United States District Court, D. Minnesota
TODD BORCHARDT, MICHELE BORCHARDT, DANIELLE SHAVER, and DILLON BORCHARDT, Plaintiffs,
STATE FARM FIRE AND CASUALTY COMPANY, Defendant.
Charles J. Lloyd and Adam C. Hagedorn, LIVGARD & LLOYD,
PLLP, for plaintiffs.
R. Krall, HANSON LULIC & KRALL, LLC, for defendant.
Patrick J. Schiltz United States District Judge
September 2014, a fire destroyed the home of plaintiffs Todd
and Michele Borchardt and their adult children, plaintiffs
Danielle Shaver and Dillon Borchardt (collectively,
“the Borchardts”). The Borchardts submitted a
claim to defendant State Farm Fire and Casualty Company
(“State Farm”), their homeowners insurer, for the
value of the home and the personal items that were destroyed
by the fire. State Farm denied coverage for two reasons:
First, State Farm alleged that the Borchardts had either set
the fire themselves or arranged for someone else to set it.
Second, State Farm alleged that the Borchardts had lied about
the cause of the fire and about the items of personal
property that were lost in the fire.
the Court denied State Farm's motion for partial summary
judgment, the case was tried, and the jury returned a mixed
verdict. The jury found that State Farm had not proven that
the Borchardts set or procured the fire that destroyed their
home. ECF No. 152 at 1-2. But the jury also found that State
Farm had proven that Todd, Michele, and
Danielle had each “willfully and with intent
to defraud State Farm conceal[ed] or misrepresent[ed] any
material fact or circumstance relating to the fire or to his
or her insurance claim.” Id. at 2. In light of
the evidence presented by State Farm at trial-and in light of
the jury's exoneration of the Borchardts with respect to
setting or procuring the fire-it is clear that the
intentional misrepresentations found by the jury related to
the number and value of items of personal property destroyed
by the fire.
Borchardts now move for judgment as a matter of law under
Fed.R.Civ.P. 50(b), arguing that no reasonable juror could
have found that their misrepresentations about their personal
property were material.
STANDARD OF REVIEW
ruling on the Borchardts' motion, the Court must view the
evidence in the light most favorable to the jury's
verdict and draw all reasonable inferences in the
verdict's favor. Mich. Millers Mut. Ins. Co. v.
Asoyia, Inc., 793 F.3d 872, 878 (8th Cir. 2015). In
other words, the Court must uphold the jury's verdict
“unless no reasonable juror could have reached the same
conclusion” as the jury. Id. (citation
is some uncertainty about whether federal courts should apply
state law standards or federal law standards to motions for a
judgment notwithstanding the verdict in diversity
cases.” Keenan v. Comput. Assocs. Int'l,
Inc., 13 F.3d 1266, 1269 n.3 (8th Cir. 1994). But the
Court need not resolve that uncertainty because the Minnesota
standard for Rule 50.02 motions is substantively identical to
the federal standard for Rule 50(b) motions. Id.;
cf. Waite v. Am. Family Mut. Ins. Co., 352 N.W.2d
19, 21 (Minn. 1984) (“On appeal from an order for
judgment notwithstanding the verdict, the evidence is viewed
in the light most favorable to the jurors' findings, and
the contrary judgment is affirmed only if reasonable minds
could not differ that the jury's conclusion was
wrong.”); Cox v. Crown CoCo, Inc., 544 N.W.2d
490, 495 (Minn.Ct.App. 1996) (“In reviewing the denial
of JNOV, this court must affirm if the record contains
‘any competent evidence reasonably tending to sustain
the verdict.'” (citation omitted)).
Borchardts make three arguments in support of their Rule
50(b) motion. The Court will address each argument in turn.
Law of the Case
Borchardts first point out that, when the Court denied State
Farm's motion for partial summary judgment in August
2017, the Court held that an insured's misrepresentations
cannot be deemed material unless those misrepresentations
impact the insurer's investigation. The Borchardts argue
that State Farm introduced no evidence that the
Borchardts' misrepresentations about their personal
property had any impact on State Farm's investigation.
Therefore, the Borchardts contend, under the “law of
the case, ” State Farm failed to prove materiality. ECF
No. 160 at 5-7.
Court disagrees. The law-of-the-case doctrine “applies
only to issues decided by final judgments.” Lovett
v. Gen. Motors Corp., 975 F.2d 518, 522 (8th Cir. 1992).
A district court “has the inherent power to reconsider
and modify an interlocutory order any time prior to the entry
of judgment, ” K.C. 1986 Ltd. P'ship v. Reade
Mfg., 472 F.3d 1009, 1017 (8th Cir. 2007) (citation
omitted), so if “a district court is convinced that it
incorrectly decided a legal question in an interlocutory
ruling, the district court may correct the decision to avoid
later reversal, ” Lovett, 975 F.2d at 522.
August 2017 order on which the Borchardts rely was an order
denying State Farm's motion for partial summary judgment.
An order denying a summary-judgment motion is not a final
judgment. Therefore, any statements that the Court made in
its August 2017 order cannot be considered the “law of
the case.” Perhaps more importantly, the Court did not
hold in its August 2017 order that the only way that
a misrepresentation can be deemed material is if the
misrepresentation impacts the insurer's investigation.
Instead, the Court held that the particula ...