the jury did find that Fonar had tortiously interfered with one of MR Plus' contracts and that Fonar had tortiously interfered with MR Plus' business relations.
Seeking to resurrect much of its antitrust case during the damages portion of the trial, MR Plus sought to introduce the rather novel argument that Fonar's predatory acts alluded to above caused it to go out of business, thereby interfering with all of its contracts and business relations (Trial Transcript "Tr." at 1615-16). Thus, MR Plus sought to recover as damages the lost value of its business (Tr. at 1613). However, though MR Plus was permitted to introduce evidence regarding the lost value of its business on the grounds that this may have been damage suffered as a consequence of Fonar's interference, the court also required that MR Plus identify the specific business relationships with which Fonar allegedly interfered and allow the jury to decide the extent of Fonar's interference with those relationships. (Tr. at 1624-26) The names of 34 businesses and other entities were then introduced at the damages phase of the trial by MR Plus' CEO, Dr. Robert Domenick. These names were then placed on a special verdict form and given to the jury when they were deliberating. The jury ultimately found that MR Plus had suffered $ 21,000 as a direct result of Fonar's tortious interference with MR Plus' contract and $ 288,175 as a consequential result. In addition, the jury awarded $ 124,090 as damages suffered as a direct result of Fonar's tortious interference with three of MR Plus' business relationships, and $ 1.1 million in consequential damages as a result of Fonar's tortious interference with 31 of MR. Plus' business relationships. Finally, the jury awarded $ 800,000 in punitive damages to MR Plus. Judgment was entered on December 26, 1996, and Fonar timely filed a motion for judgment as a matter of law pursuant to Rule 50(b) and for a new trial pursuant to Rule 59.
On January 21, 1997, the Second Circuit vacated this court's grant of summary judgment as to Fonar's copyright infringement claims, holding that the copyright was entitled to a presumption of validity because it was properly registered and that the Deccaid case was not controlling because the issue there was whether a preliminary injunction could be issued for such a vague definition, not whether the underlying copyright was valid. The court acknowledged that Fonar's definition was "flawed and unhelpful" and that it could be difficult if not impossible for MR Plus to prepare a proper defense, but that the proper way for this court to have proceeded would have been to order the disclosure of further information regarding the allegedly protected software and to issue Rule 37 sanctions, including dismissal if necessary, if such an order was not complied with.
Soon thereafter, Fonar supplemented its Rule 59 motion and moved for relief from judgment pursuant to Rule 60(b)(5) on the grounds that the entire issue of baseless litigation upon which MR Plus relied had to be reexamined in light of the Second Circuit's ruling. The court held a hearing on January 23, 1997 where it set a briefing schedule and required Fonar to post with the court $ 3 million of its own stock as security pending the court's resolution of this issue.
Fonar moves for judgment as a matter of law or, in the alternative, a new trial because the verdicts holding Fonar liable under the state law torts were against the overwhelming weight of the evidence. Fonar also moves for a new trial pursuant to Rule 59 and relief from judgment pursuant to Rule 60(b) on the grounds that the Second Circuit's opinion vacating this court's dismissal of its copyright infringement claims requires that there be a new trial on these issues.
I. State Law Claims
A. Standards for Rules 50(b) and 59
In order to grant judgment as a matter of law pursuant to Rule 50(b), a court must determine whether "the evidence, viewed in the light most favorable to the non-movants without considering credibility or weight, reasonably permits only a conclusion in the movants' favor." Jund v. Town of Hempstead, 941 F.2d 1271, 1290 (2d Cir. 1991); Pena v. Brattleboro Retreat, 702 F.2d 322, 323 (2d. Cir. 1983). Judgment as a matter of law is proper when
(1) there is such a complete absence of evidence supporting the verdict that the jury's findings could only have been the result of sheer surmise and conjecture, or (2) there is such an overwhelming amount of evidence in favor of the movant that reasonable and fair minded men could not arrive at a verdict against him.
Haskell v. Kaman Corp., 743 F.2d 113, 120 (2d Cir. 1984).
Rule 59 provides that "a new trial may be granted . . . in an action in which there has been a trial by jury, for any of the reasons for which new trials have heretofore been granted in actions at law in the courts of the United States . . . ." Fed. R. Civ. P. 59. The decision of whether to grant a new trial is committed to the sound discretion of the court. Metromedia Co. v. Fugazy, 983 F.2d 350, 363 (2d Cir. 1992), cert. denied, 508 U.S. 952, 113 S. Ct. 2445, 124 L. Ed. 2d 662 (1993). In deciding a motion for a new trial, the court is "free to weigh the evidence . . . and need not view it in the light most favorable to the verdict winner." Song v. Ives Laboratories, Inc., 957 F.2d 1041, 1047 (2d Cir. 1992). However, a new trial is warranted only if the court is convinced that a jury reached a seriously erroneous result or that the verdict is against the weight of the evidence, making its enforcement a serious miscarriage of justice. Smith v. Lightning Bolt Productions, Inc., 861 F.2d 363, 370 (2d Cir. 1988); Mallis v. Bankers Trust Co., 717 F.2d 683, 691 (2d Cir. 1983).
B. Tortious Interference with Contract
The jury found that Fonar had tortiously interfered with one contract which MR Plus had with one of its customers, Dr. Sheer. Fonar claims that it is entitled to judgment as a matter of law or a new trial because (1) there was a lack of evidence as to the existence of a valid and enforceable contract between Dr. Sheer and MR Plus and (2) because Dr. Sheer did not breach the contract, even if it existed.
The court holds that there is ample evidence that there was a valid and enforceable agreement between Dr. Sheer and MR Plus. Both Dr. Sheer as well as Dr. Domenick, the CEO of MR Plus, testified that Dr. Sheer retained Dr. Domenick to do maintenance on his Fonar MRI machine. (Tr. at 517-18, 541-43, 1347). Fonar makes the puzzling assertion that it is not sufficient evidence of the existence of a contract that both parties to that contract testify as to its existence. As authority for this seemingly ludicrous assertion, Fonar cites two cases which have held that there must be an enforceable contract in order to sustain a tortious interference claim, and since the contracts in those cases would have been governed by the Statute of Frauds, the contract could not be enforceable absent a writing, even if both parties testified as to its existence. See Nifty Foods Corp. v. Great Atl. & Pac. Tea Co., 614 F.2d 832, 837 (2d Cir. 1980); Durante Bros. Constr. Corp. v. College Point Sports Ass'n, 207 A.D.2d 379, 380, 615 N.Y.S.2d 455, 457 (2d Dep't 1994). Needless to say, these cases have no bearing here, where the Statute of Frauds has never been raised by either party.
However, the fact that Dr. Sheer never breached the contract presents a much more difficult problem for MR Plus. MR Plus has taken the position that Fonar's predatory acts alluded to above made it impossible for Dr. Domenick to conduct business, and he was thus forced to discontinue his contracts with people like Dr. Sheer. Thus, Dr. Domenick testified as follows:
Q: Were you ready, willing and able to continue your relationship with . . . Dr. Sheer?