Opinion ID: 200693
Heading Depth: 2
Heading Rank: 1

Heading: Evidentiary Admissions

Text: 24 Gallo contends that the district court improperly admitted and considered (1) Mazda's 1997 market study, (2) a report authored in 2002 by a Mazda expert, and (3) evidence of Gallo management's state of mind. We find no abuse of discretion. 25 (1) The 1997 Market Study 26 According to Gallo, [t]he plain language of [Mass. Gen. Laws ch.] 93(B), § 4(3)( l ) renders Mazda's 1997 ... market study obsolete and unworthy of consideration. For support, Gallo looks to one of the eight non-exhaustive statutory factors that a court may consider when determining arbitrariness: 27 the retail sales and service business transacted by the ... dealers with a place of business in the market area to be served by the additional franchisee during the three year period immediately preceding [the notice required by this statute]. 28 Mass. Gen. Laws ch. 93(B), § 4(3)( l )(ii) (emphasis added). Because the 1997 study was based on data that existed outside this three-year window, 3 Gallo argues that it should have been excluded as irrelevant. 29 Gallo's argument misses the mark. As the district court correctly noted, the eight statutory factors are neither exhaustive nor definitive. We need not even resort to case law for support; the statute is unambiguous. In determining whether [the establishment of the new dealership] is arbitrary, the court shall consider all pertinent circumstances. These may include but are not limited to [the eight factors]. Id. § 4(3)( l ) (emphases added). So while we agree with Gallo that the statutory language is plain, we disagree with Gallo's interpretation of it. 30 The statutory language is sufficiently broad to permit the admission of the 1997 market study. All pertinent circumstances means all pertinent circumstances. That a particular piece of evidence does not fall within the purview of a particular factor in a non-exhaustive statutory list is not a sound basis for objecting to its admissibility. Although Gallo did not receive its formal statutory notice until 2001, Mazda had made its MetroWest decision two years earlier, as evidenced by the defective notice letter dated August 16, 1999. Mazda's decision was partially based on the 1997 study — a major market study commissioned for the purpose of evaluating Mazda's businesses and business opportunities. The results of this study are not only pertinent to an arbitrariness inquiry, they are important. Accordingly, the court did not abuse its broad discretion in determining that the 1997 study was relevant to an arbitrariness inquiry. See United States v. Brandon, 17 F.3d 409, 444 (1st Cir.1994) (noting that the district court has broad discretion in making relevancy determinations). 31 (2) The 2002 expert report 32 Next, Gallo asserts that Mazda's 2002 expert report was an after-the-fact justification for the MetroWest facility that should have been excluded. 4 For support, Gallo cites two cases, each of which involves a lawsuit that closely parallels this one. See Ricky Smith Pontiac, Inc. v. Subaru of New England, Inc., 14 Mass. App.Ct. 396, 440 N.E.2d 29 (1982); Richard Lundgren, Inc. v. Am. Honda Motor Co., Inc., 1994 WL 879478 (Mass.Super.1994). 33 Neither case controls. In both cases, the court found arbitrariness despite the assembly of after-the-fact market data — not because of it. In Ricky Smith, the court noted that the factfinder  could ... consider the absence of careful consideration or relevant data at the time the [franchising] appointment was made as evidence that the ... franchise was arbitrarily granted, despite [the manufacturer's] assembly, after the fact, of information which tended to support its actions. 440 N.E.2d at 43 (emphases added). Similarly, in Richard Lundgren, the court found that, while witnesses for the manufacturer have strived diligently to assemble after-the-fact market data in an attempt to support its action, ... the intended creation of a new dealership ... was not based on any careful consideration of relevant market data at the time, and was hence arbitrary. 1994 WL 879478, at  (emphasis added). Neither case held that after-the-fact data must be excluded or that a manufacturer must conduct a contemporaneous market study. 34 Here, the district court considered several pieces of evidence, most of which involved pre-MetroWest data. 5 Mazda, of course, could not have based its 1999 MetroWest decision on the 2002 expert report. Such a report, then, merely serves as additional relevant evidence supporting Mazda's decision — a decision that was based on careful consideration of relevant market data at the time. See id. An after-the-fact study is not per se irrelevant to the court's analysis of arbitrariness because, as here, it can provide an account of the pertinent circumstances that the court is statutorily required to consider. Accordingly, the district court did not abuse its discretion in admitting this expert report. 35 (3) The State-Of-Mind Evidence 36 In its final attack on the admissibility of evidence, Gallo asserts that the district court improperly admitted evidence of Gallo management's state of mind. At issue is the following statement by the court: 37 [Gallo] has consistently voiced no objection to the introduction of a dealership in Westborough, the Town in which the Roy Rioux dealership was located, because it is sufficiently removed from [the Gallo] dealership [so as] to pose little competitive threat.... Notwithstanding the perceived difference between Shrewsbury and Westborough, [management's] lack of concern about a Westborough competitor seriously undercuts [its] claim that Mazda's decision to establish MetroWest was arbitrary. 38 Gallo, 204 F.Supp.2d at 155. 39 According to Gallo, the all pertinent circumstances language in the statute does not extend to evidence which is directly contrary to the statute's intent. Seeking de novo review, Gallo argues that, because the eight statutory factors emphasize public interest concerns and objective evidence, evidence as to management's state of mind is irrelevant to the objective examination of the benefit or detriment that the new dealership will pose to the consuming public. 40 We are not convinced. As discussed above, the broad language in the statute permits a court to consider a wide range of factors — public and private, objective and subjective, statutory and non-statutory — when making its determination of arbitrariness. Cf. Ricky Smith, 440 N.E.2d at 43 (noting that, given the language of Mass. Gen. Laws ch. 93(B), the lower court could have properly considered [the manufacturer's] conduct prior to [the new dealership's] appointment as manifesting indifference to the statute and to the impact that the new dealer would have on existing franchisees). 41 In failing to object to the proposed Westborough site (as erroneously noted in the 1999 notice letter), Gallo management undermined its subsequent position that MetroWest's actual Shrewsbury location was arbitrary. See Gallo, 204 F.Supp.2d at 155. This evidence, itself a pertinent circumstance, is further supported by several other pertinent circumstances: (1) the close proximity of MetroWest to the Westborough border (less than one-half mile), id.; (2) the fact that MetroWest's actual Shrewsbury location is only one mile closer to Gallo's Gold Star dealership than the former Rioux dealership was to Gallo's initial Shrewsbury Street dealership, id. ; and (3) the testimony of Gallo management that, in its opinion, the greater Worcester market area was not overdealered when it purchased the Shrewsbury Street franchise (despite the presence of the Rioux dealership). Given all these pertinent circumstances, the district court did not abuse its discretion when it considered relevant evidence of Gallo management's failure to object.