Plaintiff Max Zach Corporation entered into a contract with Defendant Marker 17 Marine (“Marker 17”) to modify Plaintiff’s vessel, a 2006 48′ Fountain Express Cruiser (the “Boat”)by retrofitting and repowering it with four Mercury Outboard 400 Racing Motors, at a cost of about $315,000. The agreement also provided for the delivery of the Boat by Marker 17 to Plaintiff in Greenwich, Connecticut.
The Boat was modified to specification by Marker 17, packaged, and loaded for transport from Wilmington, North Carolina to Greenwich, Connecticut. Marker 17 selected Defendant Premium Carriers Inc. (“Premium Carriers”) to assist with loading the Boat onto a trailer and to transport the Boat via land transport. The Boat was damaged when, in New Jersey, Premium Carriers accidentally flipped the trailer carrying the Boat en route to Plaintiff. Thereafter, Superior Towing and Transport, LLC towed the Boat from the accident site to its storage facility in New Jersey, where the Boat is still stored at a rate of $150 per day.
In the Second Amended Complaint, the Plaintiff raised four causes of action:
(1) negligence against Marker 17,
(2) breach of contract against Marker 17,
(3) conversion against Marker 17, and
(4) violation of 49 U.S.C. Section 14706 against Premium Carriers.
Plaintiff disclosed Scott Mitchell as his valuation expert witness whose testimony Defendants moved to preclude, arguing that Mitchell is unqualified to opine on the valuation of the Boat and that his testimony is unreliable and inadmissible.
Valuation Expert Witness
Scott Mitchell is the owner and sales manager of Boardwalk Marina in Stratford, Connecticut. He has decades of experience as a certified boat dealer, which includes dealing in Fountain powerboats from 2004-2010.
Discussion by the Court
A. Scott Mitchell’s Qualifications
Mitchell, the owner and sales manager of Boardwalk Marina in Stratford, Connecticut, offered an opinion on the Boat’s valuation and the market value if sold as new today. The Defendants claimed that he did not employ the level of intellectual rigor necessary to opine as to the valuation of the boat.
In response, the Plaintiff cited Mitchell’s decades of experience as a certified boat dealer.
However, Mitchell’s expert report makes no reference to any experience as a marine surveyor or appraiser; instead, Mitchell states in the addendum to his expert report that his “qualifications derive from buying, repairing, building, and selling new and used boats since his entire adult life.” Further, at both his deposition and the hearing, Mitchell testified that he is not certified to do valuations, he does not belong to the American Society of Appraisers or any other association of appraisers, and he is not a licensed appraiser in any state.
While Mitchell, as a dealer and reseller of boats, may be qualified to be an expert in boat sales and resale values, his qualifications and experience as a marine appraiser are not demonstrated. The Court cannot conclude that his knowledge of boat valuations is sufficient such that his opinion would likely assist the trier in fact in arriving at the truth and, accordingly, finds that Mitchell is not qualified to be an expert as to the valuation of the Boat.
B. Reliability of Mitchell’s Testimony
Defendants argued that Mitchell’s testimony was unreliable for two reasons:
(1) it did not follow any recognized methodology, including Uniform Standards of Professional Appraisal Practice (“USPAP”), and
(2) it was speculative, contradictory, and assumptive.
Mitchell’s opinion is unreliable because the Court cannot discern the exact methodology Mitchell used to valuate the Boat. Mitchell concludes in his report that the value of the Boat is $640,000, which is the sum of the $315,000 cost to “re-power” the Boat and the Boat’s $325,000 value based on 2021 prices. Nowhere in the report does Mitchell explain how he arrived at the $325,000 value of the Boat or what were the “2021 prices” on which he relied; rather, he simply states, without more, that the included exhibits of other boats “can be used to triangulate on value but moreover, support his conclusion of using the cost basis rather than market comps.”
i. Mitchell’s testimony is also contradictory and misleading
The Court’s confusion regarding Mitchell’s methodology is exacerbated by Mitchell’s contradictory and misleading testimony. As noted, Mitchell’s report suggests that he relied on the “cost basis” method only, and not on comparable sales, to valuate the Boat. However, at his deposition in June 2024, Mitchell testified that he used a “blend of comparables and cost basis” based on “[p]revious boat sales, current boat sales, current boat valuations, and then on the cost basis, what the guy paid to have the boat redone[.]”
Mitchell again changed his explanation of the comparable sales and how he valued the Boat at the September 2014 hearing on the instant motion, further supporting the Court’s conclusion that his expert opinion is unreliable. Mitchell affirmed that to ascertain the $325,000 number in his valuation, he used a comparable “sale” of a 2006 48-foot Fountain listed for $388,944, and that the two other boats mentioned in the report were not comparables.
He thereafter conceded that none of these references or calculations were in his expert report or produced to Defendants. Moreover, because Mitchell testified at his deposition that the only records he used to calculate the $325,000 value were from the Boat Trader website, the Court held that Mitchell’s opinion is unreliable for being assumptive, contradictory, and, most importantly, rooted in inadequate methodology. Daubert and Federal Rule of Evidence 702 thus mandate the preclusion of Mitchell’s report and testimony.
C. Relevance of Mitchell’s Testimony
Since the Court held that Mitchell is not qualified to serve as an expert and his testimony is unreliable, the Court declined to address whether his testimony met the relevance standard under Federal Rule of Evidence 401.
Held
Therefore, the Court granted the Defendant’s motion to exclude Plaintiff’s valuation expert witness Scott Mitchell’s testimony
Key Takeaways:
The Court excluded Scott Mitchell’s expert testimony regarding the valuation of the Plaintiff’s boat due to two primary reasons:
- Lack of Qualifications: While Mitchell, as a dealer and reseller of boats, may be qualified to be an expert in boat sales and resale values, his qualifications and experience as a marine appraiser are not demonstrated. The Court cannot conclude that his knowledge of boat valuations is sufficient such that his opinion would likely assist the trier in fact in arriving at the truth and, accordingly, finds that Mitchell is not qualified to be an expert as to the valuation of the Boat.
- Unreliable Methodology: In addition to the fact that Mitchell did not see or examine the Boat, or any comparable boats, prior to rendering his opinion as to the Boat’s valuation and that his report contains no comments or criticisms of Defendants’ vastly different appraisal that was prepared a month earlier, there is no indication from Mitchell’s expert report or deposition testimony that his “testimony is the product of reliable principles and methods” or that he “reliably applied the principles and methods to the facts of the case.”
Case Details
| Case caption: | Max Zach Corporation V. Marker 17 Marine Et Al |
| Docket Number: | 3:23cv1088 |
| Court: | United States District Court for the District of Connecticut |
| Dated: | October 30, 2024 |
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