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Smiley v. Gary Crossley Ford, Inc.

United States Court of Appeals, Eighth Circuit

June 12, 2017

Anthony Smiley Plaintiff- Appellant
Gary Crossley Ford, Inc. Defendant-Appellee

          Submitted: February 7, 2017

         Appeal from United States District Court for the Western District of Missouri - Kansas City

          Before SMITH, [1] BENTON, and SHEPHERD, Circuit Judges.

          SMITH, Circuit Judge.

         Anthony Smiley appeals from the district court's[2] order denying his renewed motion for judgment as a matter of law, or in the alternative, for a new trial on his claim that Gary Crossley Ford, Inc. (GCF) violated the Truth in Lending Act (TILA), 15 U.S.C. § 1601, et seq. Smiley alleged that GCF failed to clearly and conspicuously disclose the annual percentage rate (APR) and finance charge in the Retail Installment and Security Contract ("Contract") that Smiley entered into when purchasing a vehicle from GCF. A jury returned a verdict in favor of GCF. On appeal, Smiley argues that insufficient evidence exists for a reasonable jury to conclude that (1) the TILA disclosures on the Contract were clear and conspicuous, or (2) Smiley previously waived his TILA claim at mediation. He additionally argues that four district court errors entitle him to a new trial. Specifically, he asserts that the district court (1) prejudiced him by its inability to turn on "white noise" during bench conferences held to discuss his objections to certain evidence; (2) failed to sustain his objection to opposing counsel's statement in closing argument that being represented by an attorney is like "being pregnant, you are or you aren't"; (3) encouraged jury nullification; and (4) gave an erroneous answer to a jury question about whether certain evidence was part of the mediation settlement offer. We affirm.

         I. Background

         Smiley purchased a vehicle from GCF on May 11, 2013. Smiley purchased the vehicle from GCF because it had a trade-in protection (TIP) program. This program offered the purchaser $2, 500 toward any amount due on a traded-in vehicle. Smiley borrowed the purchase money from a finance company contracting with GCF, and GCF prepared the Contract for the vehicle loan. The Contract contained a section for the disclosures required by the TILA. Smiley acknowledged that he was given a copy of the Contract to take with him at the time of the transaction. Smiley conceded that he did not look at his copy at that time and that the first time that he reviewed his copy was in August 2013, three months later.

         Smiley attempted to participate in the TIP program, but he was denied coverage. Smiley contacted a law firm about the issue, but it declined to represent him on the TIP matter. The law firm did, however, offer to represent him on a TILA claim regarding the Contract. Smiley's attorney sent a demand letter to GCF in October 2013, threatening to sue on Smiley's behalf for purported violations of the TILA. Smiley's counsel eventually filed suit in federal court for violations of the TILA on March 3, 2014. Smiley's complaint alleged that GCF failed to clearly and conspicuously disclose the APR and finance charge in the Contract. GCF did not become aware of the federal suit until served with process several months later in August 2014.

         Meanwhile, on January 2, 2014, Smiley filed a pro se small claims action against GCF for $2, 500 in the Circuit Court of Clay County, Missouri, concerning the TIP program. The small-claims petition alleged that the entity supplying the vehicle financing notified him that GCF "doesn't participate [in the TIP program] if the loan exceeds 72 months" and that Smiley's loan exceeded that term. Smiley alleged that the Contract failed to disclose that GCF "doesn't participate if the loan exceeds 72 months or only offers the program less than a 72[-]month term." According to Smiley, GCF had not contacted him to resolve the matter.

         Smiley and GCF presented the TIP claim to a mediator on March 24, 2014. GCF was represented at the mediation by attorney Robb Denney. The mediator "was aware of [Smiley's] Truth in Lending claims, " which had been filed in federal court, but Smiley did not tell the mediator that he "wanted those claims to be preserved"; instead, he "opted not to even discuss them any further." The mediation resulted in a tentative settlement. Following the mediation, the mediator completed a "Summary of Understanding, " which Smiley and Denney signed. It provides:

         Terms agreed upon between the parties:

Crossley Ford agrees to honor the trade-in protection purchased by Anthony E. Smiley and will forward a letter to that [e]ffect on their letterhead. The letter will be received by April 14, 2014. Crossley Ford will also provide a copy of the protection plan terms and a check for $45 (forty five dollars).

         The Summary of Understanding directed the mediator to check boxes to indicate the settlement reached. The mediator did not check the box stating that "[t]he parties agree to the terms set out above that makes up a final settlement." Instead, the mediator checked the box stating that

[t]he parties agree to the terms [sic] are binding and enforceable, and request a continuance in order for the parties to complete the terms of the settlement
until . . . April 21, 2014[, ] at 9:00 o'clock AM. If no parties appear on that date, the parties stipulate that this case will be dismissed. If the parties have not done all the things they have agreed to do before the court date, they agree to appear in court on the court date above so judgment can be entered.

         The Summary of Understanding did not include an incorporation clause.

         Smiley acknowledged that the Summary of Understanding did not set out all of the settlement's terms. He testified that he agreed to file a dismissal of his small claims action as part of the settlement but that this term was not included in the Summary of Understanding. Smiley also conceded that he made no request to exclude or carve out the TILA claim from the settlement negotiations (or any agreement that might be reached).

         Denney testified that at the time of the mediation, he "did not know that [the TILA] lawsuit had been filed"; however, Denney's "discussions with [Smiley] were that the dealership want[ed] to have everything resolved with [Smiley]." Denney's concern was that Smiley had already "come up with two reasons before to try and sue the dealership, and he's going to try to come up with a third one." Denney expressed to Smiley that GCF "want[ed] to have all disputes between [Smiley and GCF] resolved." Denney testified it was "important for [him] to have everything wrapped up that day" at the mediation because "[t]hat's what [he] had been authorized to do." Denney stated that "as part of the . . . settlement negotiations, " "Smiley was to dismiss his current Clay County suit and to waive what other claims he might come up with later or that he thought he had against the dealership." Denney also testified that the Summary of Understanding was missing those terms in that "[i]t doesn't list that Mr. Smiley would be dismissing his claim. It doesn't list that Mr. Smiley was waiving any other claim he would have against the dealership." When Denney signed the Summary of Understanding, his understanding of Smiley's obligations under the agreement were that

Mr. Smiley was going to receive a letter from Gary Crossley Ford setting out that they would honor the terms of the buy back program, . . . upon receipt, and he would get a check for the amount, that he was going to be waiving his claims against the dealership arising from that transaction, and that upon receiving those items, he would contact the court and dismiss his . . . then current lawsuit.

         On March 25, 2014, GCF mailed Smiley the settlement check and a copy of the TIP terms, together with a letter promising Smiley that GCF would honor the terms of the TIP program on the vehicle that he had purchased ("GCF letter"). The GCF letter advised Smiley that the settlement check and GCF's promise were being provided "in exchange for the release and waiver of any potential claim by you against us arising from your vehicle purchase of the Complimentary Trade-In Protection Program." It further advised Smiley that his "acceptance and deposit of this check will be considered verification of your acceptance of this settlement of your claims."

         Smiley admitted receiving the March 25, 2014 correspondence from GCF. At the time that he received the GCF letter, he knew that his TILA claim arose from the same vehicle purchase that was the subject of his small claims action. Smiley waited one month before depositing the settlement check. He acknowledged that he had the opportunity to consult with his attorneys during that time and that he ultimately decided to deposit the check.

         In August 2014, three months after the settlement, GCF was served with the federal suit. In its answer, GCF pleaded the following ...

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