United Coal Company, LLC (“United Coal”) brought this action against Xcoal Energy and Resources (“Xcoal”), alleging that Xcoal failed to accept delivery of coal under two separate purchase orders.
Emily Medine is United Coal’s expert witness on damages. Medine produced an expert report providing initial damages calculations, a rebuttal report responding to Xcoal’s expert, Fran Taglia, and three supplements to her initial report.
United Coal argued that the Court should prohibit Taglia from offering opinions at trial concerning his interpretation of the Purchase Orders and the resultant obligations on Xcoal and United Coal, as they are legal opinions.
Xcoal argued that the Court should strike Medine’s expert opinions regarding United Coal’s alleged damages because: (1) both Purchase Orders expressly prohibit the recovery of lost profits, and (2) Medine’s damages opinions are “irrelevant” as they only consider damages in the form of lost profits.
Coal Industry Expert Witnesses
Fran X. Taglia III has over 22 years of technical, operational and business management experience and expertise in the mining industry, including engineering, financial, operational, and marketing assessments. His experience includes feasibility studies, reasonableness reviews, due diligence, and operational assessments for surface and underground mining operations in the United States, Canada, South America, and Australia.
Emily S. Medine developed an expertise in the coal industry, coal markets, and coal procurement. Medine has performed over 60 management/ performance audits of utility coal procurement practices, largely on behalf of state regulatory commissions.
Discussion by the Court
A. Motion to Strike Xcoal’s Expert, Fran Taglia
United Coal took issue with several opinions which Taglia shared in his expert reports and his deposition, which included: the legal effect and meaning of the “tentative” delivery schedule in the Purchase Orders; the date that the Purchase Orders became effective; the contractual rights established by the Purchase Orders; and which party ultimately breached the Purchase Orders.
Xcoal did not deny that Taglia offered legal opinions in his expert reports or his deposition but instead stated that it will not offer Taglia’s opinions as to the meaning of terms or legal effect of the parties’ conduct.
Xcoal planned to offer Taglia’s expert opinion to establish: background on the coal industry including the relationship between producers and brokers, the scheduling and performance of coal supply contracts, and the coal market in the years at issue; the parties’ course of conduct in relation to industry standards; the amount of damages suffered by Xcoal due to United Coal’s alleged breach; and critiques of Medine’s opinions on damage calculations. In United Coal’s reply brief, it took no issue with Xcoal’s response.
Xcoal acknowledged that its expert could not offer legal opinions or interpretations of the contracts at issue. United Coal accepted that concession.
Therefore, the Court prohibited Taglia from offering interpretations of the Purchase Orders and the obligations and rights resultant from the Purchase Orders. As identified in Xcoal’s brief, Taglia will be permitted to testify to background issue of the coal industry, the parties’ course of conduct in relation to industry standards, damages suffered by Xcoal due to United Coal’s alleged breach, and critiques of Medine’s damage opinions.
B. Motion to Strike United Coal’s Expert, Emily Medine
Xcoal argued that the Court should strike Medine’s expert opinions regarding United Coal’s alleged damages because: (1) both Purchase Orders expressly prohibit the recovery of lost profits, and (2) Medine’s damages opinions are “irrelevant” as they only consider damages in the form of lost profits.
To begin with, with respect to resale damages, the Court found that Medine sufficiently provided evidence of resale damages to prevent her testimony on the matter from being precluded.
Xcoal argued that Medine cannot provide testimony on resale damages, as she explicitly stated in her deposition that she did not offer an opinion on them. While it is true that when asked, Medine stated that resale damages were not “particularly applicable in this setting” and that she was not offering an opinion on them, Medine’s expert reports did show resale damage calculations. Further, Xcoal appeared to acknowledge that Medine’s reports contained resale figures, as in that same deposition, Xcoal questioned her about the data underlying her resale calculations.
With respect to lost profits, Xcoal argued that the Purchase Orders prohibit the recovery of lost profit damages, and as such, Medine’s damage opinions on lost profits should be struck. United Coal did not contest that the Purchase Orders limit lost profit damages, but rather argued that lost profits, as defined by New York law, are limited to damages based on collateral agreements, which United Coal does not seek. Though the parties have argued the issue, the Court defers on this decision at this time because it has already ruled that Medine’s resale damage opinions will not be struck, and because it would benefit from additional briefing.
As a result, the Court will permit Medine to testify at trial as to both lost profit damages and resale damages.
Held
- The Court granted United Coal’s motion to strike Xcoal’s expert, Fran Taglia.
- The Court denied Xcoal’s motion to strike United Coal’s expert, Emily Medine.
Key Takeaway
While an opinion is not objectionable just because it embraces an ultimate issue, the Second Circuit is in accord with other circuits in requiring exclusion of expert testimony that expresses a legal conclusion.
Case Details:
| Case Caption: | United Coal Company, LLC V. Xcoal Energy And Resources |
| Docket Number: | 1:23cv5709 |
| Court Name: | United States District Court, New York Southern |
| Order Date: | March 31, 2026 |
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