First Savings Bank, F.S.B. v. U.S. Bancorp

• Decision Date: 13 September 2000
• Docket Number: No. 95-4020-SAC.,95-4020-SAC.
• Citation: 117 F.Supp.2d 1078
• Parties: FIRST SAVINGS BANK, F.S.B., Plaintiff, v. U.S. BANCORP and U.S. Bank National Association, Defendants.
• Court: U.S. District Court — District of Kansas

Page 1078

117 F.Supp.2d 1078

FIRST SAVINGS BANK, F.S.B., Plaintiff, v. U.S. BANCORP and U.S. Bank National Association, Defendants.

No. 95-4020-SAC.

United States District Court, D. Kansas.

September 13, 2000.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Elizabeth R. Herbert, Pedro L. Irigonegaray, Robert V. Eye, Irigonegaray & Associates, Topeka, KS, Thomas H. Van Hoozer, Robert D. Hovey, John M. Collins, Hovey, Williams, Timmons & Collins, Kansas City, MO, for Plaintiff.

Arthur E. Palmer, Goodell, Stratton, Edmonds & Palmer, Topeka, KS, for Defendants.

MEMORANDUM AND ORDER

CROW, Senior District Judge.

This case is before the court on several motions: Defendants' Motion in Limine (Dk. 340 ); Plaintiff's Motion to Strike Defendants' Motion in Limine No. (3) (Dk. 350 ); and Plaintiff's Motion in Limine (Dk. 342). The court informed the parties of its anticipated rulings by letter sent by facsimile on September 8, 2000. This order constitutes the court's rulings on these motions and the rationale for them.

GOVERNING STANDARDS

The motion in limine is a creature of neither the Federal Rules of Civil Procedure nor the Federal Rules of Evidence. Deghand v. Wal-Mart Stores, Inc., 980 F.Supp. 1176, 1179 (D.Kan.1997). Such motions do "aid the trial process by enabling the Court to rule in advance of trial on the relevance of certain forecasted evidence, as to issues that are definitely set for trial, without lengthy argument at, or interruption of, the trial.'" Palmieri v. Defaria, 88 F.3d 136, 141 (2nd Cir.1996) (quoting Banque Hypothecaire Du Canton De Geneve v. Union Mines, Inc., 652 F.Supp. 1400, 1401 (D.Md.1987)). They also may save the parties time, effort and cost in preparing and presenting their cases. Pivot Point Intern., Inc. v. Charlene Products, Inc., 932 F.Supp. 220, 222 (N.D.Ill.1996). At the same time, it is the better practice to wait until trial to rule on objections when admissibility substantially depends upon what facts may be developed there. See Sperberg v. Goodyear Tire & Rubber Co., 519 F.2d 708, 712 (6th Cir.), cert. denied, 423 U.S. 987, 96 S.Ct. 395, 46 L.Ed.2d 303 (1975); Hunter v. Blair, 120 F.R.D. 667 (S.D.Ohio 1987).

The movant has the burden of demonstrating that the evidence is inadmissible on any relevant ground. Plair v. E.J. Brach & Sons, Inc., 864 F.Supp. 67, 69 (N.D.Ill.1994). The court may deny a motion in limine when it "lacks the necessary specificity with respect to the evidence to be excluded." National Union v. L.E. Myers Co. Group, 937 F.Supp. 276, 287 (S.D.N.Y.1996). At trial, the court may alter its limine ruling based on developments at trial or on its sound judicial discretion. Luce v. United States, 469 U.S. 38, 41, 105 S.Ct. 460, 83 L.Ed.2d 443 (1984). "Denial of a motion in limine does not necessarily mean that all evidence contemplated by the motion will be admitted at trial." Hawthorne Partners v. AT & T Technologies, Inc., 831 F.Supp. 1398, 1401 (N.D.Ill.1993). Denial only means that the court cannot decide admissibility outside the context of trial. Plair v. E.J. Brach & Sons, Inc., 864 F.Supp. at 69. A ruling in limine does not "relieve a party from the responsibility of making objections, raising motions to strike or making formal offers of proof during the course of trial." Thweatt v. Ontko, 814 F.2d 1466, 1470 (10th Cir.1987) (internal quotation omitted).

DEFENDANTS' MOTION IN LIMINE (Dk.340)

The court will begin with the defendant's motion as it was docketed first. Their memorandum (Dk.341) makes clear that the defendants are actually raising five separate motions for the court's resolution prior to trial. The court addresses them seriatim.

I. MOTION TO EXCLUDE EXPERT DAVID MILLER'S TESTIMONY

Defendants first contend that the testimony of David Miller, plaintiff's expert regarding lost profits, is inadmissible under Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579, 591, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993), and Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999), because it is neither relevant nor reliable. The court notes that the parties have agreed to address the issues regarding the admissibility of expert testimony by filing motions in limine, and that no Daubert hearing has been or will be held. This court has discretion to determine how to perform its gatekeeping function under Daubert, Goebel v. Denver and Rio Grande Western R.R. Co., 215 F.3d 1083 (10th Cir.2000), and has before it sufficient evidence to perform "the task of ensuring that an expert's testimony both rests on a reliable foundation and is relevant to the task at hand." Daubert, 509 U.S. at 597, 113 S.Ct. 2786.

Under Fed.R.Evid. 702, ¹ the trial court must act as a gatekeeper and determine at the outset, pursuant to Fed. R.Evid. 104(a), "whether the expert is proposing to testify to (1) scientific knowledge that (2) will assist the trier of fact to understand or determine a fact in issue." Daubert, 509 U.S. at 592, 113 S.Ct. at 2796. "This entails a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and of whether that reasoning or methodology properly can be applied to the facts in issue." Id.

"[W]hen the proffered expert relies on some principle or methodology," the trial court should consider a nonexhaustive list of nondispositive factors in determining whether the reasoning or methodology is scientifically valid or reliable: "(1) Can it and has it been tested?; (2) Has it been subjected to peer review and publication?; (3) Does it have a known or potential rate of error?; and (4) Has it attained general acceptance in the relevant scientific community?" Compton v. Subaru of America, Inc., 82 F.3d 1513, 1518 (10th Cir.), cert. denied, 519 U.S. 1042, 117 S.Ct. 611, 136 L.Ed.2d 536 (1996). After Daubert, the court has continued to apply a traditional rule 702 analysis "except in cases involving unique, untested, or controversial methodologies or techniques." Id. at 1519. Application of the four factors set out in Daubert "is unwarranted in cases where expert testimony is based solely on experience or training." Id. at 1518.

As part of the pretrial evaluation, the trial court also must determine whether the expert opinion is "based on facts that enable the expert to express a reasonably accurate conclusion as opposed to conjecture or speculation [but] absolute certainty is not required." Kieffer v. Weston Land, Inc., 90 F.3d 1496, 1499 (10th Cir.1996) (quoting Jones v. Otis Elevator Co., 861 F.2d 655, 662 (11th Cir.1988)). "[T]he `touchstone' of admissibility is helpfulness to the trier of fact." Werth v. Makita Elec. Works, Ltd., 950 F.2d 643, 648 (10th Cir.1991).

Plaintiff has offered the testimony of David Miller as a damages expert regarding lost profits, yet plaintiff has not shown the court that the most basic prerequisites for admission of such testimony have been met. Although Miller anticipates testifying as an expert, he did not sign the report (Dk.341, Exh. A) upon which his opinion is based, (Dk.341, Exh. B, p. 6), is not a partner with the firm for which he is employed and does not know when or if he will become one (Id.), is not a C.P.A. (Id. at p. 138), has not provided his resume for the court's review, has never before been asked to value harm caused by use of a trade name or trademark (Id. at p. 144), has never testified either by deposition or in trial (Id. at p. 156), has never published any books or articles on valuation (Id. at p. 156-157), and does not believe he has ever done a financial analysis of any institution in Kansas before (Id. at p. 158).

"A trial judge has broad discretion in determining the competency of an expert witness." Kloepfer v. Honda Motor Co., 898 F.2d 1452, 1458 (10th Cir.1990). In making this determination, two general conditions must be met.

[F]irst, the subject matter must be closely related to a particular profession, business or science and not within the common knowledge of the average layman; second, the witness must have such skill, experience or knowledge in that particular field as to make it appear that his opinion would rest on substantial foundation and would tend to aid the trier of fact in his search for truth.

Graham by Graham v. Wyeth Laboratories, 906 F.2d 1399, 1407-08 (10th Cir.) (quoting Bridger v. Union Ry. Co., 355 F.2d 382, 387 (6th Cir.1966)), cert. denied, 498 U.S. 981, 111 S.Ct. 511, 112 L.Ed.2d 523 (1990). In the present case, Miller lacks the requisite skill, experience and knowledge in the field of determining causation of lost profits to financial institutions as to make his opinion rest on a substantial foundation and aid the trier of fact in his search for truth. The court is well aware that a witness's lack of specialization does not affect the admissibility of the opinion, but only its weight, see Wheeler v. John Deere Co., 935 F.2d 1090, 1100 (10th Cir.1991), but Miller's lack of qualifications noted above go far beyond mere lack of specialization. Although the court has grave doubts as to Miller's qualifications, its opinion regarding admissibility of his testimony does not rest on this ground alone.

Instead, the court has examined the substance of the proffered testimony. Although the defendant has asserted other grounds for exclusion of Miller's testimony, the court finds two to be controlling: that Miller based his opinion on an assumption of the very fact that his report is intended to prove, and that he improperly attributed all of plaintiff's losses to the defendants' allegedly illegal acts, despite the presence of significant other factors.

When asked in his deposition whether his "entire analysis is based upon the assumption that the Defendant's name change caused a deposit loss for the Plaintiff," Miller replied; "That's correct." (Dk. 341, Exh. B at 61). When asked "If your numbers are to have any validity, your assumption that the entire decline in market...