Gil De Rebollo v. Miami Heat Associations, Inc.

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT

No. 97-1361

YVONNE GIL-DE-REBOLLO,

Plaintiff - Appellant,

v.

THE MIAMI HEAT ASSOCIATIONS, INC., ET AL.,

Defendants - Appellees.

Nos. 97-1622
97-1830

YVONNE GIL-DE-REBOLLO,

Plaintiff - Appellee,

v.

THE MIAMI HEAT ASSOCIATIONS, INC., ET AL.,

Defendants - Appellants.

APPEALS FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

[Hon. Jos Antonio Fust , U.S. District Judge]

Before

Lynch, Circuit Judge,

Cyr, Senior Circuit Judge,

and DiClerico, Jr.,* District Judge.

* Of the District of New Hampshire, sitting by designation.

Kevin G. Little, Jr., with whom David Efr n and Law Offices

David Efr n were on brief for appellant.

Ricardo F. Casellas, with whom Rodr guez & Casellas was on

brief for appellees.

March 5, 1998

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DICLERICO, District Judge. The plaintiff-appellant,
DICLERICO, District Judge.

Yvonne Gil Bonar de Rebollo, was injured by defendant-appellee,

Wes Lockard, who portrays "Burnie," the mascot of co-defendant-

appellee, Miami Heat Limited Partnership.1 The plaintiff brought

a tort action seeking damages. In the first trial, the jury

awarded the plaintiff $10,000 but the trial court found that the

verdict was most likely the result of bias or compromise and set

it aside. After a second trial, the jury awarded the plaintiff

$50,000. The district court also awarded the defendants costs

which they incurred after an offer of judgment had been made and

awarded costs to the plaintiff as a prevailing party. In this

appeal, the plaintiff contends that she should have been granted

a third trial because the $50,000 damage award was insufficient

and the trial judge improperly excluded evidence. In their

cross-appeal, the defendants contend that (1) the district court

erred in granting a second trial; (2) given the fact that the

plaintiff ultimately received less than the amount the defendants

had proposed in an offer of judgment, they are entitled to

attorney's fees incurred after the offer; and (3) the trial court

should not have awarded the plaintiff costs incurred after an

offer of judgment. We agree with the district court's

1 Florida Basketball Associates, Inc. is also a defendant to the
action. The record does not make clear the relationship between
defendant Miami Heat Limited Partnership and defendant Florida
Basketball Associates, Inc., but the parties have not
distinguished between them on appeal. Therefore, the court
refers to the Miami Heat Limited Partnership and Florida
Basketball Associates, Inc. throughout the remainder of this
opinion collectively as "the Heat."

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disposition of the case in all respects with the exception of its

ruling awarding costs to the plaintiff incurred after an offer of

judgment. Therefore, we affirm in part and reverse in part.

Factual and Procedural Background2
Factual and Procedural Background

On October 21, 1994, the plaintiff attended an

exhibition basketball game between the Miami Heat and the Atlanta

Hawks at the Roberto Clemente Coliseum. She was seated in the

front row as part of a group that had received complementary

tickets to the game. She had attended another exhibition game

under similar circumstances the prior year.

During a time-out, defendant Lockard, dressed as

Burnie, approached the plaintiff and grabbed her hand. He had

selected her at random to participate in a routine he planned to

perform as entertainment during the time-out. When he attempted

to pull her onto the floor, she resisted and loudly told him no.

He persisted, however, grabbing her left arm with both hands and

pulling, because in his experience people often were reluctant at

first but later changed their minds. Unbeknownst to either

party, the plaintiff's purse strap had fallen over the back of

her seat and was providing additional resistance to Lockard's

efforts. He pulled the plaintiff with such force, however, that

her purse strap broke and as a result she surged forward, falling

to the floor. Lockard took the plaintiff's sudden movement as a

2 Because the plaintiff has challenged the sufficiency of the
damages awarded by the second jury, the court recounts the facts
relevant to damages in the light most favorable to the verdict.
See Molloy v. Blanchard, 115 F.3d 86, 88 (1st Cir. 1997).

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sign that she had changed her mind about participating and

dragged her by the arm to the center of the court. When he saw

that the plaintiff still did not wish to participate, he did not

further coerce her. She stood up, composed herself, and walked

off the court while he completed the routine alone. The

plaintiff was extremely upset by the incident and left the game

prior to its conclusion. She felt as though she had been

humiliated in front of the entire crowd.

The plaintiff suffered both physically and emotionally

as a result of the incident. She felt pain in her left arm and

shoulder as well as pain to a lesser extent throughout her body.

She also suffered a bruise on her left thigh. She did not,

however, break any bones or suffer any neurological damage.

After arriving at home, the plaintiff took pain medication and

applied ointment to her body. A few days later, she consulted an

orthopedist and a physiatrist in connection with her physical

injuries. She undertook physical therapy which had been

prescribed for her. Surgery was neither recommended nor

undertaken.

The plaintiff has been diagnosed with post-traumatic

tendonitis in her left shoulder, the primary symptom of which is

pain. She continues to experience pain in her left arm and

shoulder, which affects her when she engages in everyday

activities. The plaintiff takes pain medication on a regular

basis, and her condition is not expected to improve further. The

plaintiff's condition has required her to modify her behavior in

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order to avoid tasks and activities that will exacerbate the

pain, particularly heavy lifting and certain repetitive

movements. However, she has a pre-existing condition in her back

that also periodically causes her pain for which she had

previously sought treatment. This pre-existing condition imposed

similar restrictions on her ability to perform certain activities

such as lifting heavy objects.

The plaintiff consulted with a psychiatrist for her

emotional distress. She feels that the event has had a

profoundly negative effect on her mental and emotional well-

being, which she attributes in part to her traditional

conservative upbringing. The plaintiff avoids large gatherings

and feels that her privacy and dignity have been injured by the

incident. She now takes anti-anxiety medications on a regular

basis. The defendants' expert testified that the emotional

difficulties experienced by the plaintiff were not permanent, but

instead represented a normal reaction to an adverse situation.

Experts for both parties agree that the plaintiff's condition

does not rise to the level of a recognized psychological

disorder. In addition to the distress caused by the incident,

the plaintiff had pre-existing emotional stressors, including

marital difficulty, that could account for some of her dysphoria.

Subsequent to the incident, the plaintiff brought

criminal charges against Lockard. She felt the need to confront

the people who she felt had wronged her. Lockard was found

guilty of misdemeanor battery. The plaintiff also brought this

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civil action against both Lockard and the Heat, Lockard's

employer. Her claim, brought pursuant to the court's diversity

jurisdiction, alleged that Lockard had negligently injured her in

violation of Puerto Rico law and that the Heat, as Lockard's

employer, was responsible for that injury.

Prior to the civil trial, the trial court ruled that

evidence of Lockard's criminal conviction would be unduly

prejudicial and precluded the plaintiff from introducing it. On

October 30, 1996, the plaintiff's case went to trial for the

first time. After approximately one and one-half hours of

deliberation, the jury returned a verdict in the amount of

$100,000 in favor of the plaintiff, but it found only the Heat

liable and not Lockard. The trial judge rejected the verdict

because the plaintiff had pursued only a theory of respondeat

superior liability against the Heat, and thus the Heat could not

have been found liable unless Lockard was liable as well. The

judge reinstructed the jury on the issue of liability and

directed it to continue deliberating.

After another hour, the jury sent a note to the court

requesting guidance on the amount of damages to which the

plaintiff was entitled. The trial judge instructed the jury to

review the instruction on damages the court had already given.

The jury deliberated for approximately another hour and then

returned a verdict that held both Lockard and the Heat liable.

However, the jury awarded the plaintiff only $10,000 in damages.

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The plaintiff filed a motion for a new trial and for

relief from judgment on November 14, 1996. On December 16, 1996,

the district court ruled that the jury's verdict was most

probably an impermissible verdict based on compromise or bias and

granted a new trial. See Gil de Rebollo v. Miami Heat Ltd.

Partnership, 949 F. Supp. 62, 64-65 (D.P.R. 1996). The trial

court reasoned that three possibilities explained the jury's

reduction of the damage award to one-tenth the figure it had

selected initially: (1) the jury may have rationally

reconsidered its decision on damages when it was sent back to

deliberate further; (2) the jury may have thought Lockard

unaccountable for his interaction with the plaintiff but wanted

to compensate her anyway from the corporate deep pocket, and when

confronted with the requirements of respondeat superior, the jury

lowered the amount of damages which Lockard might be required to

pay, reflecting an improper compromise; or (3) the jury may have

thought that the plaintiff had suffered $100,000 damages but

tried to shield Lockard from having to pay because of an improper

bias in his favor, and when it realized it could not shield

Lockard, it lowered the amount of the verdict so that his

liability would be minimized. See id. at 64. The court found

that the latter two alternatives, both improper, were more likely

than the first, which was proper, and granted a new trial. See

id. at 65.

The second trial commenced on February 10, 1997. On

February 14, 1997, the jury returned a verdict for the plaintiff

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in the amount of $50,000, finding that both Lockard and the Heat

were liable. The plaintiff again filed a motion for a new trial,

asserting that the damages were insufficient, but the trial court

denied the motion.

During the course of the litigation, the parties made

several attempts to settle their dispute without a trial. The

plaintiff's initial demand in the case was for $1,000,000. On

October 7, 1996, the defendants made a written offer of judgment

under Federal Rule of Civil Procedure 68 ("Rule 68") to have

judgment entered against them in the amount of $80,000. The

plaintiff rejected the offer and countered with a demand of

$600,000 and a public apology. The defendants rejected this

proposal and the first trial began on October 30, 1996.

After the first trial, the defendants made a second

offer of judgment on January 14, 1997, in the amount of $70,000.

The plaintiff rejected the offer and countered with a demand of

$250,000, which the defendants rejected. On January 23, 1997,

the defendants made a third offer of judgment in the amount of

$100,000. The plaintiff also rejected that offer, demanding

$180,000. The $50,000 verdict obtained by the plaintiff in the

second trial was less than all three offers of judgment.

After the second trial, the district court awarded the

defendants $8,271.71 for costs incurred after the offer of

judgment pursuant to Rule 68. It denied the defendants' request

for attorney's fees under Puerto Rico Rule of Civil Procedure

44.1 ("Rule 44.1"), finding that the plaintiff had not conducted

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her case with temerity. The court awarded the plaintiff costs as

a prevailing party under Federal Rule of Civil Procedure 54 in

the amount of $7,894.84.

At the conclusion of this legal imbroglio, the

plaintiff filed a timely appeal. The defendants have raised

several issues on cross-appeal.

Discussion
Discussion

The parties raise the following issues on appeal: (1)

the defendants claim that the trial court abused its discretion

by setting aside the $10,000 verdict in the first trial and

granting a new trial; (2) the plaintiff asserts that the jury's

verdict of $50,000 damages in the second trial was insufficient

and the trial court therefore abused its discretion by failing to

grant her motion for a third trial; (3) the plaintiff claims that

the trial court impermissibly excluded evidence of Lockard's

criminal misdemeanor conviction; and (4) the defendants assert

that the trial court erred in its award of costs and in its

failure to award attorney's fees. We discuss these claims

seriatim.

I. Grant of the Second Trial

The trial court granted the plaintiff's motion for a

second trial after it found that the jury possibly could have

properly reconsidered the amount of damages to be awarded, but

more likely had acted for an improper reason. The defendants

argue that the trial court should have accepted the $10,000

verdict and erred by granting the plaintiff's motion for a new

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trial. The court, they urge, should not have endeavored to

choose among the possible explanations for the jury's behavior.

As long as there was a plausible explanation for the jury's

conduct that was permissible, the defendants contend, the trial

court should not have granted a new trial.

This argument is unpersuasive. See Phav v. Trueblood,

Inc., 915 F.2d 764, 766 (1st Cir. 1990) (denial of new trial

reviewed only for abuse of discretion). As the defendants

acknowledge, First Circuit precedent distinguishes between cases

where a jury's verdict is challenged as improper based only on a

damage award that allegedly fails to bear any rational relation

to the evidence of the damages presented at trial, see, e.g.,

Correa v. Hospital San Francisco, 69 F.3d 1184, 1197-98 (1st Cir.

1995) (verdict alleged to be excessive), cert. denied, 116 S.

Ct. 1423 (1996); Milone v. Moceri Family, Inc., 847 F.2d 35, 37

(1st Cir. 1988) (verdict alleged to be insufficient), and cases

where there is some evidence of an improper verdict based on

factors other than the amount of the damage award, see, e.g.,

Skinner v. Total Petroleum, Inc., 859 F.2d 1439, 1446 (10th Cir.

1988), cited with approval in Phav, 915 F.2d at 768; Mekdici ex

rel. Mekdici v. Merrell Nat'l Lab., 711 F.2d 1510, 1514 (11th

Cir. 1983) (same). Where the allegation of an improper verdict

is based solely on the amount of the damage award, the

circumstances under which a trial court may overturn a verdict

are more limited. See, e.g., CIGNA Fire Underwriters Co. v.

MacDonald & Johnson, Inc., 86 F.3d 1260, 1267 (1st Cir. 1996)

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(grant of a new trial appropriate where damages were easily

calculable and damage award exceeded maximum value of damages

claimed and did not take into account offset to damages); Torres-

Troche v. Municipality of Yauco, 873 F.2d 499, 501 & n.6 (1st

Cir. 1989) (suggestion that allegedly low damage award indicated

compromise verdict was speculation not meeting heavy burden of

showing entitlement to new trial). However, where evidence of an

improper verdict exists other than the amount of the jury award,

such as when a jury answers special questions in an inconsistent

manner, the trial court's discretion to grant a new trial is

broader. In such cases the court can consider all of the

circumstances surrounding the jury's verdict, including the

amount of the damage award, in determining whether or not the

jury reached an improper verdict. See Phav, 915 F.2d at 768-69.3

The defendants acknowledge the distinction between

cases where the only evidence of a compromise verdict is an

allegedly insufficient damage award and cases where additional

evidence indicates a compromise, but they attempt to cast this

case as falling into the former rather than the latter category.

However, in this case the trial court's determination did not

turn solely on the amount of the verdict that the jury ultimately

returned. Rather, the ten-fold reduction by the jury of its

initial award of damages and the circumstances surrounding its

3 Prior First Circuit cases, however, do not endorse the
proposition propounded by the defendants that an inadequate
damage award is an indispensable element of a compromise verdict.
See Phav, 915 F.2d at 768-69 (inadequate damages are potential

evidence of compromise verdict, as are additional factors).

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determination of Lockard's liability provided the primary basis

for the trial court's determination that the verdict as finally

returned was motivated by compromise or sympathy. The verdict

form ultimately completed by the jury was free of any internal

inconsistency because it held Lockard and the Heat liable for

$10,000 damages suffered by the plaintiff. However, the sequence

of events preceding that verdict was properly considered by the

trial court as an indication that the jury reached the verdict

based on compromise or bias. See id. at 768 (odd chronology of

jury deliberations one "telltale sign of a compromise verdict").

Therefore, the trial court had more latitude in this case in

exercising its discretion to overturn the jury's verdict than it

would have had in a case where the only basis for the grant of a

new trial was the alleged insufficiency of a damage award. See

Mekdici, 711 F.2d at 1513, cited with approval in Phav, 915 F.2d

at 768.

The trial court determined that the sequence of events

leading up to the jury's final verdict in the first trial most

likely indicated that the jury had reached its verdict

improperly. The jury initially had assessed $100,000 in damages

against the Heat but did not find Lockard liable. A short time

after being told to deliberate further and requesting additional

guidance the jury determined that Lockard was liable but reduced

the amount of damages to $10,000. Based on the jury's behavior,

it was logical for the trial court to conclude that the jury

wanted to give the plaintiff something but it did not want to

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hold Lockard personally liable for a $100,000 award. There is no

indication that the trial judge, who observed the trial, the

timing of the questions, and the results of the deliberations,

abused his discretion in arriving at this determination.4 See

Phav, 915 F.2d at 766. We therefore decline to overturn the

trial court and to reinstate the initial $10,000 verdict.

II. Insufficiency of the Jury Verdict

The plaintiff's main contention on appeal is that the

trial court erred by failing to grant her motion for a new trial

following the second verdict, on the grounds that the damage

award of $50,000 is insufficient. As noted above, it is

comparatively more difficult to justify overturning a jury's

verdict where the only evidence that something has gone awry is

an allegedly insufficient damages award. Indeed, the jury "is

free to run the whole gamut of euphonious notes -- to harmonize

the verdict at the highest or lowest points for which there is a

sound evidentiary predicate, or anywhere in between -- so long as

the end result does not violate the conscience of the court or

strike such a dissonant chord that justice would be denied were

the judgment permitted to stand." Milone, 847 F.2d at 37. "At

best, plaintiff's verdicts in personal injury cases are not

models of mathematical exactitude. Thus, the fact that a

particular award is a few dollars long or short would rarely (if

ever) translate into a manifest miscarriage of justice." Id. at

4 In reaching this decision we intend no comment on the
sufficiency of the $10,000 damage award.

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41 n.7. We view the evidence in the light most favorable to the

jury's verdict, see Molloy v. Blanchard, 115 F.3d 86, 88 (1st

Cir. 1997), and will only overturn the jury's award and the trial

judge's ensuing refusal to grant a new trial for abuse of

discretion, see Correa, 69 F.3d at 1197.

The record demonstrates that most of the damages

suffered by the plaintiff were intangible. "An appellate court's

normal disinclination to second-guess a jury's evaluation of the

proper amount of damages is magnified where, as here, the damages

entail a monetary valuation of intangible losses, and the trial

judge, having seen and heard the witnesses at first hand, accepts

the jury's appraisal." Id. Even accepting the plaintiff's

complaints uncritically, which the jury was not required to do,

her primary claims for damages are that (1) she suffers from

pain; (2) the quality of her life has been reduced because of her

pain and because of the measures she must take to avoid pain; and

(3) her dignity, self-image, and sense of well-being have been

adversely affected by the incident.

In addition to the intangible nature of the plaintiff's

injuries, the evidence in this case permitted the jury to find

that her injuries were not as severe as she claimed. The jury

could also have found that most of the plaintiff's physical pain

was caused not by the incident in question but by the plaintiff's

failure to obey her doctor's orders not to move heavy objects,

which orders were given in connection with her pre-existing back

injury. The jury was free to disbelieve as much of the

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plaintiff's expert and lay testimony as it wished. In short, the

plaintiff has provided no support for the proposition that the

jury's $50,000 verdict was so far beyond the range of acceptable

verdicts, based on the evidence presented at trial, that it

constituted a manifest miscarriage of justice. The district

court did not abuse its discretion by denying her motion for a

new trial.

III. Failure to Admit Evidence of Lockard's Conviction

The trial court ruled that evidence of Lockard's

criminal misdemeanor conviction was inadmissible because its

prejudicial effect substantially outweighed its probative value.

See Fed. R. Evid. 403. The plaintiff asserts that this ruling

was error. We review the district court's determination that the

evidence of Lockard's conviction should have been excluded for

abuse of discretion. See Kowalski v. Gagne, 914 F.2d 299, 306

(1st Cir. 1990).

The plaintiff places undue reliance on Kowalski, a case

which stands for the proposition that the district court has

discretion to admit evidence such as this. See id. However,

Kowalski does not support the notion that the district court

abused its discretion in this case by failing to admit this

evidence. Indeed, as Kowalski makes clear, the district court's

decision that the evidence was substantially more prejudicial

than probative was well within its discretion. See id.

Here, the jurors were presented with sufficient

evidence to gauge the seriousness of Lockard's actions and their

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effect on the plaintiff. In addition to the testimony of the

plaintiff and other witnesses, the episode was recorded by a

television camera and the tape was made available for the jury to

watch. The parties stipulated that Lockard was portraying the

mascot Burnie throughout the incident. The jury did not need

evidence of Lockard's criminal conviction to assess his role in

the incident. Under the circumstances, admission of Lockard's

criminal conviction would have allowed the jury to substitute the

judgment reached in the criminal proceeding for its own.

Furthermore, even assuming arguendo that the exclusion

of the evidence was error, the error had no effect on the outcome

of the case. The only issue on which Lockard's conviction was

probative was the issue of his liability for the plaintiff's

injury. Both juries found Lockard liable for the plaintiff's

injuries. Lockard's conviction had relevance neither to the

issue of the plaintiff's injuries nor to the amount of damages

necessary to compensate her for those injuries.

The plaintiff's reliance on Kowalski for the

proposition that a criminal conviction is, as a matter of course,

relevant to the issue of damages in an ensuing civil trial is

also misplaced. Kowalski dealt with a Massachusetts wrongful

death statute which provides that damages should be "assessed

with reference to the degree of [the defendant's] culpability."

914 F.2d at 306. For that reason, the defendant's conviction of

the crime of second degree murder was relevant to the issue of

culpability, and thus the issue of damages. See id. The

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plaintiff's cause of action here was for negligence and she was

entitled only to compensatory damages. For these reasons, the

district court did not abuse its discretion by failing to admit

evidence of Lockard's conviction, and the plaintiff is not

entitled to a new trial.

IV. The Award of Costs & Failure to Award Attorney's

Fees

The trial court awarded the defendants costs incurred

after their first offer of judgment but declined to award the

defendants their attorney's fees. It found that the plaintiff

had not been obstinate at any point in the proceedings. In

addition, it awarded the plaintiff costs as a prevailing party.

The defendants contend that (1) the district court erred by

failing to award attorney's fees incurred after the offer of

judgment; (2) the court erred in finding that the plaintiff was

not obstinate under Rule 44.1; and (3) the court erred when it

awarded the plaintiff costs incurred after their offer of

judgment. We discuss these claims seriatim.

A. Attorney's Fees Incurred After the Offer of Judgment

The trial court declined the defendants' request that

they be awarded attorney's fees that were incurred after their

offer of judgment. The defendants assert that it was error to do

so. Resolution of this issue requires that we carefully analyze

the relationship between two rules of civil procedure, Federal

Rule 68 and Puerto Rico Rule 35.1, both of which ostensibly

govern the situation at hand.

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In Erie Railroad Co. v. Tompkins, the United State

Supreme Court set forth the general doctrine by which federal

courts in diversity cases determine whether state or federal law

will apply to a controversy. See 304 U.S. 64 (1938). In Hanna

v. Plumer, the Supreme Court set forth the test for determining

how a court should choose between a federal procedural rule and a

conflicting state substantive rule. See 380 U.S. 460, 471

(1965). Where a Federal Rule is "sufficiently broad to control

the issue" but conflicts with a state law, the court applies the

Federal Rule unless it transgresses the limits of the Rules

Enabling Act, 28 U.S.C. 2072, or the Constitution. Id. at 471-

72; see also Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29-

31 (1988).5 In most cases where a conflict exists, the Federal

5 Since the Hanna decision, the Supreme Court has clarified the

focus of the inquiry for determining whether a state law and a
Federal Rule conflict. Early cases indicated the necessity for a
"direct collision." See, e.g., Walker v. Armco Steel Corp., 446

U.S. 740, 749-51 (1980); Hanna, 380 U.S. at 472. Subsequent

cases make clear, however, that the "direct collision" analysis
does not involve the narrowest possible reading of the relevant
Federal Rule. See Stewart, 487 U.S. at 26 n.4; Walker, 446 U.S.

at 751 & n.9. In Stewart, the Supreme Court stated the

following:

Our cases at times have referred to the
question at this stage of the analysis as an
inquiry into whether there is a "direct
collision" between state and federal law.
Logic indicates, however, and a careful
reading of the relevant passages confirms,
that this language is not meant to mandate
that federal law and state law be perfectly
coextensive and equally applicable to the
issue at hand; rather, the "direct collision"
language, at least where the applicability of
a federal statute is at issue, expresses the
requirement that the federal statute be
sufficiently broad to cover the point in

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Rule will be applied because the Federal Rules are presumptively

valid. See Burlington N. R.R. v. Woods, 480 U.S. 1, 5 (1987); 17

James Wm. Moore et al., Moore's Federal Practice 124.03[1] (3d

ed. 1997).

Rule 35.1 of the Puerto Rico Rules of Civil Procedure

("Rule 35.1") addresses offers of judgment. It provides, in

pertinent part, as follows:

At least ten (10) days before the trial
begins, a party defending against a claim may
serve upon the adverse party an offer to
allow judgment to be taken against him for
the money or property or to the effect
specified in his offer, with costs then
accrued. . . . If [the offer is rejected
and] the judgment finally obtained by the
offeree is not more favorable than the offer,
the offeree must pay the costs, expenses and
attorney's fees incurred after the making of
the offer.

P.R. Laws Ann. tit. 32, App. III, Rule 35.1 (1983). The Supreme

Court of Puerto Rico has held that this rule applies not only

when the plaintiff/offeree prevails at trial and attains a

verdict that is less than the offer of judgment but also when the

plaintiff/offeree loses the suit in its entirety. See Ganapolsky

v. Keltron Corp., 823 F.2d 700, 701 (1st Cir. 1987) (citing

dispute. It would make no sense for the
supremacy of federal law to wane precisely
because there is no state law directly on
point.

487 U.S. at 26 n.4 (citations omitted). Subsequent First Circuit
cases confirm that the relevant inquiry for evaluating a
potential conflict is whether the Federal Rule is "sufficiently
broad to control the issue." See Commercial Union Ins. Co. v.

Walbrook Ins. Co., 41 F.3d 764, 772 (1st Cir. 1994); Daigle v.

Maine Med. Ctr., Inc., 14 F.3d 684, 689 (1st Cir. 1994).

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Hermandad Unida de Carpinteros y Ebanistas de America v. V. & E.

Eng'g Constr. Co., 115 D.P.R. 711 (1984)).

Rule 68 provides, in pertinent part, as follows:

At any time more than 10 days before the
trial begins, a party defending against a
claim may serve upon the adverse party an
offer to allow judgment to be taken against
the defending party for the money or property
or to the effect specified in the offer, with
costs then accrued. . . . If [the offer is
rejected and] the judgment finally obtained
by the offeree is not more favorable than the
offer, the offeree must pay the costs
incurred after the making of the offer.

Fed. R. Civ. P. 68. Rule 68 does not itself supply a definition

of "costs." Instead, it incorporates the definition of "costs"

found in the relevant substantive statute of the jurisdiction

whose substantive law applies to the case. Therefore, when the

definition of "costs" in the relevant substantive statute

includes attorney's fees, attorney's fees incurred after the

offer of judgment must be paid by the offeree. See Marek v.

Chesny, 473 U.S. 1, 9 (1985). In addition, Rule 68 applies only

when a plaintiff/offeree obtains an award that is less than the

offer of judgment, and not when the plaintiff/offeree loses the

suit in its entirety. See Delta Air Lines, Inc. v. August, 450

U.S. 346, 352 (1981); Ganapolsky, 823 F.2d at 701-02.

Rule 68 would not allow the defendants to recover

attorney's fees in this case unless the underlying substantive

law defines attorney's fees as a part of costs. See Marek, 473

U.S. at 9. The substantive law underlying this action is Puerto

Rico's law of negligence. See P.R. Laws Ann. tit. 31, 5141 ("A

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person who by an act or omission causes damage to another through

fault or negligence shall be obliged to repair the damage so

done."). Puerto Rico law makes no provision for the award of

attorney's fees as any part of "costs" in such cases. Compare

Rule 44.1(a) ("Costs shall be allowed to the prevailing party,

except when otherwise directed by law or by these rules. The

costs which may be allowed by the court are those expenses

necessarily incurred in prosecuting an action or proceeding

which, according to law or to the discretion of the court, one of

the parties should reimburse to the other."), with Rule 44.1(d)

("In the event any party or its lawyer has acted obstinately or

frivolously, the court shall, in its judgment, impose on such

person the payment of a sum for attorney's fees which the court

decides corresponds to such conduct.").

The only other source of Puerto Rico law that might

supply a definition of costs that includes attorney's fees is

Rule 35.1 itself.6 However, Rule 35.1 allows for the award of

"costs, expenses and attorney's fees." P.R. Laws Ann. tit. 32,

App. III, Rule 35.1 (1983). On its face, the rule treats costs

and attorney's fees as separate items; it does not define

attorney's fees as part of costs. See id.; see also, e.g.,

Knight v. Snap-On Tools Corp., 3 F.3d 1398, 1405 (10th Cir. 1993)

6 We accept, arguendo, the proposition that the Puerto Rico

Rules of Civil Procedure may supply substantive legal standards
in some circumstances. See Ganapolsky, 823 F.2d at 702 (Rule

35.1); V lez v. Crown Life Ins. Co., 599 F.2d 471, 474 (1st Cir.

1979) (earlier enactment of current Rule 44.1); Pan Am. World

Airways v. Ramos, 357 F.2d 341, 342 (1st Cir. 1966) (earlier

enactment of current Rule 44.1).

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("[T]he fee-shifting provision clearly identifies attorney's fees

separately from costs."); Oates v. Oates, 866 F.2d 203, 206-07

(6th Cir. 1989). Therefore, the "costs" to which the defendants

would be entitled under Rule 68 are those detailed in 28 U.S.C.

1920, which do not include attorney's fees.

Rule 35.1 and Rule 68 both ostensibly apply to this

case and would result in a different award.7 The two rules are

in "direct collision" despite the fact that they are not

"perfectly coextensive" because Rule 68 is "sufficiently broad to

cover the point in dispute." See Stewart, 487 U.S. at 26 n.4;

Burlington, 480 U.S. at 4-5. Compare Aceves v. Allstate Ins.

Co., 68 F.3d 1160, 1167-68 (9th Cir. 1995) (Rule 68 and federal

law on expert witness fee compensation controlled despite similar

California offer of judgment law and conflicting California

expert witness law), with S.A. Healy Co. v. Milwaukee Metro.

Sewerage Dist., 60 F.3d 305, 310 (7th Cir. 1995) (Rule 68 not in

direct conflict with Wisconsin statute governing rejected

settlement offers by plaintiffs), and Tanker Mgm't, Inc. v.

Brunson, 918 F.2d 1524, 1528 (11th Cir. 1990) (Rule 68 not in

7 The defendants urge, based on our decision in Ganapolsky, that

the district court should have applied Rule 35.1 to award them
attorney's fees. See 823 F.2d at 702. Ganapolsky, however, did

not involve an actual conflict between Rule 68 and Rule 35.1.
The defendant in Ganapolsky prevailed because the plaintiff's

case was dismissed as a sanction. See id. at 701. Therefore,

Rule 68 did not apply. See Delta Air Lines, 450 U.S. at 352;

Ganapolsky, 823 F.2d at 701-02. Rule 35.1, on the other hand,

did apply. See id. at 701 (citing Hermandad). This case differs

from Ganapolsky, because here the plaintiff received a verdict

less favorable than the defendants' offer of judgment and thus
Rule 68 applies.

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"direct collision" with Florida statute governing attorney's

fees, offers of judgment, and settlement offers). The parties

have not suggested and the court cannot discern any infirmity in

Rule 68 sufficient to defeat the presumption of validity and

constitutionality mandated by Burlington Northern Railroad, 480

U.S. at 5. See S.A. Healy Co., 60 F.3d at 312 ("[T]here cannot

be any doubt that Rule 68 is within the scope of the Rules

Enabling Act."). Therefore, Rule 68, rather than Rule 35.1,

applies in this case and the defendants are entitled only to

costs. The district court did not err in refusing to award the

defendants their attorney's fees as part of costs.

B. Obstinacy

The district court found that the plaintiff was not

obstinate under Rule 44.1(d) and declined to award attorney's

fees.8 A finding of obstinacy is reviewed for abuse of

discretion. See De Le n L pez v. Corporaci n Insular de Seguros,

931 F.2d 116, 126-27 (1st Cir. 1991). The defendants urge that

the plaintiff's conduct was obstinate because she refused to

8 Rule 44.1(d) provides that:

In the event any party or its lawyer has
acted obstinately or frivolously, the court
shall, in its judgment, impose on such person
the payment of a sum for attorney's fees
which the court decides corresponds to such
conduct.

P.R. Laws Ann. tit. 32, App. III, Rule 44.1(d) (Supp. 1992).

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accept multiple offers of judgment which they assert were

reasonable.9 The fact that the plaintiff was eventually awarded

less than the amount of the offers, the defendants contend, is

evidence of their reasonableness. The defendants ask that we

adopt a rule that failure to accept an offer of judgment, when

the verdict at trial turns out to be less than the offer, be

considered obstinate per se.

The presumption requested by the defendants lacks

support in Puerto Rico law, and we decline to adopt it. The

district court judge, who observed the proceedings as they

unfolded, made a finding that the plaintiff was not obstinate.

Because we find no evidence that the trial judge abused his

discretion in that determination, we decline to overturn the

district court on this issue.

C. Plaintiff's Expert Fees Incurred After the Offer of Judgment

The defendants finally contend that the court erred by

awarding the plaintiff expert fees incurred after the offer of

judgment. Such an award expressly contravenes the terms of Rule

68, which provides that, if an offer of judgment is rejected and

"the judgment finally obtained by the offeree is not more

favorable than the offer, the offeree must pay the costs incurred

after the making of the offer." Fed. R. Civ. P. 68. The

district court erred in making this award. Although the

9 The defendants argue that the plaintiff was obstinate under
the standards of either Rule 44.1 or Rule 35.1. However, because
we have determined that Rule 35.1 does not apply in this case,
see section IV.A supra, we consider here only the defendants'

argument with respect to Rule 44.1.

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plaintiff did not distinguish between costs incurred pre- and

post-offer, the defendants have only contested the award of

$3,950 paid for the testimony of two experts at the two trials.

Because such amounts were clearly incurred after the offer of

judgment and the defendants have not challenged the other

components of the trial court's initial award of costs, we reduce

the plaintiff's award of costs by that amount.

Conclusion
Conclusion

To conclude, we find the parties' remaining arguments

and claimed errors to be without merit and unworthy of extended

discussion. For the reasons stated above, the judgment of the

district court is affirmed as to the grant of the second trial,
affirmed

the exclusion of evidence of Lockard's conviction, the refusal to

grant a third trial, and the refusal to grant attorney's fees as

part of costs incurred after the first offer of judgment. The

district court's award to the plaintiff of costs incurred after

the offer of judgment in the amount of $3,950 is reversed, and
reversed

the plaintiff's award of costs shall be reduced by that amount.

Because the plaintiff's appeal was wholly without merit, costs of

the appeal are awarded to the defendants.

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