Court Opinion

ID: 4274868
Source: CourtListenerOpinion
Date Created: 2018-05-14 14:00:33.853714+00
Date Added: 2024-06-11T14:33:39.984869
License: Public Domain

Case: 17-13740   Date Filed: 05/14/2018     Page: 1 of 19

                                                             [DO NOT PUBLISH]

               IN THE UNITED STATES COURT OF APPEALS

                        FOR THE ELEVENTH CIRCUIT
                          ________________________

                                No. 17-13740
                            Non-Argument Calendar
                          ________________________

                     D.C. Docket No. 9:16-cv-81696-DMM

PATRICIA GONZALEZ,

                                                       Plaintiff-Counter Defendant-
                                                                          Appellee,

LESHA ROSARIO,

                                                                 Plaintiff-Appellee,

                                    versus

JAMES BATMASIAN,
individually,
d.b.a. Investments Limited,
MARTA BATMASIAN,
individually,
d.b.a. Investments Limited,

                                                 Defendants-Counter Claimants-
                                                                    Appellants.
              Case: 17-13740        Date Filed: 05/14/2018   Page: 2 of 19

                            ________________________

                    Appeal from the United States District Court
                        for the Southern District of Florida
                          ________________________

                                      (May 14, 2018)

Before WILLIAM PRYOR, ANDERSON and HULL, Circuit Judges.

PER CURIAM:

       Defendants James Batmasian and Marta Batmasian appeal from the district

court’s denial of their motion for a new trial, after a jury returned a verdict in favor

of plaintiff Patricia Gonzalez in Gonzalez’s action for unpaid overtime under the

Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201, et seq. The defendants

argue that the district court should have ordered a new trial because the verdict was

(1) contrary to the great weight of the evidence, and (2) influenced by improper

and prejudicial statements from the plaintiffs’ attorney. After review, we conclude

that (1) the evidence adequately supported the verdict, and (2) as to the improper

statements, the district court gave curative instructions and did not abuse its

discretion in denying the defendants’ motion for a new trial. We affirm.

                               I.      BACKGROUND

A.    The FLSA Action

      In October 2016, plaintiff Patricia Gonzalez and co-plaintiff Lesha Rosario

filed this FLSA action against defendants James and Marta Batmasian. The

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complaint alleged that Gonzalez and Rosario worked as a property manager and a

legal assistant, respectively, for the defendants’ real estate business, elsewhere

identified as Investments Limited. The plaintiffs alleged that they were not paid

overtime wages to which they were entitled, and that they were regularly instructed

to work “off of the clock”—that is, without recording their hours—so that the

defendants could avoid paying overtime.

       The complaint asserted one claim for recovery of lost overtime wages,

liquidated damages, compensatory damages, and attorney’s fees. As litigation

progressed, it became clear that the key issues were (1) whether plaintiff Gonzalez,

a property manager, was exempt from overtime pay under the administrative or

executive exemptions of the FLSA, and (2) whether co-plaintiff Rosario, a legal

assistant, had actually worked the “off of the clock” hours she claimed to have

worked.

B.     Trial, Verdict, and Motion for New Trial

       The three-day jury trial took place on May 1–3, 2017. On the third trial day,

the jury returned a verdict in favor of plaintiff Gonzalez and awarded Gonzalez

$36,939 in unpaid overtime. 1 The jury also found that the defendants “knew or

showed reckless disregard for whether the FLSA prohibited their conduct.”

       1
        Co-plaintiff Rosario never attended the trial. After the close of evidence, the district
court granted the defendants’ motion for a directed verdict as to Rosario’s claim. Rosario
appealed that decision separately. On February 23, 2018, this Court affirmed the district court’s
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       Subsequently, the district court granted plaintiff Gonzalez’s motion for

liquidated damages, based on the jury’s finding of willful conduct. On May 17,

2017, the district court entered judgment for Gonzalez in the amount of $73,878,

consisting of the jury’s award of $36,939 in unpaid overtime wages plus another

$36,939 in liquidated damages.

       The defendants timely moved for a new trial pursuant to Federal Rule of

Civil Procedure 59. The defendants argued that (1) the jury’s verdict was “against

the great weight of the evidence,” and that (2) the “egregious” conduct of the

plaintiffs’ attorney, Chris Kleppin, made it “reasonably probable that the verdict

was influenced by [attorney Kleppin’s] prejudicial statements.”

       The district court denied the defendants’ motion for a new trial. This is the

defendants’ appeal.2

                            II.     STANDARD OF REVIEW

       We review for abuse of discretion a district court’s denial of a motion for a

new trial under Rule 59. Iervolino v. Delta Air Lines, Inc., 796 F.2d 1408, 1419

(11th Cir. 1986).

directed verdict against Rosario. See Gonzalez v. Batmasian, __ F. App’x __, No. 17-12751
(11th Cir. Feb. 23, 2018). Nothing herein relates to co-plaintiff Rosario’s separate appeal.
       2
         Plaintiff Gonzalez cross-appealed from the judgment. However, Gonzalez was the
prevailing party in the district court, and stated in her notice of appeal that the cross-appeal was
“just being filed in an abundance of caution.” On December 14, 2017, this Court dismissed the
cross-appeal for lack of standing. See Picard v. Credit Sols., Inc., 564 F.3d 1249, 1255–56 (11th
Cir. 2009) (concluding that a prevailing party lacks standing to bring a “contingent cross-
appeal”).
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      Here, in reviewing the district court’s denial of the defendants’ motion for a

new trial, we will consider both the reasonableness of the jury’s verdict in light of

the evidence and the allegedly prejudicial remarks made by plaintiffs’ attorney

Kleppin. We start with the verdict.

                III.   REASONABLENESS OF THE VERDICT

      A district court should deny a new trial “when, after weighing the evidence,

the trial court cannot find that the verdict is contrary to the great weight of the

evidence.” Id. at 1419. A district court should grant a new trial “only if the verdict

is against the great, not just the greater, weight of the evidence.” Ard v. Sw. Forest

Indus., 849 F.2d 517, 520 (11th Cir. 1988).

      In determining whether a verdict is contrary to the great weight of the

evidence, a district court may not substitute its judgment for that of the jury on

questions of fact. Id. A district court “must defer to the jury’s determination when

issues of credibility are involved or the facts are in sharp conflict.” Id. at 522.

A.    FLSA and Overtime Exemptions

      Plaintiff Gonzalez’s claim was for unpaid overtime under the FLSA. The

FLSA requires employers to pay covered employees for hours worked in excess of

40 hours per week at one and one half times the employees’ regular pay rate. 29

U.S.C. § 207(a)(1). Ordinarily, an employee bringing a private action for unpaid

overtime must establish two elements: (1) that she worked unpaid overtime; and

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(2) that the employer knew or should have known of the overtime work. Bailey v.

TitleMax of Ga., Inc., 776 F.3d 797, 801 (11th Cir. 2015).

      But there are exemptions to the FLSA’s overtime requirement. The two

exemptions at issue here, the administrative and executive exemptions, provide

that the FLSA’s requirements “shall not apply with respect to . . . any employee

employed in a bona fide executive, administrative, or professional capacity.” 29

U.S.C. § 213(a)(1).

      Regulations of the U.S. Department of Labor (“DOL”) interpret these

exemptions. Under the DOL regulations, an employee is employed in a bona fide

executive capacity, and is thus exempt from overtime requirements, if she: (1) is

compensated on a salary basis above a certain amount; (2) has as a primary duty

the “management of the enterprise in which the employee is employed or of a

customarily recognized department or subdivision thereof”; (3) customarily and

regularly directs the work of two or more other employees; and (4) has the

authority to hire or fire other employees or recommend a change in employment

status for other employees. 29 C.F.R. § 541.100(a). Likewise, an employee is

employed in a bona fide administrative capacity, and is thus exempt from overtime

requirements, if she: (1) is compensated on a salary basis above a certain amount;

(2) has as a primary duty the performance or office or non-manual work “directly

related to the management or general business operations of the employer or the

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employer’s customers”; and (3) has as a primary duty “the exercise of discretion

and independent judgment with respect to matters of significance.” 29 C.F.R.

§ 541.200.

       Thus, in order to prevail on her FLSA claim, Gonzalez must show that

(1) she was eligible for overtime pay, because she did not fall within the FLSA’s

executive or administrative exemptions, (2) she worked overtime hours for which

she was not paid, and (3) the defendants knew or should have known about the

unpaid overtime. As to eligibility for overtime and the FLSA’s exemptions,

Gonzalez could establish that she was eligible for overtime by showing she did not

meet one of the required multiple elements for both of the two exemptions. 29

C.F.R. §§ 541.100, 200.

B.    Evidence Supporting the Verdict in Favor of Plaintiff Gonzalez

      Gonzalez introduced evidence to support each element of her claim.

      As to her eligibility for overtime, plaintiff Gonzalez testified that for most of

her employment with the defendants’ company Investments Limited, she worked

as a commercial leasing agent. In that post, Gonzalez showed office spaces to

prospective tenants on behalf of the company. Gonzalez testified that she lacked

authority to sign leases, set or negotiate lease prices, approve construction changes

that tenants might request, approve major repairs or renovations, or handle invoices

for maintenance work done on the properties. According to Gonzalez, she did not

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direct other employees how to do their job, apportion work among employees,

maintain production or sales records for use in supervision or control, appraise

employees’ productivity and efficiency, promote, demote, or transfer any

employee, or provide for the safety and security of employees. Gonzalez further

testified that she did not have the authority to hire or fire employees and did not

have a management or administrative position.

      James Baker, the comptroller of Investments Limited, testified that Gonzalez

did not supervise anyone and did not have the authority to hire or fire employees.

Witness Baker also testified that Gonzalez was not involved in budgeting or

financial planning for Investments Limited, had no say in how property was

purchased or leased, had no authority to negotiate on behalf of the company, and

took no part in formulating or implementing management policies.

      Several lower-level employees testified that Gonzalez did not have the

authority to set or raise employee wages, discipline employees, or interview or

select employees.

      As to working unpaid overtime hours, Gonzalez testified that when she

started working for Investments Limited, she was told she would work 40 hours

per week and her schedule would be from 8:00 a.m. until 6:00 p.m., with a 1-hour

break for lunch. She was paid an hourly wage for this schedule. However, soon

after Gonzalez started at the company, defendant James Batmasian told her she

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was required to work on Saturdays as well. She regularly worked several hours on

Saturdays, in addition to coming in early or staying late on weekdays. Gonzalez

estimated that she worked an average of 14 overtime hours per week, for which she

was not paid.

      As to the defendants’ knowledge, Gonzalez introduced an email sent by

defendant James Batmasian to comptroller James Baker and three other employees,

asking them to “confirm that we didn’t pay out any overtime this payroll period,

nor will we pay any overtime going forward, either.” Witness Baker also testified

that defendant James Batmasian “did not want to pay overtime.” And Gonzalez

testified that Batmasian told her to work on Saturdays.

C.    Analysis of Evidence

      As noted above, in order for the jury to find for Gonzalez, it had to find that

(1) Gonzalez was eligible for overtime pay, because she did not fall within the

FLSA’s executive or administrative exemptions, (2) Gonzalez worked overtime

hours for which she was not paid, and (3) the defendants knew or should have

known about the unpaid overtime.

      Here, Gonzalez testified that she worked an average of 14 hours of overtime

each week and was not paid for this overtime. She testified that defendant

Batmasian directed her to work on Saturdays, which was outside her scheduled

hours. An email introduced as a trial exhibit revealed that Batmasian asked his

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payroll employees to ensure the company did not pay overtime. And Gonzalez

testified that she did not direct other employees how to do their job, apportion

work among employees, maintain production or sales records for use in

supervision or control, appraise employees’ productivity and efficiency, promote,

demote, or transfer any employee, or provide for the safety and security of

employees. Likewise, witness Baker testified that Gonzalez did not supervise

anyone, did not have the power to hire or fire employees, was not authorized to

negotiate on behalf of the company, and took no part in formulating or

implementing management policies.

      The defendants’ witnesses testified to the contrary, and there was a

significant amount of evidence for the defendants too. But, as the defendants point

out in their brief on appeal, this case was “largely a ‘he said, she said’ trial.” If the

jury credited the testimonies of plaintiff Gonzalez and witness Baker, the jury

could reasonably find that Gonzalez was not a manager or administrator, that she

worked overtime hours for which she was not paid, and that the defendants knew

about the unpaid overtime. See 29 U.S.C. § 207(a)(1); 29 C.F.R. §§ 541.100, 200;

Bailey, 776 F.3d at 801. The district court properly deferred to the jury’s

credibility determination. Ard, 849 F.2d at 522. Therefore, the district court

properly concluded that the verdict was reasonable and not contrary to the great

weight of the evidence. Iervolino, 796 F.2d at 1419.

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                IV.   ATTORNEY KLEPPIN’S STATEMENTS

      When a motion for a new trial is based upon the misconduct of counsel, we

determine whether the misconduct was “such as to impair gravely the calm and

dispassionate consideration of the case by the jury.” Vineyard v. Cty. of Murray,

Ga., 990 F.2d 1207, 1213 (11th Cir. 1993) (quotation omitted). “[A]bsent an abuse

of discretion, the decision of the trial court, which has had the opportunity to hear

the offensive remarks within the context of the argument and to view their effect

on the jury, should not be disturbed.” Allstate Ins. Co. v. James, 845 F.2d 315, 318

(11th Cir. 1988).

      In making this determination, we “look to the entire argument, the context of

the remarks, the objection raised, and the curative instruction.” Id. With respect to

curative instructions, we presume that a jury follows its instructions. Gowski v.

Peake, 682 F.3d 1299, 1315 (11th Cir. 2012). This is so because “the influence of

the trial judge is necessarily and properly of great weight and his lightest word or

intimation is received with deference, and may prove controlling.” Allstate Ins.

Co., 845 F.2d at 319 (quotations and alterations omitted).

      The defendants identify multiple statements by either attorney Kleppin or

witness Baker that they contend prejudiced the jury. Before we discuss the

statements, they need to be placed in context.

A.    James Batmasian’s Tax Conviction

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      In 2008, defendant James Batmasian was sentenced to eight months in

federal prison after pleading guilty to willful failure to collect or pay over tax, in

violation of 26 U.S.C. § 7202.

      In the instant litigation, the defendants moved in limine to exclude evidence

of Batmasian’s prior conviction. In an oral ruling before trial, the district court

ordered attorney Kleppin to “stay away from” the prior conviction in his opening

statement, but concluded the prior conviction was “probably fair game for

impeachment.” The district court further stated that the prior conviction “might

come in” in connection with the issue of whether the defendants made unreported

cash payments to the plaintiffs.

      At trial, James Batmasian testified briefly. Although Batmasian was a

defendant, he was called as a witness by plaintiffs’ attorney, Kleppin. Early in the

direct examination, Kleppin asked Batmasian if it was true that he was convicted

of “a felony that deals with dishonesty” in the last ten years; Batmasian confirmed

that it was true. Defense counsel did not object, and the prior conviction was not

raised again during Batmasian’s own testimony.

      However, as discussed further below, the defendants’ argument on appeal is

not that Basmasian’s prior conviction should not have been mentioned at all during

the trial. Rather, their argument is that throughout the trial attorney Kleppin made

allusions to the conviction that were outside the parameters of the district court’s in

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limine order, and that the cumulative effect of these allusions and other improper

statements prejudiced the jury and require a new trial.

B.     Remarks and Curative Instructions

       We thus turn to the specific remarks to which the defendants object. The

most significant specific remarks are as follows.

       First, attorney Kleppin asked a witness about his first meeting with

defendant James Batmasian. When the witness said he did not remember the name

of the town where they met, Kleppin asked: “It wasn’t the Rock Hill Federal

Penitentiary?” The district court sustained defense counsel’s objection and

instructed the jury to disregard that question.

       Second, in his closing argument, attorney Kleppin told the jury that James

Batmasian was “[c]onvicted of a felony with respect to a crime involving

dishonesty,” that the defendants disliked witness Baker because Baker “always

tried to keep the company doing things that were legal,” that the defendants were

engaged in “one, big scheme to evade payroll taxes on all of that overtime,” and

that the defendants were “[p]eople from Harvard who really know better, who have

been in a lot of trouble before, as you have heard, with this stuff and in other things

in their lives.”

       Third, attorney Kleppin referred several times to an FLSA audit of the

defendants’ company, which supposedly concluded that plaintiff Gonzalez was not

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exempt from overtime requirements. However, no audit report was introduced into

evidence, and Kleppin never deposed the person who supposedly conducted the

audit. The district court instructed the jury to disregard Kleppin’s statements about

the audit, saying:

               What this lawyer is saying is not evidence. I’m not quite
               sure what he is doing, at this point; but please disregard
               the statements of the lawyer as to evidence. Let’s pay
               attention to the witnesses.

The district court also stated in front of the jury that attorney Kleppin was “trying

to bypass the rules of evidence.” Subsequently, outside the presence of the jury,

the district court said it would not allow the audit into evidence without a proper

predicate. Attorney Kleppin nevertheless alluded to the audit again the next day.

       Fourth, attorney Kleppin suggested that certain emails, which the defendants

produced in discovery, had been altered to remove material information. Later, the

defendants published the full emails to the jury, showing they were not altered or

redacted.

       In addition, on several other occasions, attorney Kleppin suggested the

defendants tried to avoid paying taxes; many of these remarks resulted in sustained

objections.3

       3
          During cross-examination by defense counsel, witness Baker responded to a question
about Baker’s own tax returns by saying: “I wasn’t going to jail, like Mr. Batmasian, and pay
$250,000 in penalties . . . That man went to jail for eight months.” In front of the jury, the
district court admonished witness Baker not to pursue his “agenda,” but rather to “[a]nswer the
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C.     Analysis of Remarks

       Considering the remarks of attorney Kleppin in light of the entire argument,

the defendants’ objections, the district court’s curative instructions, and other

surrounding context, it is far from clear that the remarks “impair[ed] gravely” the

jury’s deliberations. See Allstate Ins. Co., 845 F.2d at 318; Vineyard, 990 F.2d at

1213. The jury reached a verdict that was supported by the evidence. Attorney

Kleppin made several objectionable statements, but the district court addressed

many of those statements with curative instructions or other comments that put

attorney Kleppin’s behavior in context. A jury is presumed to follow its

instructions. See Gowski, 682 F.3d at 1315. There is no indication it did not in

this case.

       Indeed, in some instances attorney Kleppin’s statements may have been

harmful to his own clients, not helpful. For example, when Kleppin alluded to the

supposed FLSA audit, the district court not only told the jury to disregard

Kleppin’s statements, but also said it was “not quite sure what [Kleppin] is doing”

and that Kleppin was “trying to bypass the rules of evidence.” Likewise, after

Kleppin accused the defendants of altering documents before producing them, the

defendants showed the original documents to the jury and proved Kleppin wrong.

lawyer’s questions and don’t get into things that have nothing to do with this case.” The district
court instructed the jury to disregard the last three minutes of testimony. Since this was during
cross-examination by defense counsel, we focus more on attorney Kleppin’s own statements.
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Arguably, in these exchanges Kleppin undermined his own credibility with the

jury. In any event, we cannot say that Kleppin’s improper remarks required a new

trial. The district court heard attorney Kleppin’s remarks in context and viewed

their effect on the jury, and concluded that the jury was not unduly prejudiced. See

Allstate Ins. Co., 845 F.2d at 318. Given our deference to the district court in such

matters, we conclude that the defendants have not carried their burden to establish

that the district court abused its discretion in denying their motion for a new trial.

Iervolino, 796 F.2d at 1419.

       The defendants rely on our decision in Allstate Ins. Co. and the former Fifth

Circuit’s decision in O’Rear v. Freuhauf Corp., 554 F.2d 1304 (5th Cir. 1977), but

those decisions are materially different and do not help the defendants. In Allstate

Ins. Co., the plaintiff, insurer Allstate, sought a declaratory judgment that the

defendants’ homeowners insurance policy was null and void because the

defendants deliberately set the fire that destroyed their home. 845 F.2d at 317. In

his closing argument, Allstate’s attorney implied to the jury that “[t]hat’s why [the

jurors’] insurance premiums [were] so high,” and suggested that the jury could “do

something about this.” Id. at 318. The district court overruled defense counsel’s

objection, refused a curative instruction, and denied Allstate’s motion for a new

trial. Id. at 316, 318.

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      We concluded that the district court committed reversible error, because

Allstate’s attorney’s remarks were “tailored to appeal to the listener’s self interest”

and “identified the jurors with the group of persons who might be adversely

affected by a decision for” the defendants. Id. at 319. We also emphasized that the

attorney’s improper argument was “amplified” by the district court’s denial of

Allstate’s objection and refusal to give a curative instruction to the jury. Id.

      Here, by contrast, attorney Kleppin’s remarks were not tailored to the jurors’

self-interest, but rather were aimed at portraying the Batmasians as dishonest. And

importantly, here the district court sustained many of the defendants’ objections

and issued several curative instructions, in addition to other criticisms of attorney

Kleppin. The likelihood that the jury’s deliberation was “impair[ed] gravely” by

Kleppin’s remarks was, accordingly, significantly lower than in Allstate Ins. Co.

See Vineyard, 990 F.2d at 1213.

      In O’Rear, defense counsel violated a specific exclusionary order by the

district court. Prior to closing arguments, the district court ordered counsel for

both parties not to allude to the dismissal of two third-party defendants from the

action. 554 F.2d at 1307. Defense counsel disobeyed this order, alluded to the

dismissal in his closing argument, and further suggested that the plaintiff “let [the

third-party defendants] just go off without scot-free” in exchange for the third-

party defendants’ favorable testimony. Id. The plaintiff moved for a mistrial, but

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the district court declined to rule on the motion and instead submitted the case to

the jury, with an instruction to disregard defense counsel’s statements. Id at 1307–

08.

      The former Fifth Circuit concluded that the district court committed

reversible error. Id. at 1308-09. The Court noted that defense counsel’s argument

was contrary to specific court orders and deliberately reemphasized the false

impression of a “deal” with the third-party defendants, which counsel had been

fomenting throughout the trial. Id. at 1308. The Court also noted that plaintiff’s

counsel in its closing argument was unable to rebut defense counsel’s closing

argument due to the exclusionary order, which defense counsel had ignored. Id. at

1308–09. The Court concluded, “This disparity in treatment of counsel by the

judge unfairly hamstrung [plaintiff’s] counsel.” Id. at 1308-09. In addition, the

Court found that the district court’s curative instruction was inadequate because it

did not explain why the third-party defendants were dismissed from the action. Id.

at 1309.

      Here, by contrast, attorney Kleppin followed the district court’s order not to

mention defendant Batmasian’s conviction during opening argument, and then

used the conviction for impeachment when Batmasian testified. While attorney

Kleppin should not have necessarily mentioned the prior conviction so often, this is

not a case where the district court forbade parties entirely from mentioning a

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subject matter (as the district court did in O’Rear with the dismissal of the third-

party defendants) and then counsel violated that specific order.

      In addition, while O’Rear demonstrates that there are times when curative

instructions alone do not cure an attorney’s improper conduct, that case simply

involved worse attorney conduct, less effective curative instructions, and a greater

risk of prejudice to the jury than exist in the present case. For example, the district

court here did not apply its evidentiary rulings differently between the parties.

And the district court’s curative instructions here did not ignore a lingering

conspiracy theory or false impression fomented by attorney Kleppin.

                                 V. CONCLUSION

      Based on the foregoing reasons, we conclude that the district court did not

abuse its discretion in denying the defendants’ motion for a new trial. We

therefore affirm the judgment in favor of plaintiff Gonzalez.

      AFFIRMED.

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