Opinion ID: 697299
Heading Depth: 2
Heading Rank: 1

Heading: Inventory Damages

Text: 56 Borg-Warner cross-appeals the district court's refusal to grant judgment as a matter of law or a new trial on the basis that the jury's award of $125,000 in inventory damages was not supported by the evidence. 57 In reviewing a denial of a motion for judgment as a matter of law, we apply the same standard applied by the district court in denying the motion. O'Brien v. City of Grand Rapids, 23 F.3d 990, 995 (6th Cir.1994). We review the evidence in the light most favorable to the party opposing the motion and draw all reasonable inferences in favor of that party. Id. Judgment as a matter of law should be granted when the evidence weighs so heavily in favor of the movant that reasonable minds could not come to a different conclusion. Id. 58 We review a district court's denial of a motion for a new trial only for an abuse of discretion. An abuse of discretion exists when the reviewing court is firmly convinced that a mistake has been made. Wayne v. Village of Sebring, 36 F.3d 517, 525 (6th Cir.1994). 59 In an action for fraud, the Kentucky rule for assessing damages is that the victim of the fraud is entitled to compensation for every injury which was the natural and proximate result of the fraud. Sanders, Inc. v. Chesmotel Lodge, Inc., 300 S.W.2d 239, 241 (Ky.Ct.App.1957). 60 The plaintiff's purchase of accessory parts to sell with the Acucarbs was a natural and proximate result of Borg-Warner's material misrepresentations. Largely because of Borg-Warner's false representations concerning the testing and reliability of the Acucarbs, Miller's agreed to become a distributor. Miller's then had no choice but to sell the Acucarbs in kits comprised of the accessory parts. Miller's would not have purchased the kits had it not agreed to become a distributor based on the representations made by Borg-Warner. Once customers lost faith in the Acucarbs that Miller's was selling, customers wanted nothing to do with the accessory parts. We reject Borg-Warner's arguments that at various stages Miller's became aware that Borg-Warner had misrepresented the quality of the Acucarbs, thereby cutting off Miller's reliance on Borg-Warner's misrepresentations. Borg-Warner's initial misrepresentations placed Miller's in a situation in which it had little practical choice but to purchase the inventory. 61 The result was that Miller's was left with accessory parts worth $201,648 and pressure tanks worth $86,045. These costs were a natural, probable, and foreseeable result of Borg-Warner's material misrepresentations. We think there was abundant evidence to support the jury's verdict of $125,000 in inventory damages. The district court did not err in refusing to grant judgment as a matter of law or abuse its discretion in refusing to grant a new trial on the inventory damages issue.