United States District Court,

E.D. Wisconsin.

VIASYSTEMS TECHNOLOGIES CORPORATION, LLC, Plaintiff,

v.

LANDSTAR RANGER INC, JT & T Inc, d/b/a Industrial Construction & Associates, and ABC Global, LLC, Defendants.

No. 10-C-0577.

 

Dec. 14, 2010.

 

DECISION AND ORDER ON DEFENDANTS’ MOTION TO DISMISS

 

WILLIAM E. CALLAHAN, JR., United States Magistrate Judge.

 

I. PROCEDURAL BACKGROUND

 

On June 8, 2010, the plaintiff, Viasystems Technologies Corporation, LLC, the assignee for Viasystems-Milwaukee, Inc. (“Viasystems”), filed a complaint in the Milwaukee County Circuit Court against Landstar Ranger, Inc. (“Landstar”), J.T. & T., Inc. d/b/a Industrial Construction & Associates (“ICA”), and ABC Global, LLC (“ABC”) (collectively referred to as “the defendants”), claiming damages resulting from transportation of a Finnpower punch press (“the Press”). Viasystems is seeking, among other things, actual damages in the amount of $600,000.00, i.e., the actual value of a replacement press.

 

On July 12, 2010, ABC, joined by Landstar and ICA, removed this action to the United States District Court for the Eastern District of Wisconsin, on the grounds that Viasystems’ civil action presents a federal question. This court has jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1367. Removal was appropriate pursuant to 28 U.S.C. § § 1441(b) and 1446. All parties have consented to magistrate judge jurisdiction. See 28 U.S.C. § 636(c); Fed.R.Civ.P. 73(b)(1).

 

Landstar’s motion to dismiss Count One of the plaintiff’s Complaint is now before the court pursuant to Fed.R.Civ.P. 12(b)(6). Both ABC and ICA have joined Landstar’s motion to dismiss. Subsequently, Viasystems filed a response to Landstar’s motion to dismiss, to which Landstar filed a reply, once again joined by ABC and ICA. This motion is now fully briefed and is ready for resolution. For the reasons that follow, the defendants’ motion to dismiss will be granted in part and denied in part.

 

II. FACTUAL BACKGROUND

 

Sometime before September 3, 2009, Viasystems contacted ICA to transport certain presses from Viasystems’ facility in Oak Creek, Wisconsin to Viasystems’ facilities located in El Paso, Texas and Ciudad Juarez, Mexico. (Compl.¶ 8.) Pursuant to a purchase order, ICA agreed to load and transport the Press to El Paso, Texas, in exchange for a total sum of $8,500.00. (Compl.¶ 9.) Viasystems alleges that ICA then contacted ABC to arrange and find another common carrier to transport the Press to El Paso. (Compl.¶ 10.) Viasystems alleges that ABC then contacted Landstar to serve as the ultimate carrier of the Press, and Landstar agreed. (Compl.¶¶ 11-12.)

 

On or about September 3, 2009, Viasystems tendered the Press to the defendants. (Compl.¶ 13.) Thereafter, Landstar loaded the Press on its flatbed and secured the Press for shipment. (Compl.¶ 16.) Viasystems claims that the Press was in good order and condition at this time. (Compl.¶ 15.) According to Viasystems, instead of transporting the Press directly to Viasystems’ El Paso facility, Landstar shipped the Press to Transmaritime Central Warehouse located in El Paso, Texas. (Compl.¶ 18.) At this facility, Viasystems claims that without its permission or knowledge, Landstar unloaded the Press and loaded it onto a truck owned and operated by Padilla Transportes. (Compl.¶ 19.) Viasystems alleges that, on September 8, 2009, Landstar failed to properly secure the Press to the Padilla Transportes’ truck, allowing the Press to fall off the truck and be irreparably damaged. (Compl.¶ 21.)

 

III. DISCUSSION

 

A motion pursuant to Fed.R.Civ.P. 12(b)(6) requires the court to decide whether the plaintiff’s pleadings actually state a claim upon which relief can be granted. “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ “ Ashcroft v. Iqbal, — U.S. —-, 129 S.Ct. 1937, 1949 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). The plausibility standard is not akin to the probability standard. Id. A plaintiff’s complaint must contain enough “[f]actual allegations … to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. In other words, the plaintiff must “ ‘nudge[ ] his claims’ … ‘across the line from conceivable to plausible.’ “ Iqbal, — U.S. —-, 129 S.Ct. at 1950-51.

 

“[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not ‘show [n]’-‘that the pleader is entitled to relief.’ “ Id. at —-, 129 S.Ct. at 1950 (quoting Fed.R.Civ.P. 8(a)(2)). “[W]hen a complaint adequately states a claim, it may not be dismissed based on a district court’s assessment that the plaintiff will fail to find evidentiary support for his allegations or prove his claim to the satisfaction of the factfinder.” Twombly, 550 U.S. at 563 n. 8. While the plaintiff must provide notice to defendants of his claims, factual allegations consisting of “abstract recitations of elements of a cause of action or conclusory legal statements” are inadequate. Brooks v. Ross, 578 F.3d 574, 581 (7th Cir.2009). Moreover, the court is not required to “ignore any facts set forth in the complaint that undermine the plaintiff’s claim or to assign any weight to unsupported conclusions of law.” Gray v. County of Dane, 854 F .2d 179, 182 (7th Cir.1988).

 

In its response to Landstar’s motion to dismiss, Viasystems withdrew its punitive damages claim alleged in Paragraph 36 of the Complaint. (Pl.’s Resp. Br. at 5-6, 8-9.)  Therefore, the two remaining issues for this court to consider regarding Landstar’s motion to dismiss Count One are (1) whether Viasystems may claim attorney’s fees under 49 U.S.C. § 14704(e) and (2) the applicability of 49 C.F.R. pt. 370.

 

Viasystems suggests that facts may surface that warrant punitive damages, thus reserving the opportunity to amend its claims. The court makes no ruling with respect thereto at this time.

 

A. Right to Attorney’s Fees.

 

Count One of Viasystems’ Complaint is premised on 49 U.S.C. § 14706, the present codification of the Carmack Amendment. The Carmack Amendment, contained in the Interstate Commerce Act, governs “a motor carrier’s liability to a shipper for the loss of, or damage to, an interstate shipment of goods.”   North Am. Van Lines v. Pinkerton Sec. Sys., 89 F.3d 452, 453 (7th Cir.1996). Prior to the enactment of the Carmack Amendment in 1906, “disparate schemes of carrier liability [ ] existed among the states, some of which allowed carriers to limit or disclaim liability, others that permitted full recovery.” REI Transp., Inc. v. C.H. Robinson Worldwide, Inc., 519 F.3d 693, 697 (7th Cir.2008) (citing Adams Express Co. v. Croninger, 226 U.S. 491, 505 (1913)). Therefore, the Carmack Amendment was created to establish “ ‘a nationally uniform rule of carrier liability concerning interstate shipments.’ “ Id. (quoting North Am. Van Lines, 89 F.3d at 454).

 

To ensure national uniformity, the “remedy provision of the Carmack Amendment preempts all state and common law remedies inconsistent with the Interstate Commerce Act….” Hughes v. United Van Lines, Inc., 829 F.2d 1407, 1415 (7th Cir.1987). This remedy provision limits a carrier’s liability to the “actual loss or injury to the property” damaged en route. See 49 U.S.C. § 14706(a)(1). While Count One of Viasystems’ Complaint is premised on § 14706, Viasystems seeks “an award of reasonable attorneys’ fees under 49 U.S.C.[ ] § 14704(e).” (Compl.¶ 35.)

 

In its motion to dismiss Count One, Landstar correctly states that Viasystems’ claim for attorney’s fees under § 14704(e) is “misplaced.” (Landstar’s Mot. to Dismiss ¶ 11.) Section 14704(e) states the following: “The district court shall award a reasonable attorney’s fee under this section.” 49 U.S.C. § 14704(e) (emphasis added). Therefore, § 14704(e) allows for the recovery of attorney’s fees where “a carrier or broker providing transportation or service subject to jurisdiction under chapter 135[ ] does not obey an order of the Secretary [of Transportation] or the [Surface Transportation] Board….” See 49 U.S.C. § 14704(a)(1). However, Viasystems’ Complaint does not allege that the defendants violated 49 U.S.C. § 14704 or allege that the defendants “disobeyed an order of the Secretary or the Board.” Instead, the plaintiff has alleged a cause of action pursuant to § 14706. Given its allegations, it is perplexing why Viasystems would claim attorney’s fees under § 14704(e). The attorney’s fees provision of § 14704(e) is applicable to only § 14704 and is in no way relevant to § 14706. Accordingly, Viasystems is not entitled to attorney’s fees pursuant to § 14704(e).

 

Interestingly, in its response brief, Viasystems does not advance any argument for the applicability of 49 U.S.C. § 14704, even though 49 U.S.C. § 14704(e) is the grounds on which Viasystems claims attorney’s fees in its Complaint. (Compl.¶ 35.)

 

Notwithstanding the plain language of the statute, Viasystems contends that it is entitled to claim attorney’s fees because Wisconsin law allows for their imposition. Specifically, Viasystems argues that because “attorneys’ fees are available according to [Wisconsin] state law, they are likewise a proper remedy under the Carmack Amendment.” (Pl.’s Resp. Br. at 6.) In support of its argument, Viasystems cites A.T. Clayton & Co., Inc. v. Missouri-Kansas-Texas Railroad Co., 901 F.2d 833, 834-35 (10th Cir .1990), a Tenth Circuit case allowing for the recovery of attorney’s fees under a Carmack Amendment claim. In finding that the Carmack Amendment did not preempt the Oklahoma statute, the Tenth Circuit explained that “[t]he Oklahoma statute simply provides an incidental compensatory allowance for the expense of employing an attorney.”   Id. at 835. The purpose of the Oklahoma statute, the court of appeals explained, is “not to provide an additional remedy, but rather to encourage small claims and promote settlement.” Id.

 

Viasystems also points out that the Tenth Circuit’s holding in Clayton relies, in part, upon the Supreme Court’s holding in Missouri, Kansas & Texas Railway Co. of Texas v. Harris, 234 U.S. 412, 419-21 (1914), that a Texas attorney’s fee statute was not preempted by the Carmack Amendment. Similar to the court in Clayton, the Court in Harris determined that a Texas statute providing for the recovery of “moderate” attorney’s fees for “internal [state] policy” reasons, was not “inconsistent with the provisions of the Commerce Act and its amendments.” Id. at 421.

 

However, Viasystems does not cite a Wisconsin statute comparable to the Oklahoma or Texas statutes providing for the recovery of attorney’s fees in Clayton and Harris. Rather, Viasystems contends that it is entitled to such recovery because “Wisconsin law authorizes an award of attorney’s fees in situations where there is bad faith in denying claims-as occurred in the instant situation .” (Pl.’s Resp. Br. at 6.) In support of its argument, Viasystems cites DeChant v. Monarch Life Ins. Co., 200 Wis.2d 559, 569-71, 547 N.W.2d 592, 595-96 (Wis.1996), in which the Wisconsin Supreme Court allowed for the recovery of attorney’s fees in a “tort of first-party bad faith” action.

 

The court in DeChant recognized that “in the absence of statutory authority or a contractual provision to the contrary, Wisconsin courts have strictly adhered to the American Rule.” Id. at 571, 547 N.W.2d 592, 596. “Under the well-established American Rule, parties to litigation are generally responsible for their own attorney’s fees unless recovery is expressly allowed by either contract or statute, or when recovery results from third-party litigation.” Id. However, the court determined that “[a]n insurer has a special ‘fiduciary’ relationship to its insured which derives from the great disparity in bargaining positions of the parties.” Id. at 570, 547 N.W.2d 592, 596 (citing Anderson v. Continental Ins. Co., 85 Wis.2d 675, 688, 271 N.W.2d 368 (Wis.1978)). Because of this special relationship, the court in DeChant determined that a narrow exception to the American Rule is necessary because the “tort of bad faith was created to protect the insured,” and “[i]ts primary purpose is to redress all economic harm proximately caused by an insurer’s bad faith.” Id. Therefore, the court “conclude[d] that when an insurer acts in bad faith by denying benefits, it is liable to the insured in tort for any damages which are the proximate result of that conduct.” Id. at 571, 547 N.W.2d 592, 596.

 

While the court in DeChant created a limited exception to the American Rule for attorney’s fees in insurance bad faith cases, it provides no support for the recovery of attorney’s fees in the present case. Landstar is not an insurance company. As such, the special fiduciary relationship found in DeChant is not present in this case. Furthermore, Viasystems’ Complaint does not allege bad faith by the defendants or the denial of insurance benefits in a tort of first-party bad faith action as was found in DeChant.

 

It is worth noting, the Seventh Circuit has determined that the Carmack Amendment does not preempt state law claims that “allege liability on a ground that is separate and distinct from the loss of, or the damage to, the goods that were shipped.” Gordon v. United Van Lines, 130 F.3d 282, 289 (7th Cir.1997). The Gordon court reasoned that federal common law may not be used to create remedies, such as punitive damages, not authorized in Carmack’s comprehensive legislative scheme. See id. at 286. However, this once again proves troublesome for Viasystems because its Complaint does not claim attorneys fees on a ground that is separate and distinct from the Carmack Amendment claim contained in Count One.

 

In sum, Viasystems does not allege that the defendants violated an order of the Secretary of Transportation or the Surface Transportation Board as is required for the recovery of attorney’s fees pursuant to 49 U.S.C. § 14704(e), the grounds upon which Viasystems’ Complaint seeks attorney’s fees. Therefore, Viasystems’ Complaint does not state a claim upon which relief can be granted under 49 U.S.C. § 14704. Similarly, Viasystems’ claim for attorney’s fees under Wisconsin state law is fatally flawed. First, Viasystems does not allege in its Complaint that it is entitled to attorney’s fees pursuant to Wisconsin state law. Second, while the Wisconsin Supreme Court created a narrow exception to the American Rule regarding attorney’s fees in DeChant, DeChant provides no support for the recovery of attorney’s fees in this case.

 

Based on the foregoing, Viasystems does not state a claim upon which relief in the form of attorney’s fees can be granted. Its claim for such fees will therefore be dismissed.

 

B. Private right of action under 49 C.F.R. pt. 370.

 

In its Complaint, Viasystems alleges that the defendants violated the federal claim regulations at 49 C.F.R. pt. 370. (Compl.¶¶ 29, 34, 35.) Landstar moves to dismiss Count One of the Complaint because the “[p]laintiff’s claim is premised upon 49 CFR 370,” and “49 CFR 370 contains no language which allows a private cause of action for the alleged violation of this regulation.” (Landstar’s Mot. to Dismiss ¶ 14.) Viasystems opposes the defendants’ motion, arguing that the regulations “merely supplement the statute and provide the framework of when and how claims for damages are processed, imposing specific requirements on carriers.” (Pl.’s Resp. at 7-8.) Because the regulations “supplement the carriers’ obligations under the Carmack Amendment,” Viasystems contends, “they can be used to support a claim under the Carmack Amendment.” (Pl.’s Resp. at 8.)

 

I agree with Viasystems. In Count One of its Complaint, Viasystems alleges a cause of action pursuant to 49 U.S.C. § 14706, which expressly provides that “[a] civil action under this section may be brought in a United States district court or in a State court .” See 49 U.S.C. § 14706(d)(3). The corresponding regulations, i.e., 49 C.F.R. pt. 370, merely implement the Carmack Amendment. Particularly, these regulations govern the processing of claims for loss and damage to property being transported in interstate commerce by a motor carrier. 49 C.F.R. § 370.1. While the enabling regulations may provide context to the plaintiff’s allegations, its “claim remains grounded in the text of the Carmack Amendment.” (Pl .’s Resp. Br. at 8.) Because Viasystems adequately states a claim under § 14706 (even though it cites to the statutory enabling regulations), the defendants’ motion to dismiss Count One of the Complaint on the grounds that 49 C.F.R. pt. 370 does not allow for a private cause of action will be denied.

 

In conclusion, this court is not persuaded that the outright dismissal of Count One of Viasystems’ Complaint is appropriate. Accordingly, Landstar’s motion to dismiss, joined by ABC and ICA, will be granted with regards to the claim for punitive damages and for attorney’s fees pursuant to 49 U.S.C. § 14704(e), as alleged in Paragraph 35 of the Complaint. The defendants’ motion to dismiss Count One insofar as it alleges violations of 49 C.F.R. pt. 370 will be denied.

 

NOW THEREFORE IT IS ORDERED that the defendants’ motion to dismiss Count One of the Complaint be and hereby is GRANTED in part and DENIED in part. The defendants’ motion to dismiss Count One insofar as the claim within does not permit recovery of attorney’s fees or punitive damages be and hereby is GRANTED. The defendants’ motion to dismiss Count One insofar as it alleges violations of 49 C.F.R. pt. 370 be and hereby is DENIED.

 

SO ORDERED.

Court of Appeals of Indiana.

HUMMER TRANSPORTATION, INC. and 1039012 Ontario, Inc., Appellants-Defendants,

v.

Kimberly SPOA-HARTY and Jesse Harty, Appellees-Plaintiffs.

No. 64A04-1002-CT-72.

 

Dec. 15, 2010.

 

MEMORANDUM DECISION-NOT FOR PUBLICATION

 

FRIEDLANDER, Judge.

 

Hummer Transportation, Inc. (Hummer) and 1039012 Ontario, Inc. (Ontario) appeal from a jury verdict and judgment on the issue of damages in favor of Kimberly Spoa-Harty (Kim) and Jesse Harty (collectively, the Plaintiffs) in a personal injury action initiated against Hummer, Ontario, and others. Hummer and Ontario raise the following restated issues for our review:

 

1. Did the trial court abuse its discretion by entering a default judgment on the issue of liability against Hummer and Ontario as a discovery sanction?

 

2. Did the trial court abuse its discretion by disallowing the admission of medical records at the trial on damages?

 

3. Did the trial court abuse its discretion by the manner in which it ruled on various statements of Plaintiffs’ counsel made during closing argument?

 

We affirm.

 

On February 17, 2006, Inderjeet Sekhon (Sekhon) was operating a tractor-trailer westbound on I-94 in Portage, Indiana, when his truck collided with Kim’s Chrysler Sebring, in which she was also travelling westbound. The Plaintiffs filed a complaint against Hummer, Ontario, and others for the personal injuries Kim sustained as a result of the collision. The Plaintiffs alleged that Sekhon was operating the tractor-trailer on behalf of Hummer and Ontario at the time of the collision and that they were vicariously liable for Sekhon’s negligence. The Plaintiffs also alleged that Hummer and Ontario were negligent in failing to exercise reasonable care in the inspection, maintenance, and repair of the tractor-trailer and in the hiring, training, retention, and supervision of Sekhon, their driver. Hummer and Ontario denied negligence in their answer to the complaint and asserted numerous affirmative defenses.

 

On November 5, 2007, the Plaintiffs filed a motion to default Hummer and Ontario on the issue of liability as a sanction for alleged non-compliance with discovery. Hummer and Ontario responded to the motion thirty days after the date the response was due. Nonetheless, a hearing was held, the trial court took the matter under advisement, and ultimately granted the motion to default Hummer and Ontario on the issue of liability as a sanction for their non-compliance with discovery. Hummer and Ontario moved to have the default judgments set aside. After a hearing on the matter, the trial court denied the motion.

 

A jury trial was scheduled on the issue of damages only and all other defendants were voluntarily dismissed. Ultimately, the jury entered a verdict in favor of Kim in the amount of $4,270,000 and for her husband in the amount of $950,000, and the trial court entered judgment on the verdicts. Hummer and Ontario filed a motion to correct error, which was deemed denied by operation of Ind. Trial Rule 53.3. Hummer and Ontario now appeal. Additional facts will be supplied.

 

1.

 

Hummer and Ontario claim that the trial court abused its discretion by granting the Plaintiffs’ request for a default judgment on the issue of liability against Hummer and Ontario as a discovery sanction.

 

On November 22, 2006, the Plaintiffs had given Hummer notice of an Ind. Trial Rule 30(B)(6)  deposition of Hummer scheduled for January 18, 2007, and served interrogatories and a request for production on Hummer. Hummer did not respond to the discovery requests and continued its deposition. The Plaintiffs gave Hummer a second notice of deposition on November 7, 2007, and Hummer again continued the deposition. The Plaintiffs then requested dates for Hummer’s deposition, but Hummer failed to provide the information. The Plaintiffs sent correspondence to Hummer’s counsel asking for responses to their discovery requests, noting Hummer’s refusal to appear for deposition, and advising Hummer that the Plaintiffs would seek court intervention if Hummer again failed to cooperate.

 

Ind. Trial Rule 30(B)(6) provides in relevant part as follows:

 

A party may in his notice name as the deponent an organization, including without limitation a governmental organization, or a partnership and designate with reasonable particularity the matters on which examination is requested. The organization so named shall designate one or more officers, directors, or managing agents, executive officers, or other persons duly authorized and consenting to testify on its behalf.

 

Hummer failed to answer the outstanding discovery requests and did not appear for deposition. Instead, Hummer’s counsel claimed that Hummer  was no longer in business and that it had no involvement with the cargo being carried at the time of the accident.

 

Ontario was the legal name of the corporation, which did business as Hummer Transportation, and was located in Canada. Ontario had interstate motor carrier authority in both Canada and the United States and was in the business of transporting freight. Ontario leased its tractor trailers from GE Canada Equipment Finance. Hummer is a California corporation in the business of transporting freight and leased tractor trailers from Ontario. Hummer and Ontario shared the profits on the loads being transported.

 

The Plaintiffs scheduled Ontario’s T.R. 30(B)(6) deposition for August 23, 2007 in Canada and identified 36 areas of inquiry. Prior to the deposition, the Plaintiffs asked who would be produced as Ontario’s T.R. 30(B)(6) corporate representatives. They were advised that Ontario would be appearing by Amrik Bal, Rajneesh Walia, and Sartaj Johel. The depositions began as planned, but only Bal appeared. Throughout his testimony Bal denied having knowledge of various matters previously identified in the deposition notice and claimed that Walia and Johel were the individuals who knew the answers to the questions.  In particular, Bal testified that Walia had knowledge of whether Ontario’s operating authority had been revoked, Walia and Johel were knowledgeable about safety matters, and that Walia hired and fired drivers such as Sekhon. Bal further testified that Walia handled Ontario’s accident register and safety training. Walia or Johel were identified as having information about maintenance records for the tractor-trailer involved in the crash. Neither Walia or Johel were produced for deposition. The safety manual that the Plaintiffs had requested prior to the deposition was produced later on September 17, 2007.

 

Johel, who was the chief financial officer and corporate secretary for Hummer and was the safety director for Ontario, terminated his employment with Ontario days before the deposition was to take place. Ontario indicated in its response to the motion for default judgment that Ontario out-sourced its safety and driver training to a business organization known as Trux Solutions. Although designated by Ontario as one of their T.R. 30(B)(6) corporate representatives, Ontario later argued that Walia was an employee of Trux Solutions, and thus was beyond Ontario’s control for purposes of producing him for deposition.

 

At the hearing on the Plaintiffs’ motion for default judgment, counsel for Hummer argued that default was inappropriate as a sanction because Hummer was no longer in existence. Records from the California Secretary of State reflected that Hummer was in fact in existence, and an active corporation operated by Anil Kumar, the individual with whom Bal entered into a lease agreement for the use of Ontario’s tractor-trailers. The Federal Motor Carrier Safety Administration had revoked the motor carrier registration and authority of Hummer involuntarily on October 2, 2006. Thus, counsel for Hummer argued that the revocation of the motor carrier registration and authority in effect rendered Hummer non-existent.

 

Ontario argued that default was inappropriate because it had supplied a corporate representative for deposition and the other designated representatives were no longer under its authority or control for purposes of producing them for deposition.

 

After taking the matter under advisement, the trial court granted the Plaintiffs’ motion for default judgment on the issue of liability as to Hummer and Ontario. This ruling was unsuccessfully challenged in a motion to set aside the default judgments and is challenged now on appeal.

 

“[A] trial court enjoys broad discretion in determining the appropriate sanctions for a party’s failure to comply with discovery orders.” Smith v. Smith, 854 N.E.2d 1, 4 (Ind.Ct.App.2006). An abuse of discretion occurs when the trial court’s decision is against the logic and natural inferences to be drawn from the facts of the case. Smith v. Smith, 854 N.E.2d 1. Because of the fact-sensitive nature of discovery issues, a trial court’s ruling is given a strong presumption of correctness. Id. “Absent clear error and resulting prejudice, the trial court’s determinations with respect to violations and sanctions should not be overturned.” Id. at 4-5.

 

A trial court may impose various sanctions for discovery violations, including an award of costs and attorney fees, exclusion of evidence, dismissing the action, or rendering a judgment by default. Nwannunu v. Weichman & Associates, P.C., 770 N.E.2d 871 (Ind.Ct.App.2002) (citing Ind. Trial Rule 37(B)(2)). A trial court is not required to impose lesser sanctions before applying the ultimate sanction of dismissal or default judgment. Id.

 

The rules of discovery are designed to “allow a liberal discovery process, the purposes of which are to provide parties with information essential to litigation of the issues, to eliminate surprise, and to promote settlement.”   Hatfield v. Edward J. DeBartolo Corp., 676 N.E.2d 395, 399 (Ind.Ct.App.1997). Although discovery is intended to require “little, if any, supervision or assistance by the trial court,” when the goals of this system break down, Ind. Trial Rule 37 provides the trial court with tools to enforce compliance. Id. T.R. 37(B)(2) permits a trial court to sanction litigants for their failure to comply with discovery orders. The rule provides, in pertinent part, as follows:

 

If a party or an officer, director, or managing agent of a party or an organization … fails to obey an order to provide or permit discovery, including an order made under subdivision (A) of this rule or Rule 35, the court in which the action is pending may make such orders in regard to the failure as are just, and among others the following:

 

(c) An order striking out pleadings or parts thereof, or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party.

 

Here, Hummer and Ontario argued that they should not be sanctioned for noncompliance with discovery because they had done all they could under the circumstances. Neither entity requested additional time in which to comply with the discovery requests in lieu of default on the issue of liability. Faced with the history of the discovery process in this situation and Hummer and Ontario’s insistence that they had complied to the best of their ability, the trial court was left with little choice but to find that the sanction of default was necessary. Hummer and Ontario had answered the complaint and asserted affirmative defenses, but had not provided the Plaintiffs with information essential to litigation of the issues.

 

While we have acknowledged that the opportunity to be heard in court is a litigant’s most precious right, one that should be only sparingly denied, we also have acknowledged that we will not condone a disregard for a trial court’s orders. Prime Mort. USA, Inc. v. Nichols, 885 N.E.2d 628 (Ind.Ct.App.2008). The only limitation on the trial court’s use of discretion in discovery sanction determinations is that the sanction must be just. Id. Hummer and Ontario note that when this court is called upon to consider whether the sanction is just, we routinely consider whether a party has received a prior warning that lack of compliance could result in a dismissal.

 

It is undisputed that Hummer did not provide a T.R. 30(B)(6) corporate representative for deposition. Ontario provided a T.R. 30(B)(6) corporate representative for deposition, but that representative was unprepared to answer questions in many of the designated areas of inquiry. The Plaintiffs repeatedly sought discovery from Hummer and Ontario before notifying their counsel that the Plaintiffs would seek the intervention of the trial court. Under these circumstances we find that the entry of default judgments against Hummer and Ontario on the issue of liability was just, and that the trial court did not abuse its discretion.

 

2.

 

Hummer and Ontario argue that the trial court erred by disallowing the admission of medical records pertaining to Kim’s injuries during the jury trial on the issue of damages. Hummer and Ontario argue that a proper foundation was laid for the records and that a foundation was laid for the experts who would have used the records during their testimony. In addition, they contend that the medical records should have been admitted as a sanction for the Plaintiffs’ counsel’s conduct for allegedly informing the record custodians of the healthcare providers subpoenaed by Hummer and Ontario that Hummer and Ontario were withdrawing their subpoenas and there was no need for those witnesses to appear for trial.

 

In particular, and after the close of cross-examination in each instance, Hummer and Ontario sought to admit the medical records generated by Plaintiffs’ witnesses, Dr. Mary Zemansky, a clinical psychologist, Dr. Rupesh Shah, an internal medicine physician, and Dr. Gene Fedor, an orthopedic surgeon, all of whom treated Kim. Additionally, Hummer and Ontario sought to introduce as an exhibit two binders containing Kim’s medical records, and affidavits from the custodians of those records verifying their authenticity. There was no witness present to lay the foundation for the admission of the two binders.

 

The admissibility of evidence is within the sound discretion of the trial court. Curley v. State, 777 N.E.2d 58 (Ind.Ct.App.2002). We will reverse a trial court’s decision on the admissibility of evidence upon a showing of an abuse of that discretion. Id. An abuse of discretion may occur if the trial court’s decision is clearly against the logic and effect of the facts and circumstances before the court, or if the court has misinterpreted the law. Id. In the present case, the trial court denied the admission of the evidence.

 

In Schloot v. Guinevere Real Estate Corp., 697 N.E.2d 1273, 1277 (Ind.Ct.App.1998), a pan el of this court made the following observation:

 

Evid. R. 803(6) provides that a memorandum, report, record or data compilation of acts, events, conditions, opinions or diagnoses, made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of regularly conducted business activity (unless a lack of trustworthiness is indicated) are not excluded by the hearsay rule. That is quite different from saying that such records are per se admissible.

 

The difference arises from the fact that such records must also be otherwise admissible. In other words, hospital records may not be excluded as hearsay simply because they include opinions or diagnoses. But, and it is a substantial but, for medical opinions and diagnoses to be admitted into evidence, they must meet the requirements for expert opinions set forth in Evid. R. 702. Furthermore, as the court explained in Fendley v. Ford, 458 N.E .2d 1167, 1171 n. 3 (Ind.Ct.App.1984) expressions of opinion within medical or hospital records historically have not been admissible under the business records exception because their accuracy cannot be evaluated without the safeguard of cross-examination of the person offering the opinion. While Fendley was decided before the adoption of our Rules of Evidence, we find that its reasoning remains sound and that it continues to apply under the Rules.

 

Evidence Rule 702(a) provides in relevant part that

[if] scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert … may testify thereto in the form of an opinion or otherwise.

 

Here, the trial court determined that the exhibits would be confusing to the jurors.

 

In regard to the medical records generated by Drs. Zemansky and Shah, we note that they were asked to identify the records, but were not questioned by Hummer and Ontario about the observations, opinions, and diagnoses, contained therein. Afterwards, counsel moved to admit the records. We believe the trial court correctly observed that the doctors were identified as experts by counsel for the Plaintiffs. The problem, correctly identified by the trial court, was that the records were mostly handwritten and contained abbreviations, diagrams, and notations that were difficult to read or interpret without a witness to explain them.

 

Dr. Fedor was asked to identify a document described as a health history form purportedly pertaining to Kim. He was able to identify the form as one used by his office, but could not say for certain that Kim was the person who completed the form, as it was done outside his presence. The document was excluded because of foundational deficiencies and Dr. Fedor’s lack of personal knowledge.

 

Assuming for the sake of argument that the trial court erred, a conclusion we do not reach, any error in the exclusion of the form was nonetheless harmless. Hummer and Ontario were able to question Kim thoroughly about the form during her testimony at trial. Where wrongfully excluded evidence is merely cumulative of other evidence presented, its exclusion is harmless error. Allen v. State, 787 N.E.2d 473 (Ind.Ct.App.2003). The trial court did not abuse its discretion by disallowing the evidence.

 

Hummer and Ontario also argue that the trial court erred by excluding the medical records contained in the two binders offered at trial. The trial court found that there was an insufficient foundation laid for their admission and that the exhibit would be confusing to the jury. There was no witness present to lay the foundation for the admission of the two binders. Hummer and Ontario simply moved to admit the evidence at trial. As previously mentioned, any number of witnesses could have been called to testify about and lay the foundation for the two-binder exhibit, but such was not the case here. We do not find an abuse of the trial court’s discretion.

 

This does not end our discussion about the admissibility of the binders, though. Hummer and Ontario had issued subpoenas to the custodians of the medical records of the health care providers utilized by Kim. Those witnesses could have laid a foundation for the documents contained in the binders.

 

Prior to the trial, counsel for the Plaintiffs sent letters to those witnesses advising them that a stipulation had been reached between the parties regarding the admissibility of Kim’s medical bills and insurance payments, thus obviating the need for their testimony at trial. The subpoenas sent by Hummer and Ontario also referenced testimony about Kim’s medical records, however, which were not the subject of the stipulation. Only one of the subpoenaed witnesses appeared at trial after receiving the Plaintiffs’ letter.

 

Counsel for the Plaintiffs argued that there was no prejudice to Hummer and Ontario as no witness fee had been submitted for any of the witnesses at issue, thus service of process on the witnesses was defective. See Ind. Trial Rule 45(G). Hummer and Ontario argued that although the parties had reached an agreement regarding the admissibility of medical bills and payments made, there apparently was no stipulation regarding the admissibility of the medical records themselves. When Hummer and Ontario discovered that their witnesses had been called off, they asked the trial court to admit the two-binder exhibit as a sanction against the Plaintiffs for their actions.

 

T.R. 45(G) provides in relevant part as follows:

 

Service of a subpoena upon a person named therein shall be made by delivering a copy thereof to such person who shall be required to attend outside his county of residence as provided in section (C), and by so tendering to him the fees for one day’s attendance and the mileage allowed by law.

 

The trial court found that there was gamesmanship on the part of both sides, and declined to admit the evidence as a sanction. In fact, the trial court stated

 

When we left yesterday, we had a couple of things to decide. One of which was the defendants’ trial binder, Exhibit I, which consisted of two volumes and it had to do with the medical records of the plaintiff. If this were a football game, I could be off-setting penalties, I suppose, but that’s not the way we operate here.

 

[Counsel for Plaintiffs], I think your letters to the defendants’ witnesses were not appropriate. I also think the defendants’ tender of subpoenas without the fee was not appropriate as well. The trial binders, Defendants’ Exhibit I will not be admitted.

 

Appellant’s Appendix at 122.

 

We conclude that the trial court did not abuse its discretion by disallowing the evidence because of the lack of foundation and potential confusion of the jury. Likewise, we conclude that the trial court’s decision to decline to admit the challenged evidence as a sanction was appropriate as it did not condone the gamesmanship that apparently was being employed by counsel for both sides.

 

3.

 

Hummer and Ontario argue that the trial court abused its discretion by failing to remedy several alleged errors that occurred during the Plaintiffs’ closing argument. Hummer and Ontario contend that these errors amount to reversible error.

 

As an initial matter, the Plaintiffs note that Hummer and Ontario have developed an argument here, but have failed to cite to any authority for their position that reversible error occurred. Ind. Appellate Rule 46(A)(8)(a) requires as follows:

 

The argument must contain the contentions of the appellant on the issues presented, supported by cogent reasoning. Each contention must be supported by citations to the authorities, statutes, and the Appendix or parts of the Record on Appeal relied on, in accordance with Rule 22.

 

In their reply brief, Hummer and Ontario argue against waiver contending that previous decisions of this court allow appellants “to either develop a cogent argument or cite to relevant authority,” and cite this court’s opinion in Kentucky Nat. Ins. Co. v. Empire Fire and Marine Ins. Co., 919 N.E.2d 565 (Ind.Ct.App .2010) in support of that statement. We disagree with Hummer and Ontario’s interpretation.

 

In Kentucky National, where we found an issue waived, we observed that the appellant did “not develop a cogent argument or cite to any authority in support of its argument.” 919 N.E.2d at 586. We cited Loomis v. Ameritech Corp., 764 N.E.2d 658 (Ind.Ct .App.2002), a case in which one of the requirements, cogent argument, was not met and resulted in waiver of the issue. Thus, where an appellant waives an argument by failing to satisfy one requirement on appeal, i.e., presenting a cogent argument, as in Loomis, then where an appellant does not satisfy either requirement on appeal, i.e., cogent reasoning and citation to authority, as in Kentucky National, the issue surely is waived. The Kentucky National court did not intend to amend the appellate rules to allow an appellant to choose the method by which to present the argument on appeal. Instead, we noted that the appellant in Kentucky National had failed in both regards.

 

That said, we agree that Hummer and Ontario have waived this argument for purposes of appeal. Nonetheless, we prefer to decide issues on their merits when possible, and do so here. See Kelly v.. Levandoski, 825 N.E.2d 850 (Ind.Ct.App.2005) (appellate review of merits when possible is preferable).

 

Hummer and Ontario argue that the Plaintiffs violated their own motion in limine which was granted by the trial court during closing argument. Prior to trial, the trial court granted the Plaintiffs’ motion in limine seeking to prevent Hummer and Ontario from discussing the fact that the Plaintiffs could invest their verdict after trial. During closing argument, counsel for the Plaintiffs discussed the effects of inflation on the jury verdict, but did not mention investment of a jury verdict. Hummer and Ontario did not object to the Plaintiffs’ argument.

 

During Hummer and Ontario’s closing argument, a direct reference was made about the Plaintiffs’ ability to invest the verdict. Counsel for the Plaintiffs objected to the argument and the trial court admonished the jury to disregard that aspect of the closing argument when arriving at a damages award.

 

An order in limine is not a final ruling on the admissibility of evidence, but is designed to prevent mention of prejudicial material to the jury. Allied Property and Cas. Ins. Co. v. Good, 919 N.E.2d 144 (Ind.Ct.App.2009). To assert error in the admission of evidence that is the subject of an order in limine, however, requires a proper contemporaneous objection whether or not the court granted an order in limine. Brown v. Terre Haute Reg. Hosp., 537 N.E.2d 54 (Ind.Ct.App.1989).

 

Here, there was no objection made during the Plaintiffs’ closing argument about the effects of inflation when the jury considered the award of damages. Further, when reference was made by Hummer and Ontario about the subject of the order in limine, a contemporaneous objection was made, and the trial court instructed the jury to disregard that aspect of the argument. The trial court did not abuse its discretion in this regard.

 

Hummer and Ontario also argue that reversible error occurred when Plaintiffs’ counsel made a reference to “coked up drivers in crummy equipment” when speaking of truck drivers and the trucking industry. Appellants’ Appendix. at 126. Hummer and Ontario objected to the reference, but the trial court did not take any curative measures suggested by Hummer and Ontario.

 

A review of the record reveals that the following statements were made by counsel for the Plaintiffs prior to and immediately after the objection:

 

Well, remember when we first started you said that you were going to follow the law that Judge Alexa is going to give you and you were going to base your decision on the evidence. That’s what you’ve said. Now, what does that mean ? I’m going to give you a concrete example. If one of your members were to go back there during deliberations and say, you know what, I hate these trucking companies. They send these coked up drivers in crummy equipment flying back and forth to Chicago on 94. I don’t care who their case…. If one of your fellow jurors were to say that, that would be wrong. That’s what I was saying. You need to gently remind them to follow the evidence, follow the law….

 

Id. at 125-26. Placed in context, we agree with the trial court that curative measures were not necessary. There was no abuse of discretion here.

 

Also during closing argument, counsel for the Plaintiffs stated the following:

 

You know, when we first started seemed like a long time ago. I wondered-I tried to figure out, you know, where are these people going ? They had been proven-they’ve been convicted of negligence. All of her doctors agree-all of her doctors agree that she has brain damage. All of her doctors agree with all of her problems. What are they going to do ? What are they going to say when they come in here ? And then when that man came from-the corporate representative came the first few days, I thought, okay, they’re going to put him on and they’re going to apologize and they’re going to take responsibility and they’re going to be right and try to come to some reasonable number-make a reasonable suggestion, a reasonable resolution.

 

* * *

 

I mean, what are they talking about ? Stipulated $123,800 and they want to come in here and say pay her, what, $19,000 or something. That’s crazy. Shame on them. And shame on them for not coming in here and apologizing.

 

You know that’s what they should have done. I thought that’s what they were going to do. When they brought that man in here from Toronto, I said he’s going to stand up here and say, you know what, we were wrong. We’re going to be right next time. We are responsible We accept responsibility. We’re sorry. How do we make this right?

 

Id. at 131-33.

 

Counsel for Hummer and Ontario requested a bench conference where they claim that they objected to the reference to an apology. Prior to trial the Plaintiffs had requested an order in limine precluding Hummer and Ontario from making any reference to a “communication of sympathy, apology or attempted benevolence unless accompanied by an admission by defendants of their negligence.” Id. at 1591.

 

We first acknowledge that the argument of counsel is not evidence. El v. Beard, 795 N.E.2d 462 (Ind.Ct.App.2003). Yet, assuming for the sake of argument, that the trial court erred by failing to strike the argument, or by failing to admonish the jury, the error was harmless. The issue of liability had been decided because of Hummer and Ontario’s discovery violations. The only issue before the jury was the issue of damages. Hummer and Ontario have failed to demonstrate how this portion of the argument of counsel improperly influenced the jury’s determination of that issue. The trial court did not abuse its discretion.

 

Judgment affirmed.

 

MAY, J., and MATHIAS, J., concur.