On May 22, 2021, Keith Anderson (“Anderson”) and Lorena McCaigue (“McCaigue”) (“Plaintiffs”) brought this action against Pasadena Police Chief John E. Perez (“Perez”) and the City of Pasadena (“City”). The action arises out of Defendants’ alleged retaliation against Plaintiffs in response to the following actions: (1) bringing a civil action against the City of Pasadena and certain Pasadena police officers in which violations of the California Tort Claims Act were alleged; and (2) making a request under California’s Public Records Act (“CPRA”) to obtain copies of police body camera footage.
To begin with, McCaigue is a federal law enforcement agent who was based in the Los Angeles area. On July 22, 2019, Pasadena police responded to a call reporting a supposed suicidal person. Thereafter, McCaigue’s identity was publicized in such a way that it was no longer safe for her to continue her work in the Los Angeles area. McCaigue applied for and was granted a transfer to a new locality that has not been disclosed. However, in this new locality McCaigue lacked the same opportunities for meaningful advancement, thus negatively affecting her lifetime total earnings.
Defendant argued that the opinions of Phillip D. Sidlow, Plaintiff’s expert, were insufficient to prove that Defendant’s conduct caused McCaigue’s lost wages because his testimony was unreliable and based on “assumptions.”
Economics Expert Witness
Phillip D. Sidlow has a Master’s Degree in Applied Economics from Johns Hopkins University and is employed as a vocational economics analyst. Moreover, he has published articles about earning capacity loss, and has served as an expert in calculating lost economic opportunities suffered by parties in hundreds of lawsuits.
Defendant argued that Sidlow’s testimony should have been excluded because it “lacked foundation and was based on pure speculation,” including assumptions he and Plaintiff McCaigue made, rather than Sidlow’s independent “research,” “review,” or consultation with Plaintiff McCaigue’s supervisors.
Based on Sidlow’s experience, education, and specialized knowledge, the Court determined that Sidlow was qualified to provide expert testimony as to Plaintiff McCaigue’s lost earning potential, based on information provided by Plaintiff McCaigue.
In other words, Defendant’s challenge to Sidlow concerned the weight, not admissibility, of his testimony.
Held
The Court denied the Defendant’s motion to exclude the testimony of Phillip Sidlow.
Key Takeaway:
Although Defendant asserted that Sidlow’s testimony must be excluded because it was based on “pure speculation and assumptions,” the assumptions of an expert go to the probative weight, rather than the admissibility, of the evidence.
Case Details:
Case Caption:
Anderson V. Perez
Docket Number:
2:21cv4290
Court Name:
United States District Court for the Central District of California
Plaintiff The Upper Deck Company (“Upper Deck”) sued its former contractor, Ryan Miller (“Miller”), and its competitor, Ravensburger North America Inc. (“Ravensburger”), for claims arising from the alleged copying of Upper Deck’s new trading card game (“TCG”), Rush of Ikorr.
Miller filed motions to exclude Plaintiff’s expert witnesses Dr. Roberto J. Cavazos and Dr. Ian Bogost while Plaintiff filed a motion to exclude Miller’s expert witness James E. Pampinella.
Gaming Expert Witness
Dr. Ian Bogost serves as a professor of Film and Media Studies as well as Computer Science and Engineering at Washington University in St. Louis and enjoys international recognition “as a key figure in game design and game studies.”
Dr. Roberto J. Cavazos is an economics professor with thirty years of experience. He has worked in a number of areas including lost earnings, business damages, labor management relations for global multinationals.
James E. Pampinella CPA, CFF, CLP has been providing consultation services in the area of complex commercial litigation and valuation services for over 30 years, specializing in intellectual property strategic consulting and disputes, including matters involving copyrighted works.
Miller’s Motion to Exclude Plaintiff’s Expert Bogost
Bogost is qualified to testify about TCGs
Miller sought to exclude Bogost’s testimony, arguing that he is not qualified to opine on TCGs, that his methods are unreliable, and that he offered improper legal opinions.
The Court noted that Bogost’s CV has a marked video game slant. However, his CV also contains several indications of general game expertise: throughout his career, Bogost has written several publications on games and game theory generally, taught multiple university courses on game design, and presented at several conferences on games.
Given Bogost’s ample experience in the field of games, game design, and game review—and because his opinions are based on specialized knowledge other than science—the Court found that Bogost met the minimum bar set by Rule 702 to qualify as an expert on TCGs.
Bogost’s methodology is sufficiently reliable to offer expert opinions about the two TCGs
Miller also challenged the reliability of Bogost’s methodology. Bogost first obtained two sets of Lorcana starter decks, which included “ready to play” decks, a booster pack of cards, a tabletop play mat, printed rules, and “a set of cardboard chits.” Bogost next considered what version of Rush of Ikorr to use in his analysis. After reviewing case materials, Bogost obtained the materials Miller submitted to Upper Deck prior to his departure (“Version 2.6”), then played both games. After playing the games, Bogost made observations about each game, and formed opinions as to particular “bundles of expression” drawing on his experience in game design.
Miller took issue with how Bogost played Version 2.6 because he did not use overlays, and did not play in team mode. But as Upper Deck pointed out, Bogost could not recall whether he used the overlays and Rush of Ikorr can be played as a single-player or team-based game.
Bogost initially made determinations as to which versions of the games to obtain based on the particular facts in the record, then proceeded to play the games, and draw conclusions based on his knowledge of game mechanics.
Miller also moved to exclude Section E of Bogost’s report. In Section E, Bogost first explained that “rough-looking” materials, such as Version 2.6, still represent a substantially complete work product in the game design process. While the completeness of Version 2.6 was relevant to the copyright claim, the state of that work product when Miller left Upper Deck and whether it was sufficiently complete or valuable may also be relevant to Plaintiff’s contract claim.
Accordingly, the Court denied Miller’s motion to exclude Bogost.
B. Defendant’s Motion to Exclude Upper Deck’s Copyright Damages Expert Dr. Roberto Cavazos
In this case, Cavazos provided his opinion on copyright damages, estimating economic harm by analyzing the “market value” of rights allegedly taken, and by calculating Defendant Ravensburger’s profits allegedly derived from infringement of Upper Deck’s TCG.
Cavazos testified that his methods arise under copyright law, and were based upon his understanding from counsel of the applicable measure of copyright damages.
Cavazos does not attempt to quantify any alleged breach of contract by Miller, nor assign value to Miller’s work on Version 2.6 in the context of the profits from the Lorcana game, nor does it seem he would be qualified to do so. Rather, the royalty rate that Cavazos calculated considered only Ravensburger’s total global revenues and profits from sales of Lorcana, and did not attempt to apportion any value to Miller’s alleged disclosures of confidential information.
Cavazos admitted that he was not an expert in game design, did not identify the intellectual property at issue, and did not provide a basis for his one-third opinion, beyond that it “stands to reason” that some people would buy the game because of the underlying game design, not just because of the use of Disney IP.
The Court held that Cavazos’s opinions are no longer relevant to the issues in this case, and to the extent that they could be, he is not qualified to provide them.
C. Plaintiff’s Motion to Exclude Defense Damages Expert James Pampinella
With regard to Upper Deck’s general objection to Pampinella’s use of the costs approach, Upper Deck acknowledged that the method is one of three that is accepted by economic literature. Thus, Upper Deck’s objection to Pampinella’s decision to rely solely upon the costs approach concerned the weight rather than admissibility.
Upper Deck also took issue with Pampinella’s results under the costs approach, arguing that “it is illogical and unreliable for Pampinella to assert that there are no actual damages.” While Pampinella found no actual damages as to the alleged conduct of Ravensburger and Miller, he also concluded that Upper Deck could have suffered economic damages of up to $39,000—the amount paid to Miller under his contracts with Upper Deck.
The Court is also unpersuaded that Pampinella’s lack of expertise in the gaming industry damages renders his opinion inadmissible for the same reason it found Bogost’s lack of specialized TCGs experience not to be dispositive.
Held
The Court denied Miller’s motion to exclude Dr. Ian Bogost’s testimony.
The Court denied Upper Deck’s motion to exclude James E. Pampinella’s testimony.
The Court granted Miller’s motion to exclude Dr. Roberto Cavazos’ testimony.
Key Takeaway:
It is true that the Daubert standard can be more difficult to apply where “expert testimony is ‘experience-based’ rather than ‘science-based.’ But here, Bogost obtained the materials Miller submitted to Upper Deck prior to his departure (“Version 2.6”), then played both games. After playing the games, Bogost made observations about each game, and formed opinions as to particular “bundles of expression” drawing on his experience in game design.
This case arises from a contract between The Bama Companies, Inc., a manufacturer of baked goods, and Stahlbush Island Farms, Inc., a farmer and food processor, for the purchase of approximately 130,710 pounds of berries for a mixed berry and lemon cream pie Bama would supply for McDonald’s restaurants.
Bama claimed that it was forced to cancel the McDonald’s promotion because Bama identified a handful of physical contaminants in some finished pies.
Plaintiff’s expert, Steve Rutherford, a licensed CPA was retained to “review and verify as to the consistency and comprehensiveness of how the staff (for the Plaintiff) accounted for the standard costing and pricing comparison,” and to state whether overhead costs should be included in damages.
Rutherford opined that Bama incurred damages of Nine Hundred Eighty-Nine Thousand and Nine Hundred and Seventy-Seven Dollars ($989,977.00) due to actions of Stahlbush Island Farms, Inc.
Defendant filed a motion to exclude the opinions of Rutherford. Specifically, Defendant argued that Rutherford’s testimony should be excluded because (1) Plaintiff has failed to demonstrate that Rutherford is qualified to opine regarding the valuation of damages in a civil case, and (2) Rutherford’s opinions “consisted largely of bare conclusions that vouch for Plaintiff’s expertise as a supplier.”
Accounting Expert Witness
Steve M. Rutherford is a Certified Public Accountant and has served as the sole shareholder and president of his own accounting firm for nearly thirty-three (33) years.
Additionally, he has provided expert advice and testimony in multiple and a wide range of personal and business legal matters for approximately thirty-six (36) years and has been appointed as a bankruptcy trustee on eight (8) occasions.
In Rutherford’s report, he initially concluded that the damages set forth by Plaintiff are “a reasonable estimate of the damages” and further noted that he has “no reasons to doubt the accuracy nor the comprehensiveness of methods and calculations” set forth by Plaintiff. Moreover, he observed that Plaintiff “has been doing business with McDonald’s for approximately three decades” and that “it seems to reason that from a discerning eye, someone in the business profession would have to think [they] know what they are doing (much experience) when it comes to pricing out the costs associated with making pies for McDonald’s.”
Building on this reasoning, Rutherford further asserted that “such a long-term mutually beneficial relationship would have been terminated, had [Plaintiff] been devoid in their costing amounts.” However, according to the Court, rather than applying methodologies and performing calculations himself, Rutherford simply assumed that the methodologies applied and calculations performed by Plaintiff must be right due to Plaintiff’s previous experience and existing business relationship with McDonald’s.
Consequently, for similar reasons, the Court found that Rutherford’s opinions regarding overhead costs are also not reliable or relevant. Once again, rather than applying methodologies and performing calculations, Rutherford opined that calculations prepared by Plaintiff are “very detailed, concise and organized” and further emphasized that due to Plaintiff’s previous experience and existing business relationship with McDonald’s, “any deficiencies or irregularities would have been exposed and corrected at the time the job in question had come to fruition.” Ultimately, while he seemed to offer general principles regarding overhead costs, such as rent, Rutherford’s opinions did not apply the specific facts of the case to a particular methodology and, therefore, did not provide sufficient support for the opinions he offered.
Held
The Court granted the Defendant’s Daubert motion to exclude the opinions of Bama Damages expert Steve Rutherford.
Key Takeaway:
Rutherford’s opinions are plainly not based in sound methodology, nor do his opinions demonstrate a connection of the opinions to the facts of the case. Rutherford’s opinions consisted mainly of assumptions with no evidentiary support. While an expert may apply assumptions, assumptions must have some reasonable evidentiary foundation.
Further, although Rutherford is entitled to some element of professional judgment in forming his opinion, he must still explain how he reached his opinion based in recognized methodology and by application of the facts. Because Rutherford’s opinions failed to do so, the Court agreed with Defendant and found that Rutherford’s opinions are not reliable and relevant.
Case Details:
Case Caption:
Bama Companies, Inc., The V. Stahlbush Island Farms, Inc.
This case arises from a contract dispute between Plaintiff Alorica Inc. and Defendant Tech Mahindra (Americas) Inc. concerning customer service outsourcing for AT&T.
Defendant asserted that Plaintiff’s conduct caused damages, including employee time lost to negotiating an amendment, addressing issues from the alleged breach, and repairing Defendant’s AT&T relationship.
To quantify these damages, Defendant retained David N. Fuller, a Chartered Financial Analyst, Accredited Senior Appraiser, and Certified Fraud Examiner. Fuller relied on payroll records for three employees and a declaration from Defendant’s corporate representative identifying the number of workdays those employees devoted to the relevant tasks. Using this information, Fuller calculated daily salary rates and multiplied them by the days reported, resulting in a damages figure of $33,900.77.
Plaintiff filed a motion to strike and exclude Fuller’s testimony under Federal Rule of Evidence 702. Plaintiff contended that Fuller merely performed basic arithmetic without applying specialized expertise, arguing that his testimony would improperly lend undue credibility to Defendant’s damages claim.
Financial Analysis Expert Witness
David Neil Fuller is a Chartered Financial Analyst, Accredited Senior Appraiser, and Certified Fraud Examiner. He is currently employed as the President of Value Incorporated (“VALUE”), a financial valuation consulting firm located in Irving, Texas.
His educational background includes a Master of Business Administration degree from Southern Methodist University with a concentration in Finance, and a Bachelor of Arts degree from Austin College with a concentration in Economics.
First, there is no dispute that Fuller is a Chartered Financial Analyst, Accredited Senior Appraiser, and Certified Fraud Examiner. Plaintiff did not challenge his credentials directly but argues that he failed to apply them in forming his opinions.
Therefore, the Court held that Fuller’s background and certifications establish that he is qualified under Rule 702 to provide opinions on damages and financial analysis.
B. Fuller’s specialized knowledge will help the trier of fact
Plaintiff contended that his opinion is unhelpful because it is limited to “elementary-level arithmetic” requiring no expertise. Defendant responded that even simple calculations can be admissible when framed by specialized knowledge, and that Fuller’s testimony will aid the jury by organizing payroll data and time allocations into a coherent damages model. The Court agreed that Fuller’s testimony may assist the trier of fact by explaining how employeesalaries and reported workdays translate into a damages figure. That the math is simple does not, by itself, render the opinion inadmissible.
C. Fuller’s testimony is based on sufficient facts and data
Fuller relied on payroll records and the Franklin Declaration to determine employee compensation and time spent on tasks. Alorica argued that Fuller failed to verify these sources and simply accepted the numbers provided.
The Court found that Fuller’s reliance on payroll records and a sworn declaration provided a sufficient factual basis to satisfy Rule 702(b). The Court agreed that any challenge to those inputs’ reliability spoke to the weight of the testimony, not its admissibility.
D. Fuller’s testimony is the product of reliable principles and methods reliably applied to the facts of the case
Fuller divided bi-weekly salaries by ten to calculate daily rates and multiplied those rates by the number of workdays listed in the Franklin Declaration, yielding a damages estimate of $33,900. Plaintiff characterized this as parroting numbers without methodology, while Tech Mahindra framed it as applying financial expertise to convert compensation data into damages.
The Court concluded that Fuller’s methodology is straightforward but reliable for the limited purpose it serves.
II. Admissibility Under Rule 403
Plaintiff argued that permitting Fuller to testify would unfairly prejudice the jury because cloaking simple arithmetic in the authority of expert testimony would lend improper weight to Defendant’s damages claim. Defendant responded that any weaknesses in Fuller’s analysis can be explored on cross-examination and that the testimony poses no risk of confusion or undue prejudice.
The Court agreed with Defendant. Fuller’s testimony, though based on simple calculations, is probative of Defendant’s damages theory. Concerns about the simplicity of the arithmetic are properly addressed through cross-examination and competing evidence, not exclusion under Rule 403.
Held
The Court denied Plaintiff Alorica Inc.’s motion to strike and exclude Defendant Tech Mahindra (Americas) Inc.’s expert David Fuller.
Key Takeaway:
The Court found that Fuller applied his methodology consistently and transparently to the facts. While his calculations are not complex, they are replicable and tied to the data sources identified. To the extent Plaintiff believed Fuller should have done more independent verification, those criticisms are better addressed through cross-examination than exclusion.
Case Details:
Case Caption:
Alorica Inc. V. Tech Mahindra (Americas) Inc.
Docket Number:
4:24cv30
Court Name:
United States District Court for the Eastern District of Texas, Sherman Division
This is a medical negligence case filed by Plaintiff Tanya Soule, as holder of Power of Attorney for Marlene Do, her mother, a currently disabled adult, and Long Do, her husband. Specifically, Plaintiffs alleged that Defendants were negligent in failing to timely diagnose and manage Marelene’s ischemic stroke on December 11, 2019.
Subsequently, Defendants Blessing Hospital; Scott Hough, M.D.; Shaila O’Dear, R.N.; Jason Little, APRN; Kristin Hampton, R.N.; Angelo Liana, M.D.; and Rebecca Dennison, R.N. filed a motion to exclude all but the present value of future life care opinion testimony of Plaintiffs’ expert witness on economics, Stan Smith, PhD.
Economics Expert Witness
Stan V. Smith, PhD is the President of Smith Economics Group, Ltd., headquartered in Chicago, Illinois, which provides economic and financial consulting nationwide.
Moreover, Smith has worked as an economic and financial consultant since 1974. He has performed economic analysis in a variety of cases, including personal injury and wrongful death actions. Smith has over 40 years of experience in the field of economics and wrote the first textbook on Forensic Economic Damages.
Defendants sought to bar Smith from providing testimony at trial regarding purported loss of household/ family services sustained by Long Do, hedonic damages sustained by Marlene, and loss of society or relationship sustained by Long. Specifically, Defendants contend all of these opinions are based on methodologies that are unreliable and are not supported by facts specific to Marlene.
Loss of Household/Family Services
With respect to household/family services, Smith’s opinions included two subcategories alleged to be sustained by Long Do: (a) loss of housekeeping and household management services; and (b) loss of advice, counsel, guidance, instruction, and training services. Defendants argued that these damages are speculative and would not assist the jury.
For example, regarding loss of housekeeping and household management services, Smith opined that Long suffered a loss in the amount of $378,775. Essentially, Smith multiplied the amount of time it would take a non-professional to complete a particular task by the costs it would take to hire a professional.
In addition, Smith included a 50% non-wage component to the hourly wage rate. However, he acknowledged that Marlene was not a professional of any trade upon which he relied. Furthermore, he did not ask Marlene or Long whether they paid for any of the services considered. Smith admitted the calculation is his “estimate of the market value of the services performed by a female in the household on average.”
To illustrate, Smith created three tables to show his calculations for past and future loss of housekeeping and household management services. He then created a similar calculation to opine on the monetary loss of advice, counsel, guidance, instruction, and training services for Long.
Specifically, Smith assumed a loss of one hour per day for these advisory services based solely on his interview with Marlene’s daughter.
On the other hand, Plaintiffs noted that loss of household services is a compensable form of injury. They alleged that Smith’s testimony involves the loss of household services sustained by the family from the time of Defendants’ alleged negligence through Marlene’s life expectancy.
Conclusion
The Court allowed Smith’s testimony regarding the loss of housekeeping and household management services while excluding his testimony concerning the loss of advice, counsel, guidance, institution, and training services.
C. Hedonic Damages
Smith opined on the reduction in value of life or loss of enjoyment of life for Marlene. Plaintiffs claimed that the hedonic value of life refers to the value of the pleasure, the satisfaction, or the utility that human beings derive from life, separate and apart from the labor or earnings of life.
In his report, Smith stated that his “estimate of the value of life is consistent with estimates published in other studies that examine and review the broad range of economic literature on the value of life.”
Smith estimated the value of life “to be approximately $5.9 million in year 2023 dollars.” Defendants noted that Smith only interviewed Marlene’s daughter. He did not interview Marlene or Long.
Smith provided a “lower estimated impairment rating” and an “upper estimated impairment rating,” based on his range for either 50% or 80% reduction in value of life. Pursuant to his methodology, Smith estimated a total loss of value of life of $1,954,626 for 50% reduction and a total of $3,127,391 for 80% reduction. To determine future loss, Smith accounted for a discount factor to create a present value. He then arrived at the value of hedonic damages by reducing the $5.9 million by the percentage of disability he believes Marlene has suffered-either 50% or 80%. Defendants noted that Smith did not consult with a single medical professional to arrive at his impairment rating.
Conclusion
Defendants alleged that federal and state courts have routinely barred Smith’s testimony as to hedonic damages.
After considering Smith’s testimony on hedonic damages, the Court agreed with the reasoning of the overwhelming majority of federal district courts. Therefore, the Court granted Defendants’ motion to the extent it sought exclusion of Smith’s testimony on hedonic damages.
Loss of Society or Relationship for Long Do
To begin with, Smith presented his opinions on loss of society or relationship relating to Long Do. In particular, Plaintiffs noted that Illinois law recognizes loss of society or relationship as a recoverable pecuniary loss. In other words, this is the total value of loss of society or relationship Long did and will suffer due to Marlene’s alleged injuries. Specifically, Smith testified that the loss is “the loss of love and affection that he has sustained, the loss of the quality of the relationship that he had that has impacted his quality of life.”
Defendants noted that Smith calculated loss of society in the same manner as his calculation for reduction in value/hedonic damages for Marlene. This loss is calculated from 2019 through 2030, which ends at Long’s estimated life span of 81 years old. Smith picked $5.9 million as the value of each human life in 2023 dollars. He then arrived at the value of hedonic damages by reducing the $5.9 million by the percentage of disability he believes Marlene has suffered. For loss of society, Smith chose 50% disability. He determined Long’s loss of society was $403,273. For future loss, Smith accounts for a discount factor to create a present value.
Conclusion
As Defendants alleged, the jury is capable of processing that information to calculate damages guided by their observations, experience, and sense of fairness. The Court held that Smith’s opinions on this topic are speculative and potentially misleading in focusing on the statistically average person instead of the individuals in this case.
Held
The Court granted in part and denied in part the Defendants’ motion to exclude the opinions of Plaintiffs’ economic expert Stan Smith, Ph.D.
Key Takeaway:
Rule 702 requires a flexible inquiry and recognizes that the accuracy of proposed expert testimony can be explored adequately via the normal adversarial process of “vigorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof.”
It is “the soundness and care with which the expert arrived at her opinion” that is the focus of the inquiry and not “the ultimate correctness of the expert’s conclusions.”
Case Details:
Case Caption:
Do Et Al V. Blessing Hospital, A Corporation Et Al
Plaintiff Pietoso, Inc. operates Café Napoli restaurant in Clayton, Missouri. It has a Service Agreement for waste removal from the restaurant with Defendant Allied Services, LLC—a subsidiary of Defendant Republic Services, Inc. The Service Agreement sets a basic-service rate of $323 per month, but it allows Allied to unilaterally increase this rate for certain enumerated reasons. All other rate increases require Pietoso’s consent.
Pietoso’s service rate increased incrementally from $323 per month in 2011 to $870.25 per month in 2018. Discovery revealed that Defendants increase their prices every 10-12 months through a Yield Management Process (YMP) whereby parent company RSI generates budget guidance for its subsidiaries using an algorithm that incorporates local division budgets, costs, and historical average price increases as well as individual customer histories, including prior increases, responses thereto, and profitability.
Plaintiff Pietoso centrally asserted that Defendants’ YMP price increase practice violated the Customer Service Agreement (CSA) Rate Adjustment clause. Pietoso engaged Patrick Kilbourne to calculate damages for the class.
Defendants filed a motion to exclude Kilbourne’s expert testimony because his methodology is insufficiently precise to satisfy the legal standards for admissibility of expert testimony.
Forensic Accounting Expert Witness
Patrick J. Kilbourne is a Managing Director at Berkeley Research Group, a business consulting firm. He has an MBA from the University of Pennsylvania Wharton School of Business.
Kilbourne is a Certified Public Accountant, Certified Management Accountant, and Certified Fraud Examiner. He is also Certified in Financial Forensics and Accredited in Business Valuation by the American Institute of Certified Public Accountants.
Accounting for YMP increases in excess of actual operating cost increases, plus the average fuel recovery fee (FRF) as a percentage of the service price, plus the average environmental recovery fee (ERF) as a percentage of both, Kilbourne estimated total damages for the class at $75.1 million. While his report provided averages beyond the class period, it demonstrated the feasibility of extracting more specific data for each year and customer.
Kilbourne indicated that he was able to calculate damages for each class member by site and service. His report shows several examples calculating damages for specific customers based on YMP price increases within a certain date range. Between 2017 and 2019, Pietoso paid $2,526 over the contractually permissible increases (i.e., operating costs plus CPI). Based on the service rate for each month during that period, Pietoso paid $2,546 in FRF and $3,240 in ERF.
Application of Contract Terms
Defendants challenged Kilbourne’s methodology in several respects. First, the CSA defined the “Company” as a specific local division, but Kilbourne didn’t analyze division-level costs, which vary widely between urban and rural areas. Instead, he combined statewide costs to yield an average.
Further, Kilbourne didn’t isolate disposal or transportation cost increases or those attributable to changes in the law, as the Rate Adjustment clause contemplates. He also didn’t isolate the additional category related to recyclable waste contained in some contracts. Rather, he combined all operating costs, thus diluting the contractual categories such that the result is inaccurate.
Defendants contended that they produced division-level financial data sufficiently specific to facilitate more accurate calculations.
Given the data available in the format produced, the Court held that Kilbourne’s inability to isolate costs corresponding to contractual categories is understandable. This is not a defect in methodology warranting exclusion but rather a limitation due to Defendants’ accounting – one that actually favors Defendants by overstating cost increases and potentially understating damages.
In related points, Defendants criticized Kilbourne’s calculations for failing to account for negotiated credits and rollbacks or customer consent. But whether customers consented to increases is a central fact issue beyond Kilbourne’s assignment here.
CAGR for Average Increase in Operating Costs
Because Defendants’ financial statements don’t separate costs categories as between commercial, industrial, and residential customers or between small and large containers, and also because multiple divisions were combined into one financial statement prior to 2018, Kilbourne examined Defendants’ total operating costs of $152.9 million in 2016 to $203.2 million in 2022 to arrive at an average annual cost increase rate, or compounded annual growth rate (CAGR), of 4.9%.
He compared this with the average annual price increases for customers to estimate damages as the difference between cost increases and price increases.
In their motion to exclude, Defendants argued that Kilbourne’s methodology is flawed in that the time period Kilbourne used (2016-2022) doesn’t match the class period, and the annual average of 4.9%, while perhaps useful to predict future growth, is imprecise and factually inaccurate to calculate damages from historical data.
The Court found Kilbourne’s general approach of calculating damages as the difference between customers’ actual rate hikes and contractually “allowable” increases as a percentage increase in annual operating costs plus CPI logical. While CAGR for 2016-2022 may not be the applicable variable if or when damages are calculated in this case, Kilbourne offered a feasible model using the data available, and his report demonstrates that operating cost increases are ascertainable for any given year and also by local division after 2017, as may be required.
YMP Recommendation
Next, Defendants argued that Kilbourne’s methodology is defective because he erroneously relied on “reason code 64” to identify YMP increases, when in reality local divisions use the code differently, according to some witness testimony. But that same evidence and other testimony in the record confirms that code 64 is indeed the correct code for YMP increases, and any other use of code 64 is viewed as misuse or unintended use.
The Court found Kilbourne’s reliance on Defendants’ own coding system entirely reasonable. Any margin of error in this respect is attributable to flaws in Defendants’ data, not in Kilbourne’s methodology.
Defendants also argued here that Kilbourne’s method is unreliable because he ignored the fact that local divisions often depart from YMP recommendations. But Kilbourne expressly acknowledged this fact and noted that it would be possible to exclude YMP increases that were different from the algorithm amount if needed. The data captured every invoice and corresponding payment. Again, the Court is not persuaded that Kilbourne’s model couldn’t accommodate those adjustments, and error-free perfection is not the standard.
SQL Qualifications
As the Court understands it, Kilbourne and his staff used a computer code called structured query language (SQL, or “sequel”) to identify the characteristics of the Plaintiff class and extract their invoicing and payment records from the voluminous data produced by Defendants. Kilbourne relied on technical staff to perform the query to identify class members, then he verified it for accuracy using a quality control test process. Defendants asserted that Kilbourne’s methodology is unreliable because he isn’t qualified in SQL; rather he adopted a methodology of non-experts that he can’t independently opine on because he lacks the necessary expertise.
Kilbourne is, however, an expert in accounting and financial analysis, not computer science. The Court finds it reasonable that his examination of voluminous financial data might require technical assistance to manipulate, sort, and extract the characteristics and figures relevant to this case.
Staff with SQL expertise assisted Kilbourne, and he tested the accuracy of SQL queries through quality control processes. The Court is satisfied that his method is reliable.
Moreover, even accepting Defendants’ tenuous premise here, expertise with SQL is collateral to Kilbourne’s essential qualifications as a CPA and financial analyst. The Court therefore finds that any arguable deficiency goes only to the weight of his testimony, not its admissibility.
Fuel and Environmental Recovery Fees
Defendants’ financial records showed that fuel and environmental costs are included in Defendants’ annual operating costs incorporated in their price increases under the Rate Adjustment clause. However, Defendants also charged additional fuel and environmental recovery fees (FRF and ERF, respectively) as a percentage of the amount invoiced for the underlying services. Kilbourne was asked to calculate the total amount of these surcharges for each class member during the class period. The data enabled him to isolate amounts specific to these fees and calculate average annual increases for each year.
Defendants asserted that Pietoso has failed to plead a viable theory of damages with respect to these fees, leading Kilbourne to merely perform simple math without any meaningful analysis.
The Court will not exclude Kilbourne’s testimony on these fees. Defendants offered no argument that Kilbourne’s methodology is unreliable; they only dispute the applicability of these fees to a damages calculation. Kilbourne has demonstrated his ability to isolate these fees in the data and calculate them in relation to underlying price increases. If the jury deems some portion of the fees recoverable, Kilbourne’s methodology is reliable, and his testimony is relevant and likely to assist the trier of fact
Held
The Court denied the Defendants’ motion to exclude the testimony of Plaintiff’s damages expert, Patrick Kilbourne.
Key Takeaway:
While individual credits and rollbacks may require further examination, the Court is not persuaded that Kilbourne’s model cannot accommodate such adjustments, as the data captures every customer transaction. In the Court’s view, this doesn’t render Kilbourne’s methodology preclusively unreliable. Nothing in Rule 702 “requires the court to nitpick an expert’s opinion in order to reach a perfect expression of what the basis and methodology can support.”
Even viewing Kilbourne’s technical staff as independent experts, the Court found no basis to exclude his opinions, as experts frequently rely on the expertise of others outside their field.
Plaintiff FireBlok IP Holdings LLC (“FireBlok”) sued Defendants Hilti, Inc. (“Hilti”) and RectorSeal LLC (“RectorSeal”) (together, “Defendants”) and asserted two separate causes of action under the Lanham Act, False Advertising and False Association, based upon Defendants’ use of the UL Certification mark and FM Approval mark on Hilti’s Firestop Box Insert.
The Firestop Insert is a fire suppression product that is an intumescent box insert designed to help protect electrical outlet boxes in case of a fire. FireBlok’s alleged competing produce is the FireBlok fire suppression gasket.
FireBlok retained Dr. Alexander V. Krasnikov to testify to damages allegedly sustained by the Defendants’ false advertising and false association.
Hilti, Inc. and RectorSeal, LLC filed a motion to exclude the testimony of Krasnikov.
Marketing Expert Witness
Dr. Alexander V. Krasnikov is a professor at the Quinlan School of Business at Loyola University Chicago, specializing in marketing strategy, analytics, and intellectual property. Since receiving his Ph.D. in marketing in 2007, Krasnikov has continuously researched, published articles, and given lectures on consumer goods marketing and IP strategy. Krasnikov has nearly twenty years of experience as a business school professor, teaching undergraduate, graduate, and Ph.D. students about “data analytics, marketing metrics, customer analytics, marketing research, and strategy.”
Based on his education, experience, and review of the documents produced in litigation, Krasnikov reached three opinions:
(1) Hilti and RectorSeal’s Profits: From 2008 to 2019, the Defendants’ sales for Firestop Box Inserts reached over $316 million. According to industry- standard profit margins, the Defendants likely net about 31% of this figure ($98 million dollars).
(2) FireBlok’s Market Share: Without the Defendants’ presence in the market, FireBlok would’ve held 3.82% of the market share for intumescent inserts for electrical outlets and switchboxes. Alternatively, those sales may have evenly split between three major competitors, making FireBlok’s relative market share about 33.3%.
(3) FireBlok’s Lost Profits: From 2012 to 2019, but now adjusted for inflation, FireBlok lost between $4.2 million and $37 million in profits to the Defendants.
Qualification
While it is true that Krasnikov isn’t specifically versed in the fire suppression industry and that he’s never personally prepared a profit/loss statement, the Defendants, however, never explain why those facts matter. Krasnikov commonly analyzes profit/loss statements prepared by third parties and, to the extent necessary, filled gaps in his industry-specific knowledge by relying on FireBlok’s fire suppression expert. If anything, estimating lost profits for fire suppression products is easier than most other industries. An average consumer upset by the (now shocking) price of eggs may choose a cheaper grocery store, use an alternative product, or go without; whereas, professionals in the fire suppression industry must purchase a switchbox and insert to comply with building codes. Therefore, the Court found Krasnikov generally qualified to opine on damages.
Reliability
First, in estimating the Defendants’ profits, Krasnikov multiplied their self-reported unit sales by the price per unit (calculating total revenue), then subtracted industry-standard costs as reported in financial and economic databases.
Second, Krasnikov compared FireBlok’s self-reported 2017–2019 sales to its competitors’ publicly reported annual revenue data for the same timeframe. Finding that two competitors make about thirty-five times FireBlok’s annual revenue for one product category, Krasnikov estimated that FireBlok’s relative market share for intumescent inserts for electrical outlet and switch boxes is roughly 4%.
Finally, Krasnikov calculated FireBlok’s lost profits by multiplying the Defendants’ unit sales of uncertified products by FireBlok’s market share. So, the Defendants wrongly asserted that Krasnikov relied on insufficient data, “blindly relied” on client information, and failed to support his methodology.
For one, the Defendants challenged the relevance of their own profitability before FireBlok entered the market in 2016. But without some reason to believe this calculation makes Krasnikov’s conclusions unreliable, the argument does not concern Krasnikov’s methodology. Likewise, to group the remaining arguments by their primary themes, the Defendants maintained that Krasnikov made implausible assumptions and failed to consider key variables.
It’s true that Krasnikov didn’t consider every variable conceivably affecting market share—such as FireBlok’s manufacturing capacity, profit-sharing agreements, and any promotional discounts in the relevant timeframe. But every analysis makes some assumptions. In this case, the assumptions are supported by reason.
Krasnikov’s lost profit analysis turns on FireBlok’s past performance in the market. After analyzing manufacturer market power, product offerings and prices over time—and further discussing the market with FireBlok—Krasnikov applied that data to a series of calculations plausibly based on market realities.
Held
The Court denied the Defendants’ Daubert motion to exclude the testimony of Plaintiff’s expert Dr. Alexander V. Krasnikov
Key Takeaway:
The Defendants objected to Krasnikov’s use of the market approach methodology. The Defendants contended that Krasnikov was required to use either the yardstick or the before-and-after methodology. But the yardstick and the before-and-after methodologies are not the exclusive ways that experts can determine damages. And courts have found the market approach an acceptable methodology.
Plaintiffs Timothy Scott, Patricia Gilchrist, Karen Fisher, Helen Maldonado-Valtierra, Dan Koval, Judy D. Duff, John Griffin, Kenneth Rhodes, Judy Dougherty, John Kelly, Richard Walshon, Jennifer Fryer, and Vince Carabba alleged that Defendants AT&T Inc., the AT&T Defined Benefit Plan, and AT&T Services, Inc. (collectively AT&T) have violated the Employee Retirement Income Security Act of 1974 (ERISA).
Apparently, AT&T Defined Benefit Plan (the Plan) did not calculate and disburse “Joint and Survivor Annuities” (JSA) in a manner consonant with ERISA. Plaintiffs said that the Plan failed to treat JSA and Single Life Annuity (SLA) participants in an actuarily equivalent fashion by using “mortality assumptions” that are “fifty years out of date,” which resulted in the “payment of a benefit that is less” than the JSA beneficiaries were entitled to.
In response, Defendants filed a motion to exclude the opinions of Plaintiff’s proffered expert, Ian H. Altman, under Rule 702.
Actuarial Expert Witness
Ian H. Altman is a Fellow of the Society of Actuaries and an Enrolled Actuary. He was the founding partner and manager of Altman & Cronin Benefit Consultants, which was established in 1996. His firm merged with Gallagher Benefit Services, Inc. in 2016. Since his separation from Gallagher in 2020, he has worked as an independent consulting actuary in the employee benefits field.
AT&T said that Altman’s opinions about the Plan’s conversion factors’ failure to achieve actuarially equivalent results is unreliable because his preferred methodology assertedly did not establish the “bottom” of the range of actuarially equivalent results, and the claim that his methodology is “conservative” rests on no more than ipse dixit.
However, the Court held that Altman relied on his decades of experience and reliable evidence about industry practice to opine that the Plan’s conversion factors do not generate actuarially equivalent JSA benefits because the underlying assumptions are outdated and unreasonable.
For Altman’s methodology for calculating “damages,” AT&T said that there are several discrete mistakes that render his opinion unreliable. However, Plaintiffs emphasized guidance in the Actuarial Standards of Practice (ASOP), published by the Society of Actuaries, that provided that an actuary may apply “judgmental adjustments or assumptions” where “accurate and complete [data] may not be available” so long as the use of such adjustments or assumptions is disclosed.
Altman adequately explained and disclosed the adjustments and assumptions he made when dealing with what he reasonably believed to be deficient data, and AT&T did not demonstrate those assumptions were so outlandish that no reasonable actuary would make them.
Altman also explained why, based on his experience, the pop-up benefit should not be considered, because it is a benefit separate from the JSA benefit that offers “no value to the surviving beneficiary.”
AT&T’s final objection goes to Altman’s inclusion of participants who received benefits in the form of both a partial lump sum and JSA is not grounds for exclusion, as the contention at bottom is not about his methodology’s reliability but about whether the resultant JSA benefits are “qualified” or subject to the statutory actuarial equivalency requirement despite the partial lump sum election.
Held
In conclusion, the Court denied the Defendants’ motion to exclude the opinions of Plaintiff’s proffered expert, Ian H. Altman, without prejudice to renewal at trial as to specific calculations, as the evidence and circumstances warrant.
Key Takeaway:
Altman’s opinions are grounded in evidence and sound actuarial methods and therefore will be put through the crucible of vigorous cross examination at trial.
Plaintiff Michael Ruiz (“Ruiz”) is suing his former employer, Defendant Magellan Financial & Insurance Services (“Magellan”), under the theory that his alleged demotion and subsequent termination were due to his race and national origin and that he was also subjected to a hostile work environment.
Ruiz retained an expert, Michael J. Stokes (“Stokes”) of Beta Business Consulting LLC (“Beta”), to calculate the net present value of his lost wages and benefits. Magellan, however, filed a motion to exclude the expert testimony of Stokes.
Economics Expert Witness
Michael J. Stokes earned an MBA from the Isenberg School of Management at the University of Massachusetts Amherst with a focus in entrepreneurship. He has been employed as a litigation-related economic expert for 6 years at Beta Consulting.
Magellan argued that Stokes is unqualified because “his financial or accounting training concerned issues related to capital and corporate investment, and no other topics” and “he has no other certifications or licenses, and no publication history.”
Analysis
The Court held that Stokes is qualified to offer opinions about the net present value of Ruiz’s purportedly lost wages and benefits. First, Stokes’ opinions are “within the reasonable confines of his subject area.” Stokes holds an MBA from the University of Massachusetts, where he took classes on management, supply-chain management, entrepreneurship, finance, and basic economics.
As for the “finance and accounting” portion of his studies, Stokes studied “[a]nything from investment to just looking at capital investment, corporate investment.” These areas of study appear to encompass the opinions set forth in the report. Although Magellan may be correct that Stokes’ credentials are not highly specialized, the absence of specialization goes to the weight of Stokes’ testimony and did not provide a basis for exclusion.
Second, Stokes’ experience also forms part of the basis for his qualification to testify as an expert. Stokes is an “economic analyst” for Beta, where he has worked since 2018, and is now the full owner of the company. Before assuming ownership, Stokes was trained by the founder and previous owner, Larry Stokes (his father), who has a Ph.D. in economics. In addition to being trained and advised by his father, Stokes “occasionally reviews” trainings from the National Association of Forensic Economics (“NAFE”), a standards-setting association for forensic economists of which he is a member.
Relevance
Magellan next argued that Stokes’ testimony is not relevant because it does not consider the relevant factors in an economic damages calculation “such as back pay or mitigation” and only “seeks to estimate what [Ruiz] might have earned from Magellan had he not been terminated.”
Analysis
Stokes’ report purported to calculate the net present value—$3,729,078—of the wages and benefits Ruiz would have earned had he remained employed by Magellan until his retirement. Although this figure likely overstated Ruiz’s economic damages, as it made no attempt to account for offsets and mitigation, it was still at least one piece of the puzzle.
Magellan contended that even if relevant, Stokes’ testimony would be confusing, misleading, and/or prejudicial because Ruiz “claimed that Stokes’ calculation represents his damages.” In essence, Magellan argued that a jury would be confused by the difference between Stokes’ economic earnings projection and “economic damages,” which are calculated by incorporating a variety of figures, including mitigation. The problem with this argument is that although Ruiz has at times during this case appeared to characterize the report as showing his economic “damages,” the report itself did not purport to calculate Ruiz’s litigation damages and Stokes did not suggest as much in his deposition. In fact, he clearly stated the opposite.
Moreover, Ruiz clarified in his response brief that the report did not purport to establish his damages and will simply “be helpful to the jury to determine [Ruiz’s] damages.”
As a result, the Court will not categorically exclude Stokes’ opinions before trial based on Rule 403.
Reliability
Magellan’s final argument for exclusion is that “Stokes’ opinion is not reliable because it did not comply with his own assumptions.” Specifically, Magellan contended that Stokes “assumed that generally an employee’s earnings peak mid-career, and then ‘tend to’ decline toward the end of the employee’s working life.” The opinion that Stokes offered, however, assumed that [Ruiz’s] earnings would continue to increase through the end of his working life.
Analysis
The Court held that Magellan’s reliability-based arguments did not provide a basis for exclusion because the report is based on clear and accessible data, including Ruiz’s responses to a questionnaire, Ruiz’s W-2s from 2018-2023, publicly available government data, and scholarly research—all of which Stokes disclosed throughout the report.
In each section of the report, Stokes also explained his methodological approach. By disclosing his methodology and the data on which his analysis relies, Stokes’ calculations may be retested, refined, and challenged. This ability to be tested—also known as falsifiability—is a hallmark of the scientific method and a factor that courts may consider in testing for reliability.
Additionally, the Court is sufficiently convinced that Stokes’ methods are “generally accepted in the scientific community.” The record indicated that Stokes devised his methods in compliance with NAFE, a professional standards-setting organization for forensic economists.
Magellan argued that Stokes’ approach is unreliable because he failed to adhere to his own assumption by not lowering Ruiz’s projected wages closer to retirement. However, Stokes merely stated that a late-career decrease in earnings “often tends” to occur but that this tendency “is affected by a worker’s age, sex and level of educational attainment.” Given these caveats and qualifications, there was nothing inherently contradictory and unreliable in Stokes’ decision to assume that Ruiz’s earnings would not decrease over time.
For the same reasons, exclusion is not warranted based on Magellan’s contention that Stokes relied on other “unreliable assumptions.” As an initial matter, Stokes’ decision to use industry averages of similarly situated persons to quantify Ruiz’s projected health and retirement benefits, instead of basing the calculation on Ruiz’s actual health and retirement benefits, is not clearly unreliable. Magellan offered no authority suggesting that such an assumption is per se unreliable.
Held
The Court denied Magellan’s motion to exclude the testimony of Plaintiff’s expert Michael J. Stokes.
Key Takeaway:
Although an expert’s “failure to follow his own general practice” is a methodological flaw that may provide a basis for exclusion, the Court is not persuaded that Stokes engaged in such a failure here. Stokes merely stated that a late-career decrease in earnings “often tends” to occur but that this tendency “is affected by a worker’s age, sex and level of educational attainment.”
Louisiana Minerals, Ltd., as lessor, and Weyerhaeuser, as lessee, are the successors in interest to a 1986 Timber Sale and Lease Contract (“Contract”).
LML asserted that Weyerhaeuser has entered into a significant number of unauthorized third-party agreements that impinge upon or adversely affect LML’s rights under the Contract. Damages were sought for harm caused by Weyerhaeuser’s alleged breach of contract and a declaration of the parties’ rights under the Contract to preclude Weyerhaeuser’s “unauthorized” activity going forward.
LML retained Ms. Helga A. Zauner to calculate their alleged damages in this action. She produced two reports, the first on December 15, 2023, and a supplemental report on February 29, 2024. Weyerhaeuser filed a Daubert motion to exclude the opinions of Zauner on the basis that they are both irrelevant and unreliable.
Weyerhaeuser, on the other hand, retained Ms. Lesa S. Adair who rendered a rebuttal to Zauner’s first expert report. LML filed a motion to exclude the opinions of Adair on the basis that she is unqualified, her methodologies are unreliable, and her opinions are not based on sufficient facts.
Forensic Accounting Expert Witness
Helga Abreu Zauner, CVA, CFE, MAFF, is a testifying expert witness with 27 years of experience in litigation consulting, financial analysis, banking, research and teaching. She focuses on financial modelling and statistical techniques, with extensive experience in quantitative data analysis.
Zauner is recognized as a Certified Fraud Examiner (CFE) by the Association of Fraud Examiners and as a Certified Valuation Analyst (CVA) and Master Analyst in Financial Forensics (MAFF) by the National Association of Certified Valuators and Analysts. In addition, she has built a successful practice as an expert witness in personal injury, family law, and commercial litigation.
Lesa Shuyler Adair has a Bachelor’s Degree in Chemical Engineering and an MBA in Finance. She is a founder and principal of Pearson Adair & Co., and has more than 35 years’ experience in the energy industry. Adair also has served as an expert or consultant in many court and arbitration proceedings, assessing and analyzing damages in a variety of industries and contexts, including the oil and gas industry. She has written several energy related publications.
Weyerhaeuser asserted that Zauner’s testimony is irrelevant because her damage calculations were based upon third-party agreements selected by LML’s attorneys according to unknown and unverifiable criteria and because her calculations reflected a theory of disgorgement, which is not an available remedy for breach of contract under Louisiana law.
Having reviewed Zauner’s reports and the parties’ submissions, the Court found that Zauner’s testimony is relevant as it relates to and will aid the Court’s determination of damages. Zauner’s reports were based on assumptions of how the disputed facts might be resolved by the Court.
The third-party agreements that formed the basis of Zauner’s calculations were selected based on the assumption that they infringed on LML’s mineral rights. Her damage calculations were not based on a legal theory but were based on the assumption of what LML would have received from third parties in the absence of Weyerhaeuser’s third-party agreements.
Reliability
Weyerhaeuser contended that Zauner’s testimony is unreliable because she assumed breach of contract and causation of damages. Moreover, Weyerhaeuser argued that her extrapolation methods were faulty, she made unspecified corrections in her second report, she failed to consider Weyerhaeuser’s offsetting damages, and her analyses were based on LML’s counsel’s selection of agreements based on undisclosed criteria.
The Court disagreed with Weyerhaeuser’s assertion that there is “an unbridgeable gap” between Zauner’s opinions and the evidence in this case. Whether there is a breach of the contract that caused any damage to LML are core facts in dispute in this action. Moreover, Zauner’s calculations were not based on facts contradictory to the evidence in the record, but instead relied on assumptions of facts in dispute. In other words, the Court declared that Weyerhaeuser’s objections to Zauner’s opinions on the grounds of unreliability were ultimately rooted in the bases and sources of her opinions.
Adair Motion
First, LML claimed that Adair is not qualified to rebut the conclusions of Zauner, who is a credentialed forensic accountant. LML alleged that Adair is not qualified because she is not a forensic accountant and holds no licenses, certifications, or formal training in accounting.
Moreover, LML stated that no one on Adair’s analytical team holds any type of license or certification in accounting. LML also asserted that Adair lacked expertise in the subject matter of this case because she has never been retained by a timber company and there is no explanation of how her technical experience, as a chemical engineer, relates to her conclusions or how she applied her experience to the facts of this case.
Weyerhaeuser contended that this case did not involve forensic accounting, but a calculation of what third parties paid Weyerhaeuser for use of the surface. She was assisted by a team including a mechanical engineer, a financial analyst with an accounting degree, and a market research data analyst with a finance degree.
The Court found LML’s assertions that Adair is unqualified unconvincing. First, Adair herself has a master’s degree in finance and her team included others with a background in finance.
Further, the Court was persuaded by Weyerhaeuser’s argument that the damage calculations in dispute did not involve forensic accounting principles. Additionally, even though Adair has not been retained by a timber company before, her expertise in the oil and gas industry will aid the Court in resolving the disputed facts which form the basis of Zauner’s damage calculations.
Reliability
First, LML claimed that Adair’s report is unreliable because she only criticized Zauner’s opinion and did not conduct an independent analysis. LML also averred that Adair’s opinions are not based on sufficient facts and have not been reliably applied to the facts of this case.
The Court found that Adair’s critique of Zauner’s report was based on her independent analysis; further, any shortcomings of Adair’s analysis may be addressed on cross examination and will go to the weight of her testimony.
Held
The Court denied both Weyerhaeuser Company’s Daubert motion to exclude the testimony of Helga Zauner and Louisiana Minerals, LTD.’s Daubert motion—or, in the alternative, motion in limine—to exclude or limit the testimony of Lesa Adair.
Key Takeaway:
While expert testimony is rightly excluded where an expert’s opinions are based on such speculative assumptions or alterations of fact that the testimony is no longer relevant and would not materially assist the trier of fact, making factually supported and non-speculative assumptions does not constitute valid grounds for disqualification of an expert opinion.
Just as with Zauner, Adair has relied on assumptions — which agreements to include, the value of certain agreements, whether administrative fees should be included, and whether LML would have received the same payments that Weyerhaeuser received from third parties — of facts in dispute in this case.
Case Details:
Case Caption:
Louisiana Minerals Ltd V. Weyerhaeuser Company
Docket Number:
5:22cv145
Court Name:
United States District Court for the Western District of Louisiana, Shreveport Division
