United States District Court, E.D. Michigan, Southern Division
RELIABLE TRANSPORTATION SPECIALISTS, INC. and AMARILD USHE, Plaintiffs,
WAUSAU UNDERWRITERS INSURANCE COMPANY, Defendant.
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANT'S MOTION TO EXCLUDE JUDGE MACDONALD'S
TESTIMONY AND RULE 26(b)(2)(C) WITNESS TESTIMONY REGARDING
BAD FAITH [ECF NO. 211]
CARAM STEEH UNITED STATES DISTRICT JUDGE
matter comes before the court on Wausau's motion in
limine to exclude Judge MacDonald's testimony in its
entirety and to exclude plaintiffs' Rule 26(b)(2)(C)
hybrid witness testimony regarding bad faith. For the reasons
set forth, Judge MacDonald's opinion testimony is
excluded and the fact testimony of Judge MacDonald, as well
as Ven Johnson's and Thomas Schulte's testimony, is
limited as described.
moves to exclude retired Judge Kathleen MacDonald as both a
fact and an opinion witness because her testimony would be
unfairly prejudicial and cumulative. Wausau argues that the
jury is likely to give her testimony undue weight merely
because she was a judge, and any probative value of her
testimony is substantially outweighed by the likelihood of
unfair prejudice under FRE 403.
MacDonald presided over the underlying litigation and, if
permitted, will testify to the facts involving three
settlement conferences she held before and during trial; the
facts of the underlying litigation and trial; that Mr. Holt,
Reliable and Mr. Ushe were ready to settle within policy
limits multiple times; and her opinions formed during the
case, including that Wausau was reckless and indifferent
toward its insureds.
area of MacDonald's proposed testimony is of particular
concern to both parties. Judge MacDonald is expected to
testify that at the May 21, 2015 settlement conference, which
took place during the underlying trial, she indicated to Mr.
Joslin, insured Reliable's attorney, that plaintiff Mr.
Holt would accept the policy limits to settle the case.
Plaintiffs contend that they will be severely prejudiced if
this testimony is excluded because the jury will be presented
with Mr. Joslin's testimony that he does not recall
having this conversation with Judge MacDonald.
argues that MacDonald's conversation with Reliable's
defense counsel is not relevant to the issue of Wausau's
bad faith. The issue in this litigation is Wausau's
conduct, based on the information known to it at the time.
Therefore, the relevant evidence is what Mr. Joslin
communicated to Wausau after he spoke to MacDonald, not what
MacDonald might have told Joslin.
and MRE 605 prohibit a judge from testifying at trial in the
case over which the judge is presiding. Wausau contends that
it would be only slightly less prejudicial to have Judge
MacDonald testify in this case. Wausau cites to cases from
other states for the proposition that it is prejudicial for a
judge to express her opinion as a witness about events that
occurred in an earlier trial over which she presided.
Merritt v. Reserve Ins. Co., 34 Cal.App.3d 858
(Cal.Ct.App. 1973) (bad faith failure to settle case);
see also Aetna Cas. & Sur. Co. v. Price, 146
S.E.2d 220, 227 (Va. 1966) (testimony of trial court judges
in underlying action regarding parties' settlement
discussions was inadmissible and prejudicial in subsequent
bad faith failure to settle action); Joachim v.
Chambers, 815 S.W.2d 234, 238-39 (Tex. 1991) (“The
risk of such appearance of impropriety extends beyond the
particular case in which the judge testifies. Not only are
jurors likely to be influenced in their decision by the
testimony of a judge on one party's behalf, they will see
a judge appearing to take sides. The entrance of a judge into
the litigation arena in aid of a combatant impacts not only
the outcome of that conflict but the very idea of judicial
cite to a legal malpractice case where the court permitted
the testimony of the trial court judge who presided over the
underlying employment dispute. Sansone v. Garvey,
Schubert & Barer, 71 P.3d 124 (Or. Ct. App. 2003).
The court upheld the trial court's decision to permit the
judge to testify as to her factual observations of the
witnesses at the underlying trial as well as to her opinions
she communicated to the trial attorneys during settlement
negotiations “because those qualified as
‘facts' pertaining to what the trial attorneys knew
and when they knew it.” Id. at 132. The court
noted that the trial court “took particular care in
instructing the jury so that it would understand that Judge
Rosenblum was testifying as a witness, not as a judge.”
Id. at 133. The court concluded that the trial court
properly exercised its discretion in managing the judge's
Wausau points out that Judge MacDonald does not accurately
recall some of the details of the case and was not involved
in many of the key events. For example, at her deposition,
she incorrectly testified that Wausau offered $750, 000 to
settle during the first pretrial conference; that Holt would
have “always” taken $1, 000, 000 to settle before
trial; and that Wausau never offered its $1, 000, 000 policy
limit. MacDonald dep., p. 12-13, 18, 30-31. MacDonald was not
aware of many of Wausau's settlement offers made to Holt,
and she was not aware of the extensive high-low settlement
negotiations. Id. at 18, 28-29.
court agrees with those courts that have recognized the
inherent prejudice in having a judge testify as an opinion
witness regarding a case they presided over. The court also
has concerns regarding the foundation for any opinions Judge
MacDonald formed as to Wausau's bad faith. While Judge
MacDonald was witness to the evidence presented at trial, and
engaged in three settlement conferences, she was not privy to
all the settlement negotiations engaged in by the parties.
Given that she was not aware of the entire settlement
history, the court finds that the probative value of Judge
MacDonald's opinion, specifically that Wausau was
reckless and indifferent toward Reliable in its settlement
positions taken in the underlying litigation, is
substantially outweighed by the danger of unfair prejudice.
Pursuant to Rule 403, the court grants defendant's motion
in limine to exclude the opinion testimony of Judge
also seeks to exclude Judge MacDonald's fact testimony.
The court has concerns about the relevance of such testimony.
Judge MacDonald's impressions of the strengths and
weaknesses of the underlying litigation in relation to
Wausau's settlement decisions are only relevant if they
were communicated to Wausau. For example, MacDonald testified
at her deposition that she told Mr. Joslin, “I
can't believe you're going to continue with this. Are
you going to make an offer? . . . If you get me the million
I'll make sure that Mr. Johnson takes it.”
MacDonald dep., p. 17. The jury will be asked to consider if
Wausau failed to consider a reasonable settlement demand when
the facts of the case indicate obvious liability and serious
injury. The fact that MacDonald might have shared her
assessment of the evidence and settlement value with Mr.
Joslin, however, is not relevant unless either she or Joslin
communicated her opinions to Wausau. Otherwise, permitting
MacDonald's fact testimony has a significant risk of
confusing the jury.
will have to lay an appropriate foundation as to any fact
testimony they seek to elicit from Judge MacDonald. If they
can establish relevance, the court believes that Judge
MacDonald's proposed fact testimony presents much less
danger of unfair prejudice than does her opinion testimony.
The court can further minimize any prejudice by instructing
the jury that they are to consider MacDonald's testimony
as they would any witness and not to give her testimony more
weight merely because she was a judge. ...