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WE HAVE A VERDICT IN JARRETT VS. ANTHEM BUT ANTHEM WRESTLING FILES MOTION REQUESTING MISTRIAL, HEARING SCHEDULED FOR TODAY

By Mike Johnson on 2020-07-30 10:39:00

Anthem Wrestling, the parent company of Impact Wrestling, filed a 50-page motion on 7/29 before the United States District Court of The Middle District of Tennessee, requesting that Chief Judge Waverly D. Crenshaw, Jr. declare a mistrial, which would effective force the trial to start from scratch even though the jury has brought back a verdict in the case.  Jarrett's side filed a response this morning in advance of a scheduled hearing at 9 AM Central time to determine whether a verdict brought by the jury will stand or if the entire process will be rebooted.   Based on court filings made, the jury was split among the issues brought to light at the trial. 

PWInsider.com does not yet have complete details on the verdict, but can confirm the following based on yesterday and today's filings:

*The jury ruled that Anthem Wrestling Exhibitions, LLC is liable to Plaintiff Global Force Entertainment, Inc. for federal trademark infringement of the registered mark GLOBAL FORCE WRESTLING, violation of the Tennessee Consumer Protection Act, unjust enrichment, negligence, conversion, and federal unfair competition for infringement and Tennessee trademark infringement for usage of the GFW logo.

*The jury ruled that Anthem Wrestling Exhibitions, LLC is liable to Plaintiff Jeffrey Jarrett for violation of the Tennessee Personal Rights Protection Act.

*The jury ruled Anthem Wrestling Exhibitions, LLC was liable for federal trademark infringement of the mark GLOBAL FORCE WRESTLING.

*Anthem Wrestling Exhibitions, LLC is liable for unfair competition for infringing upon the GFW logo.

*Anthem Wrestling Exhibitions, LLC is liable for Tennessee trademark infringement for usage of the GFW logo.

*The jury ruled in favor of Global Force Entertainment, Inc. on its unjust enrichment claim, ruling that Anthem used the GFW content for their own enrichment without having the license to do so.

*The jury ruled that that Anthem Wrestling Exhibitions, LLC was negligent in deleting the original footage of the GFW Amped content.

*Anthem Wrestling Exhibitions, LLC is liable for conversion for its deletion of the original footage of the Amped content.

*However, the jury ruled that Anthem Wrestling Entertainment, LLC’s liability in this action was caused by Jeff Jarrett’s own breach of his fiduciary duty and his duty of loyalty and that Mr. Jarrett is liable to Anthem Wrestling for such breaches, so there may be damages he has to pay to Anthem.

*The jury ruled that Anthem’s conduct against Jarrett/GFW was willful.

While the jury came back with those verdicts, they have yet to award damages or punitive damages and Anthem is attempting to have everything thrown out of court to restart the entire trial process all over again.  We have broken down why and what the Jarrett side's response was this morning.

ANTHEM REQUESTS MISTRIAL RULING

Whether the jury had been prejudiced by Jarrett's side is a major bone of contention from the Anthem side, leading to their motion on 7/29.

Anthem's motion claims that Jeff Jarrett's attorney Samuel Miller made a statement on 7/21 that prejudiced the jury during his closing argument by mentioning that Ed Nordholm was not present for the court proceeding that day.  Jarrett's attorney made the mention despite Anthem's attorneys specifically requesting that the court bar that from being mentioned, which the court agreed to.

The back story there is that the trial had been postponed for several weeks out of concern that someone on Anthem's legal team may have been exposed to COVID-19, requiring the delay.  Initially the trial was to resume on 7/21, but due to scheduling concerns with members of the jury, on 7/17, the court opted to resume the proceedings on 7/20.  Since Impact Wrestling was taping TV that entire day, Anthem informed the court that Ed Nordholm and Scott D'Amore could not attend the trial that day due to the last minute rescheduling, and instead Anthem sent their Chief Financial Officer Niral V. Merchant to attend with the court's blessing.

During his closing arguments, Samuel Miller stated, "When we started this jury -- ladies and gentlemen of the jury, when we started this trial three weeks ago, I told you three things. One, Anthem had a problem. That problem was Mr. Nordholm, who is not here today. We proved that Mr. Nordholm was the problem."

Anthem's motion yesterday noted:

Mr. Miller was clearly indicating that Mr. Nordholm is a problematic individual who did not even bother to attend the closing arguments. Plaintiffs’ strategy throughout the trial was to portray Mr. Nordholm as the villain. Pointing out his absence against the order of the Court and with knowledge of Anthem Wrestling’s concerns, was a continuation of this strategy to turn the jury against Anthem Wrestling.

Second, while this statement was made only once, it was made during a crucial time of the trial. While not binding precedent on this Court, a Tennessee court has recognized that even if the offending comment was “not part of a pattern” and “happened only once,” an improper statement can be the basis for a mistrial when “it occurred during closing argument, a critical point in the trial just before the case went to the jury.

Third, Mr. Miller’s comment served no purpose whatsoever except to prejudice the jury against Anthem Wrestling, disrupting the tribunal and the administration of justice. Mr. Nordholm’s absence from closing arguments had no relevance to or impact on the issues that the jury was deciding. Pointing out Mr. Nordholm’s absence was intentionally done to achieve Defendant’s expressed concern: prejudicing the jury by making them believe that Anthem Wrestling’s representative did not care about the matter at hand and was not taking the trial seriously. Considering the fact that the Court had already ordered the parties not to make such statements and Defendant’s counsel had informed the Court and Plaintiffs’ counsel of its concern in writing that the rescheduled date and absence of Mr. Nordholm would prejudice the jury, the nature of Mr. Miller’s improper comments is even more problematic. Fourth, while the Court instructed the jury to disregard Mr. Nordholm’s absence, the cat was already out of the bag once Mr. Miller pointed out that fact. Within the context of Mr. Miller’s repeated strategy to paint Mr. Nordholm as the villain and the statement’s total lack of relevance to the issues of the case, Mr. Miller’s statement could not be cured with an instruction.

Fifth, it is likely that the case was very close at the time of closing arguments. The intellectual property issues at this case were very complicated, and, in addition to Plaintiffs’ evidence, Anthem Wrestling put on substantial evidence of multiple defenses. Finally, the jury returned a verdict holding Anthem Wrestling liable on most of Plaintiffs’ claims and found that Anthem Wrestling acted willfully on multiple claims.

Anthem attorneys also alleged that Miller "prejudiced the jury by repeatedly referring to large monetary amounts and alleged damages against the Court’s order to reserve that aspect of the case for the damages phase of the trial."

The court had broken down issued that resulted in the trial taking place into several portions in order to keep it simplified for the jury - liability, damages, and punitive damages, so the jury could rule on them separately.  They could, for example, decide Anthem was responsibile but that there were damages but no punitive damages.

Anthem cites in their motion that Jarrett's attorney kept bringing up financial numbers and potential damages despite being instructed by the court not to do so. 

During his closing argument, Miller stated, "The production costs were, in reality, based on [Ed Nordholm's] testimony, over $100,000 per hour of content. That means just to produce the 12 hours of content would have cost Anthem $1.2 million. The benefit of saving $1.2 million dollars was huge. Anthem wants you to believe it could have replaced the content for $25,000 an hour. But they don't tell you how they came to that number. Mr. Nordholm told you he left out paying for talent. He told you he left out paying for lighting. He told you he left out paying for everything else involved in creating new content."

This led to Anthem's attorneys objecting as they were dealing with the liabilities portion of the case, not the damages.  Judge Crenshaw responded, “Okay. Noted. This -- ladies and gentlemen, this is closing argument. It is not evidence. And I'll give you further instructions on that when I give you the jury charge. Go ahead.” 

However, according to Anthem, Jarrett's side kept "continued to make statements regarding evidence the Court had ruled to be inappropriate for this phase of the trial. Mr. Miller repeatedly stated that Anthem saved a lot of money from using the content at issue and that Defendant never paid Plaintiffs for the use of such content and intellectual property. These statements were so prevalent and problematic that the Court, in the middle of Mr. Miller’s closing argument, had to order the jury to leave the room and admonish Mr. Miller."

Court records indicate Crenshaw did indeed admonish Miller, telling him, "Mr. Miller, you've gone too far. This is on liability only. I gave you some leeway, but now you're continuing to come back to the issue of what money is due. Repeatedly. Now, either I can clean it up or you can clean it up, but it needs to be cleaned up. … We're only on liability. So there's no need for your continued argument about what money is due. It's just not. … [Y]ou're not in the damages phase now. And you're specifically and over and over again asking the jury to make a decision on liability because they're due something. We're here only on the theories that you've put forth and whether or not any of those theories have been established by preponderance of the evidence."

The jury, who had been removed before Crenshaw's comments to Miller, were brought back into the court room and told, "Ladies and gentlemen of the jury, I want to share with you that in the instructions that I'll give you, you will learn that the case right now is only on the claims of the plaintiff against the defendant and the defendant's claims against the plaintiff. And that's the decision that I'm going to ask you all to make. Whether or not the plaintiff or the defendant may or may not be entitled to anything depends on your decision that -- that I'll give you on the first stage of the case. So, therefore, what the lawyers are telling you now, first of all is, is not evidence. You've heard all the evidence. And you'll be the judges of how much weight to give to the evidence you've heard. And I'll give you instructions that you can consider all of it, some of it, or none of it at all. But what the lawyers -- as I told you in the beginning say -- is not evidence. So they may make reference during their closing to things that are not at issue here at this point. And to that extent you have to follow the instructions that I'll give you, as I told you when you were selected, whether you agree with those instructions or not. So with that, Mr. Miller, you have a few minutes left."

Despite those instructions, Anthem has argued that Miller had prejudiced the jury against them with his statements, writing, "The totality of the circumstances shows that Mr. Miller’s improper conduct created a reasonable probability that the jury would influence the verdict and a new trial should be granted."

Anthem is also arguing that jury instructions given were incorrect due to the breaking apart of the three portions they were to rule on - liabilities, damages and punitive damages.  While the jury instructions were to simply focus on the liabilities, according to Anthem's legal team, "the instructions submitted by the parties that explained the consequences of finding willfulness and the purpose of making such a determination—the award of punitive damages—was withheld from the jury. Similarly, the verdict form simply asked whether the jury found that Anthem Wrestling acted with the requisite mental state but did not notify the jury of the consequences of such a finding."

Now, the response from the Jarrett side, which was filed this morning.

JARRETT'S SIDE ARGUES NO MISTRIAL SHOULD BE ORDERED

This morning, Jarrett's side filed a 19-page response to the mistrial request, arguing it should be denied.  While denying that the comment made about Nordholm was even improper, Jarrett's side stated that the issue had been handled by Judge Crenshaw right there in the moment and that should therefore be considered settled and should not be considered part of the "high bar" necessary to require a new trial.  Arguing that it should fall upon Anthem to prove a new trial was necessary, Jarrett's side argued (as one would imagine they would) that Anthem had not met that requirement.

Jarrett's side also stated they did not intentionally violate any order from the court to not mention Nordholm not being at that day's proceedings, writing, "Plaintiffs’ counsel was genuinely surprised by the Court’s admonishment for violating an instruction regarding Mr. Nordholm’s absence for two reasons. First, Plaintiffs’ counsel truthfully does not recall the Court giving an instruction during the July 17 telephone conference that neither party could not point out Mr. Nordholm’s absence to the jury.1 In its Motion, Anthem does not cite to any page of a rough transcript for the Court’s instruction regarding Mr. Nordholm’s absence."  They requested a draft of the transcript of the phone call when that edict was issued.  

Jarrett's attorneys argued:

If there was such an instruction, Plaintiffs’ counsel certainly did not intend to violate it. Given the various moving parts of this particular trial, it was an honest mistake to not recall the telephonic oral instruction. It was not intentional. Certainly, no attorney wants to do anything that would have an opening statement stopped by the judge within the first few seconds, which is what happened here. There is no benefit to an attorney having a closing statement interrupted.

In fact, prior to Anthem’s Motion, Plaintiffs’ counsel could not understand where such instruction could have been given because the Court’s instruction immediately prior to closing statements pertained only to COVID-19 and the unavailability of anyone due to that illness. Nobody said at any time Mr. Nordholm could not attend due to COVID-19.

To the contrary, Anthem’s counsel represented on July 19, 2020 that Mr. Nordholm could not attend due to another alleged other commitment.

Jarrett's side also argued that the financial numbers brought up during their closing arguments were necessary towards showing that Anthem was liable for damages suffered by Jeff Jarrett and Global Force Entertainment.  Their argument:

Anthem has not met its burden of showing Plaintiffs’ counsels statements were improper.

 First, phrases relating to the amount of money Anthem saved in production costs were necessary to proving the unjust benefit conferred on Anthem by using the Amped content at the liability stage of the trial. Indeed, the jury instructions for unjust enrichment at the liability phase defined “benefit” as “any form of advantage that has a measurable value including the advantage of being saved from an expense or loss.”

To meet its burden of proof for unjust enrichment, Plaintiff GFE had to prove the measurable advantage that Anthem received from using the Amped content. In trial, Ed Nordholm was impeached through his prior deposition testimony that the cost per hour of production for Impact! in 2017 was “in excess of $100,000.” (Rough Trial Tr. 86:18-87:7, July 2, 2020). 4 Defendant did not object to this line of questioning during trial. Anthem’s benefit, therefore, was the cost savings of not having to create and produce twelve hours of wrestling content to meet its deliverable obligations. The measurable benefit was the $100,000 per hour. This was admitted without objection in the liability stage because it was clear it went to the measurable benefit for unjust enrichment. Because Anthem used twelve hours

Anthem’s counsel stated at the post-verdict status conference, “I don’t think [the jury] even realized they needed to be paying attention to numbers and so forth” and noted that she believed the jury was “shocked” they were coming back to make a damages determination. (Post-Verdict Hr’g Tr. 43:1-3, July 21, 2020). It is disingenuous for Anthem to simultaneously state that the jury did not know it would be making a damages determination and also be prejudiced by argument related to how much GFE was damaged. 4 Plaintiffs have not yet received the final version of the trial transcripts.

Accordingly, the cites in this brief are to the rough draft provided by the court reporter to generally guide the Court on where to find the citations in the record. Case 3:18-cv-00749 Document 259 Filed 07/30/20 Page 6 of 19 PageID #: 4595 7 of the Master Amped Content to meet its deliverable obligations, the total benefit was $1.2 million (i.e. $100,000 x 12 = $1.2 million).

The nature of these comments therefore could not be prejudicial to Anthem because it came into evidence during trial and were necessary to proving GFE’s unjust enrichment claims. Anthem was in no way prejudiced. Second, Plaintiffs’ counsel had a duty to counter Anthem’s unjust enrichment counterclaim. The third element of the unjust enrichment counterclaim required Anthem to prove “GFE’s or Mr. Jarrett’s acceptance of such benefit under such circumstances that it would be inequitable or unjust for them to retain the benefit without payment of the value thereof.”

Anthem stated in its closing argument the alleged measurable value on its own unjust enrichment claim, namely the $40,000 payment to Kevin Sullivan. (Rough Trial Tr. 67:20-22, July 20, 2020). To show that any alleged benefit was not unjust or inequitable Plaintiff had to show that the value of the cost savings from using the Master Amped Content far exceeded the alleged benefit to GFE for the $40,000 payment to Kevin Sullivan. Third, to counter Anthem’s affirmative defense of implied license, Plaintiff GFE had to show that there was no agreement to use GFE’s trademarks and logos unless the merger was completed. Anthem referred to a “contract” five times in its closing argument. (Rough Trial Tr. 55:25-1, 58:2-4, 65:25-66:4, 71:6-9, July 20, 2020).   Anthem also claimed the license was “legally binding.” (Rough Trial Tr. 58:2-3, July 20, 2020).

To show there was no agreement and therefore no “legally binding” license or contract, Plaintiff had to prove there was no consideration and no “bargain for exchange.” Plaintiff, indeed, never received anything in exchange for Anthem’s use of its trademarks and logos. There was no consideration, therefore, there was no license. Plaintiff’s counsel’s statements that Anthem was claiming it had a “free and forever license” highlighted the fallacy in Anthem’s defense. Because the nature of the comments was true, and necessary to counter Anthem’s affirmative defense, Plaintiffs’ counsel’s statements were not improper and in no way prejudiced Anthem. Finally, the total value of the benefit (which is at least the $1.2 million in production costs savings) also goes to showing Anthem’s willfulness and intent for conversion, negligence, unjust enrichment, and violation of the Tennessee Consumer Protection Act. Anthem decided to use GFE’s content and trademarks for its own benefit long after the merger was terminated because the benefit of doing so was so great. Showing the great value of Anthem’s benefit was significant to proving that Anthem’s actions were intentional and willful and the motive for willfully and intentionally taking those actions. For the foregoing reasons, Plaintiff’s statements pertaining to the measurable benefit were not improper because they involved facts that came into evidence and were necessary to prove Plaintiffs’ claims and rebut Defendant’s counterclaims and defenses. Similarly, showing the fallacy of Anthem’s repeated representations that there was a “contract” or “agreement” is both fair and necessary to defeat that defense to both infringement and unjust enrichment (i.e. Anthem claimed at closing that the existence of a contract bars an unjust enrichment claim). Even if this Court disagrees, the Court’s multiple curative instructions resolved any potential prejudice. Clarksville-Montgomery Cty. Sch. Sys. 925 F.2d 993 at 1002 (“[W]here such prejudice is cured by instructions of the court, the motion for a new trial should be denied.”).

Jarrett's side also argued that since there was a mixed verdict with each side receiving rulings on different issues, that itself is proof that the jury was not prejudiced against one side, arguing

Here, the jury returned a mixed verdict. The jury did not find in favor of GFE on all trademark issues, did not find in favor of Mr. Jarrett on his cancellation claim, and found in favor of Defendant on its claims of Breach of Fiduciary Duty and Breach of Loyalty. This mixed verdict indicates that the jury was not prejudiced by any statements made by Plaintiffs’ counsel during closing and should weigh against granting a new trial.

Jarrett's motion this morning also stated:

The jury found that (1) Defendant’s violation of the Tennessee Consumer Protection Act were willful and knowing; (2) Defendant’s conversion of the original Amped files of the 16 episodes was done by fraud, ill will, malice, recklessness, wantonness, oppression, insult, willful or conscious disregard of the plaintiff's rights Global’s rights and/or other aggravating circumstances; and (3) Defendant’s use and/or destruction of the original Amped files for the 16 episodes were intentional or reckless.

As you might imagine, Jarrett's side is taking issue with the jury instructions being a problem as well.

There is slated to be a hearing today in Nashville, which depending on which side the court rules for, will either mean that the jury will move forward into determining damages and punitive damages...or that this all starts back at the beginning of the trial process all over again.

At the center of the case has whether Impact Wrestling retained the rights to continue to use footage of Global Force Wrestling's Amped! TV taping footage, which Jarrett (at the time Chief Creative Officer of the company) made the call to use.  Jarrett is claiming that after his termination, Impact no longer had those rights.  Exacerbating the situation is that Impact had the masters from the GFW footage deleted from their servers, which Jarrett is claiming has prevented him from trademarking the content and is a huge financial loss.  Impact has claimed the company only generated $10,000 in revenue from using GFW content and selling it on DVD and PPV.  Jarrett is also attempting to wrest the rights to the trademark of his name away from Anthem, which acquired it as part of their takeover of the company when they foreclosed on the debt Dixie Carter's Impact Ventures had accrued from Anthem banking the production of TV tapings.

The two sides had several settlement discussions over the course of the legal process but were unable to come to terms.  

If you want to do a deeper dive, the case has been well documented here on PWInsider.com:

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