The Admissibility of Other Acts

FOR YOUR PRACTICE | EVIDENCE

The Admissibility of Other Acts EVIDENCE UNDER FEDERAL RULE OF EVIDENCE 404(B)(2) AND MARYLAND RULE 5-403

BY BURKE MURPHY, III, ESQ.

“I’ll see their trial first, bring in their evidence.”

—WI LLI AM SHAK E SPE ARE , K I N G LE AR, ACT 3 , S C E NE 6

Litigants, both plaintiffs and defendants, have successfully relied on Fed. R. Evid.

404(b)(2), under the right circumstances, to introduce evidence that otherwise might have been excluded under Fed. R. Evid. 404(b)(1).

Common practice, and Federal Rule of Evidence (hereinafter Fed. R. Evid.) 404(b)(1), has it that “[e]vidence of any other crime, wrong, or act is not admissible to prove a person’s character in order to show that on a particular occasion the person acted in accordance with the character.” Frequently overlooked, however, at least by civil practitioners, is the Fed. R. Evid. 404(b)(2) exception to the general rule. Specifically, “[t]his evidence [viz, evidence of any other crime, wrong, or act] may be admissible for another purpose, such as proving motive, opportunity, intent, preparation, plan, knowledge, identity, absence of mistake, or lack of accident.” Litigants, both plaintiffs and defendants, have successfully relied on Fed. R. Evid.

404(b)(2), under the right circumstances, to introduce evidence that otherwise might have been excluded under Fed. R. Evid. 404(b)(1).

Moreover, Maryland courts have also admitted evidence of prior acts, even though Maryland’s rules of evidence are significantly different from the Federal Rules of Evidence.

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Md. Rule 5-404(b) is derived from Fed. R. Evid. 404(b), but the Supreme Court of Maryland has held that it applies only to the state offering evidence against a criminal defendant, and not in civil litigation.

Cases applying the Fed. R. Evid. 404(b)(2) exception go back as far as 1978. In Eaves v. Penn,1 the plaintiffs, beneficiaries of Glen’s Profit Sharing Plan, an employee profit-sharing plan, sued the plan’s trustee. Plaintiffs alleged that the defendant failed to discharge his fiduciary duties with respect to the plan as required by the Employee Retirement Income Security Act of 1974. Plaintiffs’ claims arose from the sale of the closely held employer corporation, Glen’s, to the plan and defendant, the plan’s trustee, whose sale was funded in almost its entirety by the plan’s assets or by money the corporation borrowed and funneled through the plan. In exchange for all of the plan’s assets, 97% of the Glen’s closely-held shares were transferred to the defendant as the plan’s trustee. Defendant personally

purchased the remaining company shares, with all but $5.12 of the purchase price funded by a loan from Glen’s to the defendant. After the purchase, the defendant became vice-president of Glen’s.

As a result of the sale of Glen’s, its shares lost $500,000 of their value. Defendant’s mismanagement of Glen’s further contributed to its financial distress. At the trial of the case, plaintiffs introduced, over defendant’s objection, evidence of Glen’s post-sale status and defendant’s post-sale conduct, such as loans that Glen’s had made to defendant and his acquaintances, and defendant’s increased post-sale compensation. Defendant objected that plaintiffs’ evidence was “irrelevant to the determination whether or not he fulfilled his fiduciary duties at the time of the purchase-sale transaction.”2 Not so, held the district and circuit courts, which noted that under Fed. R. Evid. 404(b) “evidence of other acts is admissible for such purposes as proving motive, opportunity, or intent.”3 Since plaintiffs’ evidence “could tend to prove Penn’s intentions at the time he agreed to purchase the company,”4 it fell within the exception to the general rule. It should be noted that the courts did not engage in the more nuanced analysis employed by other courts, as discussed below.

Not all litigants are as successful in introducing other acts evidence as the Eaves plaintiffs. Unit Drilling Company v. Enron Oil & Gas Co.5 involved a contractual dispute between the parties. Defendant, Enron Oil & Gas Company (Enron), had contracted with plaintiff, Unit Drilling Company (Unit Drilling), to drill an oil well, yet failed to pay Unit Drilling the full contract price because, Enron claimed, the damage that Unit Drilling caused exceeded the balance Enron owed. Predictably, Unit Drilling sued Enron. Before trial, Enron filed a motion in limine to exclude evidence that Unit Drilling sought to introduce of Enron’s failure to pay another contractor. “Unit asserted that such evidence was admissible under Fed. R. Evid. 404(b) to prove that Enron’s motive in withholding payment from Unit was not to offset repair costs, as Enron claimed, but rather to exact price concessions.”6

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1 2 3

587 F.2d 453 (10th Cir. 1978).

Id., at 464.

4 5

Id. 108 F.3d 1186 (10th Cir. 1997).

6

Id., at 1193.

Id.

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The district court granted Enron’s motion, and the decision was upheld on appeal. The court reasoned that admitting the evidence would have required a trial within the trial, potentially confusing the jury. Furthermore, the probative value of the evidence would have been “not great” because “Enron’s motive is not at issue in a breach of contract case.”7 Interestingly, the appellate court stated in its opinion that the evidence may have been properly admissible under the Fed. R. Evid. 404(b) (2) exception, but the district court had not abused its discretion in granting Enron’s motion.

Perhaps a more prosaic but no less significant case addressing the admission of other acts evidence is Thomas v. Chambers,8 which involved a collision between an automobile driven by the plaintiff and a tractor-trailer driven by one of the defendants. Defendants claimed that plaintiff had staged the accident, and, in furtherance of that defense, sought to introduce evidence of other accidents that plaintiff had staged. Specifically, one of the witnesses that the defendants sought to call had given the defendants a recorded statement that the plaintiff had been involved in other staged accidents. The court allowed defendants to introduce the witness’s testimony because the evidence was admissible under Fed. R. Evid. 404(b)(2) “to show intent, plan, and the absence of mistake or accident.” Also, the similarities between the accidents were such that the probative value of the evidence outweighed any of the Fed. R. Evid. 403 factors.9

Md. Rule 5-404(b)10 is derived from Fed. R. Evid.

404(b), but the Supreme Court of Maryland has held that it applies only to the state offering evidence against a criminal defendant, and not in civil litigation.11 In determining whether to admit other acts evidence, Maryland courts apply Md. Rule 5-403, which requires a simple balancing test, namely whether the probative value of the evidence “is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.”12 In Francis v. Johnson,13 a suit against three police officers for violation of the Maryland Declaration of Rights, false imprisonment, battery, and assault, the plaintiff sought to introduce evidence of another alleged abduction that took place within an hour of the plaintiff’s alleged abduction, occurring at the same place, and involving the same police officers. The defendants objected to the introduction of the evidence on the grounds that it was irrelevant and, even if relevant, that the potential prejudice it would cause outweighed its probative value.

In analyzing the circuit court’s admission of the evidence, the Appellate Court of Maryland first sought to determine whether the evidence was relevant, and then whether its prejudicial value outweighed its probative value. As to the evidence’s relevancy, the court stated that “[w]e agree with the circuit court that

7 Id., at 1194.

8 2019 WL 1989236 (E.D.La. 2019).

9 Fed. R. Evid. 403 states that the court “may exclude relevant evidence if its probative value is substantially outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence.

10 Md. Rule 5-404(b) states that “[e]vidence of other crimes, wrongs or acts is not admissible to prove the character of a person in order to show action in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, common scheme or plan, knowledge, identity, or absence of mistake or accident.”

11 See Ruffin Hotel Corp. of Maryland, Inc. v. Gasper, 418 Md. 594 (2011).

12 Espina v. Prince George’s County, 215 Md. App. 611, at 652 (2013) (quoting Maryland Rule 5-403). Compare Fed. R. Evid. 403, supra.

13 219 Md. App. 531 (2013).

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the evidence of the similar incident involving Mr. Woodland was relevant to appellants’ motive and intent,”14 and as to whether the plaintiff had voluntarily gone with the defendant police officers. As to the evidence’s potential for prejudice as compared to its probative value, the Appellate Court of Maryland agreed with the circuit court that “the evidence was highly probative because it goes to the crux of this case, what exactly was the intent of the parties and whether or not the plaintiff consented [to go with the defendant officers]. . . . [I] ts probative value significantly outweigh[ed] any danger of unfair prejudice.”15 So, in conclusion, other acts evidence is admissible in federal court under the limited circumstances set forth in Fed. R. Evid. 404(b)(2). The more connected the other acts are, temporally and otherwise factually, to the acts of the party that are the subject of the litigation, the greater the chance that the court will deem the evidence material and probative.

If seeking to introduce Fed. R. Evid. 404(b)(2) evidence, anticipate an objection based on the tendency of the evidence to confuse the jury or waste the court’s time (the “trial within the trial” argument to which the courts have been receptive).

In the Maryland state courts, the analysis is less complicated.

The questions are only whether the evidence sought to be introduced is relevant (which question is pertinent to all evidence), and whether the potential for prejudice substantially outweighs the evidence’s probative value.

14 Id., at 552.

15 Id., at 553 (internal quotations of the circuit court omitted).

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The more connected the other acts are, temporally and otherwise factually, to the acts of the party that are the subject of the litigation, the greater the chance that the court will deem the evidence material and probative.

__________ Burke Murphy, III,'s practice primarily consists of insurance defense and commercial litigation in both state and federal courts, including trials and appeals. He also handles matters in the areas of motor vehicle liability, premises liability and construction defect litigation.

Murphy’s representative experience includes insurance companies, individual insureds and commercial insureds, as well as both small businesses and large companies. He has handled numerous jury trials, and even more bench trials to verdict as first chair, in addition to managing multi-jurisdictional litigation