Steady State Imaging, LLC v. General Electric Company

Background

Steady State Imaging, LLC and General Electric Company entered into a 2011 contract concerning the commercial development of Steady State’s magnetic resonance imaging technique known as Sweep Imaging with Fourier Transform. Steady State later brought claims for breach of contract, breach of the implied covenant of good faith and fair dealing, and promissory estoppel.

The court had dismissed the good-faith-and-fair-dealing claim in January 2018. In April 2019, it granted General Electric summary judgment on Steady State’s first breach-of-contract claim. The opinion states that two counts remained: Count III, breach of contract, and Count IV, promissory estoppel.

Motion to Bifurcate

General Electric moved under Federal Rule of Civil Procedure 42(b) to separate the remaining claims for trial. It requested a jury trial on the breach-of-contract claim followed by a court trial on the promissory-estoppel claim. General Electric argued that trying both claims together could confuse the jury and cause the jury to use evidence related to promissory estoppel when deciding the contract claim.

Rule 42(b) permits a court to order separate trials for convenience, to avoid prejudice, or to speed up and reduce the cost of the proceeding, while preserving any federal right to a jury trial. The party seeking separate trials bears the burden of showing that the rule’s objectives would be served.

Court’s Analysis

The court treated General Electric’s motion as primarily seeking separate trials to avoid unfair prejudice. It concluded that General Electric had not shown prejudice. The court was confident that jurors could evaluate the evidence objectively and that any possible confusion could be addressed through jury instructions and the verdict form.

The court also concluded that separate trials would not speed up or reduce the cost of the proceeding. It rejected General Electric’s argument that a separate trial could be efficient because the promissory-estoppel claim might become moot if the jury first found that a contract existed. The court stated that any such efficiency depended on the outcome of the first trial and that it would not base bifurcation on that speculation. The court further noted that Steady State could be harmed by having to repeat testimony or being unable to produce some witnesses for two trials.

Disposition

Chief Judge John R. Tunheim ordered that General Electric’s Motion to Bifurcate, Docket No. 451, was denied. The order did not decide the merits of the remaining breach-of-contract or promissory-estoppel claims.