Chrysler Grp. LLC v. Walden
Chrysler Grp. LLC v. Walden
Opinion of the Court
*247We suspect that bench and bar have become accustomed to hearing the familiar recitation from this Court that Georgia's "new" Evidence Code has changed the rules. Although the new Evidence Code became law in January of 2013, meaning that it is not so very new in its application, cases can take some time to make their way to this Court on appeal. Accordingly, we still have work to do in interpreting the new Code, and this case gives us that opportunity. We hold today not that compensation evidence is always admissible to show the bias of an employee witness, or that it is never admissible, but that such evidence is subject to the Rule 403 analysis weighing the evidence's unfair prejudice against its probative value. Because Chrysler did not raise a Rule 403 objection to the compensation evidence at issue in this appeal, we consider the question not under the ordinary abuse-of-discretion standard, but as a question of plain error. We conclude that under the particular circumstances of this case-where the jury's evaluation of the bias and credibility of Chrysler's CEO were central to the allegations in the case because the CEO was alleged to have specifically interjected himself in a federal safety investigation to the detriment of the plaintiffs-we cannot say that the prejudicial effect of the evidence so far outweighed its probative value that its admission was clear and obvious reversible error. Accordingly, although we disagree with the rationale of the Court of Appeals, we ultimately affirm its judgment.
I.
Construed to support the jury's verdict, see Citizens & Southern Nat. Bank ,
At trial, in March and April of 2015, Appellees challenged the Jeep's vehicle design, arguing that Chrysler should not have used a rear-mounted fuel tank. To avoid the operation of Georgia's ten-year statute of repose, Appellees were required to show not just that the gas tank was dangerous, but that Chrysler had acted with "willful, reckless, or wanton disregard for life or property." OCGA § 51-1-11. Evidence showed that Chrysler had long known that mounting a gas tank behind the rear axle was dangerous. Evidence also showed that Chrysler's placement of the gas tank behind the rear axle was contrary to industry trends, which favored placing tanks in front of the rear axle. In 2009, the federal Office of Defects Investigation *248("ODI"), a division of the National Highway Traffic Safety Administration ("NHTSA"), had launched an engineering investigation and recommended a recall of several Jeep models with rear gas tanks, including the model at issue in this case. Appellees emphasized that after Chrysler Chief Executive Officer Sergio Marchionne met with two political appointees heading NHTSA and the Department of Transportation ("DOT"), the model of Jeep at issue in this case was excluded from the recall.
Chrysler, on the other hand, presented evidence that the vehicle met or exceeded all applicable Federal Motor Vehicle Safety Standards and that many other vehicles of the era used rear-mounted fuel tanks. Marchionne testified, and denied any inappropriate political influence; he stressed that the NHTSA investigation of the alleged defect ultimately resulted in a conclusion that Chrysler's design did not pose an unreasonable risk to safety. Appellee's counsel pressed him to admit that he had persuaded NHTSA to resolve its investigation without finding a defect in order to avoid a drop in car sales, but Marchionne refused.
When questioning Chrysler Chief Operating Officer Mark Chernoby at trial, Appellees' counsel asked about CEO Marchionne's salary, bonus, and benefits; Marchionne himself was never questioned about his income and benefits. Chernoby detailed Marchionne's annual pay, stock options, and cash awards, which together totaled over $68 million. The trial court overruled Chrysler's repeated relevance and wealth-of-a-party objections to this line of questioning. Evidence was also admitted, this time without objection, to the fact that had Remington survived to adulthood he "could even have been the chairman and CEO of a global automaker." Appellees' counsel referenced Marchionne's compensation again in closing, arguing, "what [Chrysler's counsel] said Remi's life was worth, Marchionne made 43 times as much in one year.... We ask you to return a verdict for the full value of Remington's life of at least $120 million.... That's less than two years of what Mr. Marchionne made just last year."
The jury determined that Chrysler acted with a reckless or wanton disregard for human life and failed to warn of the hazard that killed Remington. In returning its award of $120 million in wrongful death damages and $30 million in pain and suffering damages, the jury found Chrysler 99 percent at fault and Harrell 1 percent at fault. The trial court reduced these damages to $30 million and $10 million respectively when it denied Chrysler's motion for a new trial.
In its opinion affirming the trial court's order, the Court of Appeals approved the admission of Marchionne's compensation evidence, stating that "evidence of a witness's relationship to a party is always admissible" and that Marchionne's compensation "made the existence of [Marchionne's] bias in favor of Chrysler more probable." Chrysler Group, LLC v. Walden ,
II.
The question at trial was who, if anyone, was liable for Remington Walden's death. As the case comes to us on appeal, however, the first question is about Georgia's Evidence Code, which was more fairly characterized as "new" at the time of the trial than it is now. In considering whether evidence of Marchionne's compensation was properly admitted, the Court of Appeals interpreted OCGA § 24-6-622, which addresses evidence relating to a witness's feelings about and relationship toward the parties, as a super-admissibility rule meaning, essentially, that *249any evidence at all of a witness's bias would always be permitted, no matter how prejudicial or otherwise improper. Chrysler, on the other hand, relies primarily on the "longstanding common law rule banning party wealth" to assert that the evidence should have been barred. Neither is correct, but to understand why, we need to consider Georgia's new Evidence Code as a whole.
A. We first establish our parameters of interpretation. Georgia's new Evidence Code was modeled in large part on the Federal Rules of Evidence, "and when we consider the meaning of such provisions, we look to decisions of the federal appellate courts construing and applying the Federal Rules, especially the decisions of the United States Supreme Court and the Eleventh Circuit." Glenn v. State ,
The statutory interaction between Rule 403 and the relevancy rules demonstrates at the outset that not all evidence that "shall" be admissible according the Rules may always be entered in every instance; that rule specifically notes that relevant evidence is only admissible if it is not subject to constitutional requirements or other limitations. By standardizing rules concerning both the presumptive admissibility of relevant evidence and the judicial exclusion of certain otherwise admissible evidence, Rules 401, 402, and 403 overlay the entire Evidence Code, and are generally applicable to all evidence that a party seeks to present. See, e.g., State v. McPherson ,
But again, not all of our new Evidence Code is "new." One "holdover" provision from the old set of rules with no federal counterpart is Rule 622, which was applied by the Court of Appeals to uphold the admission of the compensation evidence in this case. See OCGA § 24-6-622. The Court of Appeals held that "any 'concerns regarding prejudice in this instance must yield to the statutory mandate' " of
Rule 622 because *250" '[t]he state of a witness's feelings towards the parties and his relationship to them may always be proved for the consideration of the jury.' " Chrysler Group ,
So we must determine what impact Rule 622 has on the evidentiary analysis in this case-in other words, whether there is there any reason to conclude that Rule 622 somehow falls outside the bounds of Rule 403's unfair prejudice limitations. Because the Rule is a holdover from our old Evidence Code, we look to Georgia cases decided under the former version of that rule- OCGA § 24-9-68 -for guidance. The short summary is that Rule 622 does not move the needle to automatically admit evidence in spite of any prejudicial effect it may have. Even before the new Evidence Code standardized our consideration of prejudice, Rule 622 did not function as a rule of super-admissibility. For example, this Court upheld the exclusion of evidence that concerned a witness's credibility and bias but also violated the general prohibition against eliciting bolstering testimony from a party's own witness because section 24-9-68"must not be read in a vacuum, but in the context of other rules relating to witnesses and evidence." Blige v. State ,
Chrysler takes a different approach, but its argument also misapprehends the new Evidence Code. Chrysler insists that the trial court should have blocked evidence of Marchionne's compensation by applying the general rule of Georgia's common law that "evidence of the wealth or worldly circumstances of a party is never admissible, unless in those exceptional cases where position or wealth is necessarily involved."
*251Smith v. Satilla Pecan Orchard & Stock Co. ,
The new Evidence Code addresses old common law rules in OCGA § 24-1-2 (e), which provides that "[e]xcept as modified by statute, the common law as expounded by Georgia courts shall continue to be applied to the admission and exclusion of evidence and to procedures at trial." The converse of that point is also true; where the new Evidence Code does modify a common law evidentiary rule, the old rule does not continue to apply. If the outcome remains the same, it is by "happenstance" rather than design. Davis , 299 Ga. at 192,
When we consider our prior decisions applying Georgia's common law rule barring party-wealth evidence, we can see that it has indeed been modified by passage of the new Evidence Code. The old rule, by its very language, permitted party-wealth evidence "where position or wealth [was] necessarily involved ," and was, at its core, a rule of relevancy. See Satilla ,
Accordingly, because the new Evidence Code borrowed federal language for its generally-applicable relevance rules-Rules 401 and 402-Georgia's common law rule relating to the relevance of party-wealth evidence is no longer independently in force. We recognized a similar principle in State v. Jones ,
Because the common law party-wealth rule was itself a rule of relevance, and because there is no specific exclusionary rule in the new Evidence Code carrying forward the common law's general exclusionary rule for that type of evidence, Georgia courts must consider party-wealth evidence under the parameters of the new Evidence Code. This is yet another example of the "new evidence *252world" in which we live. Davis v. State , 299 Ga. at 192,
In any event, the common law evidentiary rule against party-wealth evidence would not settle the issue before us for a simple reason: Marchionne is not a party. See Party , BLACK'S LAW DICTIONARY (10th ed. 2014) ("One by or against whom a lawsuit is brought; anyone who both is directly interested in a lawsuit and has a right to control the proceedings, make a defense, or appeal from an adverse judgement; litigant."). The Court of Appeals has recognized that "great caution should be exercised by the court in disregarding the corporate entity" in holding that even the sole managing member of a limited liability company "is considered separate from the company and is not a proper party to a proceeding by or against a limited liability company." Milk v. Total Pay and HR Solutions, Inc. ,
This is not to say that party-wealth evidence is now admissible in Georgia-it is frankly quite difficult to see how it would be relevant in nearly any case, at least not involving punitive damages. As the Tenth Circuit has said, "Comments on the wealth of a party have repeatedly and unequivocally been held highly prejudicial, and often alone have warranted reversal." Whittenburg v. Werner Enterprises Inc. ,
Nor does this case establish that the kind of compensation evidence at issue here always comes in-it often doesn't. But the proper objection is made under Rule 403, and must be based on unfair prejudice outweighing probative value, not on a blanket ban. This is a fact-specific analysis. See United Statesv. Bradley ,
We also note that despite a relative lack of decisions from the federal circuit courts addressing the specific issue before us, multiple federal district courts have dealt with the issue, and although these cases are not binding, their analyses highlight the varying outcomes that may be appropriate depending on the facts of a case. Some have allowed financial evidence as relevant to show the bias of a witness. See, e.g., Avondale Mills, Inc. v. Norfolk S. Corp. , No. 1:05-2817-MBS,
Others have banned such evidence as too prejudicial under Rule 403. See, e.g., L-3 Comm. Corp. v. OSI Systems, Inc. , No. 02 Civ. 9144(PAC),
When evaluating the trial court's admission of the compensation evidence in this case, we ordinarily would determine whether, under the facts of the case, the trial court had abused its discretion. Cooper Tire & Rubber Co. v. Crosby ,
Chrysler did not specify Rule 403 or mention unfair prejudice as grounds for its objections to evidence of Marchionne's compensation.
Instead, it referenced relevance and referred back to its pretrial motion on party wealth. That motion did invoke Rule 403, but the 403 analysis of party wealth is entirely different than that of witness bias. In the former, the concern is the relevance of the evidence to the case and the risk of bias against the wealthy party on the part of the jury. For the latter, the question the trial court must consider is whether, even considering Rule 622's admonition regarding the *254admissibility of evidence of witness bias, the evidence in question is unfairly prejudicial to the objecting party.
B. For that reason, we can only analyze whether the admission of this evidence constituted plain error, not whether it was an "ordinary" abuse of discretion. This is yet another innovation of our new Evidence Code-before, the issue would have been waived entirely. See Hall v. State ,
Although this Court has thus far applied the plain error standard only in criminal cases, our Evidence Code does not distinguish between the two, and so it also applies in the civil arena.
That is not to say that we would make the same decision de novo, or even necessarily under the ordinary "abuse of discretion" standard of review. But the exclusion of evidence under Rule 403 is "an extraordinary remedy which should be used only sparingly" and "[t]he application of the Rule 403 test is a matter committed principally to the discretion of the trial courts," Smart v. State ,
In the end, we hold that determinations of whether a non-party witness's compensation, like other wealth evidence, "is relevant under [Georgia] Rule of Evidence 401, or more prejudicial than probative under Rule 403, must turn on the facts of each specific case." Bradley ,
For all these reasons, we affirm the judgment of the Court of Appeals.
Judgment affirmed.
All the Justices concur in Divisions I and II A. Boggs and Peterson JJ., concur specially in Division II B. Hines, C. J., Hunstein and Blackwell, JJ., concur in judgment only in Division II B.
Bryan Harrell pled guilty to vehicular homicide and is now in prison.
Although none are at issue in this case, some other provisions are original creations of the new Evidence Code, which we interpret using "the usual principles that inform our consideration of statutory meaning." Frost , 297 Ga. at 299,
Chrysler's argument that a 1977 case extended the party wealth rule's application to witnesses is misplaced. See Reed v. State ,
It is not a simple task to unpack the development of plain error review in federal courts and in this State, but the issue merits some discussion here. Federal courts sometimes explain that plain error review is derived from Federal Rule of Criminal Procedure 52 (b), which codified the federal common law in 1944, and provides that "[a] plain error that affects substantial rights may be considered even though it was not brought to the court's attention." See United States v. Olano ,
We can locate no federal cases finding the federal equivalent of plain error for admission of this type of evidence, although we again note that under federal law plain error typically is not found in civil cases.
We also directed the parties to brief a question regarding the Court of Appeals's review of the remitted judgment. Upon review of the record and full briefing, however, we conclude that this issue does not warrant our review.
Concurring Opinion
Even when considered in light of the concurrence from Justice Peterson, I agree with the analysis in the majority opinion. I write separately only to emphasize that, while this case was certainly easier to decide under a plain error standard, the outcome here could very well have been different had Chrysler made the proper Rule 403 objection below and this case had been evaluated under a normal abuse of discretion standard. In this regard, I would caution the bench and bar to be wary of the use of employee compensation evidence as a means of showing a witness' bias, because such evidence can be highly inflammatory and lead to unfair prejudice, and because there are other ways to show an employee's potential bias without referencing their actual income.
For example, the fact that a witness in employed full time with a particular company, alone, could show that the witness may be biased in favor of that place of employment. The employee's source of income, rather than the level of income itself, may be more relevant to one's potential bias in a *256particular case. However, a focus on the employee's income may show not only the witness' bias, but may bias the jury against an employer to use the employee's income as a questionable basis for calculating compensatory, rather than punitive, damages in a case. Indeed, the plaintiffs specifically encouraged the jury to use Chrysler's CEO's income as a reference point for calculating its compensatory damages award. In order to reduce the risk of such abuses occurring, in those rare cases where employee compensation may be relevant to an issue presented at trial, I would encourage trial courts to use limiting instructions as an additional tool to blunt any potential prejudice and to direct the jury's attention to the limited purpose for which the evidence should be considered.
Peterson, Justice, concurring specially in part.
I concur fully in Divisions I and II (A) of the majority opinion. Although I concur in the judgment in Division II (B), I write separately because I do not agree with all that is said in that division.
I agree with the actual holding of the majority's opinion. Properly understood, that holding has three parts: (1) as explained in Division II (A), the trial court's admission of evidence of Chrysler CEO Sergio Marchionne's compensation ought to have been evaluated under Rule 403 ; (2) as explained in Division II (B), because Chrysler did not object on that basis, admission of that evidence is reviewable only for plain error; and (3) as further explained in Division II (B), the admission of that evidence is not reversible under that standard because even if admission of the evidence were error, any error was not obvious. I agree with each of those premises, and they are all that is necessary to decide the question this case presents. As such, "the cardinal principle of judicial restraint-if it is not necessary to decide more, it is necessary not to decide more-counsels us to go no further." Moore v. McKinney,
I am authorized to state that Justice Boggs joins in this concurrence.
Reference
- Full Case Name
- CHRYSLER GROUP LLC n/k/a FCA US LLC v. WALDEN
- Cited By
- 38 cases
- Status
- Published