Samuel W. SHOEN, M.D.; Mary Anna Shoen-Eaton; Cecilia M. Shoen-Hanlon; Katrina M. Shoen-Carlson; Theresa Shoen-Romero; Michael L. Shoen; Leonard S. Shoen; and the following Arizona corporations: Samwill, Inc.; Cermar, Inc.; Kattydid, Inc.; Thermar, Inc.; Mickl, Inc.; Marin, Inc.; and L.S.S., Inc., Plaintiffs-Appellees, Cross Appellants, v. Edward J. SHOEN, Defendant-Appellant, Cross Appellee

Arizona Court of Appeals1997-07-24No. No. 1 CA-CV 95-0199

191 Ariz. 64952 P.2d 302

Summary · law.co

Holding. The court held that denials of motions for JNOV are reviewed de novo, not under an abuse-of-discretion standard. The court affirmed the trial court's denial of the defendant's JNOV motion and the grant of remittitur.

This case involved a long-running dispute among Shoen family members over control of AMERCO, the parent company of U-Haul. Shareholders sued Edward Shoen and other board members over conduct in 1988 that allegedly stripped the plaintiffs of majority ownership. A jury awarded $1.47 billion in compensatory damages and $70 million in punitive damages, but the trial court reduced these amounts to $461 million and $7 million respectively through remittitur. The appeal focused on the proper standard of review for evaluating the trial court's denial of the defendant's motion for judgment notwithstanding the verdict (JNOV) on the punitive damages award.

The key dispute was whether courts should review a trial court's denial of a JNOV motion under an abuse-of-discretion standard or a de novo standard. The court concluded that because JNOV and directed verdict motions use the same legal test—both requiring that evidence have so little probative value that no reasonable person could rule for the claimant—they should receive the same standard of appellate review.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Appropriate standard of review for denying a motion for JNOV
Whether JNOV and directed verdict motions share the same legal standard
Reduction of punitive damages through remittitur

Procedural posture

The defendant appealed the trial court's denial of his JNOV motion and denial of a new trial on punitive damages, while plaintiffs cross-appealed the trial court's grant of remittitur reducing damages.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

OPINION

WEISBERG, Judge.

This appeal is the latest chapter in the long-standing litigation among members of the Shoen family over control of AMERCO, the parent company of U-Haul. Plaintiffs were shareholders who sued Edward “Joe” Shoen (“Joe”) and other members of AMERCO’s board of directors (collectively, “defendants”) regarding conduct in 1988 that deprived plaintiffs of majority ownership. After a seven-week trial, a jury awarded plaintiffs $1.47 billion in compensatory damages against all defendants and $70 million in punitive damages against only Joe. The trial court, however, granted defendants’ and Joe’s motions for remittitur, reducing compensatory damages to $461 million, upon tender of plaintiffs’ stock, and punitive damages to $7 million.

This appeal concerns only the award of punitive damages. Joe appeals the trial court’s denial of his motion for judgment notwithstanding the verdict (“JNOV”) or new trial, and plaintiffs cross-appeal the trial court’s grant of remittitur.

In a separate memorandum decision, we affirmed the trial court’s denial of Joe’s motion for JNOV and grant of remittitur. Shoen v. Shoen, 1 CA-CV 95-0199, (filed concurrently with this opinion). We have decided, however, to separately address the issue of the appropriate standard of review for the denial of a motion for JNOV.

The parties dispute the standard of review for the denial of a motion for JNOV. Citing Nelson v. Phoenix Resort Corp., 181 Ariz. 188, 191, 888 P.2d 1375, 1378 (App.1994), plaintiffs argue that we review such a ruling for an abuse of discretion. Nelson does, in fact, support this argument: “We review denials of motions for [JNOV] and for new trial on an abuse of discretion standard.” Id. Joe contends, however, that the court in Nelson was incorrect, and points out that the ease upon which Nelson relies, to support an abuse-of-discretion standard, Mammo v. State, 138 Ariz. 528, 533-34, 675 P.2d 1347, 1352-53 (App.1983), deals only with the denial of a motion for new trial, not JNOV.

When reviewing denials of both a motion for directed verdict and a motion for JNOV, we view the evidence and all reasonable inferences therefrom in the light most favorable to the nonmoving party. Piper v. Bear Med. Sys., Inc., 180 Ariz. 170, 173, 883 P.2d 407, 410 (App.1993). In addition, the test for granting JNOV is the same as that for granting a directed verdict: Both should be granted only if the facts presented in support of a claim have so little probative value that reasonable people could not find for the claimant. Id.

Because the test for granting or denying a motion for JNOV and a directed verdict is the same, the standard of review ought also to be the same; and a ruling on a motion for directed verdict is reviewed de novo. Gemstar, Ltd. v. Ernst & Young, 185 Ariz. 493, 505, 917 P.2d 222, 234 (1996); see also Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 95 F.3d 1422, 1430 (9th Cir.1996) (denial of motion for JNOV reviewed de novo). Accordingly, we conclude that the standard of review for the denial of JNOV is de novo. We disagree with Nelson to the extent that it holds otherwise.

EHRLICH, P.J., and GRANT, J., concur.