Taylor v. Cottrell, Inc.

• Decision Date: 29 July 2015
• Docket Number: No. 14–2943.,14–2943.
• Citation: 795 F.3d 813
• Parties: Timmy A. TAYLOR; Deborah Taylor, Plaintiffs–Appellants v. COTTRELL, INC.; Auto Handling Corp., Defendants–Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

795 F.3d 813

Timmy A. TAYLOR; Deborah Taylor, Plaintiffs–Appellants

v.COTTRELL, INC.; Auto Handling Corp., Defendants–Appellees.

No. 14–2943.

United States Court of Appeals, Eighth Circuit.

Submitted: April 16, 2015.

Filed: July 29, 2015.

Rehearing Denied Sept. 3, 2015.

Roy C. Dripps, argued, Alton, IL, (Charles Armbruster, III, Michael T. Blotevogel, Alton, IL, Brian M. Wendler, Edwardsville, IL, on the brief), for Plaintiffs–Appellants.

Jeffery T. McPherson, argued, Saint Louis, MO, (Thomas B. Weaver, Saint Louis, MO, Paul L. Wickens, William F. Logan, Kansas City, MO, on the brief), for Defendants–Appellees.

Before BYE and SMITH, Circuit Judges, and SCHILTZ,¹ District Judge.

Opinion

BYE, Circuit Judge.

Timmy A. Taylor (“Taylor”) and Deborah Taylor brought this action to recover damages resulting from injuries Taylor sustained in two incidents involving a Cottrell, Inc. (“Cottrell”) truck trailer. Upon Cottrell's motion in limine, the district court excluded one of Taylor's expert witnesses, finding the doctor had entered into an impermissible contingent-fee agreement which completely undermined any testimony he might offer. The district court then found Taylor lacked sufficient evidence to create a triable issue on his neck and back injury claims without an expert opinion on damages and causation, entered summary judgment on those claims in favor of Cottrell, and stayed the remaining claims. We conclude the district court erred in excluding Taylor's expert witness and reverse.

I

On October 1, 2007, Taylor was injured while attempting to secure a vehicle on a Cottrell car-hauling trailer. He underwent medical care for his injuries, which eventually led him to Dr. James M. Odor for a surgical consultation. After an examination, Dr. Odor advised Taylor that the best chance for improvement was through surgery. On February 21, 2008, Dr. Odor operated on Taylor to complete a two-level cervical fusion. After an unsuccessful “trial program” to return to work and some further treatment, on November 6, 2009, Taylor returned to work full-time without restrictions.

On January 12, 2010, Taylor was again injured when he fell approximately ten feet from a Cottrell trailer. He was taken to the emergency room, where he underwent x-rays and a CT scan. He was eventually discharged home with some pain medication. The same month, Taylor reported to Dr. Odor with neck and back pain. After testing, Dr. Odor observed several disc protrusions and a disc desiccation. These injuries led to another complex spinal surgery with Dr. Odor in September 2012, the cost of which exceeded $450,000.

Meanwhile, Taylor commenced this action in state court on April 3, 2009, which Cottrell timely removed to federal court based on diversity jurisdiction. After Taylor suffered the second injury and underwent more treatment, he amended his claims. While the litigation spanned over several years, the relevant events for the issues currently in dispute on appeal occurred in the span of a few months and relate to the district court's exclusion of Taylor's treating physician and expert witness (Dr. Odor) and the district court's grant of summary judgment on some claims in favor of Cottrell.

On August 9, 2013, two weeks before trial was scheduled to begin, Cottrell moved for a trial continuance, asserting it had recently uncovered copies of agreements between Taylor's counsel and Dr. Odor which evidenced an impermissible contingent-fee agreement. After a hearing on August 14, the district court granted the motion and permitted additional discovery. On December 27, 2013, Cottrell filed a motion to strike Dr. Odor's testimony, for sanctions related to the alleged failure to disclose the contingent-fee agreements, and to dismiss the entire case for fraud on the court. In its order granting Cottrell's motion to strike, the district court explained it was “dismayed at the events detailed in [the] Motion” and found there was a contingency agreement—not merely a lien on any proceeds from the litigation—which undermined Dr. Odor's interest in the case so much that the “best course of action [was] to exclude the testimony of Dr. Odor as an expert witness.” Taylor v. Cottrell, No. 4:09–cv–00536–HEA, 2014 WL 414325, at *2 (E.D.Mo. Feb. 4, 2014). Cottrell then filed a motion to bar evidence of Taylor's damages based on the testimony of Dr. Odor or dismiss the neck and low back claims that depended on his testimony. The district court granted the motion, barring any testimony from Dr. Odor and dismissing the claims for Taylor's neck and back injuries. The district court then granted permission to file an interlocutory appeal pursuant to 28 U.S.C. § 1292(b), which this Court denied on May 1, 2014. Upon Cottrell's motion, the district court then severed the claims related to the neck and back injuries, entered judgment on those claims, stayed the claims related to Taylor's shoulder injuries, and certified the judgment for immediate appeal.

II

We review a district court's exclusion of expert testimony for an abuse of discretion, see Brooks v. Union Pac. R. Co., 620 F.3d 896, 899 (8th Cir.2010), and its findings of fact for clear error, see Jackson v. Allstate Ins. Co., 785 F.3d 1193, 1206 (8th Cir.2015). Taylor argues the district court abused its discretion in excluding Dr. Odor as an expert witness because there was no agreement for the payment of his expert services made contingent on the outcome of the litigation, and even if there was, it did not warrant exclusion. It is difficult to determine the precise interest the district court believed existed in this case and why any bias as a result of such an interest could not be adequately addressed with the jury through cross-examination. However, the issue is immaterial because we conclude the district court erred regardless of which interest it believed existed.

The parties disagree on whether a payment for an expert witness's services made contingent on the outcome of the litigation serves to disqualify the witness. This appears to be an issue of first impression in this Court. Courts in other jurisdictions have disagreed on whether such a contingent financial interest automatically disqualifies, may serve to disqualify, or can never alone disqualify an expert witness. Compare Straughter v. Raymond, No. 08–2170 CAS (CWx), 2011 WL 1789987, at *3 (C.D.Cal. May 9, 2011) (“The Court finds that the better course of action is to exclude the testimony of expert witnesses in civil cases whose compensation is contingent on the outcome of the case.”); Farmer v. Ramsay, 159 F.Supp.2d 873, 883 (D.Md.2001) (striking expert's reports because “witness contingency fee agreements affirmatively violate the fundamental policy of Maryland and the United States” (internal quotation marks omitted)), aff'd on other grounds, 43 Fed.Appx. 547, 551 n. 5 (4th Cir.2002) (not deciding whether it was proper to exclude the expert report because it was unnecessary); Accrued Fin. Servs., Inc. v. Prime Retail, Inc., No. CIV.JFM–99–2573, 2000 WL 976800, at *3 (D.Md. June 19, 2000) (“Financial arrangements that provide incentives for the falsification or exaggeration of testimony threaten the very integrity of the judicial process which depends upon the truthfulness of the witnesses.”); J & J Snack Foods, Corp. v. Earthgrains Co., 220 F.Supp.2d 358, 367 n. 8 (D.N.J.2002) (“A contingent fee arrangement with an expert witness would be unethical, and would undermine or destroy the reliability of the survey design and execution.”), with Tagatz v. Marquette Univ., 861 F.2d 1040, 1042 (7th Cir.1988) (“It is unethical for a lawyer to employ an expert witness on a contingent-fee basis but it does not follow that evidence obtained in violation of the rule is inadmissible. The trier of fact should be able to discount for so obvious a conflict of interest. In any event, there was no objection to Dr. Tagatz's testifying as an expert witness, so we need not delve deeper into this intriguing subject.” (internal citations omitted)); Universal Athletic Sales Co. v. Am. Gym, Recreational & Athletic Equip. Corp., 546 F.2d 530, 539 (3d Cir.1976) (“[I]t does not necessarily follow that any alleged professional misconduct on his part would in itself render his testimony ... a nullity.”); Milfam II LP v. Am. Commercial Lines, LLC, No. 4:05–cv–0030–DFH–WGH, 2006 WL 3247149, at *2 (S.D.Ind. Mar.30, 2006) (“The Seventh Circuit has not held such arrangements illegal per se but has instead left the trier of fact to consider the credibility issues.”); Valentino v. Proviso Twp., No. 01 C 557, 2003 WL 21510329, at *3 (N.D.Ill. June 26, 2003) (“Thus, the issue of Horstman's compensation and his beliefs about his compensation only affect Horstman's credibility as a witness, not the admissibility of his report and testimony.”). Because we find that no such contingent interest exists in this case, we need not further address the issue.

It is not clear from the district court's order whether the district court believed a contingent-fee agreement existed for Dr. Odor's expert witness services or for the payment of past medical services performed by Dr. Odor. The district court broadly referenced “a contingency fee arrangement with an expert witness,” and stated “payment of the expert,” which suggest it thought the contingency was for the expert witness services—not for the payment of prior medical services. Taylor, 2014 WL 414325 at *2. Additionally, the only authority the district court cited in support of exclusion was the Restatement (Third) of the Law Governing Lawyers § 117, which prohibits a lawyer from offering or paying an expert witness consideration contingent on the outcome of the litigation. Id. Thus, it appears the district court concluded Dr. Odor's compensation for testifying in this case was made contingent on the outcome of the litigation. However, the district court cited no evidence in the record to support such a finding and our independent review of the record has not revealed any....