UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

MICHAEL E. TEUTON,
Plaintiff-Appellee,

v.
                                                                No. 98-2807
THE PAUL REVERE LIFE INSURANCE
COMPANY,
Defendant-Appellant.

Appeal from the United States District Court
for the District of South Carolina, at Columbia.
Patrick Michael Duffy, District Judge.
(CA-97-753-3-23)

Argued: March 3, 2000

Decided: April 18, 2000

Before LUTTIG and TRAXLER, Circuit Judges,
and Jackson L. KISER, Senior United States District Judge
for the Western District of Virginia, sitting by designation.

_________________________________________________________________

Affirmed by unpublished per curiam opinion.

_________________________________________________________________

COUNSEL

ARGUED: John Bowman McLeod, HAYNSWORTH, MARION,
MCKAY & GUERARD, L.L.P., Greenville, South Carolina, for
Appellant. David Maurice Ratchford, RATCHFORD & HAMILTON,
L.L.P., Columbia, South Carolina, for Appellee. ON BRIEF: W.
David Conner, HAYNSWORTH, MARION, MCKAY & GUE-
RARD, L.L.P., Greenville, South Carolina, for Appellant. Charles W.
Bagnal, RATCHFORD & HAMILTON, L.L.P., Columbia, South
Carolina, for Appellee.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

The district court excluded the admission of certain evidence from
trial by granting a pre-trial motion in limine and by sustaining a mid-
trial objection. Post-trial, the district court denied a motion for judg-
ment as a matter of law, or, alternatively, for a new trial. Defendant
assigns both of these rulings as error. Finding no error in the district
court's decisions, we affirm.

I.

In May of 1993 the Appellant, The Paul Revere Life Insurance
Company ("Paul Revere"), issued the Appellee, Dr. Michael E. Teu-
ton, a Disability Income Protection Policy. The general purpose of
such a policy is to provide benefits should the insured's disability
impair his ability to earn income from his occupation. On the policy
Teuton listed his occupation as an obstetrics and gynecology special-
ist ("OB/GYN"). His OB/GYN practice was facilitated by his privi-
leges at Byerly Hospital in South Carolina.

A total disability occurs under the policy when the insured, because
of injury or sickness, is "unable to perform the important duties" of
an OB/GYN. A residual disability occurs when, because of injury or
sickness, the insured is "unable to perform one or more of the impor-
tant duties" of an OB/GYN or when the insured is"unable to perform
the important duties of [an OB/GYN] for more than 80% of the time
normally required to perform them." The insured cannot be residually

                     2
and totally disabled simultaneously.1 A June 1993 letter from Paul
Revere acknowledges that Teuton's protected occupation is that of an
OB/GYN specialist and that if Teuton "could be working in some
other occupation or specialty [it] would not preclude the payment of
total disability benefits."

Due to marital difficulties, Teuton and his third wife, Johnnie, sep-
arated in July 1993. On November, 4, 1993, police reports indicate
that Teuton physically attacked Johnnie. After Teuton was arrested
for burglary in the first degree and assault and battery with intent to
kill he was involuntarily admitted to Charter Rivers, a private mental
institute in South Carolina. The involuntary admission, also occurring
on November 4, 1993, arose from an application signed by Teuton's
family physician, Dr. Thomas Bell. A court ordered Teuton's commit-
ment and he was to be evaluated for any danger he might pose to him-
self or others.

Teuton's primary treatment at Charter Rivers was provided by a
psychiatrist on call when Teuton arrived there, Dr. Larry Nelson. Dr.
Nelson has seen Teuton over a hundred times. Dr. Nelson discharged
Teuton from Charter Rivers on November 29, 1993, saying that Teu-
ton has had moderate depression that "waxes and wanes" and that
Teuton was taking antidepressants prescribed by Dr. Bell.2 These
antidepressants cause Teuton's hand to tremor, Dr. Nelson noted.

To ensure Teuton's tranquility, a judge recommitted Teuton to
Charter Rivers about two weeks after the initial discharge. After Teu-
ton's final release from Charter Rivers his OB/GYN practice soon
closed and he lost his privileges with Byerly Hospital, making it diffi-
cult to obtain privileges elsewhere.
_________________________________________________________________

1 The insured must also be under physician's care to receive total or
residual benefits, but this requirement may be waived by Paul Revere.
An actual loss of earnings while the insured is working, as an OB/GYN
or otherwise, is required to receive benefits pursuant to a residual disabil-
ity.

2 Dr. Nelson also said that Teuton suffers from anxiety, attention deficit
disorder, and other health-related problems.

                     3
In December 1993 Teuton filed a claim pursuant to the Paul Revere
policy saying that he had "severe depression." Paul Revere's policy
payments to Teuton began in March 1994 but the payments stopped
in January 1997.

Dr. Nelson testified that Teuton was totally disabled (as defined by
the Paul Revere policy) while at Charter Rivers from November 4 to
November 29, 1993, but from then to late April-early May 1994 Teu-
ton "could probably return" to his OB/GYN practice if his treatments
worked (Teuton's antidepressants were not presently causing a tremor
that would limit his surgical abilities). When Teuton's Byerly privi-
leges were not re-instated in April 1994 it was, however, "kind of the
start of a very slippery slope" and led to severe depression. Teuton
has been, Dr. Nelson testified, totally disabled since late April-early
May 1994 because he cannot perform the procedures that are the "im-
portant duties" of an OB/GYN specialists, such as surgical proce-
dures. Teuton will remain "totally and permanently" disabled, Dr.
Nelson continued, because he must take his antidepressant to combat
his depression but that this medication causes a hand tremor that pre-
vents Teuton from performing OB/GYN surgery. Teuton can, Dr.
Nelson acknowledged, perform "some" duties of a medical practice,
which are also things that an OB/GYN performs (e.g., a pelvic exam).
The stress of practicing as an OB/GYN could deepen Teuton's
depression, Dr. Nelson adds.3

Much of Dr. Nelson's diagnosis was corroborated by two expert
witnesses offered by Teuton. Dr. William Dennis, an OB/GYN pro-
fessor and practitioner, offered expert testimony that Teuton is "to-
_________________________________________________________________

3 Paul Revere attacked Dr. Nelson's credibility with evidence indicat-
ing that from January 1994 to April 1994 Dr. Nelson said Teuton could
perform as an OB/GYN while, from February through May 1994, he told
Paul Revere that Teuton had been totally disabled since November 4,
1993. Dr. Nelson testified that his inconsistent statements were "clearly
a mistake" caused by an inadequate review of his records. Dr. Nelson's
diagnosis during those disputed periods is relevant only insofar as it
might have affected his credibility because Dr. Nelson consistently diag-
nosed Teuton as totally disabled to perform as an OB/GYN specialist
after May 1994 and the issues on this appeal involve Teuton's policy
rights after February 1997.

                    4
tally disabled" to perform the important duties of an OB/GYN
because he cannot make competent decisions in the clinical practice.
In September 1996 Teuton saw Dr. Deborah Leverette, an expert in
psychiatry, to obtain a second opinion regarding electrotherapy.4 Dr.
Leverette diagnosed Teuton as suffering from a major depression,
among other ailments, and said that Teuton is totally disabled to prac-
tice medicine whatsoever, including as an OB/GYN.

Teuton's employment varied after his November 1993 arrest. At
various times through 1994 to 1996, Teuton worked as an emergency
room physician, a physician in urgent care medicine, and in an
OB/GYN-related capacity in Nigeria (though not as an OB/GYN spe-
cialist). From February to April 1997 Teuton was allegedly pursuing
a writing career. During a portion of the following four months, from
May to September 1997, Teuton worked at an impotency clinic.
Afterwards, from October to December 1997, Teuton maintained a
part-time urgent medical care position. Finally, from May to July
1998 Teuton obtained full-time employment as a staff physician,
though not in the OB/GYN field.5

In September 1996, Paul Revere had Teuton undergo an indepen-
dent medical evaluation by Dr. Harold Morgan, an expert in psychia-
try. Dr. Morgan diagnosed Teuton with moderately severe depression.
Dr. Morgan said that Teuton was residually disabled under the policy
because he could perform "some" of the important duties of an
OB/GYN, such as an examination, but not other important functions,
such as surgery (because of his drug-induced tremor). Dr. Morgan
noted alternatives to Teuton's tremor-inducing antidepressant, but
admitted that Teuton's depression will periodically prevent him from
performing as an OB/GYN specialist.

Based on Dr. Morgan's diagnosis and Teuton's unemployed status,
Paul Revere stopped paying Teuton in January 1997. Teuton filed his
_________________________________________________________________
4 Electrotherapy might improve Teuton's depression but may also
cause severe memory loss.
5 The record is unclear as to Teuton's employment, if any, from Janu-
ary through April 1998. Because the jury found Teuton totally disabled
during time periods both before and after that uncertain timeframe, any
employment Teuton may have had would not alter the jury's findings.

                    5
complaint alleging breach of contract and bad-faith failure to pay. The
jury found that Teuton was due total disability benefits from February
to April 1997, residual benefits from May through September 1997,
and total disability benefits from October 1997 through August 1998.
Paul Revere made no payments during the relevant time period. Paul
Revere moved the court for a judgment as a matter of law or for a
new trial. The court denied the motion on both grounds. This appeal
followed.

II.

Paul Revere argues that the district court erroneously excluded the
admission of certain evidence from trial. A district court's evidentiary
rulings are reviewed for an abuse of discretion. See WLR Foods, Inc.
v. Tyson Foods, Inc., 65 F.3d 1172, 1174 (4th Cir. 1995).

A.

The district court did not abuse its discretion by excluding, under
Fed. R. Evid. 403, evidence of Teuton's 1993 alleged attack on Johnnie.6
Rule 403 excludes evidence that, "although relevant . . . its probative
value is substantially outweighed by the danger of unfair prejudice
. . . ." Fed. R. Evid. 403. The district court reasoned:

          I'm going to tell you, I can't think of anything more prejudi-
          cial than letting you tell the jury the man tried to kill his
          wife, and I can hardly dream up anything more detrimental
          to a person's position in court than to tell the jury that. And
          there's got to be some very good and relevant reasons to
          allow that kind of testimony to be the lens through which
          the jury views all the other evidence.

Paul Revere says the district court wrongfully ignored the potential
probative value of the November 1993 arrest evidence, that is,
_________________________________________________________________
6 Teuton argues that Fed. R. Evid. 404(b) also bars the admission of the
evidence. We need not resolve the applicability of Rule 404(b) because
relevant evidence offered under Rule 404(b) is subject to Rule 403's
exclusion, see Westfield Ins. Co. v. Harris, 134 F.3d 608, 614 (4th Cir.
1998), which is our basis for upholding the district court.

                    6
whether Teuton feigned depression to escape prosecution.7 Paul
Revere wanted to argue that Teuton's criminal conduct caused his
loss of privileges at Byerly Hospital and prevented him from obtain-
ing privileges elsewhere. Because Teuton could not perform as an
OB/GYN specialist without privileges, Paul Revere continues, Teu-
ton's November 1993 arrest is the real reason why he was unable to
perform important OB/GYN duties. Paul Revere says that the Fourth
Circuit admits prejudicial evidence in similar situations, citing Mullen
v. Princess Anne Volunteer Fire Co., Inc., 853 F.2d 1130, 1134 (4th
Cir. 1988); Westfield Ins. Co. v. Harris, 134 F.3d 608 (4th 1998).

We disagree with Paul Revere. The district court's balance of the
probative value and unfair prejudice, as remarked in the record, is not
an abuse of discretion:

          [a]ny discussion of [Teuton] being arrested is not important,
          it's irrelevant . . . . I don't want anything about his alleged
          intent to kill his wife to color everything that happens in this
          trial. . . . [W]hat we are interested in is why he was
          depressed or why he's qualified under the policy or not
          qualified. And if he's not been convicted of a criminal
          action, the fact that he was arrested or that somebody kept
          him in jail for 10 days to me is highly prejudicial to a fair
          assessment of the facts. . . . At some point [Paul Revere
          was] paying him. . . . Now, if [Paul Revere] had reached that
          decision and that he was qualified for payments under the
          policy, I don't need to hear before that a whole lot of history
          of what he did just to taint the jury. . . . I don't want any dis-
          cussion of the arrest, because that's prejudicial, unfairly so,
          and it's not relevant.

The cases relied on by Paul Revere, moreover, involve evidence
_________________________________________________________________
7 Although Paul Revere's brief mentions the district court's exclusion
of Teuton's April 1994 arrest for violating a restraining order obtained
by Johnnie, this exclusion was not raised in oral argument. We note,
however, that this evidence would be properly excludeable for the same
reasons as the November 1993 arrest. Teuton's criminal and civil cases
pertaining to his alleged activity involving Johnnie, moreover, were
either dropped or settled according to his counsel.

                     7
with clear probative value in light of the underlying cause of action.
Paul Revere's proposed evidence, of course, offers a far more tenuous
link to the underlying breach of contract claim.

For instance, in an employment-related racial discrimination case,
where racial animus was an issue, it was error for the district court
to exclude inflammatory racial slurs made by the defendants. See
Mullen v. Princess Anne Volunteer Fire Co., Inc., 853 F.2d 1130,
1133 (4th Cir. 1988). Because the plaintiff in such a case "must show
that racial animus was a motivating factor in the decision," the "emo-
tional reaction claimed to be unfairly prejudicial is . . . closely tied
  1679 47 1 to the inquiry." Id. at 133-35.8
                      In Westfield, the defendant-insurer

wanted to admit evidence under Rule 404(b) that the insured had
seven prior fire loss claims, suggesting an absence of mistake or acci-
dent. See Westfield Ins. Co. v. Harris, 134 F.3d 608 (4th Cir. 1998).
We agreed that this evidence was relevant as to the policy's coverage
for the loss, but held that the district court failed to adequately explain
how the evidence was prejudicial under Rule 403. Id. at 614.

In the record before us, the district court adequately explained how
evidence of Teuton's arrest is unfairly prejudicial under Rule 403.
The arrest evidence, moreover, does not "aid[the jury's] search for
truth;" that is, whether Teuton was entitled to benefits under the Paul
Revere policy. Mullen, 853 F.2d at 1135. The arrest evidence, unlike
the evidence in Mullen and Westfield, is irrelevant to the breach of
contract action against Paul Revere.

From an evidentiary perspective, Paul Revere's theory that Teu-
ton's involuntary commitment was an elaborate device to avoid pros-
ecution is unsupportable. There is no evidence that his family doctor,
Dr. Bell, initially applied for Teuton's commitment with a fraudulent
_________________________________________________________________
8 Mullen notes that because the district court could have instructed the
jury to consider the statements only on the question of discriminatory
intent, outright exclusion was improper. While a limiting instruction can
blunt the potential prejudice of evidence, see U.S. v. Powers, 59 F.3d
1460 (4th Cir. 1995), Paul Revere's brief does not indicate that they
asked for a limiting instruction. See Fed. R. Evid. 105 (the court shall,
"upon request," instruct the jury as to the limited scope of evidence
admissible for one purpose but not for another).

                     8
motive. There is no credible evidence that Dr. Nelson's diagnosis was
in any way designed to help Teuton avoid prosecution. There is no
evidence that the judge's re-commitment to Charter Rivers after Teu-
ton's initial discharge was designed to skirt the criminal system. By
dismissing Paul Revere's theory the probativeness of the arrests
becomes incredibly low, if not non-existent, while the unfair preju-
dice remains high.9

B.

Paul Revere argues, secondly, that the district court erroneously
excluded evidence within Teuton's November 1994 and February
1997 applications for hospital privileges at Palmetto Richland Memo-
rial Hospital in South Carolina ("Palmetto"). Paul Revere maintains
that statements within those files support the theory advanced when
proffering the November 1993 arrest evidence: Teuton's criminal
conduct caused Teuton's loss of hospital privileges and, having no
such privileges, prevented Teuton from performing as an OB/GYN
specialist. The depression Teuton claims, the theory continues, was
feigned to avoid criminal prosecution. The proffered Palmetto materi-
als, therefore, contradict Teuton's position at trial that his depression
caused his inability to perform the important duties of an OB/GYN.
After an in camera review, the district court admitted only portions
of the documents.

In a November 1994 letter, Teuton writes that Byerly Hospital
revoked his privileges because of his November 1993 domestic dis-
pute and arrest involving Johnnie. The letter adds that Byerly did not
question Teuton's clinical abilities. The only portion read to the jury,
however, states "I have been treated successfully for depressions and
I am ready to pursue my occupation." The February 1997 Palmetto
application includes Teuton's response to general inquiries (licensing,
education, et cetera), as well as his history of depression. The district
court permitted Paul Revere to read to the jury portions where Teuton
_________________________________________________________________
9 Paul Revere says they also wanted to use Teuton's arrest to cross-
examine Teuton's witnesses that offered psychiatric diagnosis. Even if
Paul Revere had stressed this issue, the district court's decision to
exclude the evidence under Fed. R. Evid. 403 is not, in this context as
well, an abuse of discretion.

                     9
says that he does not "take any medications" nor does he "have any
mental or physical condition which could interfere with [his] ability
to provide care or call coverage for [his] patients."

We find no error in the district court's decision to exclude portions
of the application materials. A South Carolina statute says that "all
proceedings of and all data and information acquired by the commit-
tee (of a hospital executive staff) . . . are confidential." S.C. Code
Ann. § 40-71-20 (incorporating S.C. Code Ann.§ 40-70-20). The
South Carolina Supreme Court says that this prevents discovery of a
physician's applications for staff privileges and documents submitted
to an executive committee of hospital medical staff. See McGee v.
Bruce Hospital System, 312 S.C. 58, 439 S.E.2d 257 (1993). The dis-
trict court admitted the above portions, nevertheless, ruling that the
South Carolina law was not intended to let a doctor assume conflict-
ing positions in an application and in court. The portions admitted
were sufficient to inform the jury of their evidentiary value to Paul
Revere; that is, that Teuton was telling a hospital that he could per-
form as an OB/GYN specialist. It may be, indeed, that the South Car-
olina statute would not have permitted any of the application's
contents into evidence. Moreover, the portion excluded from the
November 1994 letter included Teuton's disclosure of the November
1993 arrest incident, evidence that we have already deemed properly
excluded from trial under Fed. R. Evid. 403.10

III.

Paul Revere says the district court wrongfully denied its motion for
judgment as a matter of law, or, alternatively, for a new trial because
the jury's findings were inconsistent and because the evidence does
not establish that Teuton was totally disabled under the policy. A
motion for judgment as a matter of law may be granted if the evi-
dence is so substantial or conclusive that any contrary verdict would
necessarily be based upon speculation or conjecture. See Gairola v.
Virginia Dep't. of Gen. Servs., 753 F.2d 1281, 1285 (4th Cir. 1985).
_________________________________________________________________
10 The district court also excluded other Palmetto-related documents
proffered by Paul Revere. On appeal, Paul Revere only argues that the
complete November 1994 and February 1997 applications should have
been admitted and suggests no error regarding the other documents.

                    10
Because a district court's decision on a motion for judgment as a mat-
ter of law is reviewed de novo, see id. ; Princess Cruises, Inc. v. Gen-
eral Electric Co., 143 F.3d 828, 831 (4th Cir. 1998) (citations
omitted), evidence is viewed in the light most favorable to the party
against whom the motion is made. See Garraghty v. Jordon, 830 F.2d
1295, 1302 (4th Cir. 1987); Andrade v. Mayfair Management, Inc., 88
F.3d 258, 261 (4th Cir. 1996). Judgment at law is proper "when, with-
out weighing the credibility of the evidence, there can be but one rea-
sonable conclusion as to the proper judgment." Singer v. Dungan, 45
F.3d 823, 826 (4th Cir. 1995) (citation omitted). The denial of a
motion for a new trial is reviewed for abuse of discretion. See Bristol
Steel & Iron Works, Inc. v. Bethlehem Steel Corp. , 41 F.3d 182, 186
(4th Cir. 1994). We find no grounds to reverse the district court's
decision.

Specifically, the jury determined Teuton totally disabled from Feb-
ruary 1997 through April 1997. During this time Teuton said he was
pursuing his writing career. Paul Revere argues that because Teuton's
February 1997 application to Palmetto states that Teuton is able to
work the jury's finding is erroneous. From May through September
1997 the jury found Teuton residually disabled. Paul Revere says this
is inconsistent with evidence that Teuton was actually unemployed
for two of those months and only worked part-time for the other three
months. Paul Revere adds that this jury finding means, by deduction,
that the jury determined that Teuton could do some important duties
of an OB/GYN during this time frame. The jury also found Teuton
totally disabled from October 1997 to July 1998. Paul Revere says
this is inconsistent with evidence that proves Teuton worked part-time
in urgent medical care from October through December 1997 and
then as a full-time medical staffer from May to July 1998. Moreover,
there was insufficient evidence to indicate how Teuton was able to
perform at least one important function of an OB/GYN, as reflected
in the jury's finding of "residually disabled" for May to September
1997, but then could not perform any important functions afterwards.

Viewing the evidence in favor of Teuton, as we must, we find no
error in the district court's decision. Teuton's employment in non-
OB/GYN jobs is irrelevant to his policy rights. Teuton provided
ample medical expert testimony that he could not perform the impor-
tant duties of an OB/GYN because of his depression. The jury's deter-

                    11
mination that Teuton was merely residually disabled from May to
September 1997 is not unreasonable because Teuton was working
part-time at the impotency clinic in May 1997. The jury was informed
that Teuton told Paul Revere, during the Summer of 1997, that he was
establishing a new occupation and "reentering" the medical field. It
is not clear when Teuton stopped working at the impotency clinic, but
because his next employment began in October 1997, the jury could
infer that this position lasted until September 1997. The jury could,
therefore, reasonably conclude that Teuton could do some of the
important duties of an OB/GYN during that period.

AFFIRMED

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