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Wednesday, November 08, 2006

Ind. Decisions - Supreme Court issues one today

In Outback Steakhouse of Florida, Inc., Toncredi, Inc., and John Broz, d/b/a Outback Steakhouse of Muncie v. David D. and Lisa K. Markley, a 23-page opinion, Justice Boehm writes:

The plaintiffs’ response to the defendants’ discovery request failed to identify a critical witness whose identity was known to plaintiffs’ counsel. Under the circumstances of this case we conclude that this omission, in concert with other acts and omissions attributable to plaintiffs’ counsel, constituted misconduct requiring a new trial. * * *

Outback argues that the failure to disclose Roysdon’s identity and the substance of her 1997 statement in response to Outback’s 1999 interrogatories violated Indiana Trial Rules 26 and 33. Second, Outback argues that Alexander’s failure to inform Outback that he intended to call Roysdon and that she would recant her 2001 deposition testimony at trial violated the duty to supplement discovery responses under Trial Rule 26(E). Outback argues that these discovery abuses constitute “misconduct” which denied Outback a fair trial. Outback also claims miscon-duct by plaintiffs’ counsel in closing argument. As a remedy Outback seeks a new trial at which Roysdon’s testimony is excluded and recovery of its trial and post-trial attorney fees from the Markleys and/or the Markleys’ counsel.

As explained below, we conclude that the plaintiffs’ failure to identify Roysdon as a person with knowledge of the relevant facts was a negligent if not intentional breach of its discovery obligations. Subsequently, plaintiffs failed to supplement their response with the substance of her change in testimony. As these events unfolded, these omissions cascaded into a closing ar-gument that materially misled the jury. The cumulative effect was misconduct prejudicing Outback’s defense. * * *

Notwithstanding our conclusion that Alexander’s conduct is not grounds for relief from a judgment under Trial Rule 60(B), we conclude that his conduct warrants investigation by the Indiana Disciplinary Commission. Rule 3.3(a)(1) of the Indiana Rules of Professional Conduct provides that an attorney “shall not knowingly make a false statement of fact or law to a tribu-nal.” The commentary explains that candor is necessary to preserve the integrity of the adjudica-tive process. Rule 4.1(a) provides that an attorney shall not “knowingly make a false statement of material fact or law to a third person” in the course of representing a client. The commentary to this Rule explains that misrepresentations include “partially true but misleading statements.” Rule 8.4(d) provides that it is also misconduct for an attorney to engage in conduct “prejudicial to the administration of justice.” We leave to the Disciplinary Committee to consider whether these facts are as they appear from this record and if so whether any charges are appropriate.

Conclusion. Outback raised several issues before the Court of Appeals that are not raised in its peti-tion for transfer. Because we agree that Outback’s motion for a new trial must be granted, we need not address these issues. The order of the trial court denying Outback’s motion for relief from a judgment is reversed. This cause is remanded with direction to vacate the judgment and schedule a new trial.

For background, see this August 1, 2005 ILB entry, titled "Appeals court upholds $39 million judgment", and this one from Feb. 2, 2006 ("Supreme Court grants transfer to Outback Steakhouse case").

Posted by Marcia Oddi on November 8, 2006 12:29 PM
Posted to Ind. Sup.Ct. Decisions