U.S. 575,

589 (1964); United States v. Santos, 201 F.3d 953, 958-59 (7th

Cir. 2000); McAllister v. FDIC, 87 F.3d 762, 766 (5th Cir.

1996); Menendez v. Perishable Distributors, Inc., 763 F.2d 1374,

1379-80 (11th Cir. 1985).

We do not criticize the judge for wanting to push the case

to a conclusion. When he set the trial date, the parties had

had more than a year to conduct discovery. Although he

didn’t give them much notice, maybe an unexpected slot

had appeared in his trial schedule (this happens all the time,

because many cases settle on the eve of trial) and he wanted

to fill it. And district judges have to wedge civil cases into

calendars dominated by criminal trials that must conform to

the Speedy Trial Act. But when a judge announces a trial

date on short notice, he must allow the parties at least the

bare minimum amount of time that they reasonably require

to get ready for the trial.

Had Ty asked the judge to enter a final judgment in

its favor as a sanction for Softbelly’s having submitted an

untimely list of documents for trial, the judge would

doubtless have refused on the sound ground that sanctions
No. 03-1592 9

should be proportioned to wrongs. Allen v. Chicago Transit

Authority, 317 F.3d 696, 703 (7th Cir. 2003); Bolt v. Loy, 227

F.3d 854, 856-57 (7th Cir. 2000); Nick v. Morgan’s Foods, Inc.,

270 F.3d 590, 597 (8th Cir. 2001); cf. Ball v. City of Chicago, 2

F.3d 752, 758 (7th Cir. 1993). The wrong here was minor in

culpability and consequences—indeed an understandable

result of the judge’s effort (which we do not criticize) to

hurry the case to trial. But because the omitted documents

were the heart of Softbelly’s case, the sanction of exclusion

that the judge imposed was tantamount to entering judgment for Ty. The sanction was excessive, unreasonable, and

so must be reversed. Cf. Long v. Steepro, 213 F.3d 983, 986-

88 (7th Cir. 2000); Hathcock v. Navistar Int’l Transportation

Corp., 53 F.3d 36, 40-41 (4th Cir. 1995).

The judge committed a different kind of procedural error

in excluding another item of Softbelly’s evidence. One of

Softbelly’s star witnesses was to be a man named Harold

Nizamian, a competitor of Ty for whom Ty Warner had

worked before forming his own business. Nizamian was

prepared to testify that as early as 1988, before Ty began

selling “Beanie Babies,” the word “beanie” was being used

in the trade names of other manufacturers of “plush beanbag animals” and indeed that the word had become generic.

On the Friday before the Monday on which the trial began,

Softbelly’s lawyer deposed Warner and in the course of the

deposition disclosed that Nizamian would be testifying that

“beanies” was a generic term. On Monday, when the lawyer

called Nizamian to schedule his testimony, Nizamian said

that he had been telephoned by Warner and was no longer

willing to testify. Putting two and two together, at the trial

Softbelly’s lawyer asked Warner whether he had told

Nizamian not to testify. Ty objected and the judge sustained

the objection.
10 No. 03-1592

We do not understand the judge’s ruling. If Warner asked

Nizamian not to testify, this would entitle the jury to infer

that Nizamian’s testimony would have supported

Softbelly’s contention that “beanies” had become a generic

term. “[A]n attempt by a litigant to persuade a witness not

to testify is properly admissible against him as an indication

of his own belief that his claim is weak or unfounded or

false.” Newark Stereotypers’ Union No. 18 v. Newark Morning

Ledger Co., 397 F.2d 594, 599 (3d Cir. 1968); see also Crabtree

v. National Steel Corp., 261 F.3d 715, 721 (7th Cir. 2001);

Aramburu v. Boeing Co., 112 F.3d 1398, 1407 (10th Cir. 1997);

Vodusek v. Bayliner Marine Corp., 71 F.3d 148, 156 (4th Cir.

1995). Ty points out that whether a term is generic depends

on what consumers think, and that is true, but experienced

businessmen know a great deal about what consumers

think; that is personal knowledge, Central Illinois Light Co. v.

Consolidation Coal Co., 349 F.3d 488, 492-93 (7th Cir. 2003);

Agfa-Gevaert, A.G. v. A.B. Dick Co., 879 F.2d 1518, 1523 (7th

Cir. 1989); Kansas City Power & Light Co. v. Ford Motor Credit

Co., 995 F.2d 1422, 1432 (8th Cir. 1993), not hearsay that

would require a witness such as Nizamian to be qualified as

an expert before he would be permitted to testify to it.

Nizamian could easily have been qualified as an expert,

which does not require academic-type credentials, Tuf

Racing Products, Inc. v. American Suzuki Motor Corp., 223 F.3d

585, 591 (7th Cir. 2000); Circle J Dairy, Inc. v. A.O. Smith

Harvestore Products, Inc., 790 F.2d 694, 700 (8th Cir. 1986),

though Softbelly’s did not attempt to do so—and did not

have to.

Warner admits that he telephoned Nizamian in order to

inquire whether he was going to testify, and after the trial

was over Softbelly’s lawyer deposed Nizamian who in

his deposition stated that Warner had told him that if he

testified it would cost Warner “a tremendous amount of
No. 03-1592 11

money” and cause “a lot of problems;” that he (Warner)

“was involved in the Softbelly’s case and that if my statement got into the case. . . it would be very damaging to

him.” Nizamian added that his situation with respect to

Ty was “delicate” because he and Warner had recently

discussed the possibility of doing business together and

“I realized after speaking to Ty that it was a very important

matter to him, and even though I didn’t understand all of

the particulars, I felt if he felt that strongly about it . . .

maybe it would be best if I did not go.” Nizamian did not

say that Warner had threatened him, but “because of the

seriousness in his voice and the importance to him, . . . I

figured I’d just rather not get involved.” Nizamian’s deposition became the basis of Softbelly’s Rule 60(b)(3) motion,

and we shall get to that in a moment; our present point

is only that the judge should not have cut off the lawyer’s

cross-examination of Warner concerning his phone conversation with Nizamian.

These errors taken together require that there be a new

trial, but even if we disregarded them we would have to

remand for a new trial on likelihood of confusion. On this

issue Ty had the burden of proof, and while it presented

some evidence that consumers thought “Screenie Beanies”

a Ty product, a rational jury could have concluded otherwise. Although the actual Screenie Beanies so closely resemble Beanie Babies that we were surprised that Ty didn’t

sue Softbelly’s for copyright infringement, the tag attached

to each Screenie Beanie does not resemble the distinctive Ty

tag very closely, the Screenie Beanies are sold through

different outlets, and the suggested retail price of Screenie

Beanies is twice that of most Beanie Babies—$10 versus $5.

Someone shopping for Beanie Babies would be unlikely to

be looking for them in a computer store and if he found

them there would wonder why they cost twice as much.

This evidence is no more conclusive against a finding of
12 No. 03-1592

likelihood of confusion than Ty’s evidence was in favor of

such a finding, but that is just to say that there was indeed

a jury question. We add that determining the likelihood

of confusion over a common and simple consumer product

is something quite within the ability of jurors, and so judges

should not be quick to remove it from them out of a warranted distrust of their ability to decide complex commercial

or technical questions.

And finally the judge’s ruling as a matter of law that

Softbelly’s use of the term “Beanies” diluted Ty’s “famous”

mark (dilution of famous marks now being a violation of

federal trademark law, 15 U.S.C. § 1125(c); Moseley v.

V Secret Catalogue, Inc., 537 U.S. 418, 420-22 (2003)) had scant

grounding in the evidence. We’ve held that “Beanies”

(assuming it isn’t generic) is indeed a famous mark within

the meaning of the federal law, Ty Inc. v. Perryman, 306 F.3d

509, 511 (7th Cir. 2002), and even more clearly is “Beanie

Babies.” Id. But there is great doubt whether Ty has proved

dilution in this case. After the district court’s ruling, the

Supreme Court held in the Victoria’s Secret case cited above

that the statute requires proof of “actual dilution,” implying

a need for trial-type evidence to determine, in the words of

the Court, whether there has been “any lessening of the

capacity of the Victoria’s Secret mark to identify and

distinguish goods or services sold in Victoria’s Secret stores

or advertised in its catalogs.” 537 U.S. at 434. We are not

sure what question could be put to consumers that would

elicit a meaningful answer either in that case or this one.

(We are not alone in having these doubts. Jonathan Moskin,

“Victoria’s Big Secret: Whither Dilution Under the Federal

Dilution Act?,” 93 Trademark Rep. 842, 853 (2003); 4

McCarthy, supra, § 24:94.2.) But in any event no evidence of

any sort was presented that would have enabled a trier of

fact to infer any lessening in the capacity of “Beanies” or
No. 03-1592 13

“Beanie Babies” to “identify and distinguish” the plush

beanbag animals sold by Ty.

Ty argues that no consumer survey or indeed any other

evidence is required when the allegedly diluting trademark

is identical to the allegedly diluted one, citing the following

passage in the Supreme Court’s opinion: “It may well be,

however, that direct evidence of dilution such as consumer

surveys will not be necessary if actual dilution can reliably

be proven through circumstantial evidence—the obvious

case is one where the junior and senior marks are identical.”

537 U.S. at 434. The Court did not explain and no one seems

to know what that “circumstantial evidence” might be. No

matter. Neither “Beanies” nor “Beanie Babies” is identical to

“Screenie Beanies.”

So the case must be remanded. But the new trial (if one is

held—see next point) should be limited to liability, and not

revisit damages. Ty presented uncontradicted evidence of

Softbelly’s gross revenues from the sale of Screenie Beanies.

The burden then shifted to Softbelly’s to show what part of

those revenues represented cost rather than profit. 15 U.S.C.

§ 1117(a); Bambu Sales, Inc. v. Ozak Trading Inc., 58 F.3d 849,

854 (2d Cir. 1995); Maier Brewing Co. v. Fleischmann Distilling

Corp., 390 F.2d 117, 124 (9th Cir. 1968). Softbelly’s presented

no evidence and has no excuse for failing to do so. So if Ty

prevails on remand, it is entitled to the damages awarded at

the trial under review.

We move now to the Rule 60(b)(3) issue. The rule authorizes the district court to set aside a judgment on the basis

of fraud or other misconduct by a party. If it is fraud on the

court, the motion may be made at any time, but if it is just

fraud on an opposing party, the motion must be made

within a year after the judgment sought to be vacated

becomes final. We needn’t decide which type of fraud is the

basis of Softbelly’s motion, because the motion was made
14 No. 03-1592

within a year. We need not even decide whether the conduct

alleged as fraud—that Ty Warner had tampered with a

prospective witness for Softbelly’s, namely Nizamian

(Softbelly’s attached Nizamian’s deposition in support of its

motion)—is better described as “other misconduct” because

it did not involve deceit. Misconduct triggers the rule too.

Witness tampering is often described as a form of fraud,

King v. First American Investigations, Inc., 287 F.3d 91, 94 (2d

Cir. 2002) (per curiam); cf. Fernandez v. Leonard, 963 F.2d 459,

462 (1st Cir. 1992) (altering documents), and it is certainly

very serious—indeed, criminal—misconduct, 18 U.S.C. §

1512(b), and for relief under Rule 60(b)(3) the victim of the

fraud or other misconduct need show only that it affected

his ability to present his case, not that he would have won

had the fraud or misconduct not occurred. Lonsdorf v.

Seefeldt, 47 F.3d 893, 897 (7th Cir. 1995); Square Construction

Co. v. Washington Metropolitan Area Transit Authority, 657

F.2d 68, 72 (4th Cir. 1981); Rozier v. Ford Motor Co., 573 F.2d

1332, 1339 (5th Cir. 1978).

The district judge’s response to the motion was perfunctory. Without conducting a hearing to determine what

exactly Warner had told Nizamian, the judge denied relief

on the ground that Nizamian had said in his statement “that

the reason he would not testify was due to his own time

constraints. The witness also stated that he told Ty Warner

that he would testify and that Mr. Warner had made no

threats or attempted to dissuade the witness from testifying.” It is true that Nizamian gave time constraints as one

reason for not testifying, but as is apparent from the passages that we quoted earlier from his deposition, that was

not the only reason. Indeed, the deposition suggests that it

was not the decisive reason. For it was in answer to the

question what the “specific reason” for his changing his

mind about testifying was that he said that he had “realized

after speaking to Ty that it was a very important matter to
No. 03-1592 15

him . . . [and] if he felt that strongly about it, . . . maybe it

would be best if I did not go.” Nizamian was not threatened, but there is very little doubt—if his deposition is

believed, and the judge gave no reason to disbelieve it—that

Warner attempted to dissuade him from testifying.

Witness tampering is extremely serious misconduct, as we

have said, and it would be particularly egregious if committed by a person of Warner’s wealth and standing in the

business community. We do not say that he did tamper with

Nizamian, that if he did it was the cause of Nizamian’s not

testifying, or that dismissal of the suit would be the only

appropriate sanction. And we are mindful of cases that say

that fraud, when alleged as a basis for relief under Rule

60(b)(3), must, as was traditionally the case when fraud is

alleged, be proved by clear and convincing evidence.

Lonsdorf v. Seefeldt, supra, 47 F.3d at 897; Metlyn Realty Corp.

v. Esmark, Inc., 763 F.2d 826, 832 (7th Cir. 1985); Greiner v.

City of Champlin, 152 F.3d 787, 789 (8th Cir. 1998); Smith v.

Reddy, 101 F.3d 351, 353 (4th Cir. 1996). These cases may be

inapplicable to witness tampering, if it is not fraud but other

misconduct. They may even be wrong, for as the Supreme

Court emphasized in Grogan v. Garner, 498 U.S. 279, 288-89

(1991), most federal fraud laws do not require proof by clear

and convincing evidence, but only by a preponderance of

the evidence. It is unclear to us why Rule 60(b)(3) should be

thought to set a higher standard.

We need not decide; all we hold is that Nizamian’s deposition, in conjunction with Warner’s admission to having

called Nizamian on the eve of trial to discuss the case,

required further investigation by the judge. Had the judge

concluded that Nizamian’s version of the phone conversation was accurate, there would have been compelling evidence of serious misconduct on Warner’s part, requiring a
16 No. 03-1592

commensurately severe sanction, quite possibly dismissal of

Ty’s suit. Weibrecht v. Southern Illinois Transfer, Inc., 241 F.3d

875, 884 (7th Cir. 2001); Lightning Lube, Inc. v. Witco Corp., 4

F.3d 1153, 1178-79 and n. 15 (3d Cir. 1993). In hindsight it is

apparent that Softbelly’s should have protected itself against

Nizamian’s having a change of heart by taking his deposition before rather than after the trial, but Softbelly’s was

rushed in its trial preparations and in any event negligence

is not a defense to fraud or other deliberate wrongdoing.

E.g., Shropshear v. Corporation Counsel of City of Chicago, 275

F.3d 593, 597 (7th Cir. 2001); Eastern Trading Co. v. Refco, Inc.,

229 F.3d 617, 625 (7th Cir. 2000).

Some other issues are raised, but they are either unimportant or likely to wash out at a new trial if one is held.

The judgment for Ty and the order denying Softbelly’s

Rule 60(b)(3) motion are reversed and the case is remanded

for further proceedings consistent with this opinion. Circuit

Rule 36 shall apply on remand.

REVERSED AND REMANDED.

A true Copy:

Teste:

 _____________________________

Clerk of the United States Court of 

Appeals for the Seventh Circuit 

USCA-02-C-0072—12-22-03