Advanced Risk Managers, LLC v. Equinox Management Group, Inc.

Background

After pretrial conferences on February 9 and February 16, 2022, the court issued this order summarizing rulings made from the bench and establishing procedures for the jury trial, which was scheduled to begin on February 22, 2022. The jury’s trial time was limited to 14 hours total, with seven hours for each side, in addition to specified time for opening statements, questioning prospective jurors, and closing arguments.

The order also required advance notice of witnesses, limited testimony to identified witnesses except for true rebuttal or impeachment witnesses shown to be necessary, restricted exhibits to those identified in the pretrial submissions except in similar circumstances, and imposed masking and social-distancing requirements. The court warned that violating its orders could result in sanctions, including striking a witness’s entire testimony or ending the case through terminating sanctions.

Motion to Amend

The court denied Plaintiff’s motion for leave to amend the complaint to add claims for fraudulent concealment and punitive damages. The court found that Plaintiff had not shown good cause because it was not diligent and had waited until January 14, 2022—one year after discovery closed and one month before trial—to seek amendment. The court also found that Plaintiff’s evidence did not establish that Defendant acted in bad faith or obstructed discovery, that Plaintiff had not raised discovery disputes with the court, and that amendment would substantially prejudice Defendant by requiring significantly different discovery.

Plaintiff’s Motions in Limine

Plaintiff’s first motion in limine, concerning evidence about the accuracy of underwriting data as a reason for the Geisinger settlement, was denied to the extent it sought to exclude all testimony, argument, and evidence about the settlement’s reasons. The court interpreted the contract phrase “used to facilitate post-payment adjudication, settlement, or resolution of the claim” to mean “used to help achieve post-payment adjudication, settlement, or resolution of the claim.” The court held that this contract interpretation was a legal question for the court, while the jury would decide the factual issues.

The court allowed testimony about the settlement’s reasons if supported by admissible evidence and personal knowledge. Witnesses could testify about underlying facts but could not give opinions on whether particular work “facilitated” or “helped achieve” a settlement or otherwise decide the ultimate factual issues for the jury.

Plaintiff withdrew its second motion in limine.

Defendant’s Motions in Limine

Defendant’s first motion in limine, seeking to prevent Plaintiff from arguing that it could recover both an hourly fee and 28% of net claims-reduction savings, was denied as moot because Plaintiff agreed not to seek both forms of payment. The court stated that any award under the 28% provision would be reduced by amounts already paid under the hourly provision, and that the verdict form and jury instructions would include that offset.

Defendant’s second motion in limine raised the meaning of “net claims reduction savings.” The court interpreted that phrase to mean the “final amount of money saved by reducing the monetary value of the claims.” Plaintiff was prohibited from arguing or presenting evidence that it was entitled to potential savings identified in its audits or that damages should be calculated using those potential savings. Plaintiff could use evidence of potential savings to challenge the reliability or credibility of Defendant’s claimed net savings or its allocation of those savings.

Defendant’s third motion in limine was granted to the extent Plaintiff sought to introduce evidence about alleged discovery misconduct or Defendant’s alleged failure to disclose the true amount of savings from the Humana and Geisinger settlements. The court allowed evidence concerning communications involving Summit Re for specified purposes, including showing that Plaintiff worked on certain claims, that Plaintiff’s work was used to help achieve resolution, and how Defendant or RenRe characterized the savings. Plaintiff withdrew its separate “Summit Re creative savings theory” and agreed not to present it at trial.

Witnesses and Exhibits

Plaintiff withdrew Kira Sturgis as a witness, and Defendant withdrew James Conway. The parties agreed that Mimi Choi could offer opinion testimony as a lay witness under Federal Rule of Evidence 701, although the provided text ends before stating the complete ruling on that issue.

The court overruled Defendant’s objections to Plaintiff’s Exhibits 10, 21, and 53 in the circumstances described in the order, and overruled objections to Exhibit 66 subject to a limiting instruction. Exhibit 66 could be used only to challenge the reliability or credibility of Defendant’s claimed net claims-reduction savings or its allocation of those savings, not as evidence of Plaintiff’s damages. Objections to Exhibits 43 and 44 were sustained. Objections to Exhibit 62 were denied as moot, and that exhibit could not be offered at trial because Plaintiff withdrew the related theory.

The court overruled Plaintiff’s objection to Defendant’s Exhibit A, subject to a witness with personal knowledge providing an adequate foundation. The court deferred further oral argument on Exhibit LL until February 22, 2022. Plaintiff’s objection to Exhibit RR was sustained. Plaintiff’s objections to Exhibits BBB and CCC were overruled; the court found those exhibits admissible as summaries, charts, or calculations of voluminous writings under Federal Rule of Evidence 1006.

Disposition

This was a pretrial order governing trial conduct, amendment of the pleadings, contract interpretation for evidentiary purposes, and the admission or exclusion of evidence. It did not decide the ultimate liability or damages issues in the contract dispute.