Allina Health System v. County of Washington, 82-CV-18-2029

CourtTax Court of Minnesota
Writing for the CourtJane N. Bowman, Judge
PartiesAllina Health System, Petitioner, v. County of Washington, Respondent.
Docket Number82-CV-18-2029
Decision Date13 July 2021

Allina Health System, Petitioner,
v.

County of Washington, Respondent.

No. 82-CV-18-2029

Tax Court of Minnesota, Regular Division, Washington County

July 13, 2021


This matter came on for hearing before the Honorable Jane N. Bowman, Judge of the Minnesota Tax Court, on petitioner Allina Health System's motion to exclude expert testimony.

Nicholas A. Furia, Law Offices of Nicholas A. Furia, PLLC, represents petitioner Allina Health System.

Stuart V. Campbell, Assistant County Attorney, represents respondent Washington County.

ORDER ON PETITIONER'S MOTION IN LIMINE

Allina Health System moves the court to exclude the expert testimony of Gary Cavett as untimely and prejudicial. Washington County opposes the motion, arguing Mr. Cavett's testimony, characterized as rebuttal evidence, is admissible under the proper standard. The court, upon all the files, records, and proceedings herein, now makes the following:

ORDER

1. Allina Health System's motion in limine is granted.

2. Washington County is precluded from offering Mr. Gary Cavett's expert testimony at trial.

IT IS SO ORDERED.

MEMORANDUM

Jane N. Bowman, Judge

I. Background

This case concerns Allina's claim-in part-that its Stillwater facility was exempt from property tax as of January 2, 2017, as a public hospital and a purely public charity as defined in article X section 1 of the Minnesota Constitution and Minnesota Statute section 272.02.[1] The court filed a Scheduling Order on April 15, 2019, which set many deadlines in this matter, including for the disclosure of expert witnesses (no later than November 29, 2019), the exchange of expert reports (February 10, 2020), and the filing of witness and exhibit lists (June 29, 2020).[2] In July 2020, Washington County filed a witness list, naming as fact witnesses a commercial assessor, an environmental specialist, and any and all witnesses identified in Allina's witness list.[3] The County also "reserve[d] the right to … call rebuttal witnesses as necessary." [4] The County's witness list did not include anyone providing expert testimony.

In January 2021, after all pretrial deadlines had passed and the matter had long been trial-ready, Washington County moved to consolidate this case with one concerning the subsequent year and to amend the Scheduling Order, asking that all pretrial deadlines-including the discovery and the expert report exchange deadlines-be revived and extended into 2022.[5] Allina Health Sys. v. Cnty. of Washington, No. 82-CV-19-905, 2021 WL 1288267, at *2 (Minn. T.C. Apr. 2, 2021). The basis for the County's motion was that a new lawyer had taken over the case and wished to pursue a different legal strategy, one that involved further developing the record for summary judgment. Id. In April 2021, the court denied the County's motion, owing to the Scheduling Order's express provision that a change in counsel does not constitute good cause to extend deadlines. Id.

Approximately seven weeks later, Washington County filed an Amended Witness List noting that it might call Gary Cavett, a CPA and healthcare industry consultant, as an expert witness at trial.[6] Allina subsequently brought the current motion to exclude Mr. Cavett's testimony, arguing Washington County had noticed its expert testimony far beyond the deadline set forth in the Scheduling Order.[7] Washington County opposes the motion, arguing that Mr. Cavett's testimony will be rebuttal evidence, which is not governed by the Scheduling Order.[8] The County further argues Mr. Cavett's testimony should not be precluded under the standard set forth in Dennie v. Metropolitan Medical Center, 387 N.W.2d 401 (Minn. 1986).[9] In reply, Allina argues that expert testimony from Mr. Cavett is not correctly characterized as "rebuttal evidence," that allowing undisclosed and late-noticed expert testimony would be highly prejudicial to Allina, and-in any event-that exclusion is warranted under pertinent Dennie factors.[10] See id. The parties argued their respective positions at a remote hearing on June 28, 2021.[11] The court grants Allina's motion.

II. Governing Law & Analysis

To properly analyze Allina's motion, the court must first accurately characterize the testimony anticipated from Mr. Cavett.

A. Mr. Cavett's testimony

Washington County claims the testimony of Mr. Gary Cavett, a CPA and healthcare industry consultant, will be rebuttal.[12] "Rebuttal evidence is that which explains, contradicts, or refutes the defendant's evidence. Its purpose is to cut down defendant's case and not merely to confirm that of the plaintiff." Farmers Union Grain Terminal Ass'n v. Indus. Elec. Co., 365 N.W.2d 275, 277 (Minn.App. 1985) (citing Van Tassel v. Patterson, 235 Minn. 152, 160, 50 N.W.2d 113, 117 (1951)). Rebuttal testimony is typically presented after both parties have introduced their cases-in-chief. See Minn. Stat. § 546.11(1)-(3) (2020).

The court concludes that Mr. Cavett's anticipated testimony is not rebuttal evidence. Instead, Mr. Cavett's testimony is properly categorized as evidence that should have been proffered as part of Washington County's case-in-chief. Indeed, the County candidly acknowledges that it does not anticipate rebutting any of Allina's factual evidence.[13] Thus, the County seeks to introduce the expert testimony of Mr. Cavett to "review documents disclosed by Allina in discovery and to listen to the testimony of Allina's witnesses at trial and to place those factual predicates in context based on his expert knowledge of the healthcare industry." [14] In other words, the County seeks to introduce Mr. Cavett's expert testimony, not to rebut facts, but to advance its own theory of the case. This is exactly the type of testimony properly contained in a case-in-chief, which requires prior notice and disclosure of a report under the governing Scheduling Order.

We will not allow Washington County to mischaracterize its proposed case-in-chief expert testimony as rebuttal. To allow otherwise would eviscerate the distinction between primary and rebuttal witnesses.

B. Allina's motion to exclude expert testimony

Having determined Mr. Cavett's testimony is properly categorized as case-in-chief evidence, the next question is whether it should be excluded. Trial courts are cautioned that "expert testimony should be suppressed for failure to make a timely disclosure of the expert's identity only where 'counsel's dereliction [in failing to make the disclosure] is inexcusable and results in disadvantage to [the] opponent.'" Dennie, 387 N.W.2d at 405. Courts should exclude expert testimony only in "the most compelling circumstances" and after considering the following factors:

(1) the extent of preparation required by an opposing party in preparing for cross-examination or rebuttal of expert witnesses
(2) when the expert agreed to testify
(3) when the party calling the expert notified the opposing party of the expert's availability
(4) when the attorney calling the expert assumed control of the case
(5) whether a party intentionally and willfully failed to disclose the existence of a trial expert; and
(6) whether the opposing party sought a continuance or other remedy.

Id. at 406. The Minnesota Supreme Court has recognized that "[s]ome of the Dennie factors are context...

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