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Keller Farms, Inc. v. McGarity Flying Service, LLC

United States Court of Appeals, Eighth Circuit

December 11, 2019

Keller Farms, Inc. Plaintiff- Appellant
v.
McGarity Flying Service, LLC; Dennis E. McGarity; Michael C. Pemberton; John Doe; John Doe Corporation Defendants Colin V. Stewart, individually and as a Partner of Joint Venturer in Stewco Farms; Brandon G. Stewart, individually and as a Partner or Joint Venturer in Stewco Farms; Faron B. Stewart, individually and as a Partner or Joint Venturer in Stewco Farms Defendants - Appellees Kenny Hulshof; Renee L. Hulshof Defendants

          Submitted: September 24, 2019

          Appeal from United States District Court for the Eastern District of Missouri - Cape Girardeau

          Before GRUENDER, ARNOLD, and GRASZ, Circuit Judges.

          GRUENDER, CIRCUIT JUDGE.

         Keller Farms appeals the district court's[1] directed verdict and the jury's verdict in favor of appellees the Stewarts. We affirm.

         I.

         Keller Farms operates a farm in southeast Missouri, where it grows various crops and maintains a number of both windbreak and ornamental trees. The Stewarts also operate a farm in southeast Missouri, to the north and east of Keller Farms' property. Other farms border, or are in close proximity to, Keller Farms' property.

         In April and May 2015, Keller Farms, the Stewarts, and some operators of neighboring farms applied herbicides to their fields. The Stewarts hired Dennis McGarity to apply herbicides via airplane to their fields, which he did on April 23, 2015. In early May 2015, Keller Farms first detected herbicidal damage to some of its crops. Around this time, Keller Farms also noticed damage to some of its trees.

         Keller Farms suspected that herbicide drift caused this damage and submitted a complaint to the Missouri Department of Agriculture ("Department"), which assigned Yvonne Barr to investigate the matter. Based on Barr's investigation, the Department issued a warning letter to McGarity in February 2016, finding that it was more likely than not that chemicals he applied to the Stewarts' field had drifted onto Keller Farms' property. Although Missouri law empowers the Director of the Department to order restitution in such circumstances, see Mo. Rev. Stat. § 281.060.2, the Department opted only to issue McGarity this warning letter.

         Keller Farms subsequently sued McGarity and Michael Pemberton (who applied herbicides to a different field farmed by the Hulshofs around the same time McGarity applied herbicides to the Stewarts' field), alleging negligence, negligence per se, and statutory trespass under Missouri law for applying herbicides in a manner that allowed them to drift onto Keller Farms' property and cause damage to its crops and trees. Keller Farms later amended its complaint to add the Stewarts and the Hulshofs to hold them vicariously liable for the herbicide drift. The district court dismissed Pemberton from the action after he went bankrupt and dismissed McGarity and the Hulshofs after Keller Farms settled with them. The action thus proceeded against the Stewarts alone.

         In a pretrial order, the district court limited Keller Farms' statutory trespass count to tree damage, concluding that Keller Farms could not recover for crop damage under the plain language of the statute. In a pretrial conference, the district court also excluded two sets of evidence Keller Farms proffered: (1) the February 2016 warning letter issued to McGarity by the Department as well as testimony regarding the findings and conclusions in the letter from Darryl Slade, who was at that time the Enforcement Program Coordinator for the Department; and (2) two warning letters the Department issued to McGarity regarding other instances where it found he likely caused herbicide drift. During trial but before submitting the case to the jury, the district court directed a verdict for the Stewarts on the statutory trespass claim because Keller Farms failed to present sufficient evidence of tree damage. The district court allowed the negligence and negligence per se claims to go to the jury, which returned a verdict in favor of the Stewarts on both counts.

         The district court then entered final judgment in favor of the Stewarts on all counts. Keller Farms moved for a new trial, challenging the district court's directed verdict on the statutory trespass count, its exclusion of evidence, and the jury's verdict on the negligence and negligence per se counts. The district court denied the motion. Keller Farms appeals.

         II.

         This is a diversity case arising out of Missouri. As such, "we apply state substantive law and federal procedural law." Barkley, Inc. v. Gabriel Bros., Inc., ...


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