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Mid America Solutions, LLC v. Merchant Solutions International, Inc.

United States District Court, W.D. Michigan, Southern Division

December 1, 2016

MID AMERICA SOLUTIONS, LLC, Plaintiff,
v.
MERCHANT SOLUTIONS INTERNATIONAL, INC., Defendant.

          OPINION

          ROBERT HOLMES BELL, UNITED STATES DISTRICT JUDGE

         This is a breach of contract case. Defendant Merchant Solutions International, Inc. is a merchant service provider, and Plaintiff Mid America Solutions, LLC, was an independent contractor working for Defendant. The matter is before the Court on Defendant's motions in limine. (ECF Nos. 99, 101, 103, 106, 108, 110, 112.) Plaintiff has filed a response to each. (ECF Nos. 115, 116, 117, 118, 119, 120, 121.)

         I.

         Questions of evidence admissibility are properly determined before trial. The Federal Rules of Evidence provide that “preliminary questions concerning . . . the admissibility of evidence shall be determined by the court[.]” Fed.R.Evid. 104(a). Relevant evidence is “evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence.” Fed.R.Evid. 401. The standard for relevance is “liberal” under the Rules. Churchwell v. Bluegrass Marine Inc., 444 F.3d 898, 905 (6th Cir. 2006); United States v. Whittington, 455 F.3d 736, 738 (6th Cir. 2006). A piece of evidence “does not need to carry a party's evidentiary burden to be relevant; it simply has to advance the ball.” Dortch v. Fowler, 588 F.3d 396, 401 (6th Cir. 2009).

         But not all relevant evidence is admissible. Rule 403 permits the Court to “exclude relevant evidence if its probative value is substantially outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence.” Fed.R.Evid. 403; United States v. Brady, 595 F.2d 359, 361 (6th Cir. 1979). Rule 403 creates a balancing test to help the Court determine whether evidence, although relevant, should be excluded. The Court enjoys broad discretion when it decides questions of relevance and possible prejudice. See Tompkin v. Phillip Morris USA, Inc., 362 F.3d 882, 897 (6th Cir. 2004).

         Under Rule 403, “[e]vidence is not excluded merely because it is damaging or prejudicial to a defendant's case; rather, it must be unfairly prejudicial.” Brooks v. Caterpillar Global Mining America, LLC, No. 4:14CV-00022-JHM, 2016 WL 3676764, at *2 (W.D. Ky. July 6, 2016) (internal citation omitted). To warrant exclusion, “any danger of unfair prejudice posed by the evidence must substantially outweigh its probative value.” Id. (internal citation omitted) (emphasis in original). Rule 403 is “not concerned with the damage to the defendant's case that results from the legitimate probative force of the evidence[.]” Id. (internal citation omitted). Rather, it applies when the evidence has an undue tendency to suggest decision on an improper basis, like an emotional one. Old Chief v. United States, 519 U.S. 172, 180 (1997) (citing Fed.R.Evid. 403 advisory committee's note); see also Journey Acquisition-II, L.P., v. EQT Prod. Co., 830 F.3d 444, 459 (6th Cir. 2016) (citing United States v. Poulsen, 655 F.3d 492, 509 (6th Cir. 2011)).

         II.

         Defendant's First Motion in Limine (ECF No. 99)

         Defendant first argues that evidence of an alternate agreement should be excluded under Rules 401 and 403 because the evidence is not relevant or probative, and will confuse the jury and waste time. Defendant explains that both of the agreements contain the same language with respect to commissions calculations and Schedule A. Defendant notes the different language in both agreements, but contends that the difference is of no consequence here. Defendant also cites to Plaintiff's admission that Defendant's agreement was the agreement which governed the parties' relationship. (ECF No. 99-2, PageID.2269.)

         In Plaintiff's response, Plaintiff argues that this difference is “essential relevant evidence vis a vis the established course of conduct of the parties in executing their agreement over the course thereof.” (ECF No. 115, PageID.2683.) Plaintiff argues that which agreement is controlling is material to both the complaint and Defendant's counter-complaint.

         The Court has reviewed each agreement to determine whether the differences are relevant under Rule 401. Each agreement contains a compensation paragraph, which states:

Commission. MAS will be paid a residual commission equal to (see schedule A). This is a percentage of the annual projected Gross Profit attributable to merchant accounts obtained by MAS that have begun processing through one of the Company's processing banks. “Gross Profit” means the dollar value of the basis point difference between the discount rate and per-item fees charged to the merchant and the discount rate and per-item fees charged to the Company and its processing banks.

(ECF Nos. 99-1, 99-3, PageID.2261, PageID.2285.) But the agreements differ at the end of this paragraph, and Plaintiff's agreement includes a provision that, in case of breach, Plaintiff will be considered vested in all accounts. (ECF No. 99-3, PageID.2285-86.) The agreements also differ as to the term and termination provisions, including the duration of the covenant not to compete. (ECF Nos. 99-1, 99-3, PageID.2262, PageID.2286.)

         Moreover, the Schedule A Compensation Agreements differ as to whether Plaintiff is entitled to 50% residual profit of the merchant's monthly volume or whether it is entitled to 50% profit of the merchant's monthly processing volume. (ECF Nos. 81, 99-1, PageID.1779, PageID.2264.) In ...


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