Cavalier Metal v. Johnson Controls

Citation: Not availableDocket: W2001-01057-COA-R3-CV

Court: Court of Appeals of Tennessee; September 17, 2002; Tennessee; State Appellate Court

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Cavalier Metal Corporation initiated a lawsuit against Johnson Controls, Inc. (JCI) for breach of contract, resulting in a jury award of $2,029,294.00 for Cavalier. Following the verdict, JCI sought a new trial, presenting affidavits from two jurors claiming that a fellow juror, previously employed by JCI, had improperly shared insider knowledge related to the case. JCI had previously attempted to disqualify this juror during jury selection, but the motion was denied. The trial court deemed the affidavits inadmissible under Tennessee Rule of Evidence 606(b), leading to an appeal. The Court of Appeals of Tennessee reversed the trial court's decision and ordered a new trial.

The dispute arose from a series of contracts between Cavalier and JCI for the plating and finishing of metal parts, critical for JCI's assembly of components sold to automobile manufacturers. The contractual relationship began in January 1990, with subsequent agreements in November 1990 and March 1993, but ended in December 1994 when Cavalier ceased operations. Cavalier alleged breaches of both the November 1990 and March 1993 contracts, claiming JCI diverted significant business to another company and changed quality control procedures that increased Cavalier's costs. Cavalier contended these actions ultimately led to its business failure, as JCI was its sole customer. The contracts included clauses for annual price adjustments and required modifications to be made in writing.

JCI claimed that Cavalier's contract performance was inadequate in quality, dependability, and timeliness. Following a trial, a jury determined that JCI breached the contract, awarding Cavalier $2,029,294 in damages. During a hearing for a new trial, JCI raised concerns about juror misconduct involving Terri Ricketts, a former JCI employee fired for absenteeism, who served on the jury. JCI's challenge to her inclusion was denied, and a request to question her outside the jury's presence was also rejected. 

Affidavits from two jurors indicated that Ricketts disclosed her employment with JCI during deliberations, stating that parts received from Cavalier were comparable in quality to those from other suppliers and that JCI had initially breached the contract. JCI's motion for a new trial was denied, leading to an appeal addressing several issues: 

1. Whether the trial court erred by not granting a new trial due to Ricketts presenting prejudicial information during deliberations, despite JCI's challenge for cause being denied.
2. Whether the trial court erred in providing supplemental jury instructions that were not disclosed to the parties and included substantive errors.
3. Whether the trial court improperly allowed damages claims unrelated to the 1993 contract, including lost business value, and failed to properly interpret the contract and manage claims of lost profits.
4. Whether the court admitted irrelevant and prejudicial evidence regarding hydrogen embrittlement, which was recognized as non-relevant, especially since the plaintiff had not claimed damages related to it.
5. Whether the court abused its discretion in awarding prejudgment interest of $912,356.77, given that the plaintiff did not include this claim in the complaint and was slow to pursue the case. 

Juror Diane Grissom confirmed Ricketts’ statements during deliberations regarding JCI's contractual violations.

Ms. Ricketts informed fellow jurors during a smoking break about her experience at Johnson Controls, stating the company sent parts to other platers besides Cavalier and that Cavalier’s quality was comparable to others. Juror Patsie Ann Schantz corroborated this in her affidavit, noting that Ricketts shared her insights about Cavalier's quality during deliberations. Both jurors felt influenced by Ricketts’ comments, suggesting that others may have been as well. The trial judge addressed the admissibility of this information, indicating that much of it was inadmissible under Rule 606(b), which protects against questioning jury deliberations and internal discussions. The judge later summoned the jury foreman to confirm that the verdict was based solely on evidence and law presented at trial, not influenced by external factors. The foreman affirmed this, leading the trial court to deny a motion for a new trial based on alleged jury misconduct, stating the verdict was valid as it was based on the evidence and law presented, in line with the precedent set in Caldararo v. Vanderbilt Univ.

The admissibility of juror affidavits in this case is governed by Tennessee Rule of Evidence 606(b), which restricts jurors from testifying about deliberations or their mental processes, with specific exceptions. These exceptions allow jurors to testify regarding: 1) extraneous prejudicial information brought to the jury's attention, 2) improper outside influences on any juror, or 3) pre-agreed quotient or gambling verdicts. The rule aims to protect the integrity of jury deliberations and encourages open discussions among jurors without fear of post-trial scrutiny, thereby preventing minority viewpoints from being recanted.

Tennessee courts distinguish between extrinsic influences, which could justify a new trial if prejudicial (e.g., external communications or unadmitted facts), and intrinsic influences, which do not warrant a new trial (e.g., juror discussions or personal experiences unrelated to the case). Jurors must base their verdicts solely on trial evidence, and a verdict won’t be overturned due to jurors' generalized knowledge about the case or parties involved.

In this case, Juror Ricketts provided information that does not clearly fall into the defined categories of extrinsic or intrinsic influence. While it could be seen as not admitted evidence, it was also presented in court by witnesses. Consequently, the determination of whether Ricketts’ information constitutes "extraneous" under Rule 606(b) remains unresolved, as it relates directly to the litigation despite being a discussion among jurors.

Intimidation, harassment, or a juror's subjective emotions do not constitute extraneous influence in jury deliberations. The Caldararo court recognized that a juror's personal experiences related to the case can be deemed external information. If such experiences pertain directly to the litigation, they may be scrutinized to assess their impact on the jury's verdict. Jurisdictions have consistently upheld that a juror's past experiences relevant to the case can be considered extraneous information, which can be used to challenge a jury's decision. The Sixth Circuit defines extraneous influence as knowledge or relationships affecting a juror's impartiality, while the Ninth Circuit views a juror's personal knowledge about the defendant or the alleged crime as impermissible extrinsic evidence. The Alaska Supreme Court concurs that prior knowledge about a case or defendant can constitute prejudicial information under Rule 606(b). The Tennessee Court of Criminal Appeals also recognizes that a juror's personal knowledge of a defendant's criminal history is considered extraneous. However, in State v. Crenshaw, it was held that jurors with prior knowledge accepted during voir dire could not later claim the information was extraneous. The underlying reasoning suggests that when a juror possesses firsthand knowledge relevant to the trial, it compromises the integrity of deliberations, as this knowledge is not subject to the procedural safeguards of the trial. Such situations raise significant concerns about the fairness and accuracy of verdicts when jurors consider information not presented in court. Tennessee case law, exemplified by Booby v. State, illustrates this principle, where a new trial was granted due to jurors being influenced by a fellow juror's unverified claims about the defendant's past. The court emphasized that any knowledge about the defendant should have been formally presented and subjected to scrutiny in court.

Juror Ricketts provided extraneous information to fellow jurors that was deemed prejudicial, specifically comments favoring Cavalier. Testimony at trial covered the same matters, but Ricketts' remarks biased the jury's perception. Affidavits indicated that two jurors felt influenced by Ricketts’ comments, suggesting that this information swayed their judgment. Under Rule 606(b), jurors may testify regarding the introduction of extraneous prejudicial information without violating the sanctity of deliberations, as litigants deserve verdicts free from such influences. The case established that Ricketts' pre-existing knowledge of the issues—claiming JCI violated the contract and asserting Cavalier's quality was comparable to other suppliers—was extraneous and detrimental. Consequently, the court reversed the decision and remanded the case for a new trial, with costs assigned to Cavalier Metal Corporation.