Opinion ID: 781269
Heading Depth: 2
Heading Rank: 1

Heading: The Bogosian Appeal

Text: 15 Bogosian insists that the district court contravened the Seventh Amendment by failing to accord her a jury trial on counts 1 and 2. See Fed.R.Civ.P. 38; see also Fed.R.Civ.P. 39(b) (Issues not demanded for trial by jury as provided in Rule 38 shall be tried by the court.). We conclude that the district court did not err. 4 16 First, although Bogosian acknowledges that no jury-trial demand was made in the amended complaint as to counts 1 and 2, and that the defendants made no such demand in their answer, Bogosian's reply to their answer did demand a jury trial on defendants' counterclaim. The counterclaim alleged that Bogosian had converted WRC funds to her personal use. Bogosian contends that the issues at the heart of both her claims, as well as the counterclaim, were so interwoven that the latter demand implicitly preserved her right to jury trial on all three matters, even though the defendants ultimately dismissed their counterclaim prior to trial. 17 The lone case citation submitted for the present contention is wholly inapposite. Gasoline Prods. Co. v. Champlin Ref. Co., 283 U.S. 494, 51 S.Ct. 513, 75 L.Ed. 1188 (1931), involved the entirely distinct matter as to whether, upon remand for a new trial, the issues of liability and damages fairly may be addressed in separate trials. The Supreme Court simply observed that issues of liability and damages frequently are interwoven. Id. at 500-01, 51 S.Ct. 513. Thus, Champlin neither implicated the right to jury trial, nor in any sense remotely suggested that the right to jury trial, once affirmatively waived, must be restored due simply to the fact that the opposing party in the litigation happens to have alleged a so-called interwoven counterclaim. 18 The Bogosian complaint and the appellees' counterclaim were not interwoven, however, at least as concerns the right to jury trial. In counts 1 and 2 of the amended complaint, Bogosian alleged that appellees had breached their fiduciary duty to her as a minority shareholder, by, inter alia, initiating the vexatious Fall River litigation in which the appellees alleged that she had breached her fiduciary duty to WRC by usurping a corporate opportunity. Bogosian incorrectly asserts on appeal that appellees' counterclaim complained that [she] breached her fiduciary duty [to WRC] when she purchased options on the property in Fall River. (Emphasis added.) Instead, in their counterclaim the appellees merely alleged that Bogosian had utilized her official position in WRC to retain legal counsel to handle her own — as distinguished from corporate — legal matters, including the Fall River litigation. 19 Federal Rule of Civil Procedure 38(b) permits a party to demand a trial by jury of any issue triable of right by a jury, provided the jury-trial demand is served within ten days after the service of the last pleading directed to such issue. Fed.R.Civ.P. 38(b). Bogosian contends, in effect, that she was entitled to a jury trial on counts 1 and 2 simply on the basis that her complaint and appellants' counterclaim arose from a common factual setting, viz., the Fall River property litigation. The right to jury trial depends not upon the factual setting from which the claim arose, however, but (i) upon whether the claim involves an issue triable of right by a jury, and (ii) upon the nature of the cause of action as well as its historical treatment in English-American jurisprudence ( viz., whether the proceedings are more emblematic of a legal proceeding, as distinguished from an equitable one). See Tull v. United States, 481 U.S. 412, 417-18, 107 S.Ct. 1831, 95 L.Ed.2d 365 (1987); see also supra note 4. 20 Additionally, we are not presently confronted with the situation in which two claims require factfinding on an element common to both causes of action, such that the nonequitable claim might need to be tried first to a jury. Cf., e.g., Allison v. Citgo Petroleum Corp., 151 F.3d 402, 423-24 (5th Cir.1998); Cabinet Vision v. Cabnetware, 129 F.3d 595, 599-600 (Fed.Cir. 1997). Had these appellees initially tried their counterclaim before a jury, the lone pertinent factual element would have been whether the Fall River litigation related to Bogosian's personal business, such that she would have been in breach of her fiduciary duty to WRC by having converted its funds for the purposes of retaining counsel to handle her own case. In contrast, Bogosian could prevail on her equitable claims in counts 1 and 2 only by demonstrating that the appellees had acted in bad faith by initiating the litigation relating to the Fall River property — a finding neither essential to, nor an element of, their counterclaim for conversion. 21 Next, Bogosian asserts that she relied upon an inaccurate docket entry by the clerk's office, which mistakenly stated:  Defendant made a demand for a jury. Yet Bogosian neither provides a citation to the record on appeal, nor can we glean any such docket entry from the record on appeal, see Fed. R.App. P. 28 (requiring that appellant cite to record as to each salient fact). Moreover, not only was she a defendant as to appellees' counterclaim, but even if any such docket entry did advert to the appellees in the singular ( i.e., Defendant), Bogosian cites no authority for the suggestion that reliance on an obvious clerical error suffices to resurrect a right to jury trial previously waived. 22 Lastly, Bogosian maintains that she opposed the district court ruling rejecting her motion to continue by asserting that the scheduling of counts 1 & 2 for bench trial abrogated her Seventh Amendment right to jury trial. The present contention is patently flawed in at least two respects: (i) her cursory objection failed to detail the nature of any putative error; and (ii) without more, no such belated objection can serve to resurrect a jury-trial right long since waived. See Fed.R.Civ.P. 38(d) (The failure of a party to serve and file a demand as required by this rule constitutes a waiver by the party of trial by jury.) (emphasis added); Fed.R.Civ.P. 39(b) (noting that party who fails to make timely request for jury trial may avoid waiver and secure a jury trial only if the district court, in its discretion, acts favorably on such a request). 23 Accordingly, we affirm the district court ruling that Bogosian waived any right to trial by jury in relation to counts 1 & 2. 24
25 Next, Bogosian maintains that the district court erred in denying her motions to postpone the bench trial due to her life-threatening illness. We review trial-management rulings for clear abuse of discretion and [o]nly an `unreasoning and arbitrary insistence upon expeditiousness in the face of a justifiable request for delay will abuse [such discretion].' N.E. Drilling, Inc. v. Inner Space Servs., Inc., 243 F.3d 25, 36 (1st Cir.2001) (citation omitted). Our review examines, inter alia, the delay entailed, the reasons for the request, whether the moving party is at fault, any inconvenience to the court and litigants, and whether the denial of a continuance unfairly would prejudice the moving party. See FDIC v. Houde, 90 F.3d 600, 608 (1st Cir.1996). 26 Although we recognize that Bogosian experiences serious health problems, the record on appeal plainly reflects that these district court rulings were neither irrational nor arbitrary. First and foremost, by July 2000 when Bogosian submitted the initial motion to continue the trial, this litigation had been languishing for twelve years. Her motions were also predicated upon her recent retention of new counsel, the ninth such substitution of counsel since she initiated her lawsuit. Even assuming some adequate justification for Bogosian's numerous replacements of trial counsel, the attendant further delays plainly afforded additional legitimate grounds for the district court to continue to seek, wherever practicable, a fair and expeditious disposition of the case. See Amarin Plastics, Inc. v. Md. Cup Corp., 946 F.2d 147, 151 (1st Cir.1991) (noting that trial court may consider reasons for previous delays). 27 Second, medical doctors determined that Bogosian, then age 77, suffered from several debilitating illnesses, including severe arthritis and a serious anxiety disorder. See Morrissey v. Nat'l Mar. Union, 397 F.Supp. 659, 668 (S.D.N.Y.1975) (noting unavailable witness's advanced age as ground for denying continuance), aff'd, 544 F.2d 19, 32 (2d Cir.1976). As regards her metastatic lung cancer, Bogosian's doctors performed major surgery ( viz., a lobectomy), followed by an arduous course of concurrent radiation and chemotherapy, which was expected to provide Bogosian with but a 30% to 50% prospect of long-term survival. Although in more normal circumstances a continuance may well have been warranted, there existed the very real prospect that any immediate postponement almost surely would deteriorate into an indefinite one given that Bogosian's physical condition was such as reasonably to suggest that it was improbable that she would ever become more available to assist counsel or testify at trial. See Amarin Plastics, Inc., 946 F.2d at 152-53 (noting absence of any reasonable indication that party would ever improve enough to appear at trial); Scholl v. Felmont Oil Corp., 327 F.2d 697, 700 (6th Cir.1964) (affirming denial of continuance absent any medical assurances that witness would ever be available to testify at trial). 28 Third, trial counsel for Bogosian advised the district court at the September 2000 hearing that he intended to substitute a limited liability family corporation as the lone plaintiff, in order to minimize Bogosian's continued involvement and participation in the proceedings. Plainly, such a representation by counsel strongly implied that other members of Bogosian's family were available and competent to assist counsel with further pretrial preparations. 29 Fourth, Bogosian's protestations on appeal notwithstanding, the district court granted her July 2000 motion to continue, thereby authorizing the requested 190-day extension, whereupon the anticipated trial date was postponed to late March 2001. Moreover, the district court subsequently allowed yet another motion for continuance, further postponing the trial to May 8, 2001. 30 Fifth, Bogosian submitted no updated medical documentation that she remained unfit to testify at trial in May 2001, even though her oncologist had represented in a November 3, 2000, letter that her treatment would finish in late January [2001], and that he anticipated a month or so of post-treatment recovery. 5 Moreover, in a January 2001 follow-up letter, the oncologist reiterated that his estimate of the anticipated recovery time for Ms. Bogosian from all her treatment would not be until the end of February of this year 2001. The January 2001 letter was the final pretrial communication from her medical professionals regarding when she would be able to testify at trial. 6 As the district court observed at trial, Bogosian still has not shown she is incapable of testifying in open court. All I have is [counsel's] word that she is not able to come to court. I see no doctor's certificate. 31 Moreover, the district court later allowed Bogosian's deposition testimony to be admitted at trial. Finally, Bogosian has made no contention on appeal (let alone any showing) that her deposition testimony was inherently inferior, in any respect, to her anticipated live testimony. See Wells v. Rushing, 755 F.2d 376, 380 (5th Cir. 1985) (noting that need for continuance becomes less compelling where testimony comes in by deposition). 32 Accordingly, given the totality of the circumstances, the district court rulings regarding Bogosian's requests for a sick-leave-based continuance did not remotely constitute an `unreasoning and arbitrary insistence upon expeditiousness in the face of a justifiable request for delay.' N.E. Drilling, Inc., 243 F.3d at 36 (citation omitted). 7 33
34 In March 1998, Bogosian discovered a discarded CD ROM containing hundreds of internal WRC documents. One year later, as directed on remand, see Bogosian, 158 F.3d at 9, the district court scheduled an evidentiary hearing to determine Bogosian's one-third portion of the tax liability which WRC incurred upon the sale of certain corporate properties in order to generate the funds with which to acquire her WRC shares, pursuant to WRC's count 3 statutory election. 35 The day before the scheduled hearing, Bogosian submitted a motion to continue, citing a further need to extract and evaluate the newly-discovered CD-ROM documents. She contended that at least one of the extracted CD-ROM documents suggested that (i) WRC had committed fraud on the court at the pre-remand hearing regarding count 3, during which the district court placed a valuation on the WRC assets and cash flow; (ii) a portion of the sales proceeds from one piece of property was diverted covertly by WRC to other corporate purposes; and (iii) WRC overstated, by one hundred percent, the capital gains it realized from the sale. 36 Bogosian now maintains that (i) the district court allowed insufficient time for her to retrieve the documents relating to certain suspicious business practices, vaguely described by her counsel as the marking-up of WRC's payroll and the mishandling of insurance proceeds, and (ii) these documents reflected that WRC had initiated these activities prior to February 1989 ( viz., the date Bogosian was terminated), thus tending to suggest that her brothers had a motive for freezing her out of WRC ( viz., in order to conceal their own misfeasance from her). We discern no abuse of discretion in these rulings. See N.E. Drilling, Inc., 243 F.3d at 35. 37 At the March 30 hearing, Bogosian sought a three-week delay to study the contents of the CD-ROM. Over defendants' objection, the district court allowed as how the proffered evidence appeared to be relevant to the disposition of count 3, then granted the continuance. Furthermore, when the district court proposed to suspend the accrual of interest on the count 3 fund, Bogosian's counsel expressed ready agreement. 38 Thereafter, at a hearing held on April 28, Bogosian's counsel requested yet another thirty-day continuance within which to depose WRC's controller concerning the previously-discussed land sale, stating emphatically: After 30 days is up, that's it, we are ready for trial, and [a]ll I am asking for is 30 days, and to get on with this trial. 39 On the ample basis of these representations, the district court granted the requested continuance for the limited purpose of deposing the WRC controller. 40 At a hearing on July 30, however, Bogosian requested yet another round of discovery — even though she had yet to depose the WRC controller — contending that (i) the CD-ROM documents had demonstrated that the WRC had a much larger monthly cash flow in 1996 than the $9,500 previously represented to the court, (ii) we ... can envision a situation ... where WRC was being used as a private cookie jar [ i.e., improperly and surreptitiously to syphon off cash to its shareholders], (iii) WRC's so-called compulsion to sell its assets in order to buy out her shares probably was a ruse, and (iv) accordingly, Bogosian should not be held accountable for her one-third share of the tax liability associated with the sale of those shares. 41 The choice of the term envision by Bogosian's counsel was telling indeed. Pressed by the court, counsel admitted that he had no basis for claiming [that WRC did not have to sell the properties], but that additional discovery might disclose cash diversions by insiders. Then and there, the district court made clear that it would not permit additional discovery, unless there's really newly discovered evidence here, and that Bogosian had submitted no motion for new trial showing [any] newly discovered evidence. Accordingly, the court denied the motion for additional discovery, then seriously took under advisement appellees' motion for sanctions. 42 Given the exceptionally sorry travel of this case, the instant contention can only be deemed utterly frivolous. Far from abusing its discretion, the district court proceeded to allow the continuances requested by Bogosian's counsel to study the CD ROM documents and conduct limited depositions. Thereafter, it reasonably drew the line when Bogosian acknowledged that she had no newly-discovered evidence warranting further discovery. See Ameristar Jet Charter, Inc. v. Signal Composites, 244 F.3d 189, 193 (1st Cir. 2001) (noting that appellant concedes, however, that it has no evidence that it will receive contradictory testimony ... [and][w]e will not allow [it] to go on a `fishing expedition,' with the mere `hope' that it will obtain such information) (citation omitted). 8 43
44 a) The Motion to Quash Subpoena Served Upon Opposing Counsel 45 Next, Bogosian contends that the district court made several erroneous rulings at trial. First, she suggests that her due-process rights were violated when the district court (i) quashed her subpoena against opposing counsel, William Grimm, and (ii) barred Bogosian from submitting a proffer as to the substance of Grimm's anticipated testimony. See Fed.R.Evid. 103(a)(2). 46 Trial court rulings on motions to quash are reviewed only for abuse of discretion. See Town of Norfolk v. U.S. Army Corps of Eng'rs, 968 F.2d 1438, 1456 (1st Cir.1992). Although not strictly forbidden, the procurement of trial testimony from opposing counsel is generally disfavored. See United States v. Yonkers Bd. of Educ., 946 F.2d 180, 185 (2d Cir.1991). Among the appropriate factors for consideration by the trial court are the following: whether (i) the subpoena was issued primarily for purposes of harassment, (ii) there are other viable means to obtain the same evidence, and (iii) to what extent the information sought is relevant, non-privileged, and crucial to the moving party's case. See Pamida, Inc. v. E.S. Originals, Inc., 281 F.3d 726, 729-30 (8th Cir.2002); Gould, Inc. v. Mitsui Mining & Smelting Co., Ltd., 825 F.2d 676, 680 n. 2 (2d Cir. 1987). 47 At trial, Bogosian maintained (i) that she had two internal WRC documents which would show that Mr. Grimm had been a WRC director in 1989-90, (ii) that during this same period WRC had engaged in suspicious business practices, vaguely described by her counsel as the marking-up of its payroll and the mishandling of insurance proceeds; (iii) that these marked-up documents demonstrated that WRC initiated these activities prior to February 1989 ( viz., the date Bogosian was terminated), thus tending to indicate that her brothers had a motive for freezing her out of the company ( viz., in order to conceal their misfeasance from her). We discern no abuse of discretion whatsoever by the district court. 48 As evidence of her apparent intent to harass the defense, we note that Bogosian (i) served the subpoena the day before trial, without the slightest attempt to explain why she had failed to depose opposing counsel during the preceding ten-year period of ongoing discovery, (ii) requested that Mr. Grimm produce eighteen broadly-described categories of corporate documents spanning more than two decades ( i.e., since 1980), (iii) made no showing that she was unable to obtain the evidence from other sources, particularly WRC, their rightful owner, (iv) requested that Mr. Grimm testify at trial solely to the existence[ ] or ... authenticity of the two documents, testimony she obviously could have obtained from any number of witnesses other than Mr. Grimm, (v) sought testimony from Mr. Grimm which was marginally relevant at most, in that the two documents postdated the freeze-out. Finally, the testimony sought from Mr. Grimm — in all likelihood and for the most part — would have been cumulative, since Bogosian herself adduced other evidence that her brothers had frozen her out in order to conceal from her their alleged corporate shenanigans. 49 Accordingly and for the foregoing reasons, the district court ruling quashing the subpoena must be affirmed. 50 b) The Adverse Inference Sought Based On the Failure of Certain Defendants to Appear at Trial 51 Bogosian next contends that the district court erred in declining to infer — from the failure of defendants James and Z. Elaine Woloohojian to appear at trial — that their testimony would have been adverse to the defense. She points to the putative testimony of her process server that these defendants made themselves unavailable to testify by evading service of process. 9 We discern no error. 52 The missing witness rule permits, rather than compels, the factfinder to draw an adverse inference from the absence of a witness, see Niziolek v. Ashe, 694 F.2d 282, 292 (1st Cir.1982), particularly where the factfinder concludes that the party who requested the adverse inference failed to subpoena a witness otherwise available to testify, see Trump Plaza Assocs. v. Poskanzer ( In re Poskanzer ), 143 B.R. 991, 998 (Bankr.D.N.J.1992). As the finder of fact, of course, it was for the district court to determine the credibility of the proffer Bogosian made regarding the process server's testimony. 53 In so doing, the district court simply concluded that James and Z. Elaine Woloohojian had not evaded service of process. As such credibility determinations are within the unique province of the trier of fact, see Carr v. PMS Fishing Corp., 191 F.3d 1, 7 (1st Cir.1999), the district court was not compelled to draw the suggested adverse inference from the absence of James and Z. Elaine Woloohojian at trial. 10 54
55 Finally, Bogosian insists that the district court, in finding for the appellees on counts 1 and 2, committed various errors of law and ignored unrebutted evidence favorable to her case. Following a bench trial, the district court's findings of fact, including its witness-credibility assessments, are reviewed for clear error only. See Barrs v. Lockheed Martin Corp., 287 F.3d 202, 210 (1st Cir.2002); Carr, 191 F.3d at 7. The outcome in the instant case turned principally upon just such credibility determinations. 56 The district court explicitly credited appellees' testimony that Bogosian was fired solely because she voluntarily ceased performing any work at WRC, while continuing to draw full salary and benefits. Bogosian, 167 F.Supp.2d at 503 (This court credits the testimony of James and Harry.). Undaunted, Bogosian incorrectly asserts on appeal that her late brother, Harry, provided unrebutted deposition testimony that the actual basis for her termination had been that she sought to audit the corporate books. Instead, Harry simply attested to the fact that Bogosian had requested the audit and questioned the defendants' motives. Harry did not state, however, that this was what prompted Bogosian's discharge. 57 Thus, the mere description of Bogosian's requests certainly did not compel the district court to determine, as a fact, either that her audit requests were justified or that she was fired by her brothers in order to prevent her revelation of their improper business practices. Indeed, Bogosian has never adduced any corroborative evidence whatsoever in regard to her allegations. 58 Instead, Bogosian simply maintains that she adduced evidence that Harry was not terminated by WRC in the early 1980's for failure to perform his corporate duties, and that WRC's disparate treatment of her belies appellees' purportedly legitimate basis for terminating her. The district court reasonably determined, however, that Bogosian was well aware — regardless whether Harry should have been fired earlier — that she was knowingly inviting termination by her refusal to perform her own corporate responsibilities. Thus, although a rational factfinder conceivably may have inferred some such nefarious motive as that suggested by Bogosian based on the proffer of disparate-treatment evidence, the record plainly did not compel any such inference. 59 Further, Bogosian contends that her daughter presented unrebutted testimony that appellees advised her that it would be futile for Bogosian to come to work, since they intended to ignore her input on corporate decisionmaking. However, it remains within the exclusive province of the trier of fact to determine whether unrebutted testimony is creditworthy. See Carr, 191 F.3d at 7. Thus, the district court explicitly found (i) that Bogosian's daughter had her own agenda and (ii) that she had demonstrated on the witness stand that she lacked credibility. Bogosian, 167 F.Supp.2d at 500. 60 Next, with regard to whether appellees' commencement of the Fall River litigation constituted a discrete breach of their fiduciary responsibilities, Bogosian urges us to set aside the district court finding that appellees commenced their action in the good faith belief that Bogosian had misappropriated a corporate opportunity of WRC by purchasing the Fall River property on behalf of E & J. Id. at 500-01. She contends that the state court found not only that she had not breached her fiduciary duty, either to WRC or her brothers, but that appellees' lawsuit had been unfounded ( viz., frivolous, designed solely to harass and to recover damages to offset their anticipated buy-out of her shares). 61 Quite the contrary, the state court simply turned away appellees' alternative contentions on appeal, either (i) that they had adduced such compelling evidence of Bogosian's breach of her fiduciary responsibility that a reasonable factfinder was compelled to find in their favor, or (ii) that the judgment was against the clear weight of the evidence. In its unpublished opinion, made part of the record before us, the state appellate court explicitly noted that appellees had adduced evidence which might have been credited by the jury, but that the jury chose instead to credit Bogosian's version. Cf., e.g., Bartlett v. John Hancock Mut. Life Ins. Co., 538 A.2d 997, 1000 (R.I.1988) (noting that bad faith will not be inferred where party sued on debatable issue of law). The Bogosian appeal itself, ironically, has now been hoisted on the same petard. 62 Bogosian further faults the district court for (i) finding that she sustained no damages as a result of the Fall River lawsuit, and (ii) ignoring that the appellees had lodged a lis pendens against the Fall River property, that three prospective buyers thereafter decided not to purchase the property, and that state law permits the factfinder to infer that such a cloud on title thwarted its sale. See DeLeo v. Anthony A. Nunes, Inc., 546 A.2d 1344, 1347-48 (R.I.1988). As her citation to DeLeo itself acknowledges, however, any such inference is permissive, rather than mandatory. Id. (Filing such a document without a colorable claim is done at the filer's peril.). Moreover, appellees adduced ample evidence that the three prospective purchasers of the Fall River property backed out for reasons other than the lis pendens. Bogosian, 167 F.Supp.2d at 496-97. 63 Bogosian points also to her brother James's testimony that he has never believed that she stole a WRC corporate opportunity by purchasing the Fall River property through E & J. She insists that James's testimony compelled a finding that the property did not represent a corporate opportunity of WRC, and, consequently, that she could not have pirated such an opportunity from WRC. 64 The present contention conveniently ignores the requirement that the proffered testimony is to be viewed in the context of the witness's other testimony: (i) that James, unlike Bogosian, had not participated in the initial decision to acquire the property for E & J, rather than for WRC, and (ii) that James believed from the outset that Bogosian's decision violated her fiduciary duty to WRC and to their brother, Harry, who was not a partner in E & J. Additionally, the district court aptly cited James's testimony that the Fall River property acquisition was unlike E & J's other purchases, in that WRC itself had remitted the option fees to obtain the former. Bogosian, 167 F.Supp.2d at 502. 65 As the record on appeal contains ample supportive evidence for the district court judgment relating to counts 1 and 2, there was no clear error. See Barrs, 287 F.3d at 206. 11