                                                                                                                           Opinions of the United
1999 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


6-18-1999

Cooper Distr Co Inc v. Amana Refrig Inc
Precedential or Non-Precedential:

Docket 98-6400




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Filed June 18, 1999

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

No. 98-6400

COOPER DISTRIBUTING CO., INC.,
a New Jersey corporation,
       Appellant

v.

AMANA REFRIGERATION, INC.,
a Delaware corporation

On Appeal from the United States District Court
for the District of New Jersey
D.C. Civil Action No. 91-cv-05237
(Honorable Maryanne Trump Barry)

Submitted Pursuant to Third Circuit LAR 34.1(a)
April 23, 1999

Before: SLOVITER, SCIRICA and ALITO, Circuit Judges

(Filed June 18, 1999)

       DONALD A. KLEIN, ESQUIRE
       KENNETH K. LEHN, ESQUIRE
       Winne, Banta, Rizzi, Hetherington
        & Basralian
       25 Main Street
       Court Plaza North
       Hackensack, New Jersey 07602
       JOHN J. GIBBONS, ESQUIRE
       Gibbons, Del Deo, Dolan,
        Griffinger & Vecchione
       One Riverfront Plaza
       Newark, New Jersey 07102-5497

        Attorneys for Appellant

       STEPHEN M. GREENBERG,
        ESQUIRE
       Stern & Greenberg
       75 Livingston Avenue
       Roseland, New Jersey 07068

        Attorney for Appellee

OPINION OF THE COURT

SCIRICA, Circuit Judge.

This is the second appeal of a damages award for
wrongful termination of a franchise under the New Jersey
Franchise Practice Act ("NJFPA"). In the first appeal, we
vacated the award and remanded for a new trial on the
appellant's NJFPA damages. See Cooper Distrib. Co. v.
Amana Refrigeration, Inc., 63 F.3d 262 (3d Cir. 1995)
(Cooper I). The plaintiff appealed again following the second
trial. After argument, we remanded so that the District
Court could rule on one open matter. Thereafter, the
parties returned to this Court. We will affirm in part,
reverse in part, and remand for further proceedings.

I.

From 1961 to 1991, Cooper Distributing Company
("Cooper") was a distributor of appliances manufactured by
Amana Refrigeration, Inc. ("Amana"). Under the terms of
their distribution contract, Cooper bought a specified
quantity of products at a wholesale discount from Amana
and then resold them to retailers, who in turn sold them to
consumers. Although Cooper did not have exclusive
distribution rights under the contract, Cooper was the only
distributor of Amana products in its territory, which

                                  2
primarily encompassed New York, New Jersey, and
Connecticut. By 1991, Cooper's sales of Amana products
generated $20 million per year in revenues and constituted
about 80 percent of Cooper's business.

In November 1991, Amana attempted to terminate its
distribution relationship with Cooper on ten days' notice,
citing a provision in the distribution contract allowing
either party to do so. It is undisputed that the attempted
termination was motivated by changes in Amana's
nationwide business strategy rather than unsatisfactory
performance on Cooper's part.

Cooper sued Amana in New Jersey state court, alleging
four causes of action: (1) unlawful termination without good
cause in violation of the NJFPA; (2) breach of contract; (3)
breach of the implied obligation of good faith and fair
dealing; and (4) tortious interference with prospective
economic advantage. Amana removed the case to federal
district court in New Jersey. In February 1992, the District
Court issued a preliminary injunction prohibiting Amana
from " `taking any action whatsoever to limit . . . or in any
way interfere with Cooper's activities as a distributor of
Amana products.' " Cooper I, 63 F.3d at 267-68 (quoting the
injunction). The injunction was still in effect when the
parties went to trial in February 1994.

At trial, the jury found Amana liable on all four counts
and awarded Cooper $4.375 million in compensatory
damages on its NJFPA claim, $2 million on its breach of
contract claim, and zero in actual damages on both of the
remaining two common-law claims. It also awarded Cooper
$3 million in punitive damages on the tortious interference
claim. Accordingly, on March 8, 1994, the District Court
entered a judgment of $9.375 million in damages to Cooper
and dissolved the injunction, thereby allowing Amana to
terminate the distributorship and pay damages.

On appeal, we affirmed the judgment of liability under
the NJFPA but held the District Court should have found
as a matter of law that there was no breach of contract;
therefore, we reversed the award of $2 million in damages
on that claim. See Cooper I, 63 F.3d at 280-81. We also
reversed the award of $3 million in punitive damages for

                                3
tortious interference because no actual damages had been
found, see id. at 284, and we vacated the award of $4.375
million in NJFPA damages and remanded for a new trial on
that issue, see id. at 277-78.

Cooper I identified two defects in the original calculation
of NJFPA damages. First, the jury had mistakenly assumed
that Cooper had an exclusive right to sell Amana products
to retailers in its territory. This assumption, we found, was
expressly contradicted by the unambiguous terms of the
contract and it resulted in a significantly higher valuation
of the franchise. See id. at 278. Second, we held the
franchise had been valued as of the wrong date. The
District Court had instructed the jury to value the franchise
as of November 8, 1991, the date on which Amanafirst
attempted to terminate the franchise. As we pointed out,
however, the more appropriate valuation date was March 8,
1994, the date on which the franchise actually was
terminated. Cooper had continued to earn income from its
franchise after November 8, 1991. Thus, to value the
franchise as of that date would bestow upon Cooper a
"double recovery," as Cooper would receive both the value
of the franchise on November 8, 1991 -- that is, the
present value of lost future earnings from the franchise --
and the actual earnings from the franchise after that date.
Id. Consequently, we held "the proper date of valuation in
this case is March 8, 1994," id., and remanded for "a new
trial on [NJFPA damages] consistent with this opinion," id.
at 285.

On remand, the District Court ruled prior to trial that the
"only issue" in the case was the franchise's fair market
value to a hypothetical buyer and seller as of March 8,
1994. Thus, Cooper was barred from presenting evidence
relating to additional damages theories, including the value
of the franchise to the actual parties and the amount of lost
profits Cooper allegedly suffered before March 8, 1994.

In the second trial, Cooper received an award of
$377,000. Cooper now appeals, asserting four grounds for
reversal: (1) the District Court erred in limiting the scope of
the second trial to a determination of the fair market value
of the franchise as of March 8, 1994; (2) the court's jury
instructions were misleading and erroneous; (3) the court

                               4
improperly allowed hearsay testimony and failed to give
effect to stipulations by Amana; and (4) the court
erroneously denied Cooper's post-trial motion for
prejudgment interest.

II.

A. Valuation of the Cooper Franchise

Cooper argues the District Court misconstrued our
mandate in Cooper I, preventing it from proving important
components of its damages: the value of the franchise to
Cooper and Amana specifically, rather than to a
hypothetical buyer and seller; Cooper's lost profits between
November 8, 1991 and March 8, 1994; the value of
Cooper's complementary distribution lines; and the
enhanced value of the franchise due to Amana's
subsequent expansion of its distribution line. Amana
responds that the District Court's restriction of damages to
the fair market value of the franchise as of March 8, 1994
was not only consistent with Cooper I, but was required by
the New Jersey Supreme Court's decision in Westfield
Centre Serv., Inc. v. Cities Serv. Oil Co., 432 A.2d 48 (N.J.
1981).

We exercise plenary review on these issues because they
involve whether the District Court properly interpreted the
law of the case as set forth in Cooper I. See Feather v.
United Mine Workers of America, 903 F.2d 961, 964 (3d Cir.
1990). It is "axiomatic" that on remand after an appellate
court decision, the trial court "must proceed in accordance
with the mandate and the law of the case as established on
appeal." Bankers Trust Co. v. Bethlehem Steel Corp., 761
F.2d 943, 949 (3d Cir. 1985). Moreover, where (as here) the
mandate requires the District Court to proceed in a manner
"consistent" with the appellate court decision, the effect is
" `to make the opinion a part of the mandate as completely
as though the opinion had been set out at length.' " Id.
(quoting Noel v. United Aircraft Corp., 359 F.2d 671, 674 (3d
Cir. 1966)).

Our opinion in Cooper I did not expressly address
whether the measures of damages that Cooper now
proposes should be included in the scope of the second

                               5
trial. As noted, we remanded in order for the District Court
to remedy two errors in the original calculation of damages:
the jury's mistaken assumption that Cooper had possessed
an exclusive distributorship, and its valuation of the
franchise as of the wrong date. Cooper does not claim
either error was repeated in the second trial. Moreover, to
the extent our opinion provided guidance as to the specific
method by which damages should be calculated on remand,
we held the franchise should be valued according to
" `either the present value of lost future earnings or the
present market value of the lost business, but not both.' "
63 F.3d at 278 (quoting Johnson v. Oroweat Foods Co., 785
F.2d 503, 507 (4th Cir. 1986)). The District Court's choice
of the latter of these two measures was consistent with that
mandate.

It was also consistent with New Jersey law, which
controls in this diversity case. The statute itself does not
specify a particular measure of damages: "Any franchisee
may bring an action against its franchisor for violation of
this act . . . to recover damages sustained by reason of any
violation of this act and, where appropriate, shall be
entitled to injunctive relief." N.J. Stat. Ann.S 56:10-10
(West 1998). But in Westfield, the New Jersey Supreme
Court held that

       a franchisor who in good faith and for a bona fide
       reason terminates, cancels or fails to renew a franchise
       for any reason other than the franchisee's substantial
       breach of its obligations has violated [the NJFPA] and
       is liable to the franchisee for the loss occasioned
       thereby, namely, the reasonable value of the business
       less the amount realizable on liquidation. These are the
       damages contemplated by N.J.S.A. 56:10-10 . . . .

Westfield, 432 A.2d at 57. The court further held that
"[r]easonable value would be that price upon which willing
parties, buyer and seller, would agree for the sale of the
franchisee's business as a going concern." Id. at 55. It is
clear from the court's discussion that these "willing parties"
are hypothetical buyers and sellers, not the actual parties
in the case: for example, the court noted the potential
usefulness of IRS valuation techniques and expert
testimony based on comparable sales in the area. See id.

                               6
Westfield appears to be the only case that discusses the
proper measure of damages under the NJFPA.

Here, Amana terminated Cooper "in good faith and for a
bona fide reason" and not for "the franchisee's substantial
breach of its obligations." See Cooper I, 63 F.3d at 267
(describing the business reasons for which Amana decided
to terminate Cooper's franchise). Thus, under Westfield
Amana is liable to Cooper for a loss equal to the value of
the franchise as measured by its fair market value to a
hypothetical buyer and seller, minus the value of assets
that can be liquidated by Cooper.

The question is whether this measure of damages
necessarily excludes the other measures advanced by
Cooper. As we discuss, Westfield and our mandate in
Cooper I exclude most of these additional damages theories,
but they do not refute Cooper's "lost profits" argument.

1. The Value of the Franchise to Cooper and Amana

Cooper contends the District Court should have allowed
it to present evidence of the franchise's value to the parties
themselves, rather than its market value as measured by
what third parties would be willing to pay for it. As noted,
however, Westfield suggests the opposite. See 432 A.2d at
55 ("Reasonable value would be that price upon which
willing parties, buyer and seller, would agree for the sale of
the franchisee's business as a going concern."). Moreover,
our opinion in Cooper I refers, variously, to "the current
value of [the] business," "the value of the business as a
going concern," and "the present market value of the lost
business." 63 F.3d at 278. Such terms suggest an objective,
not subjective, measure of the franchise's value.
Accordingly, we believe the District Court correctly
determined that the purported value of the franchise to
Cooper and Amana themselves was not a proper measure of
damages.

2. Pre-March 8, 1994 Lost Profits

Cooper argues that although Amana did not actually
succeed in terminating the franchise until March 8, 1994,
Cooper's uncertain status before that date caused a decline
in its profits during the November 1991 to March 1994

                               7
period. The District Court appears to have acknowledged
this point. See App. at 319 (statement of the District Court
that "I can't believe that . . . [Amana's counsel] would have
for a moment attempted to argue in his opening that the
jury's verdict in the first trial established Mr. Cooper
suffered no harm from Amana's conduct during the period
from mid-1991 to March 8th, 1994"). Lost profits would not
be accounted for in a valuation of the franchise as of March
8, 1994 because that value represents only the lost future
profits of the business: that is, the present value of the
profits Cooper would have earned after March 8, 1994, had
its franchise not been unlawfully terminated. See Cooper I,
63 F.3d at 278. Thus, Cooper contends the pre-March 8,
1994 lost profits must be included in the damages
calculation in order to make it whole. In response, Amana
argues that because Westfield identifies only one measure
of damages (fair market value of the franchise at the time
of termination), it implicitly forbids other measures, such
as lost profits prior to termination.

We find no support for Amana's argument, either in
Westfield or elsewhere in New Jersey law. The franchisee in
Westfield was a gasoline station owner whose business was
not affected by uncertainty surrounding his franchise
status. Consequently, the fair market value at the date of
his franchise's termination was a complete and
comprehensive measure of the harm he suffered. There is
no reason to believe Westfield precludes lost-profit damages
in a case where attempted termination of the franchise
itself causes a substantial decline in business. In fact,
Westfield's reference to "the legislative intent to make
franchisees economically whole" supports the inclusion of
lost profits. 432 A.2d at 58 (awarding attorney's fees); see
also Winer Motors, Inc. v. Jaguar Rover Triumph, Inc., 506
A.2d 817, 823 (N.J. Super. Ct. 1986) (holding that under
Connecticut franchise law, an award for improper
termination "should have two components, the losses
provable to that date, and the future damages based upon
the reasonably anticipated net future profits of the
dealership," and noting that there is "little difference
between the law of New Jersey and Connecticut on this
subject"). Here, Cooper advances the plausible claim that
retailers were aware of Cooper's ongoing litigation with

                               8
Amana and consequently did not know whether they could
count on Cooper for long-term sales and warranty service
on Amana products. As a result, at least some retailers may
have chosen to reduce or eliminate their dealings with
Cooper even before the date of actual termination.

Although we express no opinion on the extent of Cooper's
lost profits, or even their existence, we believe it was error
to preclude Cooper from presenting evidence on the issue.
This component of damages was not expressly commanded
by Cooper I or Westfield, but it is undeniably a part of the
loss suffered by Cooper as a result of Amana's unlawful
termination of its franchise. Inclusion of lost profits during
this period is the logical result of shifting the valuation date
from November 1991 to March 1994. Accordingly, we will
reverse and remand for a new trial on this issue.

3. Cooper's Loss of Complementary Lines

Cooper also contends its damages should have included
the value of what it calls "complementary lines," that is,
product lines carried by Cooper for the sole purpose of
complementing its Amana products. The complementary
lines consisted primarily of Hardwick, In-Sink-Erator, and
Dacor products. Cooper alleges that when it lost the Amana
franchise, its ability to sell these products at a profit was
destroyed.

We do not believe this issue warrants a new trial.
Westfield specifically instructs that the value of assets
retained by the franchisee is to be deducted from the
damages award. See 432 A.2d at 57. It may be true that
Cooper would not have purchased the complementary lines
if it did not also sell Amana products. But that fact does
not have any legal significance. Cooper acknowledges that
it was not required to purchase the additional lines, only
"encouraged" to do so by Amana. The complementary lines
fall squarely within the category of assets retained by the
franchisee under Westfield, and the District Court properly
excluded their value from the damages calculation.

4. Enhanced Value of the Franchise

Cooper also contends the District Court erred in refusing
to allow it to amend its expert report to reflect the

                               9
"enhanced value" that Cooper's franchise would have
received between November 1991 and March 1994, if
Amana had allowed it to partake in the expansion of
Amana's products lines that occurred during that time.
Allegedly, three other Amana distributors were given access
to the additional brands (Caloric, Modern Maid, and Speed
Queen) that had been consolidated by Amana's parent
company, Raytheon. Cooper claims it was denied access to
these additional lines solely because Amana was in the
process of attempting to terminate Cooper's franchise; thus,
Cooper should be allowed to include the value of these lines
as a component of its damages.1

It is unclear whether Amana denied Cooper access to the
additional product lines solely because of the pending
litigation. But in any event, Amana was under no legal
obligation to offer an expanded product line to Cooper, only
to maintain the status quo as required by the injunction
that was in effect at the time. As of March 8, 1994, Cooper
had never had access to the additional lines and did not
have the prospect of access in the future. We believe the
expansion offered to other Amana distributors was properly
excluded from the calculation of the Cooper franchise's
value on that date.

B. Jury Instructions

Cooper attacks the District Court's jury instructions on a
myriad of grounds, all of which fall within one of two
general criticisms: (1) the District Court failed to explain
the law thoroughly; and (2) the court's pricing instructions
were unfairly prejudicial to Cooper.2 The parties dispute
whether Cooper's objections to the jury instructions were
_________________________________________________________________

1. Contrary to Cooper's assertions, we find no defect in the procedure by
which the motion to amend the report was denied. In any event, we
believe Cooper's argument regarding enhanced value fails on the merits.

2. Cooper also makes the related claim that the District Court should
have allowed Cooper to introduce into evidence a historical pricing
analysis showing the discounts that Cooper had traditionally received
from Amana. We do not believe the court abused its discretion in
refusing to admit the exhibit, particularly since Cooper's expert was
allowed to testify about Cooper's historical discounts and profit margin
without the exhibit.

                               10
timely made, and accordingly what the appropriate
standard of review is.

We exercise plenary review to determine whether jury
instructions misstated the applicable law, but in the
absence of a misstatement we review for abuse of
discretion. See Walden v. Georgia-Pacific Corp., 126 F.3d
506, 513 (3d Cir. 1997); Savarese v. Agriss, 883 F.2d 1194,
1202 (3d Cir.1989). If the party claiming error did not make
a timely objection, we review for plain error. See Ryder v.
Westinghouse Elec. Corp., 128 F.3d 128, 136 (3d Cir. 1997).
Fed. R. Civ. P. 51 provides that a party may not assign as
error defects in jury instructions unless the party distinctly
stated its objection before the jury retired to consider its
verdict. See Fed. R. Civ. P. 51; accord Smith v. Borough of
Wilkinsburg, 147 F.3d 272, 277 (3d Cir. 1998) ("[T]o
preserve an issue for appeal, counsel must state distinctly
the matter objected to and the grounds of the objection.").
We will reverse only if the trial court committed plain error
that was "fundamental and highly prejudicial, such that the
instructions failed to provide the jury with adequate
guidance and our refusal to consider the issue would result
in a miscarriage of justice." Ryder, 128 F.3d at 136.

Cooper did not object at the close of jury instructions.
When the District Court asked Cooper's counsel if he had
any objections after the jury charge, he responded only by
correcting one of the exhibit numbers. Moreover, Cooper
had previously participated in a charge conference in which
both parties met with the judge and agreed on mutually
satisfactory language on all the instructions. It appears
from the record that the District Court gave the
instructions agreed upon by the parties at the charge
conference.

Nevertheless, Cooper claims its objections were properly
preserved and should receive plenary review. Cooper relies
upon two cases. In the first, Bowley v. Stotler & Co., 751
F.2d 641 (3d Cir. 1985), we held the appellant's objection
was preserved because the trial court expressly told
appellant that his previous written objections would
constitute an automatic objection to every adverse ruling
and that his objections would be preserved in the record.
See id. at 647. But Bowley is of little help to Cooper, who

                               11
received no such assurance from the District Court. In the
second, Thornley v. Penton Publishing, Inc., 104 F.3d 26 (2d
Cir. 1997), the Court of Appeals for the Second Circuit held
that failure to object is sometimes excused when a party
has "previously made its position clear to the trial judge
and any further attempt to change the judge's mind would
have been futile." Id. at 30. Arguably, Cooper had made its
position known to the District Court in its proposed jury
instructions and at the charge conference, and therefore
believed that further objection would be futile. But this
argument is belied by the fact that immediately after giving
its instructions, the District Court expressly invited any
objections by the parties. Cooper did not object at this time.
Therefore, we believe Cooper's exceptions to the jury
instructions were not preserved and are subject to plain
error review.

As noted, Cooper proffers two basic challenges, each of
which includes more specific criticisms. First, Cooper
claims the District Court did not thoroughly explain the
relevant law to the jury. According to Cooper, prior to trial
the jury should have been instructed as to: the definition of
a "franchise"; the meaning of the "license" and "community
of interest" elements of an NJFPA violation; the legal
standards for an implied covenant of good faith and fair
dealing; and the meaning of "constructive termination."
Cooper claims the District Court's failure to issue a
preliminary statement explaining these issues to the jury
constitutes reversible error.

In our view, the District Court correctly determined that
instructions on these ancillary legal issues were
unnecessary and could mislead the jury. As Amana points
out, it had already been established in Cooper I that Amana
was liable to Cooper for wrongful termination under the
NJFPA. Thus, there was no longer any dispute that Cooper
was a "franchise" within the meaning of the NJFPA and
that the "license" and "community of interest" elements of
the NJFPA had been satisfied. Similarly irrelevant are the
issues of the implied covenant of good faith and fair dealing
and the meaning of "constructive termination." The liability
phase of the trial was over; the only issue in the second
trial was the amount of damages owed to Cooper for

                               12
Amana's actual, not constructive, termination of the
franchise. Revisiting these issues, especially with a
"detailed annotation to New Jersey statutory and case law"
-- Cooper's own description of its proposed jury charge --
would only have confused the jury. We believe the District
Court's ruling was correct, and certainly was not plain
error.

Second, Cooper argues the District Court's instructions
on pricing were erroneous and misleading to the jury.
Cooper requested that the jury be instructed as follows:

       Amana cannot as of March 8, 1994 materially alter the
       historical relationship between the parties and must in
       its pricing to Cooper recognize that Cooper functions as
       a wholesale franchise, not as an appliance retailer.. . .
       Amana's pricing of products to Cooper must take into
       consideration Amana's historical relationship with
       Cooper as a franchise as well as the traditional
       wholesale discount to Cooper given by Amana when
       compared to the prices Amana generally charged for
       the same products to retailers who purchased
       appliances directly.

The District Court rejected this proposed charge and
instead instructed the jury that Amana "could not price its
appliances to Cooper, a wholesale distributor, or to retail
dealers in Cooper's assigned territory, in such a way that
Cooper would not have a reasonable opportunity to
compete for Amana-brand sales in that territory."

We do not believe the court misstated the law or misled
the jury. The court's instruction adequately communicated
the notion that in determining the fair market value of
Cooper's franchise as of the termination date, the jury must
assume that Amana's pricing to Cooper would not be
affected by the ongoing litigation between the two. An
explicit reference to historical pricing tactics was not
necessary to make this point. In any event, it is clear the
District Court's pricing instruction was not plain error so
"fundamental and highly prejudicial" as to"result in a
miscarriage of justice." Ryder, 128 F.3d at 136.

C. Evidentiary Rulings

Cooper also challenges a number of the District Court's
evidentiary rulings. We review for abuse of discretion. See

                                13
SEC v. Hughes Capital Corp., 124 F.3d 449, 456 (3d Cir.
1997).

1. Evidence of Amana's Inconsistent Legal Positions

In his opening statement, Amana's counsel told the jury
that Amana did not have the right to make direct sales in
Cooper's territory. After Cooper objected successfully to that
statement,3 Amana's counsel modified it and said that at
the time in question, Amana did not believe it had the right
to make direct sales in Cooper's territory. Cooper now
appeals the District Court's refusal to allow Cooper to
introduce evidence purportedly showing that Amana did in
fact believe that it had such a right: namely, a segment of
Amana's post-trial brief from the first trial and a statement
by Amana's counsel in oral argument on a motion.

The record shows the District Court fully considered the
request for admission but denied it on the ground that it
would be more time-consuming than probative. Instead, the
court allowed Cooper to admit a redacted version of the
order holding that Amana had the right to make direct
sales and invited Cooper to revisit the issue at a later time,
which Cooper never did. We see no abuse of discretion in
the District Court's exclusion of these materials.

2. Alleged Failure to Give Effect to Pretrial Stipulations

Cooper argues the testimony of former Amana executive
Charles Mueller violated pretrial stipulations. On cross-
examination, Mueller stated that Amana had intended to
compete directly with Cooper in Cooper's sales territory and
that Amana's president Robert Swam would "necessarily"
have been involved in that decision. According to Cooper,
these statements contradicted Amana's internal "five-year
plans," produced during post-remand discovery and
stipulated to represent Amana's company policy, as well as
a pretrial statement made by Amana's counsel to the
District Court to the effect that Swam should not be
deposed because he had no knowledge of the issues to be
tried. But Cooper did not object to Mueller's statements at
trial: in fact, Cooper elicited them on cross-examination.
_________________________________________________________________

3. We held in Cooper I that Amana did have such a right. See 63 F.3d at
279-80.

                                14
Cooper's argument accordingly seems to be that the District
Court's failure to strike the statements, sua sponte, that
Cooper itself brought out on cross-examination constitutes
reversible plain error. We find this argument meritless.

3. Other Evidentiary Challenges

Cooper levels two additional challenges to the District
Court's evidentiary rulings. First, Cooper claims the court
wrongly denied its objection to hearsay testimony by
Cooper's own principal, Bill Cooper, on cross-examination.
As the record shows, however, Cooper objected to the
question as being argumentative, not hearsay:

       Q Do you know that [sic] he has said about this --
       this concept of somehow Cooper, after March 8,
       1994 capturing all of the sales in your territory is
       absurd?

       A Well, that's not my --

          MR. LEHN: Objection, Your Honor, that's
          argumentative.
          [the objection is overruled]

       Q You know he said that, don't you?

       A Yes. I know he also said that no manufacturers
       want to compete with their own distributors and no
       one has dual distribution.

       Q We'll get to that, also.

The question was not argumentative, and the District Court
properly overruled Cooper's objection on that basis. Even if
Mr. Cooper's response was inadmissable hearsay, the
District Court was not required to supply the proper basis
for objection. Moreover, once the statement was admitted,
the court did not abuse its discretion in allowing Amana's
counsel to refer to it in his closing argument.

Second, Cooper argues the District Court did not"permit
Cooper to explore the implications of [Amana's valuation
expert's] `model' by cross-examination." Although this
statement implies that the District Court denied Cooper the
right to cross-examine Amana's expert, the record reveals
that Cooper engaged in a lengthy cross-examination. The

                                  15
District Court merely sustained Amana's objection to
Cooper's request that the expert calculate Cooper's
potential 1994 sales on the witness stand by converting the
actual sales by another distributor in another area of the
country and then adjusting for differences in population
density. The District Court did not abuse its discretion in
cutting off this line of questioning on the basis that it was
more prejudicial than probative.

D. Prejudgment Interest

Cooper also claims the District Court erred in denying
prejudgment interest for the time period between the date
of the wrongful termination and the jury's award of
$377,000 in the second trial. (See Order of Oct. 8, 1998).4
The District Court refused to grant prejudgment interest
because of what it termed "preposterous" valuation theories
advanced by Cooper in the second trial. See Cooper Distrib.
Co. v. Amana Refrigeration, Inc., No. 91-5237, op. at 5 (Oct.
8, 1998). Specifically, the court held: "Because . . . Cooper
persisted in pressing estimates of damages which, in fact,
bore no resemblance to reality and were `so unreasonable
as to amount to bad faith,' settlement was precluded. It
would not be equitable to award prejudgment interest and
Cooper's application is denied." Id. at 7 (quoting In re
Bankers Trust Co., 658 F.2d 103, 109 (3d Cir. 1981)).

Both parties have submitted supplemental briefs
discussing the propriety of the District Court's decision to
deny prejudgment interest. Because of our disposition of
the other claims, however, we believe it would be premature
to decide the issue now. The determination of Cooper's lost
_________________________________________________________________

4. In Cooper I, we affirmed the District Court's denial of prejudgment
interest on its original NJFPA award of $13.475 million. We held that
regardless whether the NJFPA claim was considered to arise in contract
or tort, prejudgment interest was inappropriate because Cooper was not
denied the use of its franchise while the preliminary injunction was in
effect and accordingly, "Cooper's franchise existed until the date of
judgment." 63 F.2d at 285. Consequently, no prejudgment interest was
appropriate for the time period between November 1991 and March 8,
1994. This appeal presents the separate issue of whether Cooper is
entitled to prejudgment interest for the period from March 8, 1994 until
October 22, 1997, the date of judgment in the second trial.

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profits will require a new trial and, potentially, a new award
of damages. It is impossible to predict either the date of
judgment or the amount of damages to be awarded.
Furthermore, to the extent the award of prejudgment
interest is a matter of equitable discretion based upon the
parties' conduct, we note the parties' conduct is not yet
complete--the parties must return to the District Court and
reinstitute proceedings on the issue of lost profits.
Accordingly, we will vacate the District Court's denial of
prejudgment interest, which may be raised, if at all, after
the outcome of the new trial.

III.

We believe the District Court's decision was correct on all
issues except its exclusion of evidence regarding Cooper's
lost profits. Accordingly, we will affirm the judgment in
part, reverse in part, and remand for a determination of the
amount of lost profits, if any, that Cooper sustained
between November 1991 and March 8, 1994 as a result of
Amana's unlawful termination of Cooper's franchise.
Because our disposition of these issues requires further
proceedings, we will also vacate the District Court's denial
of prejudgment interest pending resolution of the
proceedings.

Each party to bear its own costs.

A True Copy:
Teste:

       Clerk of the United States Court of Appeals
       for the Third Circuit

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