The Plaintiffs sought damages and injunctive relief accusing the Defendants of willfully, intentionally, and calculatedly refusing to provide potable water to residents of the Plaintiffs’ manufactured home communities and a denial of applications by the Plaintiffs Grover Dinwiddie, and Sarina Shannon for municipal water utility services provided to other residents of the City of Oak Grove, Kentucky, in violation of the Equal Protection clause of the Fourteenth Amendment to the United States Constitution.
Defendants filed a motion to exclude Plaintiffs’ accountant expert Missy DeArk and prevent her from offering expert witness opinion testimony at trial, claiming that her disclosure did not comport with the requirements of Fed. R. Civ. P. 26 and “will result in unfair surprise and prejudice to Defendants because Defendants have no basis for or knowledge of DeArk’s opinion testimony.” Defendants therefore sought the exclusion of the late or undisclosed evidence under Fed. R. Civ. P. 37(c)(1), FRE 702, and Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579 (1993).
Accounting Expert Witness
Melissa Welch DeArk, CPA/CFF, CVA/MAFF is an associate director in Dean Dorton’s litigation support and business valuation groups. Prior to joining the firm in 2008, she was a controller and Chief Financial Officer for more than 16 years with full responsibility for all financial, administrative, and human resource functions for multi-million dollar organizations.
Discussion by the Court
Although lacking in details and specifics, the Court does not find Plaintiffs’ expert disclosure to be a total surprise here. Plaintiffs’ disclosure of expert accountant Missy DeArk and the damages calculations about which she will testify is technically deficient under Rule 26, but not fatally so under Rule 37. The damages sought by Plaintiffs were outlined in discovery responses as early as February 2023. According to Plaintiffs’ Response, counsel reached out to defense counsel prior to the expert disclosure deadline and identified DeArk though they did not yet have a written report from her, and “Counsel for Defendants raised no objection and indicated that there were no issues with proceeding without a written report.”
Counsel for Defendants denies any such representation. It appears that there has been: 1) an honest misunderstanding by counsel; 2) some form of procedural gamesmanship on the part of counsel; or 3) a direct misrepresentation by counsel in these pleadings. Without specific evidence to the contrary, the Court will assume that there has been an honest misunderstanding by counsel. Plaintiffs’ counsel believes there to have been an understanding between the parties regarding disclosure of DeArk without the necessity of producing a report.
Although Plaintiffs’ counsel would have been well-advised to confirm such an understanding in writing, Subpart (B) of Rule 26(a)(2) does not require a writing and apparently contemplates such agreements regarding disclosures in its very text, “[U]nless otherwise stipulated.” Moreover, Plaintiffs’ failure to provide DeArk’s report can be excused by the Court under Rule 37(c) if, as he has alleged, Plaintiffs’ counsel was under the impression that Defendants’ counsel did not object to proceeding without DeArk’s report.
Analysis
When Plaintiffs formally and timely disclosed DeArk in a pleading, they also attached the Curriculum Vitae for DeArk which outlines her employment history and experience; CPA credentials with certifications in financial forensics, valuation analysis; and financial forensics specialty in matrimonial litigation.
No trial date has been set in this matter, so there is little risk that trial will be disrupted by the Court declining to strike DeArk’s testimony. The Court found that the evidence appears to be important particularly regarding calculation of Plaintiffs’ damages, to the extent that DeArk’s testimony can provide that proof. Also, Plaintiffs have explained that DeArk was disclosed as an expert witness to defense counsel well before the disclosure deadline.
Held
The Court exercised its discretion and directed Plaintiffs to supplement their expert disclosure with a written report. In conclusion, the Court denied the Defendants’ motion to strike Plaintiffs’ expert witness Missy DeArk.
Key Takeaway:
Plaintiffs’ failure to timely provide DeArk’s written report might warrant the sanction of exclusion if the failure to properly disclose were on the eve of trial, or if the deficient disclosure were in some way intended to sandbag Defendants. However, the Court found that, in this case and at this time, the harsh sanction of exclusion was not appropriate.
Case Details:
| Case Caption: | Plainview Mobile Home Park Et Al V. City Of Oak Grove, Kentucky Et Al |
| Docket Number: | 5:22cv76 |
| Court: | United States District Court, Kentucky Western |
| Order Date: | December 19, 2024 |
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