Filed: Jul. 14, 2010
Latest Update: Feb. 21, 2020
Summary: CUNA MUTUAL INSURANCE CO., INC., ET AL.and Assets.appellees.-6-, as summary judgement evidence.2, Roach argues that the affidavit should have stood in the way, of granting appellees motion even if it was incompetent to support, her own, citing Hayes v. Douglas Dynamics, Inc., 8 F.3d 88 (1st, Cir.
Not for Publication in West’s Federal Reporter
United States Court of Appeals
For the First Circuit
No. 09-2022
CHERISE ROACH,
Plaintiff, Appellant,
v.
CUNA MUTUAL INSURANCE CO., INC., ET AL.,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. William G. Young, U.S. District Judge]
Before
Boudin, Circuit Judge,
Souter, Associate Justice,*
and Howard, Circuit Judge.
Sergei Lemberg, with whom Lemberg & Associates, LLC was on
brief, for appellant.
Edward C. Cooley, with whom Giarrusso, Norton, Cooley &
McGlone, P.C. was on brief, for appellees.
July 14, 2010
*
The Hon. David H. Souter, Associate Justice (Ret.) of the
Supreme Court of the United States, sitting by designation.
SOUTER, Associate Justice. A subsidiary of the appellee
CUNA Mutual Insurance Company, Inc., was the transferee of a bank’s
interest in a truck subject to a defaulted installment loan, and
the CUNA subsidiary retained a Texas company, the appellee Assets
Recovered, LLC to repossess the vehicle. The truck was found on
the lot of Stanley Services, Inc., which had taken possession of it
using equipment of its own, according to a receipt indicating a
mileage figure of 66,782. In anticipation of eventual sale by Auto
Auction of New England, Assets acted on CUNA’s behalf in obtaining
a Texas title certificate. Since the truck was locked and had no
keys, Assets did not read the truck’s digital odometer, but instead
gave the Texas agency an odometer reading of 66,782 miles, not
realizing that the mileage figure on the receipt referred to
Stanley’s transport vehicle, not the truck. A title certificate
was issued accordingly.
Thereafter, new keys were made for the truck and it was
discovered that the odometer actually read 31,245. Auto Auction
had not yet sold the truck, and Assets still had the title
certificate with the higher, wrong number. Assets applied for an
amended certificate showing the actual odometer figure, which was
obtained before the truck changed hands, first to a wholesaler, and
then to a retail dealer, who finally sold it to the appellant,
Cherise Roach. She took title by accepting a certificate showing
mileage under 32,000.
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In due course, Roach discovered she had a lemon and sued
the appellees CUNA and Assets1 on a claim they had violated a law
commonly known as the Odometer Act, which requires a transferor of
a motor vehicle to state correct mileage or to say that mileage is
unknown, 49 U.S.C. § 32705(a)(1)(A) and (B), and gives a transferee
a private right of action for a statutory violation committed with
intent to defraud, § 32710(a) and (b). The parties agree the
intent requirement may be satisfied by showing a transferor’s
reckless disregard for accuracy, and we may assume this to be so.
See Haynes v. Manning, 917 F.2d 450, 453 (10th Cir. 1990). On
cross motions, the district court granted summary judgement to CUNA
and Assets. We affirm.
The dispositive issue as the case was litigated in the
trial court was the nature and significance of the appellees’
intent when obtaining the first title certificate with the 66,782
number: was there a genuine dispute about any material fact bearing
on the intent that stood in the way of either Roach’s or the
appellees’ entitlement to judgement as a matter of law? Roach’s
answer in her favor seems to assume that an error resulting from
misreading a record (Stanley’s record, in this case) is immune to
subsequent correction and is an actionable violation of the Act on
the complaint of any downstream transferee who later learns that
1
Appellee Wachovia Corporation informed this court by letter
that it had settled with Roach and would not file a brief in this
appeal.
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the error had once been made. Perhaps sensing the unlikelihood
that the law could be in her favor, she resorts to alternative
stratagems: on the one hand, she claims that reliance on the
earlier, mistaken figure is not a necessary element of a private
claim; on the other, she claims that she was “entitled . . . to
rely on the veracity of historical odometer disclosures” and was in
fact “guided” by the earlier figure to make an imprudent purchase.
We agree with the district court that Roach’s position is
untenable, however stated. First, we will assume for argument that
the mistaken reading of Stanley’s receipt (as showing the truck’s
mileage) was negligent, but negligence is not recklessness
tantamount to fraudulent intent, and reliance upon the receipt in
these circumstances (where access to the odometer was not
immediately possible and where the mistake was timely corrected
before Assets transferred the truck) cannot fairly give rise to an
inference of reckless disregard for the truth. See W. Keeton et
al., Prosser and Keeton on the Law of Torts § 34, p. 213 (5th ed.
1984) (defining “reckless” as intentional acts “of an unreasonable
character in disregard of a known or obvious risk . . . usually
accompanied by a conscious indifference to the consequences”); cf.
United States v. Ranney 298 F.3d 74, 78 (1st Cir. 2002) (“reckless
disregard for the truth” requires proof that the speaker “in fact
entertained serious doubts as to the truth of the [statement]” and
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may be “inferred from circumstances evincing obvious reasons to
doubt [its] veracity” (internal quotation marks omitted)).
Next, even if the appellees had been reckless, Roach’s
claim must fail for the further reason that she can prove no injury
caused by the allegedly fraudulent misrepresentation. See Huson v.
Gen. Motors Acceptance Corp., 108 F.3d 172, 173 (8th Cir. 1997) (no
liability where a failure to investigate “could not have caused any
injury” to the plaintiffs). There is no support in the statute for
the astonishing notion that a mistake once made, whatever the
intent behind it, is impervious to correction, such that a buyer
apprised of the correction may ignore it. On the contrary, Roach’s
position is at odds with the very justification for providing a
private cause of action for statutory violation; there may well be
more than one strand of policy behind the private remedy, but at
the least it is a remedy for injury. See 49 U.S.C. § 32710(a)
(creating liability for treble damages with a $1,500 minimum). It
is a source of compensation for harm traceable to a statutory
violation, whereas Roach can trace no causation to a mileage
statement that had been amended by the time she bought the truck.
In sum, there were no undisputed facts that entitled Roach to a
finding that Assets acted with reckless disregard of the truth when
it filed the original application for a title certificate, nor
would such a finding, even if permissible, support a conclusion of
liability on Roach’s private complaint.
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The appellees’ converse request for judgement as a
matter of law fares better. There being no proffered evidence to
the contrary, the only sensible explanation for the initial higher
figure is that someone at Assets read the Stanley record as
referring to mileage on the repossessed truck, instead of Stanley’s
recovery vehicle. As we explained, that was conceivably negligent,
but it could not reasonably be seen, without more, as evidence of
reckless disregard for truth. Moreover, as the district judge
concluded, Assets’s correction of the figure before transfer of the
truck precluded any reasonable inference that Assets or its
principal, CUNA, ever meant to defraud someone when it used the
earlier number. However true it is that “summary judg[e]ment is to
be used sparingly when intent or motive is at issue,” Catrone v.
Thoroughbred Racing Ass’ns of N. Am., Inc., 929 F.2d 881, 889 (1st
Cir. 1991), this is the unusual instance in which no fact finder
could reasonably infer the fraudulent intent necessary for
liability. And of course, as noted before, the correction stands
in the way of finding any causation between the original statement
and Roach’s bad buy, as the private cause of action would require.
The view of the case just set out rests on our resolution
of disputed issues about the use of two affidavits, the first being
that of Filipe Ossa, Assets’s managing officer, filed by the
appellees. Roach objected that Ossa was not speaking from personal
knowledge, with the consequence that his affidavit was incompetent
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as summary judgement evidence. See Fed. R. Civ. P. 56(e)(1); Perez
v. Volvo Car Co., 247 F.3d 303, 315-16 (1st Cir. 2001).
Howevermuch Roach would now like to expand the scope of the
statements to which this objection might refer, in the district
court her sole specific reference was to Ossa’s conclusory
allegation that Assets did not use the wrong figure intentionally
when it submitted the first title application. See Addendum to
Reply Brief for Appellant 4. But this is a point of no
consequence, for disregarding Ossa’s conclusion would not affect
the appellees’ entitlement to judgement. As explained before, even
if the original application included a reckless misstatement, Roach
could not show a causal connection to her decision to buy the truck
accompanied by a corrected title certificate. Any error in the
district court’s consideration of the affidavit was thus harmless.
The second disputed affidavit goes to Roach’s fall-back
position that even the corrected figure of 31,245 was a fraudulent
falsehood, despite its being the reading on the odometer as found
when the new keys allowed inspection of the digital display. Her
only evidence for this claim was the affidavit of William Zaher,
the principal of a “diagnostic” service that Roach asked to examine
the truck after she had driven it, unsatisfactorily, for about
8,000 miles. Zaher stated that he inspected the truck and found
its condition “entirely inconsistent” with the odometer reading.
On appellee’s motion, the district court struck the affidavit on
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the ground that Roach had failed to comply with the Rule 26
requirement that a party disclose the identity of any expert
witness to be relied upon and supply a report indicating the
witness’s qualifications to provide expert opinion testimony. See
Fed. R. Civ. P. 26(a)(2)(B).
There was no abuse of discretion in this ruling. See
Poulis-Minott v. Smith, 388 F.3d 354, 357 (1st Cir. 2004). Roach
claims that she disclosed that a “representative” of the diagnostic
service “may” testify about the relationship of odometer mileage to
the condition of the truck, but she supplied neither Zaher’s name
(also required, along with his address and phone number, by Rule
26(a)(1)(A)(I)) nor the basis claimed for his qualification as an
expert before she submitted his affidavit in support of her summary
judgment motion. Her argument that, according to the court’s
scheduling order, the deadline for these disclosures was still
months off misses the mark. “The purpose of the expert disclosure
rules is to facilitate a fair contest with the basic issues and
facts disclosed to the fullest practical extent” and to prevent
parties from seeking the “unfair tactical advantage that can be
gained by failing to unveil an expert in a timely fashion.”
Poulis-Minott, 388 F.3d at 358 (internal quotation marks omitted).
Roach’s failure to make the disclosures before she attempted to
offer the affidavit as evidence at summary judgement frustrated
that purpose, even if she still had time to make disclosures before
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the evidence would be offered at trial. Equally to the point is
the requirement of Rule 56, invoked by Roach herself in objecting
to the Ossa affidavit, that affidavits on summary judgement must
show the admissibility of the proffered evidence by including,
among other things, an indication “that the affiant is competent to
testify on the matters stated.” Fed. R. Civ. P. 56(e)(1). Roach’s
failure to disclose whatever qualifications Zaher may have as an
expert runs afoul of the rule. Her only response is that his
affidavit was proffered as that of a fact witness who happened to
be an expert, not as that of an expert, a claim that is manifestly
erroneous. The Zaher affidavit was properly kept out, and without
it Roach had no basis to raise any issue of fact about the accuracy
of the actual odometer reading or the appellees’ reliance on it.2
The judgement is affirmed.
2
Roach argues that the affidavit should have stood in the way
of granting appellees’ motion even if it was incompetent to support
her own, citing Hayes v. Douglas Dynamics, Inc., 8 F.3d 88 (1st
Cir. 1993). The case is no help to her, holding only that an
affidavit must satisfy Rule 56, whoever wishes to rely on it.
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