Update (May 15, 2017): In the case described below and in later Minnesota Litigator posts, we face an almost comic turn-around in which one litigant (Wells Fargo) fought to have a bench trial, lost that fight, and then won the case decisively before the jury.

The adversaries, Plaintiffs Blue Cross Blue Shield of Minnesota and other insurers (here, “BCBSM”) fought to have a jury trial, won that fight, and then lost their case before the jury.

Post-trial, U.S. District Court Judge Donovan W. Frank (D. Minn.) held that he would have found for the Plaintiff BCBSM but, he reasoned, his hands were tied. He thought he was bound by the jury’s finding in favor of Wells Fargo.

Plaintiffs appealed their loss at trial and also the judge’s decision that his hands were tied as to “non-jury” parts of the case by the jury verdict (that is, the parts for the judge and not the jury to decide). The Eighth Circuit held that “the district court failed to consider whether the parties waived the application of collateral estoppel.

In other words, can the Plaintiffs object to the jury verdict when they argued so strongly in favor of a jury? Can Wells Fargo object to the judge’s own determination of liability on “non-jury” questions when Wells Fargo argued so strenuously against a jury and for the judge’s decision?

On May 5, Wells Fargo made its plea for U.S. District Court Judge Donovan W. Frank (D. Minn.) to reconsider his March 14 decision that Wells Fargo “waived the jury verdict’s preclusive effect.

As we pointed out back in 2013, “waiver” is a malleable legal idea. Even if we put aside “constructive waiver” — which we might as well call “waiver in the absence of waiver” or “make-believe waiver” (for example, a U.S. Supreme Court holding that a state constructively waived sovereign immunity when the state had expressly disavowed waiver) —  what comprises “the knowing and voluntary surrender of a known right”? The concept can be hazy.

Certainly, if Wells Fargo had been queried while the jury was deliberating, “Will you agree that the judge is bound by whatever the jury decides,” and Wells Fargo answered, “No,” it would be fair to say that Wells Fargo couldn’t “change its mind” when the jury came back in its favor. But, of course, that did not happen.

“A Tough Knot to Crack” (photo by Jay Fanelli)

This, then, is one of those incredibly knotty problems that judges need to tease out (lucky them!). The chances of this lawsuit making a return trip to the U.S. Court of Appeals for the Eighth Circuit seem quite high.

Update (April 23, 2014): Below is a post from last month reflecting a loss of plaintiff Blue Cross (and others) in a case that Blue Cross, represented by the Twin Cities litigation powerhouse of Robins Kaplan Miller & Ciresi, brought against Wells Fargo Bank.

But, post-trial, U.S. District Court Judge Donovan W. Frank (D. Minn.) held that, in contrast to the jury, the Court would have found that Wells Fargo breached its fiduciary duties owed to the plaintiffs. He continued, however, that the Court was bound by the jury’s conclusion to the contrary (see linked doc, p. 7, ftn. 6).

This is too hard a nut to crack for Minnesota Litigator on a tight deadline, but I can appreciate a sense that the legal system’s integrity and legitimacy, its adherence to the ideal of “truth,” would appear to be in play if one can have a single trial in which (a) a single entity is found to have breached its fiduciary duties owed to plaintiffs, and (b) the same entity is found NOT to have breached its fiduciary duties on the same facts as to the same plaintiffs.

This would seem to be the upshot of accepting both the jury verdict and also the judge’s irreconcilable finding on the same question.

So, where a case is tried before both a judge and a jury and their conclusions conflict, whose truth trumps (or is there a place in our justice system and in our minds for quantum mechanical ambiguity)? (Blue Cross’ argument is here.)

Original Post (March 24, 2014) (Under the subject line: “Robins Kaplan Loses a Big One”): The brilliant lawyers of Robins Kaplan represented Blue Cross Blue Shield of Minnesota in a landmark case against “Big Tobacco” which enriched the firm in the hundreds of millions of dollars.

No such luck in another assault for Blue Cross against “Big Bank.”

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