Opinion ID: 662744
Heading Depth: 2
Heading Rank: 4

Heading: Aggregation of Damages

Text: 26 The district court awarded Med-Therapy only $300,000, holding as a matter of law that the larger award for the federal securities violation subsumed the smaller award for common law fraud. The court held that recovery on both counts would constitute double recovery because both claims arose from the same allegation of wrong-doing and harm. Med-Therapy has appealed this portion of the judge's order. 27 Under Richmond v. Madison Management Group, Inc., 918 F.2d 438, 461 (4th Cir.1990), 28 [a] district court may aggregate verdicts without violating the seventh amendment right to a jury trial if the verdicts are  'logical and probable' only if they are aggregated. ... The requirement that aggregation occur only if the aggregated verdict is what the jury must have intended stems from the fact that a district court's reexamination of record evidence is barred by the Seventh Amendment. 29 Med-Therapy has argued that the jury clearly intended to award MedTherapy a total of $552,527 for both claims; that, under Richmond, it is logical and probable to aggregate the two awards; and that the trial court erred by refusing to do so. 30 The district judge acknowledged Richmond 'slogical and probable language in his Order. He held, however, that permitting MedTherapy to recover on both claims would constitute double recovery. The question whether damage awards are duplicative is one of fact. As such, it is reviewable under the clearly erroneous standard. U.S. Indus., Inc. v. Touche Ross & Co., 854 F.2d 1223, 1259 n. 53 (10th Cir.1988). 31 In refusing to aggregate the verdicts, the judge contravened the intent of the jury. The jury clearly intended the parties to come out in a wash aside from Med-Therapy's $1000 punitive damages award. 10 In an attempt to award Med-Therapy a total of $553,527 (including punitive damages), the jury apportioned the money among the claims contained in the special verdict forms provided by the judge: $300,000 for the federal securities violation; $252,527 for the common law fraud; and $1000 for punitive damages. Because the awards in favor of each party are identical with the exception of the $1,000 punitive damages award for Med-Therapy, it is an inescapable fact that the jury intended to award Med-Therapy $552,527 for Diversicare's fraud. The verdicts are logical and probable under Richmond only if they are aggregated. 32 The jury, then, did not award duplicative damages. Rather, the jury arrived at a lump sum damages decision and appears to have divided it in order to give Med-Therapy something on each claim. The court did not inform the jury prior to its deliberation that such an action would result in the elimination of the lesser award. The court instructed the jury with respect to Med-Therapy's federal securities fraud claim and potential out-of-pocket and consequential damages. The court also instructed the jury as to the six elements of common law fraud under North Carolina law and potential damages. The district court, however, did not instruct the jury as to the duplication issue as it affected the federal securities and common law fraud awards. 33 Aside from the fact that the jury intended to give Med-therapy $552,527, it appears that the district judge, in exercising his discretion under Richmond, was unduly influenced by his own decision to cancel the Note, rendered in response to Med-Therapy's post trial motion, effectively eradicating the verdict in favor of Diversicare. 11 34 Our ultimate purpose in reaching a result in the case, is to adhere fully to the jury's verdict. Because aggregation seems to accomplish the most equitable result, and a result that is consistent with the jury's verdict, we hold that the trial court's order with respect to aggregation should be reversed, and the jury's verdict reinstated as rendered.