Claim Denied? Why Picking the Wrong Expert Can Cost You

Ian Dankelman | Property Insurance Coverage Law Blog | June 2, 2019

Picking the right expert has never been more important when fighting an insurance company that has wrongfully denied an insurance claim. The rule for expert admissibility has just changed in Florida and the same concerns about experts apply everywhere.

Under the Frye test, a party seeking to introduce expert evidence had to prove the general acceptance of the underlying scientific principles and methodology that the expert employed when advancing new or novel scientific testimony. Now, Florida has adopted the Daubert  standard, which requires the trial judge to ensure that “any and all scientific testimony or evidence admitted is not only relevant, but reliable.”1 In reaching this decision, the Supreme Court emphasized that the amendments would reduce forum shopping and harmonize Florida’s standard with the standard employed by federal courts.

However, in dissent, Justice Labarga cautioned that “Daubert and its progeny drastically expand[] the type of expert testimony subject to challenge.”2 One concern over the amendment the dissent highlighted was that the new standard would undermine the constitutional right to a jury trial by authorizing judges “to exclude from consideration the legitimate but competing opinion testimony of experts.”3 Another was that the new expert testimony standard would overburden the courts, impede the ability of parties to prove their cases on the merits, and increase litigation costs.

So what does this mean for policyholders? On one hand, Daubert is the well-established standard in federal court, and there is clear direction in federal case law that state judges can follow to reach reasoned rulings. It is likewise conceivable that the number of cases removed from state court to federal court will be reduced based on the amendments to the evidence code. The new standard will also give policyholders a new ability to challenge the insurers’ experts when their work does not meet the requirements demanded by the Daubert standard. On the other, policyholders’ cases may be delayed while Florida courts deal with increasing numbers of challenges to expert opinion testimony. Policyholders will likely face additional hearings on the admissibility of expert testimony that will require intense preparation.

It remains to be seen how judges will tackle the increase in challenges to expert testimony in Florida’s courts. Only one thing is certain: the amendment to the evidence code will have important ramifications on all litigation in Florida.
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1 In re: Amendments to the Florida Evidence Code, No. SC19-107 (Fla. May 23, 2019).
2 Id. at 13 (Labarga, J., dissenting).
2 Id. at 15-16.

The Supreme Court of Texas Clarifies That a Party Can Testify as an Expert Witness without Waiving the Attorney-Client Privilege

Donnie Apodaca | Avoiding Insurance Bad Faith | March 12, 2019

Litigation usually involves complex issues related to technology, products, or business processes. In many cases, clients are the best subject-matter experts of their craft. Nevertheless, attorneys are sometimes hesitant to designate a client or a client’s employee as an expert witness for fear of waiving attorney-client privilege. In a recent decision, the Supreme Court of Texas addressed this very issue and held that the attorney-client privilege remains unscathed when a party (or its corporate representative) is designated as a testifying expert witness. See In re City of Dickinson, — S.W.3d —, No. 7-0020, 2019 WL 638555 (Tex. Feb. 15, 2019).

Background

City of Dickinson concerned whether a property insurer underpaid insurance benefits related to a Hurricane Ike claim made by the City of Dickinson. In responding to the City’s motion for summary judgment, the property insurer filed the affidavit of its corporate representative who was also a senior claims examiner. Unsurprisingly, the affidavit offered factual and expert testimony in opposition to the dispositive motion. The City later learned the corporate representative exchanged emails and drafts of the affidavit with defense counsel.The City then moved to compel the production of the emails and all other information “provided to, reviewed by, or prepared by or for” the corporate representative in anticipation of his expert testimony. Naturally, the property insurer claimed the documents were protected by the attorney-client privilege. The trial court, however, disagreed and granted the motion to compel. The intermediate appellate court reversed, finding the information sought was privileged.

The Supreme Court of Texas’s Decision

On appeal, the Court addressed whether Texas Rules of Civil Procedure 192.3 and 194.2 barred the property insurer from asserting attorney-client privilege. Rule 192.3 concerns the scope of discovery and provides that, with respect to a testifying expert, “[a] party may discover . . . all documents, tangible things, reports, models, or data compilations that have been provided to, reviewed by, or prepared by or for the expert in anticipation of a testifying expert’s testimony[.]” In construing Rule 192.3, the Court noted that the use of the word “may” merely meant that an opposing party could discover the information—not that it had an absolute right to discover it when a privilege applied. The Court also noted that another subpart of Rule 192.3 expressly precluded the discovery of privileged information.

Rule 194.2 concerns the content of a discovery tool called “requests for disclosure” and provides that, with respect to testifying expert, “[a] party may request disclosure of . . . all documents, tangible things, reports, models, or data compilations that have been provided to, reviewed by, or prepared by or for the expert in anticipation of the expert’s testimony[.]” As with Rule 192.3, the Court explained that the word “may” simply meant that a party could request the discovery. Another subpart of the rule expressly allowed the trial court to limit requests for disclosure, and the official comment to the rule made clear that “requests for disclosure under Rule 194 are subject to the attorney–client privilege just like the provisions of Rule 192.”

The Court also rejected the City’s argument that the Texas Rules of Civil Procedure should be interpreted the same as the pre-2010 Federal Rules of Civil Procedures because they were modeled after them. The Court summarily rejected the argument because the comments to the rules where substantively different.

The Court also distinguished its decision in In re Christus Spohn Hosp. Kleberg, 222 S.W.3d 434 (Tex. 2007). In that case, the Court held that a party was required to produce an investigator’s report provided to party’s expert. The Court explained that Christus Spohn only addressed the work-product privilege—not undisputed attorney-client communications. The Court explained that its holding was consistent with prior decisions, which “underscore the status of the attorney-client privilege as ‘quintessentially imperative’ to our legal system” and that “[w]ithout the privilege, attorneys would not be able to give their clients candid advice as is an attorney’s professional duty.”

Takeaway

City of Dickinson provides clarity in a previously unsettled area of Texas law. Further, it reinforces the importance of the attorney-client privilege and clarifies that a client does not have to choose between testifying as an expert at trial and invoking attorney-client privilege. Going forward, we expect the primary party-expert dispute to center on whether materials provided to the party-expert constitute discoverable work product under Christus Spohn or protected attorney-client privilege under City of Dickinson. Indeed, as the Court noted in its opinion, the two privileges are often conflated.

Florida Decides Against Adopting Daubert

Rahul Gogineni | Subrogation Strategist | December 12, 2018

In Delisle v. Crane Co., 2018 Fla. LEXIS 1883, 43 Fla. L. Weekly S 459, the Supreme Court of Florida reaffirmed that the appropriate test for admissibility of an expert opinion about new or novel scientific evidence is the “Frye” test, not the “Daubert” test.

As result of developing mesothelioma, Richard Delisle sued sixteen defendants, including Crane Company (Crane) and R.J. Reynolds, claiming that each exposed him to asbestos, which is a leading cause of mesothelioma. At trial, Crane and R.J. Reynolds sought to preclude the expert opinions of Mr. Delisle’s causation experts. The trial denied the motions and the jury awarded Mr. Delisle $8 million.

Crane and R.J. Reynolds appealed the trial court’s decision to admit the plaintiff’s expert causation testimony. Upon review, the Fourth District Court of Appeal concluded that under Daubert, the trial court erred in admitting the plaintiff’s expert causation testimony. In addition, it remanded the case for a new trial against R.J. Reynolds and the entry of a directed verdict in favor of Crane.

The plaintiff appealed the appellate decision, arguing that in accordance with past precedent, the trial court correctly applied the Frye test rather than the Daubert test.

Daubert v. Frye

In the United States, all states apply a variation of either the “Frye” test or the “Daubert” test to determine the admissibility of expert opinions. Under Frye, expert testimony need only be generally accepted by a meaningful segment of the associated scientific community. Under Daubert, expert testimony is admissible if: (1) the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue; (2) the testimony is based on sufficient facts or data; (3) the testimony is the product of reliable principles and methods; and (4) the expert has reliably applied the principles and methods to the facts of the case. In 2013, the Florida state legislature codified the requirement that courts apply the Daubert test in Section 90.702 of the Florida Statutes. Prior to this legislation, Florida courts applied the Frye test.

In Delisle, the court addressed whether the legislature had the authority to legislate the appropriate test for the admissibility of expert testimony. In citing to Article II, Section 3 and Article V, Section 2 of the Florida Constitution, the court held that the state legislature did not have the authority to pass legislation that, “determine[s] matters of [court] practice or procedure” through a mere majority vote.[1] It further held that the test for the admissibility of expert testimony is a procedural rule and, therefore, within the sole purview of the Judiciary. The court concluded by reaffirming “that Frye, not Daubert, is the appropriate test in Florida courts.” The court noted, however, that the Frye test is “inapplicable to the vast majority of cases because it applies only when experts render an option that is based on new or novel scientific techniques.” However, with respect to the medical causation testimony at issue, the court held that the trial court properly admitted the testimony because medical causation testimony is not new or novel, and not subject to a Frye analysis. This case serves as a good reminder that, prior to filing suit, subrogation practitioners should be aware of which test will apply to the admissibility of the testimony of the expert or experts involved in the case.


[1] It should be noted that the Florida Constitution does permit the repeal of a rule of the Court if the legislation is enacted by two-thirds votes of both houses of the legislature.

Cross-Examining the Expert Witness in a PL Case Part III: Challenging the Methodology

Rosario M. Vignali | Wilson Elser | January 16, 2018

In this third and last installment of our three-part series examining the type of deposition questioning that can derail your opponent’s expert and set up a successful Daubert challenge, we will look at Daubert’s insistence that the expert’s opinions be based on “reliable methodology” before opinions can be presented to the jury.

What exactly does a reliable methodology under Daubert mean? Essentially, it requires that the expert’s opinions be based on information gathered in the same manner as a scientist would undertake before he or she reaches a conclusion about the design of the product at issue. The distinction is between using sound scientific procedures as opposed to unsupported speculation to develop a hypothesis, analyze and test against it, and reach a conclusion.

Careful and targeted questioning of the expert often can establish that the expert’s opinions are indeed the product of nothing more than guesswork and conjecture – the very ipse dixit approach against which Daubert and its progeny warned and that the Federal Rules, when properly enforced by the court exercising its “gatekeeping” function, should disallow. Fortunately, Daubert and its progeny have given us extensive guidance as to the types of questions to ask the expert to establish the expert’s lack of sound methodology. They involve concepts such as testing, “peer review,” rates of error, the existence of standards, “general acceptance” and other well-defined criteria. Let’s look at some of them.

Assume for the sake of this example that a plaintiff’s expert has opined in a report that your client’s Widget-making machine was defectively designed because it lacked a guard over its cutting implement. That hypothesis, like all hypotheses, could theoretically be tested, but has the expert bothered to do so? For example, has the expert actually designed and placed a guard over the Widget-making machine to see if, under real working conditions, it actually cuts down on the frequency of accidents without reducing the machine’s overall functionality and utility?

“Peer review” is the process by which a scholarly work (such as a paper or a research proposal) is vetted by a group of experts in the same field to make sure it meets the acknowledged and accepted standards in the field before it is published or generally accepted. Why should the plaintiff’s expert’s opinion (i.e., scholarly work) be any different, or immune to this level of scrutiny? Under Daubert, it isn’t. For that reason, effective questioning of the expert often will establish that his theory of defect – in our imagined scenario, the lack of a guard over the Widget-making machine’s cutting implement – has never been published anywhere other than in a series of the expert’s reports he issued in prior lawsuits. Therefore, by definition, the theory of design defect the expert is advancing in your case has never been offered for commentary to other experts in the same field. Once this fact is established, the plaintiff’s expert is nothing more than a lone wolf; his theory of design defect has never been checked for scientific soundness and has never become generally accepted by the community of similarly situated scientists.

Real scientists employ the scientific method to develop a hypothesis, test against it and then reach a conclusion about the soundness of the hypothesis. Real scientists then publish their theory in trade journals and give speeches about it at industry or academic gatherings. In this way, the expert’s proposed testimony grows naturally and directly out of healthy and impartial scientific curiosity. If targeted questioning establishes that the expert has never published the theory of defect in anything but the reports that were prepared within the context of litigation, then the expert’s opinions become nothing more than the product of advocacy instead of the product of real scientific inquiry.

Will the guard over the Widget-making machine’s cutting implement stop all accidents, or only some of them? If questioning establishes that there remains a fair modicum of Widget-machine accidents that would happen even with a guard over the cutting implement, then it also has established that there is a certain amount of “known or potential error” in the plaintiff’s expert’s hypothesis. Stated otherwise, the expert’s proffered design is no panacea.

Similarly, has the expert accounted for other possible explanations for the accident? What if the plaintiff was hurt simply because he or she was under the influence of alcohol? What if the Widget-making machine originally had a guard over its cutting implement, but the guard had been removed? Real scientists, using a legitimate methodology, strive to explain away all other possibilities for an accident’s occurrence.

Effective questioning of the expert also can establish that the expert can cite no known published standard – voluntary or mandatory; governmental or private – to support his theory. In our fictional example, effective questioning can show that no body of experts in the field, who were otherwise charged with the deliberative task of developing standards over a period of months or years for the safe design and use of Widget-making machines, had ever advanced the notion that a guard over the cutting implement was necessary to make the machine “safe.” Again, the plaintiff’s expert looks more and more like the lone wolf − rather than a reasonable scientist.

In a case in which the expert advanced an opinion that your client’s product was missing an important warning, had the expert actually developed a proposed warning for the product? That is, has the expert actually written the verbiage and determined the warning’s size and shape, the font size and correct “signal” word? Has he tested the proposed warning for “understandability” and its effect on the reader? Will the proposed warning actually work to change the product user’s behavior and prevent an accident? Without such development and testing, the expert’s opinions in this area is speculative at best.

Lastly, effective questioning of the expert should ask whether there is a causal link between the opinion and the facts of the case; that is, as Daubert and its progeny put it, whether the opinion actually “fits” the facts of the case. If questioning of the plaintiff’s expert establishes that the existence of a guard over the Widget-making machine’s cutting implement would have made no difference – perhaps the facts show that the plaintiff intentionally reached into the area of the cutting implement to clear a jam and thus the existence of a guard would not have prevented the accident – then the plaintiff’s expert’s opinion and proffered alternative design, though interesting, arguably proves nothing.

The ways to question a supposed expert’s methodology is limited only by one’s imagination. This article suggests some areas of attack. With effective questioning, your opponent’s expert will look less like an independent and impartial scientist and more like the proverbial “hired gun” who will advance any opinion so long as an attorney is willing to pay the required hourly rate.

You’ve Got Damage from a Construction Defect – How Do You Know How Much Invasive Testing is Sufficient?

Donald B. Brenner | National Law Review | April 18, 2016

Community associations are often given common elements in transition that incur damage from design and/or construction deficiencies. Associations typically have limited funds. Even those with ample financial resources are usually governed by Boards whose members are keenly aware of the fact that the Association’s funds are trust monies that need to be carefully managed and wisely expended.

Most board members do not have construction experience and are not lawyers or design professionals. They often do not know what to think when advised by counsel and engineering professionals that invasive testing is needed to permit investigation and documentation of the Association’s claims. Even when confronted with evidence of water infiltration, which they suspect or know may be causing damage, many association have an initial inclination not to want to spend a lot of money on engineering and forensic investigations. Once limited, preliminary testing shows a problem exists, and litigation becomes necessary, the question becomes, “How much testing is needed to support the association’s claims?” This blog is intended to help give some perspective to boards facing such a decision.

In Federal and most State courts, admissibility of scientific expert witness testimony is governed by the Daubert” standard articulated in Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579 (1993). The key purpose of the Daubert standard is to ensure that the proposed expert testimony is both relevant to the issues in dispute and the evidence in support thereof is reliable.

Under Daubert, “the test of admissibility is not whether a particular scientific opinion has the best foundation, or even whether the opinion is supported by the best methodology or unassailable research. Rather, the test is whether the ‘particular opinion is based on valid and reliable methodology. The admissibility inquiry thus focuses on principles and methodology, not on conclusions generated by the principles and methodology. Once admissibility has been determined, then it is for the trier of fact to determine the credibility of the expert witness.” In re TMI Litig., 193 F.3d 613, 665 (3rd. Cir. 1999).

Generally, expert testimony is permitted when:

  1. The expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue

  2. The testimony is based on sufficient facts or data

  3. The testimony is the product of reliable principles and methods

  4. The expert has reliably applied the principles and methods to the facts of the case

Many state courts have adopted nearly verbatim Federal Rule of Evidence 702. For example, the New Jersey Rules of Evidence state:

“If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education may testify thereto in the form of an opinion or otherwise.”

It is impossible for any association to afford to pay for its experts to invasively test every inch of a building. That is why courts allow parties to use limited invasive testing done by experts to support an opinion that the same conditions found in the limited testing exist everywhere on the buildings. This process is known as “extrapolation.”

The trial Judge is the gatekeeper of the evidence the jury gets to hear at trial. As a general matter, the use and admissibility of expert testimony based on extrapolation supporting claims of damages caused by design and construction deficiencies is based on an evaluation by the Judge of:

  1. The randomness of the sample

  2. The size of the sample

A detailed discussion of these concepts is…

To finish reading this article