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Song v. Rom

United States District Court, N.D. Ohio, Eastern Division

March 28, 2018

XUDONG SONG, et al., PLAINTIFFS,
v.
DAVOR ROM, et al., DEFENDANTS.

          MEMORANDUM OPINION AND ORDER

          HONORABLE SARA LIOI, UNITED STATES DISTRICT JUDGE.

         Before the Court are post-judgment motions for judgment as a matter of law filed under Fed.R.Civ.P. 50(b) by defendant IIP Ohio, LLC (“IIP Ohio”) (Doc. No. 205 [“IIP Ohio Mot.”]) and defendant Davor Rom (“Rom”) (Doc. No. 213 [“Rom Mot.”]). Plaintiffs Xudong Song and Sunshine International, LLC (collectively, “Song”) filed briefs in opposition to each motion. (Doc. No. 206 [“IIP Ohio Mot. Opp'n”]; Doc. No. 222 [“Rom Mot. Opp'n”].) IIP Ohio and Rom filed replies. (Doc. No. 209 [“IIP Ohio Mot. Reply”]; Doc. No. 225 [“Rom Mot. Reply”].) As set forth herein, the motion of IIP Ohio, LLC (Doc. No. 205) is granted and the motion of Davor Rom (Doc. No. 213) is denied.

         Song attached a chart to plaintiffs' brief in opposition to Rom's motion. (Doc. No. 222-1.) Both defendants have moved to strike this chart. (Doc. No. 224 [“Mot. Strike”].) Song filed an opposition brief (Doc. No. 227 [“Mot. Strike Opp'n”]) and defendants filed a reply (Doc. No. 228 [“Mot. Strike Reply”]). As set forth herein, defendants' motion to strike is granted.

         I. RELEVANT BACKGROUND

         Song, a Chinese national who invests in real estate, sued IIP Ohio and Rom alleging fraudulent inducement with respect to his purchase of certain rental properties in Ohio. (See Doc. No. 67, Third Amended Complaint, Count One.) Song claimed that he was promised double-digit returns on his investment, but the anticipated income never materialized due to the allegedly undisclosed condition of the properties. A jury trial was conducted and, on June 30, 2017, verdicts in favor of Song were entered against each defendant separately. However, when it came to the award of actual damages, the jury awarded $0 against IIP Ohio and $50, 000.00 against Rom. No. punitive damages were awarded against either defendant. (See Doc. No. 202 at 8102 and 8103.[1])

         IIP Ohio seeks judgment as a matter of law, claiming that, given the zero award of damages, Song failed to establish the sixth element of a fraudulent inducement claim as to IIP Ohio. Rom also seeks judgment, claiming that there is insufficient evidence in the record to support the award of $50, 000.00 and, in any event, the “no-reliance” clause in all of the agreements between the parties precludes recovery.

         II. DISCUSSION

         A. Standard of Review

         Judgment as a matter of law is appropriate only when, construing the evidence in the light most favorable to the nonmoving party, “‘there is a complete absence of fact to support the verdict, so that no reasonable juror could have found for the nonmoving party.'” Kiphart v. Saturn Corp., 251 F.3d 573, 581 (6th Cir. 2001) (quoting Moore v. KUKA Welding Sys. & Robot Corp., 171 F.3d 1073, 1078 (6th Cir. 1999)). The Court does not “weigh the evidence, evaluate the credibility of the witnesses, or substitute [its] judgment for that of the jury.” Black v. Zaring Homes, Inc., 104 F.3d 822, 825 (6th Cir. 1997) (citations omitted). “If reasonable minds could differ as to the import of the evidence, however, a verdict should not be directed.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-51, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (citing Wilkerson v. McCarthy, 336 U.S. 53, 62, 69 S.Ct. 413, 93 L.Ed. 497 (1949)).

         B. Fraud in the Inducement

         The jury was instructed[2] that, to establish fraud in the inducement, Song had to prove the following by a preponderance of the evidence: (1) a representation made by the defendant that relates to the past or to the present; (2) the representation is material to the transaction at hand; (3) the representation was made falsely, with knowledge of its falsity, or with such utter disregard and recklessness towards the truth or falsity of the representation that knowledge may be inferred; (4) the representation was made with an intent to mislead another into relying on it; (5) actual justified reliance by the plaintiff on the representation; and, (6) resulting injury to the plaintiff proximately caused by the reliance.

         1. IIP Ohio's Motion (Doc. No. 205)

         IIP Ohio moves for judgment as a matter of law, arguing that, in light of the jury's award of $0 in actual damages against IIP Ohio, “reasonable minds could only conclude that plaintiffs had not satisfied their burden of proof as to the sixth element of their fraudulent inducement claim when viewing the evidence in the light most favorable to plaintiffs.” (IIP Ohio Mot. at 8121.)[3]

         IIP Ohio is correct. “Resulting injury” is an element of the claim of fraudulent inducement, and Song failed to establish that element as to IIP Ohio, as reflected by the jury's answer to Interrogatory No. 2. (Doc. No. 201 at 8082.) As a result, IIP Ohio is entitled to judgment as a matter of law on the fraudulent inducement claim. See, Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) (holding that summary judgment[4] is mandated “against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial”); Columbia Gas Transmission Corp. v. Ogle, No. 97-3910, 1998 WL 879583 at *4 (6th Cir. Nov. 25, 1998) (it was not error to grant summary judgment ...


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