iIf you are a trial lawyer, then you are going to want to be familiar with Georgia Pacific Consumer Products, et al. v. von Drehle Corp.
The decision reverses a North Carolina district court’s entry of JNOV for von Drehle based on issue and claim preclusion defenses that were raised shortly before trial. The Fourth Circuit reversed and ruled that von Drehle had waived those defenses by failing to assert them earlier.
Von Drehle initially won the case on summary judgment, which resulted in a first appeal to the Fourth Circuit. Meanwhile, in Arkansas, GP was involved in an identical lawsuit against a different defendant in a case captioned GP v. Myers . GP lost the Myers case one month before von Drehle moved for summary judgment in North Carolina, but von Drehle didn’t notify the district court of the Myers decision. GP then appealed Myers to the 8th Circuit, where it was pending during the year-long Fourth Circuit appeal of the von Drehle summary judgment order. von Drehle never alerted the Fourth Circuit to the existence of the Myers case or its potentially preclusive effect, and the Fourth Circuit reversed the summary judgment order, sending von Drehle back to North Carolina for trial.
Finally, two months after the 8th Circuit affirmed Myers, and well after the Fourth Circuit remanded von Drehle to North Carolina for trial, von Drehle moved to amend its answer to assert claim and issue preclusion defenses arising from Myers. The district court denied that motion, holding that von Drehle had waived the defense. The von Drehle case was tried, and GP won. Here is where things get unusual. In the interim between the district court’s denial of von Drehle’s motion to amend and the trial, GP lost another identical case, GP v. Four-U-Packaging, Inc., which was pending in Ohio federal district court. Based upon that decision, and before trial, von Drehle renewed its motion to amend based upon the newly decided Four-U case. However, the renewed motion was not decided pre-trial. Then, post-trial, the von Drehle trial court granted von Drehle’s renewed motion to amend, sua sponte vacated the jury verdict and granted JNOV to von Drehle. This resulted in a second appeal to the Fourth Circuit.
In a blistering opinion, the Fourth Circuit reversed the JNOV, holding that von Drehle’s delay had resulted in a waiver of the issue and claim preclusion defense that could not later be revived. The Fourth Circuit was unimpressed by von Drehle’s reliance on Four-U, because the Four-U decision was itself premised upon Myers. In other words, the Fourth Circuit resisted any trickle down benefit to von Drehle from a trailing case decided on the same basis as Myers where von Drehle knew about, and failed to timely raise, the earlier Myers decision.
The lesson? If there is a decision from any court that you believe impacts your case, whether within the same jurisdiction or not, and whether on appeal or not, report the case and make any related motions expeditiously, because once a defense is waived, that waiver could be irreversible, even in the face of subsequent authority. The reasoning for the Fourth Circuit’s opinion is debatable, but one perspective could be that it felt as though von Drehle had wasted judicial resources by not raising available defenses as soon as Myers came down. This case is worth a close read, because the Fourth Circuit’s perspective on appropriate timing may depart from traditional ideas.
