Transportation Law Update: Eighth Circuit Vacates Judgment Against Motor Carrier

08.22.2022

The United States Court of Appeals for the Eighth Circuit has vacated a judgment from the District Court for the District of Nebraska, holding that the district court abused its discretion when declined to analyze arguments the plaintiffs made under Federal Rule of Civil Procedure 37(c)(1) and Federal Rule of Evidence 706 relating to a late-proposed expert report. Petrone v. Werner Enters., Inc., 42 F.4th 962 (8th Cir. 2022). The Eighth Circuit concluded the district court had discretion as to both issues, but that it must actually exercise that discretion and apply the appropriate analysis. The Eighth Circuit also held that the district court appropriately denied a request to present the pay information through a summary exhibit under Federal Rule of Evidence 1006 without expert testimony because the information was too complicated to be easily deciphered. We have previously reported on this case.

Facts & Procedural History

Philip Petrone and other student drivers (“Plaintiffs”) filed a class action against multiple trucking companies that operated student driver training and orientation programs for new drivers. Plaintiffs claimed Defendants had underpaid them for certain activities. Defendants deposed Plaintiffs’ expert and uncovered inaccuracies in the original report. Plaintiffs sought to submit a new expert after the expert designation. The district court found no good cause to extend the expert designation deadline under Federal Rule of Civil Procedure 16(b), but allowed the supplemental report under Rule 1, citing the district court’s preference for deciding cases on their merits, and Rule 37(c)(1), which provides the district court discretion when considering a sanction for a party failing to timely disclose an expert’s opinions. The jury’s verdict was in favor of Plaintiffs on some of their claims and Defendants appealed.

On appeal, the Eighth Circuit held that the district court inappropriately applied Rules 1 and 37(c)(1). Rule 37(c)(1) only applies when a party fails to make Rule 26(a) disclosures and attempts to use that information “on a motion, at a hearing, or at a trial.” The Eighth Circuit held the district court should not have allowed the new report and remanded the case “for proceedings consistent with” that opinion.

On remand (now this case), Plaintiffs moved for a new trial and asserted they could admit payroll and time records. Plaintiffs formally requested to use the new report at trial under Rule 37(c)(1) and, in the alternative, for a court-appointed expert under Federal Rule of Evidence 706. The district court also declined to allowed a Federal Rule of Evidence 1006 exhibit summarizing the payroll records of 55,000 drivers. Defendants moved for judgment, again, and asserted that Plaintiffs could not prove their damages without the report and the Eighth Circuit’s remand was, in essence, a directive to enter judgment in favor of Defendants.

The district court found that the only evidence of damages came from the new expert report, which it declined to allow because Plaintiffs lacked the requisite good cause. The district court also concluded that Plaintiffs could not prove damages using time or payroll records, or a summary exhibit of them, without expert testimony. The district court entered judgment in favor of Defendants and Plaintiffs appealed.

Analysis

The Eighth Circuit held that the district court abused its discretion by refusing to even analyze Plaintiffs’ Rule 37(c)(1) or Rule 706 arguments. While the district court had discretion when deciding those issues, it must at least analyze the issues under the appropriate framework before deciding. However, the Eighth Circuit agreed with Defendants in that Plaintiffs could not prove damages using time and pay records, or a summary of them. The district court reasoned that Plaintiffs’ own expert could not appropriately analyze the records, so the summary evidence would not be helpful to a jury or appropriate. The Eighth Circuit vacated the district court’s judgment and remanded for a determination on the Rule 37(c)(1) and Rule 706 issues, but did not disturb the finding related to the use of time and pay records, or summaries of them.

For more information

Contact John F. Fatino for more information about trucking and transportation matters at (515) 288-6041. Associate attorney Peter J. Chalik assisted in the preparation of this article.

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