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Computerized Store Systems, Inc. v. Compaq Computer Corp.

Citation: 124 F. App'x 521Docket: No. 03-16369

Court: Court of Appeals for the Ninth Circuit; February 21, 2005; Federal Appellate Court

Narrative Opinion Summary

In this case, Compaq Computer Corporation appealed the district court’s denial of its renewed Motion for Judgment as a Matter of Law (JMOL) and the award of prejudgment interest to Computerized Store Systems, Inc. (Convenient) following a jury verdict in favor of Convenient. The jury awarded $3,245,000 in compensatory damages and $2 million in punitive damages. Compaq conceded liability but challenged the sufficiency of the evidence supporting the jury's damage awards. The appellate court, exercising jurisdiction under 28 U.S.C. § 1291, applied a deferential standard and upheld the compensatory damages, finding that the evidence supported the jury's conclusion. The court also affirmed the award of prejudgment interest, ruling that the damages were liquidated and the demand requirement was met under Arizona law. The jury's punitive damages award was reviewed for abuse of discretion, and the court found substantial evidence of an 'evil mind' on Compaq's part, justifying the punitive damages. The appellate court affirmed the district court’s judgment, and the opinion was designated as non-publishable under Ninth Circuit Rule 36-3.

Legal Issues Addressed

Compensatory Damages Based on Reliance

Application: The jury awarded damages based on the amount Convenient reasonably spent in reliance on Compaq's misrepresentations.

Reasoning: The jury was instructed to award damages based on the amount Convenient reasonably spent in reliance on Compaq's misrepresentations.

Demand Requirement for Prejudgment Interest

Application: The court held that Convenient met the demand requirement by presenting a letter acknowledging its claim, which justified the award of prejudgment interest.

Reasoning: Convenient met the demand requirement by presenting a letter from a Compaq vice-president acknowledging Convenient's claim of $3,245 million in debt against Compaq.

Prejudgment Interest under Arizona Law

Application: The court found that damages were liquidated and met the requirement for reasonable certainty, thus supporting the award of prejudgment interest.

Reasoning: The jury determined that the amount from Convenient's private stock sales was an easily ascertainable figure, meeting the requirement for reasonable certainty.

Punitive Damages under Arizona Law

Application: The jury found substantial evidence that Compaq acted with an 'evil mind' and awarded punitive damages based on this finding.

Reasoning: The jury found substantial evidence for actual damages and determined that Compaq knowingly engaged in conduct that posed a significant risk of harm to Convenient.

Standard for Judgment as a Matter of Law

Application: The appellate court applied a deferential standard, requiring that evidence must be sufficient to support the jury's conclusion, even if alternative interpretations exist.

Reasoning: The court applies a deferential standard, requiring that evidence must only be sufficient to support the jury's conclusion, even if alternative interpretations exist.