Court Opinion

ID: 9556636
Source: CourtListenerOpinion
Date Created: 2023-08-18 00:00:43.392361+00
Date Added: 2024-06-11T09:01:22.389651
License: Public Domain

Case: 22-30653    Document: 00516862177       Page: 1    Date Filed: 08/17/2023

          United States Court of Appeals
               for the Fifth Circuit                              United States Court of Appeals
                                                                           Fifth Circuit

                              ____________                               FILED
                                                                   August 17, 2023
                                No. 22-30653                        Lyle W. Cayce
                              ____________                               Clerk

   Louisiana Newpack Shrimp Company, Incorporated,

                                                         Plaintiff—Appellee,

                                    versus

   Indigo Seafood Partners, Incorporated,

                                                                 Defendant,

   ______________________________

   Longhai Desheng Seafood Stuff Company, Ltd.,

                                                        Plaintiff—Appellant,

                                    versus

   Louisiana Newpack Shrimp Company, Incorporated,

                                           Defendant—Appellee.
                 ______________________________

                 Appeal from the United States District Court
                    for the Eastern District of Louisiana
                  USDC Nos. 2:19-CV-12948, 2:20-CV-782
                 ______________________________

   Before Jones, Clement, and Haynes, Circuit Judges.
Case: 22-30653         Document: 00516862177               Page: 2    Date Filed: 08/17/2023

                                            No. 22-30653

   Per Curiam: *
          Longhai Desheng Seafood Stuff Company, Ltd. (“Longhai”) appeals
   the district court’s amended final judgment in favor of Louisiana Newpack
   Shrimp Company, Inc. (“Louisiana Newpack”). For the reasons set forth
   below, we REVERSE.
                                       I.     Background
          Louisiana Newpack, Ocean Feast Company, Ltd. (“Ocean Feast”),
   and Indigo Seafood Partners, Inc. entered into a joint venture to procure, im-
   port, and sell seafood products from manufacturers located around the world.
   Louisiana Newpack was the financier for this joint venture. The joint venture
   placed eleven orders for crabmeat with Longhai, a crabmeat processor and
   exporter. While Louisiana Newpack paid for the first eight orders, Longhai
   initially did not receive payment for the final three orders. Louisiana New-
   pack took possession and eventually disposed of these three orders. Longhai
   sent a demand for payment to Louisiana Newpack, which, in turn, made par-
   tial payments. Ultimately though, $998,188.03 remained outstanding for the
   three orders.
          Longhai sued Louisiana Newpack, claiming (1) it contracted with
   Louisiana Newpack and its founder, and they breached that contract by not
   paying the outstanding $998,188.03 balance, and, alternatively, (2) Louisiana
   Newpack and its founder had failed to pay Longhai based on an open account
   between the parties. The district court consolidated this case with several
   related cases.
          The case proceeded to trial, during which Louisiana Newpack orally
   moved for judgment as a matter of law under Federal Rule of Civil Procedure

          _____________________
          *
              This opinion is not designated for publication. See 5th Cir. R. 47.5.

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                                        No. 22-30653

   50 on Longhai’s open account claim. The court denied this motion and
   permitted the jury to consider the merits of the open account claim even if it
   found that no contract existed between the parties. The court also provided
   the jury with separate instructions as to the definitions of both a “contract”
   and an “open account.”
          The jury found that Longhai failed to demonstrate it had a contract
   with Louisiana Newpack. However, the jury separately found, in line with
   its open account instructions, that (1) Longhai proved it had an open account
   with Louisiana Newpack, (2) Longhai sent a written demand for the amount
   owed, (3) Louisiana Newpack failed to pay the open account within thirty
   days, and (4) Louisiana Newpack owed Longhai $998,188.03 based on this
   open account. 1 The district court entered judgment consistent with these
   findings.
          Louisiana Newpack then moved to amend the judgment and for a new
   trial under Federal Rule of Civil Procedure 59. The district court granted the
   motion in part and entered an amended judgment in favor of Louisiana
   Newpack, dismissing all of Longhai’s claims. It reasoned Longhai could not
   recover on its open account claim because the jury found that there was no
   contract between the parties, and that its previous determination to the
   contrary constituted a manifest error of law. Longhai timely appealed.

          _____________________
          1
            The jury further determined that Longhai did not have “unclean hands,” but that
   its recovery should nonetheless be reduced by $665,458.69 because of its own fault or
   conduct. Finally, the jury concluded that “Ocean Feast [wa]s liable for any debt owed to
   Longhai,” which amounted to $332,729.34.

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                                        No. 22-30653

                     II.   Jurisdiction & Standard of Review
          The district court had diversity jurisdiction over this case under 28
   U.S.C. § 1332(a). We, in turn, have jurisdiction over this appeal pursuant to
   28 U.S.C. § 1291. “In general, a grant or denial of a Rule 59(e) motion is
   reviewed for abuse of discretion.” Fletcher v. Apfel, 210 F.3d 510, 512 (5th
   Cir. 2000). However, where an appeal involves “[i]ssues that are purely
   questions of law,” we review de novo. Tyler v. Union Oil Co. of Cal., 304 F.3d
   379, 405 (5th Cir. 2002).
          Further, the standard for amending a judgment is very high. See
   Templet v. HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004). Indeed, this
   standard “favor[s] the denial of motions to alter or amend a judgment.” S.
   Constructors Grp., Inc. v. Dynalectric Co., 2 F.3d 606, 611 (5th Cir. 1993).
   Accordingly, to warrant the extreme remedy of an alteration of a judgment, a
   Rule 59(e) motion “must clearly establish . . . a manifest error of law or fact.”
   Rosenzweig v. Azurix Corp., 332 F.3d 854, 863 (5th Cir. 2003) (quotation
   omitted).
                                 III.      Discussion
          It is important to consider the jury’s instructions in this context.
   “The jury system is premised on the idea that rationality and careful regard
   for the court’s instructions will confine and exclude jurors’ raw emotions.”
   CSX Transp., Inc. v. Hensley, 556 U.S. 838, 841 (2009). As the Supreme
   Court has made clear, “juries are presumed to follow the court’s
   instructions.” Id.
          Relevant to this appeal, the district court provided two sets of jury
   instructions: one with respect to contracts, and one with respect to open
   accounts. Per these instructions, the jury separately considered Longhai’s
   breach of contract and open account claims. That is, the jury independently
   assessed whether Louisiana Newpack was obliged to perform under a

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                                    No. 22-30653

   contract with Longhai, as well as whether the business transactions between
   Louisiana Newpack and Longhai gave rise to an open account.                 Put
   differently, the district court’s instructions provided definitions of what
   would constitute a contract and open account sufficient for the purposes of
   Longhai’s claims.
          The jury, applying the district court’s contract-related instructions,
   ultimately concluded that Longhai had failed to prove that it entered a
   contract with Louisiana Newpack. However, the jury, applying the entirely
   different set of open account-related instructions, concluded that Longhai
   had shown that it and Louisiana Newpack had an open account. Because we
   can presume that a jury follows a district court’s instructions, see id., we can
   presume here that the jury followed the different sets of instructions it was
   given and concluded that, while Longhai and Louisiana Newpack didn’t have
   a contract that fit the court-provided definition of a formal contract, there
   was sufficient evidence to support a contractual relationship in the form of an
   open account.
          With that being the case, we turn to the relevant statutory provisions
   and case law. Under Louisiana’s open account statute, “[w]hen any person
   fails to pay an open account within thirty days after the claimant sends
   written demand therefor correctly setting forth the amount owed,” the
   claimant can recover “collection of such claim when judgment on the claim
   is rendered in [his] favor.” La. Rev. Stat. § 9:2781(A). The statute also
   provides that an “‘open account’ includes any account for which a part or all
   of the balance is past due, whether or not the account reflects one or more
   transactions and whether or not at the time of contracting the parties
   expected future transactions.” Id. § 9:2781(D).
          Courts are split as to whether a party must demonstrate the existence
   of a contract to recover on an open account claim. As the district court

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                                     No. 22-30653

   correctly observed, some state and federal court cases discuss open accounts
   in the context of contracts and suggest that a contract, or a contractual
   relationship, is a necessary prerequisite for an open account claim. See, e.g.,
   A Better Place, Inc. v. Giani Inv. Co., 445 So. 2d 728, 733 (La. 1984); Kelso v.
   Butler, 899 F.3d 420, 422–23, 426 (5th Cir. 2018). However, in contrast,
   different state and federal cases expressly distinguish between open account
   claims and typical contract claims. See, e.g., Cambridge Toxicology Grp., Inc.
   v. Exnicios, 495 F.3d 169, 174 (5th Cir. 2007); Signlite, Inc. v. Northshore Serv.
   Ctr., Inc., 959 So. 2d 904, 907 (La. Ct. App. 2007); Olinde v. Couvillion, 650
   So. 2d 1241, 1242 (La. Ct. App. 1995). Indeed, a number of Louisiana courts
   have determined that open account claims can remain viable even where
   there is no typical contract between the parties. See, e.g., Acadian Servs., Inc.
   v. Durand, 813 So. 2d 1142, 1143–44 (La. Ct. App. 2002); Hayes v. Taylor, 812
   So. 2d 874, 878 (La. Ct. App. 2002); Sandoz v. Dolphin Servs., Inc., 555 So.
   2d 996, 997–98 (La. Ct. App. 1989).
          The district court concluded that its initial determination (that the
   jury should be able to consider the open account claim irrespective of its
   finding on the contract claim) was a manifest error of law that justified
   amending the original judgment. However, the abovementioned conflicting
   case law and the relevant statutory provisions indicate that it was not a
   manifest error of law to allow Longhai to recover on its open account claim.
   That is, while various cases speak to the contractual relationship requirement
   for open accounts, numerous courts have distinguished between open
   account claims and contract claims and allowed plaintiffs to recover on open
   account claims despite the absence of a formal contract.              Moreover,
   considering the distinct sets of instructions it received, the jury’s finding that
   no contract existed between Louisiana Newpack and Longhai did not preclude
   it from finding a contractual relationship in support of its separate finding that
   the parties had an open account.

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                                           No. 22-30653

           Therefore, because the district court concluded otherwise, we
   REVERSE and RENDER by reinstating the original judgment. 2

           _____________________
           2
              Longhai separately raises a sufficiency of the evidence challenge to the jury’s
   finding that no contract existed between the parties. See Ham Marine, Inc. v. Dresser Indus.,
   Inc., 72 F.3d 454, 459 (5th Cir. 1995) (per curiam). Under our “well-settled” approach to
   such challenges, “[u]nless the evidence” upon which the jury bases its finding “is of such
   quality and weight that reasonable and impartial jurors could not arrive at such a verdict, the
   findings of the jury must be upheld.” Id. (emphasis added). While Longhai points to
   various pieces of evidence in support of its argument that Louisiana Newpack was bound
   by a contract, it concedes that it never entered into a formal contract with Louisiana
   Newpack. Likewise, there were “numerous plausible grounds on which [the jury] could
   have concluded that [Longhai] failed to” demonstrate the existence of that contract,
   including, for example, discrediting certain testimony. King v. Univ. Healthcare Sys., L.C.,
   645 F.3d 713, 722 (5th Cir. 2011). Therefore, we conclude we must uphold the jury’s
   finding that no contract existed between the parties. See Ham Marine, Inc., 72 F.3d at 459.

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