Trinseo Europe GmbH filed a lawsuit against several Defendants, including Stephen Harper, Steve Harper Consulting, Inc., Polycarbonate Consulting Services, Inc., Kellogg Brown & Root, LLC (KBR), William Davis, and Polycarbonate Resins Consulting, LLC. The lawsuit alleged that these parties had unlawfully obtained Trinseo’s trade secrets and confidential information associated with polycarbonate manufacturing. Polycarbonate is a thermoplastic used in various specialized commercial and consumer products like automobile components, specific eyeglass lenses, and medical devices.
Trinseo accused KBR of knowingly utilizing these trade secrets and confidential data to develop a “PCMax licensing package.” This package was then sold by KBR to Chinese companies, enabling them to establish competing polycarbonate manufacturing plants in China. In response to the lawsuit, Defendants appointed Michael Kratochwill as their expert on polycarbonate markets, specifically focusing on Trinseo’s position within those markets. Kratochwill presented a 59-page expert report and provided testimony through deposition.
Trinseo, in its request to the Court, sought the exclusion of specific opinions and testimony offered by Michael Kratochwill. Trinseo alleged that Kratochwill’s opinions and testimony amounted to impermissible repetition of research reports in which he had no involvement in preparing.
Chemical Engineering Expert Witness
Michael Kratochwill possesses substantial expertise in advising clients on various areas including screening for acquisition and investment opportunities, financial transactions, and commercial development related to new products and technologies. His professional portfolio includes significant involvement in expert witness and testimony work, particularly in appraisals, valuations, and the dynamics of industry and technology. With over 45 years of experience in the industry, Kratochwill brings a wealth of knowledge and practical understanding to his engagements. He has been a member of the AIChE since 1970 and the SPE since 1979. Michael holds a Bachelor of Science in Chemical Engineering from Drexel University, US, and a Master of Business Administration from Widener University, US.
Discussion by the Court
Trinseo contended that Michael Kratochwill’s approach primarily involved repeating and amalgamating the work of others. Employed by “IHS Markit,” a company known for producing subscription-based products for the chemical industry, Kratochwill’s expert report consisted basically of a series of citations to numerous IHS Markit subscription reports and a synthesis of those reports. Trinseo argued that Kratochwill’s reliance on subscription reports he hadn’t contributed to was unjustified, especially considering his lack of independent expertise specifically in the realm of polycarbonate. Despite being designated as an expert in polycarbonate markets, Kratochwill admitted that his familiarity with these markets wasn’t distinctively tailored to this sector but was more aligned with his broader experience in analyzing various markets.
The Court found that Kratochwill was not qualified by training or expertise to discuss the technical aspects of PC technology, its design, or its operation.
As for Kratochwill’s opinions lacking reliability on account of his virtually exclusive reliance on various studies and industry reports, Defendant responded by pointing out that the Federal Rules of Evidence permit an expert to base their opinion on factors outside of their own firsthand knowledge or observation. As per Federal Rules of Evidence 703, the expert is allowed to rely on certain kinds of hearsay. Nevertheless, while an expert may rely on reliable studies and reports, he is not permitted to be a mere vehicle to bring this hearsay in front of the jury. This applies not only to direct testimony based upon personal knowledge and experience on the topic at issue, but also to efforts to synthesize a number of facts or analysis from other sources into an expert opinion.
The Court outlined the purpose of expert reports, emphasizing the need for these reports to present the expert’s opinions and the foundation for those opinions. Acknowledging that expert reports qualify as hearsay, the Court stated its refusal to admit the reports without unanimous agreement among the parties.
Recognizing the extensive historical context involved in the PC business spanning decades, the Court highlighted the challenge for any expert to comprehensively cover the entire industry history. It noted that experts often rely on pre-existing facts or data predating their involvement or on insights from predecessors in the industry, provided such reliance aligns with the norms of the field.
However, the Court drew a clear line, disallowing experts from merely regurgitating opinions formulated by others. It emphasized that such individuals would not qualify as experts but rather as conduits for others’ opinions. The Court denied the motion to exclude with such parameters in mind. The ruling, though, did not prevent the Plaintiff from objecting should the witness attempt to solely repeat others’ opinions. The Court suggested that challenging such a witness would be more effectively done through opposing evidence and a robust cross-examination.
Michael Kratochwill was barred from providing testimony regarding the technical facets of PC technology, encompassing its manufacturing and design aspects. However, he was permitted to testify about PC markets, under the condition that his testimony adhered to Rule 703. The Court explicitly stated that he could not simply repeat the opinions of others during his testimony.
Held
The Court granted in part and denied in part Plaintiff, Trinseo Europe GmbH’s motion to exclude certain opinions and testimony of Defendants, Stephen Harper and Polycarbonate Consulting, Inc.’s expert Michael Kratochwill.
Key Takeaways
The Court barred Michael Kratochwill from providing any expert testimony on the technical aspects of polycarbonate (PC) technology and manufacturing because he lacked the necessary training, expertise, and firsthand knowledge to opine on how PC is designed or operated.
However, Kratochwill was allowed to testify as an expert on polycarbonate markets and industry trends. But his testimony must comply with Federal Rule of Evidence 703 – he cannot simply parrot or regurgitate opinions and analysis performed entirely by others. The Court was clear that experts must present their own independent opinions and reasoning.
While experts may rely on outside studies, reports, and data to inform their opinions, as is common practice, they cannot serve merely as a vehicle to bring otherwise inadmissible hearsay before a jury. Synthesizing others’ research into an expert opinion is also insufficient. The Court emphasized experts must contribute original analysis and judgment.
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