In December 2020, Koninklijke Philips N.V. (“Philips”) initiated legal action against Defendants Telit IoT Solutions, Inc. and Telit Communications LTD (collectively “Telit”), asserting infringement of six Philips patents crucial to telecommunications standards regulated by the European Telecommunications Standards Institute (ETSI). ETSI, which stands for the European Telecommunications Standards Institute, is a “standards body dealing with telecommunications, broadcasting and other electronic communications networks and services.” These patents were deemed essential to various aspects of telecommunications standards adopted by ETSI.
Telit counterclaimed, contending that Philips violated the Intellectual Property Rights (IPR) Policy of ETSI by not disclosing its standard essential patents to ETSI before the adoption of the corresponding standards. This policy, governed by the French law, was central to the dispute. Telit moved to dismiss this case based on a lack of personal jurisdiction in Delaware, which is where the matter was being tried and presented opening and reply expert reports from Philippe Stoffel-Munck, a French law professor and purported French expert under Federal Rule of Civil Procedure 44.1, supporting their claim.
Telit’s argument centered on Philips’ alleged failure to adhere to ETSI’s IPR Policy regarding the declaration of essential patents before their adoption into standards, forming a critical aspect of their defense in the case.
Philips sought the exclusion of specific opinions expressed in Stoffel-Munck’s reports, citing Federal Rule of Evidence 702. They contended that Stoffel-Munck’s expertise and background were insufficient, lacking prior experience in cellular telecommunications technology or involvement with ETSI or any similar standard-setting organization. Philips argued that these deficiencies rendered him unqualified to offer opinions on the practices and obligations of ETSI members, as presented in the mentioned paragraphs of his reports.
Foreign Law Expert Witness
Philippe Stoffel-Munck is an accomplished legal scholar and practitioner with a distinguished career. He excelled in the rigorous “concours d’agrégation de droit” in 2001, securing the top position. Since 2005, he has held the prestigious role of Full Professor at the Panthéon-Sorbonne University (Paris I), a renowned institution in French legal education. He teaches private law, law of contracts, tort law, and law of security interests.
Beyond academia, Stoffel-Munck is a registered attorney at the Paris Bar, establishing himself as a seasoned independent arbitrator. With over fifteen years of experience, he has handled a diverse array of cases, both on international and domestic fronts, operating under the auspices of prominent arbitral institutions like the ICC, LCIA, and the Swiss Arbitration Center. His extensive involvement as a co-arbitrator or chairman in more than 50 cases over the last decade attests to his profound expertise in this field.
Moreover, his contributions expand beyond arbitration; Stoffel-Munck has showcased his adeptness as a consultant and legal expert. Notably, in 2020, he received a prestigious appointment by the Ministry of Justice to lead the law commission charged with preparing a comprehensive reform of the Civil Code. This reform specifically targeted contracts concerning sale, lease, loan, deposit, agency, services, and aleatory agreements. The draft reform bill, crafted under his leadership, was published for public consultation in July 2022.
Discussion by the Court
The amended Federal Rule of Evidence 702, effective from December 1, 2023, allowed expert witnesses to provide testimony in the form of opinions or otherwise, provided they were qualified based on knowledge, skill, experience, training, or education. To be admissible, the proponent had to demonstrate to the Court that:
(a) The expert’s specialized knowledge would assist the trier of fact in understanding the evidence or determining a fact in question.
(b) The testimony was grounded in sufficient facts or data.
(c) The testimony was derived from reliable principles and methods.
(d) The expert’s opinion was a reliable application of these principles and methods to the case’s facts.
The established principle required an expert witness to possess expertise, knowledge, or experience in a field substantial enough to suggest that their opinion would likely assist the trier of fact in seeking the truth. It was essential for a proffered expert witness to demonstrate a level of skill or knowledge beyond that of an average layperson. While the Third Circuit adopted a liberal approach in applying this standard, it did not automatically qualify every proffered witness as an expert, maintaining discretion in determining admissibility based on the specific qualifications and relevance of the expert testimony.
The Court determined that specific sections of Stoffel-Munck’s opening and reply expert reports pertained to ETSI and acknowledged that Stoffel-Munck lacked any formal background, training, or education in cellular telecommunications technology or ETSI. As he lacked expertise in this area, the Court concluded that he did not possess skills or knowledge surpassing that of an average layperson regarding ETSI. Consequently, under Rule 702, Stoffel-Munck was deemed unqualified to provide expert opinions concerning ETSI.
Telit argued that because Philips’ expert, Jean-Sebastien Borghetti, addressed the same topics as Stoffel-Munck without expertise in cellular telecommunications or ETSI, Philips’ motion should be denied. The Court held that this argument is legally irrelevant to whether the challenged paragraphs in Stoffel-Munck’s expert reports are proper. The Court also noted that Telit submitted three Daubert motions, none of which raised the argument that Borghetti was unqualified to opine on ETSI.
Philips contended that specific sections of Stoffel-Munck’s opening and reply expert reports should be excluded as he improperly applied French law to the case’s facts in those paragraphs. Philips acknowledged Stoffel-Munck’s expertise in French law but argued that foreign law experts should aid the Court in determining the content of applicable foreign law rather than applying that law to the case’s facts.
The Court sided with Philips, concurring that the role of a foreign law expert is to assist in determining the content of foreign law. However, after observing that Courts do not always strike experts who offer legal conclusions, the Court highlighted the limited weight given to opinions offering legal conclusions, suggesting little or no credibility attached to such opinions.
The Court noted that in the case of Hardy Exp/. & Prod. (India), Inc. v. Gov’t of India, Indian contract law experts offered declarations aiding the Court in interpreting Indian law. The Court considered the declarations to ascertain the content of Indian law but refrained from relying on the experts’ legal conclusions. The Court’s discretion led to retaining the expert declarations without excluding the legal conclusions from the expert’s declarations. Similarly, in Pfizer Inc v. Elan Pharm. Rsch. Corp., the Court disregarded a foreign law expert’s testimony regarding how German courts might interpret a contract agreement. But the Court did not strike the expert’s testimony or exclude such statements from the expert’s affidavit.
The Court declined the motion to exclude specific sections of Stoffel-Munck’s opening and reply expert reports because he applied French law to the case’s facts in those paragraphs.
Held
Plaintiff’s Motion to Exclude the Opinions of Defendant’s expert Philippe Stoffel-Munck was granted in part and denied in part by the Court.
The Court has not arrived on an outcome for this case since the remaining issues involved in this case still await resolution.
Key Takeaways:
The key takeaways regarding expert testimony underscore the criteria set by Federal Rule of Evidence 702, which outline the benchmarks for admissibility. These criteria demand that an expert’s knowledge aids in comprehending evidence or determining facts, grounded in data and reliable principles, and applied reliably to the case’s specifics. Importantly, an expert’s qualification hinges on possessing expertise surpassing that of an average layperson in the relevant field. Lack of such expertise might disqualify an expert from opining on specific subjects. Additionally, the role of foreign law experts centers on aiding Courts in understanding foreign law content, rather than applying it to case specifics. Courts may not heavily rely on legal conclusions from foreign law experts, but their declarations could still inform the Court’s understanding. This discretion in admissibility extends to considering expert declarations while disregarding specific legal conclusions. Court precedents, as seen in cases like Hardy Exp/. & Prod. (India), Inc. v. Gov’t of India and Pfizer Inc v. Elan Pharm. Rsch. Corp., demonstrate this nuanced approach. Experts, especially in foreign law, are expected to elucidate the content rather than apply it directly to the case. Despite objections, Courts may exercise discretion in admitting expert testimony based on relevance and the expert’s contribution, emphasizing the Court’s role in evaluating expert opinions.
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