Munchkin, Inc. v. Playtex Products, LLC

FILED
NOT FOR PUBLICATION APR 20 2015
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MUNCHKIN, INC., a Delaware No. 13-56214
corporation,
D.C. No. 2:11-cv-00503-ODW-RZ
Plaintiff-counter-defendant -
Appellant,
MEMORANDUM*
v.
PLAYTEX PRODUCTS, LLC, a
Delaware limited liability company,
Defendant-counter-claimant -
Appellee.
Appeal from the United States District Court
for the Central District of California
Otis D. Wright II, District Judge, Presiding
Argued and Submitted April 7, 2015
Pasadena, California
Before: D.W. NELSON, TASHIMA, and CLIFTON, Circuit Judges.
In this false advertising case, Appellant Munchkin, Inc. challenges the
district court’s decisions (1) to order a new trial based on an erroneous jury
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
instruction and (2) to exclude damages evidence pursuant to Rules 26 and 37 of the
Federal Rules of Civil Procedure. We conclude that the district court acted within
its considerable discretion in both instances and affirm.
The district court did not abuse its discretion when it ordered a new trial.
Although we have held that a presumption of injury is appropriate in false direct
comparative advertising cases, see, e.g., TrafficSchool.com, Inc. v. Edriver Inc.,
653 F.3d 820, 831 (9th Cir. 2011), this is not a direct comparative advertising case
because the “advertising does not directly compare . . . products,” Harper House,
Inc. v. Thomas Nelson, Inc., 889 F.2d 197, 209 n.8 (9th Cir. 1989). We need not
decide whether a jury may presume injury where advertising occurs in the context
of a “binary” market structure, cf. Time Warner Cable, Inc. v. DIRECTV, Inc., 497
F.3d 144, 162 (2d Cir. 2007), because the district court made a factual finding that
the market at issue was not binary. We are not persuaded that this finding was
clearly erroneous. Moreover, we agree with the district court that the initial
erroneous instruction was not “more probably than not harmless.” Lambert v.
Ackerley, 180 F.3d 997, 1008 (9th Cir. 1999).
The district court also acted within its discretion when it determined that
Munchkin failed to comply with its obligations under Fed. R. Civ. P. 26 and when
it fashioned an exclusion sanction pursuant to Fed R. Civ. P. 37. Although it is
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true that Rule 26(e) contemplates the supplementation of disclosures,
“[s]upplementation under the Rules means correcting inaccuracies, or filling . . .
interstices.” Keener v. United States, 181 F.R.D. 639, 640 (D. Mont. 1998); see
also Luke v. Family Care & Urgent Med. Clinics, 323 F. App’x 496, 500 (9th Cir.
2009). Munchkin’s extensive new damages evidence and theories were not a mere
supplementation within the meaning of the Rules. The district court, having
concluded that a violation of Rule 26 occurred, did not abuse its discretion in
excluding the evidence pursuant to Rule 37.1
AFFIRMED.
1
Our Rule 37 case law does provide that a party has the right not to have its
damages evidence excluded, where that exclusion “amount[s] to dismissal of a
claim,” absent a finding that the “noncompliance involved willfulness, fault, or bad
faith.” R & R Sails, Inc. v. Ins. Co. of Pa., 673 F.3d 1240, 1247 (9th Cir. 2012).
The record indicates no objection made by Munchkin on this basis before the
district court, nor was this argument “raised clearly and distinctly in the opening
brief” on appeal. McKay v. Ingleson, 558 F.3d 888, 891 n.5 (9th Cir. 2009); see
also Crawford v. Lungren, 96 F.3d 380, 389 n.6 (9th Cir. 1996). Any such
argument is waived. There is evidence that the district court would have made the
requisite finding if the issue had been raised, and the record supports the
conclusion that only Munchkin and its counsel were responsible for the late
disclosures.
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