Free Motion to Amend/Correct/Modify - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 04-cv-1099-JLK-DLW WOLF CREEK SKI CORPORATION, INC. Plaintiff, v. LEAVELL-MCCOMBS JOINT VENTURE D/B/A THE VILLAGE AT WOLF CREEK Defendant. ______________________________________________________________________________ LEAVELL-McCOMBS JOINT VENTURE'S MOTION TO AMEND SCHEDULING ORDER ______________________________________________________________________________ Leavell-McCombs Joint Venture (the "Joint Venture"), through its undersigned counsel, hereby respectfully submits this Motion to Amend Scheduling Order and in support thereof states as follows: Certificate of Conferral. Pursuant to Local Rule, D.C.COLO.LCivR 7.1(A), counsel for the movant has conferred in good faith with Plaintiff's counsel and such counsel has indicated that Plaintiff will oppose the relief requested herein. I. INTRODUCTION A recent final ruling by the United States Forest Service (the "Forest Service") has resulted in changed circumstances with respect to the damages suffered by the Joint Venture due to the requirement of a second access road. The requirement of the new road necessitates a reassessment of the Joint Venture's damages by expert testimony which, while not necessary to prove such damages, would greatly aid the trier-of-fact. As a result, the Joint Venture requests

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an amendment to the Scheduling Order to allow designation of an engineering expert1 on the reasonable and necessary costs to build the new road. II. PROCEDURAL BACKGROUND This litigation commenced on May 5, 2004 with the filing of the Complaint for Declaratory Judgment and Jury Demand by Wolf Creek Ski Corporation (the "Ski Corporation") in state court. The action was removed to federal court on May 28, 2004. On August 19, 2004, this Court signed a Stipulated Scheduling and Discovery Order providing that the parties were limited to three affirmative experts per side. See Stipulated Scheduling and Discovery Order dated August 19, 2004, docket # 11, § 6(e)(2). Each party reserved the right to name experts in additional areas of expertise. Id. § 6(e)(1). Pursuant to that Scheduling Order, the deadline for disclosure of affirmative expert witnesses under FED. R. CIV. P. 26(a)(2) was set for December 10, 2004, and disclosure of rebuttal experts was set for January 10, 2005. Id. § 6(e)(3) and (4). The cut-off for discovery was set for February 10, 2005. Id. § 6(c). On November 19, 2004, the Court extended the Rule 26(a)(2) deadline to January 24, 2005, the rebuttal expert disclosures to February 24, 2005, and the discovery cut-off to March 1, 2005. See Findings and Order Re: Defendant's Motion to Amend Scheduling Order, filed December 1, 2005, docket # 116. The Scheduling Order was again amended by Minute Order dated January 7, 2005 to extend the expert disclosure deadlines by approximately one month (to February 28, 2005 and March 31,

1

The Joint Venture does not seek to designate as experts any of the parties listed in its recent 26(a)(1) supplemental disclosures who were the subject of the Ski Corporation's recent Motion to Exclude or this Court's Order dated August 11, 2006. To the extent, if any, these individuals are ever called to testify at trial, the Joint Venture does not intend to elicit FRE 702 opinion testimony from any of them. 2

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2005 respectively). Id. Upon the Ski Corporation's motion, the March 31, 2005 deadline was extended to April 15, 2005 by Order dated March 25, 2005. See docket # 69. III. FACTUAL BACKGROUND 1. motion: (a) In July 1999, the Ski Corporation and the Joint Venture entered into an agreement (in previous briefs to this Court the "1999 SURP Agreement"). Therein, the Ski Corporation covenanted to (1) "diligently pursue"2 all necessary approvals from the Forest Service for the creation, operation and maintenance of a road on Forest Service land connecting the Joint Venture's enclaved property (the "Village Property") to nearby Highway 160, (2) exert its "best efforts"3 with respect to future use permits therefor, and (3) "use good faith efforts...to implement the Preliminary Development Plan"4 for the proposed Village at Wolf Creek development (the "Village"). The 1999 SURP Agreement represented that the Ski Corporation had already obtained permission from the Forest Service to construct a 23-foot-wide access road (the "Access Road") extending from Highway 160 to the border of the Village Property, as set forth in a map and related documents described in section 5.01 of that agreement. In fact, the Forest Service had the month before issued a Notice of Decision and Finding of No Significant Impact in which it approved (subject to a 45-day appeal period) the Wolf Creek Ski Area Facilities Expansion Environmental Assessment (the "1999 EA"). The 1999 EA included the
2

The Joint Venture has previously alleged the following facts relevant to this

1999 SURP Agreement, § 5.01. That document has previously been submitted to the Court on numerous occasions and will not be resubmitted herewith as these background facts are not determinative to this motion.
3 4

Id. § 2.03. Id. § 1.01(5).

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Access Road as well as new parking and lift facilities for the Wolf Creek Ski Area.5 Thus, the Access Road to the Village Property was encompassed in the 1999 EA, which had already been approved at the time of the 1999 SURP Agreement. (b) Within a matter of weeks after the Ski Corporation obtained the benefit of the 1999 SURP Agreement (which included significant land concessions from the Joint Venture to further the Ski Area expansion), the Ski Corporation breached that agreement by failing to diligently pursue final Forest Service approval the bargained-for Access Road. More

specifically, rather than vigorously resist efforts by those opposing the 1999 EA, Davey Pitcher, on behalf of the Ski Corporation, entered into a secret pact with the opponents of the Access Road and related improvements. 6 The secret pact included an agreement by the opposition to drop their resistance to the 1999 EA in exchange for which the Ski Corporation agreed to (1) cut the Access Road 250 feet short so that it would not reach the Village Property,7 and (2) support a requirement that, if the Joint Venture sought to use existing FSR 391 (the only existing access

5

The Wolf Creek Ski Area, owned by the Ski Corporation, is located on Forest Service property and operated pursuant to a special use permit from the Forest Service. It was that special use permit that the Ski Corporation was seeking to expand in 1999. The proposed Access Road was to run from Highway 160 to the Ski Area's planned Tranquility Parking Lots and thence an additional 250 feet to the Village Property.
6

Sworn testimony by the Ski Corporation's Davey Pitcher reveals that he never argued for or diligently pursued the Access Road in discussions with the Forest Service and never intended to fight an appeal by the opposition to the original approval by the Forest Service of the 1999 EA.

7

This agreement to shorten the Access Road was a further breach of the 1999 SURP Agreement (§ 5.01), wherein the Joint Venture and the Ski Corporation agreed to the design and alignment of the Access Road and that no changes to its design and alignment would be made without mutual written consent.

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road)8 for commercial purposes, it would have to submit to a full NEPA review. As a result of the secret agreement, the opponents dropped their appeal of the Forest Service's approval of the 1999 EA (with the caveats agreed to by Davey Pitcher) and the Ski Corporation was allowed to expand its Ski Area on land (easements) acquired from the Joint Venture in the 1999 SURP Agreement. (c) Since that time, the Ski Corporation has not only failed to diligently pursue approval for the Access Road, it has actively campaigned to thwart all efforts by the Joint Venture to gain access to its property, whether by the originally agreed-upon alignment or any other means, filing this and other civil lawsuits and agency appeals challenging governmental approvals that would allow the Joint Venture to build on its property. 2. The Joint Venture was asked not to participate in the settlement discussions with

the Forest Service and opponents of the 1999 EA and understood that its interests were being represented by the Ski Corporation, as the Joint Venture's agent, in those discussions. Unaware of the Ski Corporation's secret agreement in breach of the 1999 SURP Agreement, and relying on advice, commitments and support from the Ski Corporation's Kingsbury and Davey Pitcher, the Joint Venture initiated an application to the Forest Service to build out the remaining 250 feet of the Access Road (aka the "Tranquility Road"). The Ski Corporation assured the Joint Venture that the Forest Service often acted in stages and that approval for the last 250 feet of the Access Road would pose little difficulty since the Ski Corporation had already obtained approval for the first approximately 1,800-1,900 feet of the Access Road. Accordingly, in June 2001, the Joint

8

FSR 391 is a dirt road over Forest Service property that runs through the Ski Corporation's permitted area.

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Venture submitted an Application for Transportation and Utility Systems and Facilities on Federal Lands (the "Application" as amended in November 2003). Exh. A-1. Therein, the Joint Venture (with a letter of support from Davey Pitcher), requested an easement over Forest Service lands "from the end of the previously permitted area access road approximately 250 feet to the Village at Wolf Creek boundary," (i.e., the full length of the Access Road as originally contemplated in the 1999 SURP Agreement). Id. § 7(a). 3. At the time the Ski Corporation submitted its 1999 EA (including the Access

Road) to the Forest Service, the Canadian lynx was not classified as a threatened species; thus, the Access Road could have been obtained through the relatively simple EA process had the Ski Corporation sought to fight the threatened Colorado Wild appeal of the 1999 EA.9 However, in April 2000, the Canadian lynx was designated as a threatened species. This designation

triggered an Endangered Species Act review of the impact of the extended Access Road by the U.S. Fish & Wildlife Service. As a result, the U.S. Fish & Wildlife Service mandated that the Joint Venture implement and bear the cost of certain conservation and mitigation measures to protect the lynx. The costs are imposed on a per housing unit basis, ranging from $500 to $1000 per unit. The Joint Venture estimates that these lynx mitigation costs will total $2,803,936 at full build-out.10

9

Testimony from Colorado Wild's Jeff Berman reveals that at that time Colorado Wild did not believe it had a very strong appeal, would lose the appeal, and would not have a strong enough case to go to court.

10

This estimate is set forth on pp. 17-18 of the March 2006 report of the Joint Venture's accounting expert, Lisa Meer. The report itself is stamped CONFIDENTIAL and thus is not attached hereto although copies have been provided to the Ski Corporation. 6

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4.

As a part of the Joint Venture's June 2001 Application, the Joint Venture was

required to pay for the preparation of an Application for Transportation and Utility Systems and Facilities for the Village at Wolf Creek Draft Environmental Impact Statement (the "DEIS").11 Applicable excerpts from the DEIS are attached hereto as Exh. A-2. To prepare the DEIS, the Forest Service solicited proposals from a number of firms and, eventually, with the Joint Venture's approval, selected Tetra Tech, Inc. to prepare the analysis needed for the DEIS. To date, the Joint Venture has expended well over $2,000,000.0012 for preparation of the DEIS and FEIS (the Final Environmental Impact Statement) and other environmental impact documents in order to obtain Forest Service approval for the road the Joint Venture bargained to obtain from the Ski Corporation in July 1999. 5. The DEIS prepared by the Forest Service was approved and published in October,

2004. The DEIS contained a description of the "Proposed Action" providing in pertinent part: To access the western boundary of the private property, the Applicant is proposing to extend Tranquility Road by adding approximately 250 feet of road length...The access road would merge into the current entrance to the Ski Area at the junction of Highway 160. Exh. A-2 § 1.4.1 at p. 1-8. This Proposed Action was essentially the embodiment of the Access Road bargained for in the 1999 SURP Agreement and the 250-foot road extension requested by the Joint Venture in the June 2001 Application. The Proposed Action was initiated with the

The National Environmental Protection Act requires the agency reviewing an application to prepare either an EIS or an EA, as the case may be. The applicant is required to fund the review and approval process by paying for the costs of preparing the analysis for the EIS and the costs of the agency.
12

11

These costs are set forth in the March 2006 expert report of Lisa Meer.

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consent and support of the Ski Corporation which continued to hide the fact of its secret agreement in breach of the 1999 SURP Agreement. 6. Along with the Proposed Action, the DEIS was required under 40 CFR § 1508.25

to identify three alternative courses of action. In this case, Alternative 1 was the standard "No Action" alternative. Id. § 2.2, at p. 2-1. Alternative 2 was the Proposed Action, the 250-foot Access Road extension preferred by the Joint Venture. Id. § 2.3, at p. 2-3. Per the DEIS, the first 2,100 feet13 of this road had already been "developed" (i.e. approved by the Forest Service in 1999 and partially constructed by the Ski Corporation, although not in accordance with the approved parameters). Id. §2.3.1, at p. 2-5. Alternative 3, the Snow Shed ­ East Village Access Alternative (the "Snow Shed Road"), provided for access from Highway 160 to the Village Property at a point approximately one-third of a mile east of the entrance to the Ski Area via the Tranquility Road. Id. § 2.4, at p. 2-6. Under this Alternative 3, the Joint Venture would be authorized to construct a second access road at an estimated length of 1,500 feet and average grade of 6%. Id. § 2.4.1 and Figure 2.4-1 Alternative 3 Map, at p. 2-7.14 7. A fourth alternative was also identified: the Dual Access Road Alternative. Id. §

2.5, at p. 2-6. As its name suggests, this alternative was a combination of Alternatives 2 and 3 and would authorize construction of both the Snow Shed Road and the 250-foot extension to the Tranquility Road.15

13

This figure from the DEIS differs from the final as-built road constructed by the Ski Corporation. Since that time, the length of the Snow Shed Road has increased dramatically as a result of Forest Service mandates. See ¶ 19 infra.

14

15

All three alternatives to the No Action Alternative also included utility corridors running adjacent to the access route.

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8.

For the Proposed Action and each Alternative, the DEIS was required to provide

Project Design Criteria that would be implemented to "avoid, minimize, or mitigate potential impacts to the USFS resources in the proposed project areas." Exh. A-2, Appendix C, at p. C-2. These criteria addressed each of the numerous Rio Grande National Forest Conservation Measures. Id., at p. C-1 to C-47. These conservation measures included maintaining hydrologic function (e.g., erosion and sediment controls), ensuring water purity (pollution controls), protecting riparian areas, safeguarding biodiversity (by, for example, revegetation), preserving wildlife (e.g., by protecting known and inactive raptor nest areas and protected species breeding areas), preventing encroachment by undesirable and non-native plants (by, for example, reclamation of disturbed areas using weed-free materials), and preserving scenic resources (among other conservation measures). Id. 9. Obviously, the costs for implementing each of these protective measures would

vary depending on the Alternative ultimately selected by the Forest Service since each Alternative involved a geographically different site with distinct and varied topography, water courses and wetlands, vegetation, and wildlife. In addition to these costs, each Alternative posed its own potential costs associated with surveying, mapping, designing, and constructing the road and utility corridors themselves. As an entirely separate item of costs associated with the Alternatives, each had its own separate point of access to Highway 160. 10. The Colorado Department of Transportation ("CDOT") regulates access to state

roads, including Highway 160. Any new road connecting to Highway 160 requires an access permit setting forth particularized connectivity requirements dictated by CDOT to accommodate traffic, safety, and other factors identified by a Traffic Impact Study. This study must be

9

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completed by the party seeking access. See C.R.S. § 43-2-147 and State of Colorado State Highway Access Code, Vol. 2, Code of Colorado Regulations 601-1 §§ 2.3(3)a, 2.3(5) and 2.3(7) (March 2002). Thus, connectivity costs would also vary considerably depending on the point of access to Highway 160. 11. Shortly after the Forest Service circulated its DEIS to the public in October 2004,

the Ski Corporation retained an environmental consultant to assist it with the preparation of a detailed and 29-page letter to the Forest Service, prepared and submitted by Ski Corporation attorneys, vehemently opposing approval of the Tranquility Road on a variety of procedural and substantive grounds. See Exh. A-3. This despite the fact that the Ski Corporation had

previously agreed to obtain approval for and to build the Tranquility Road. Accordingly, the Ski Corporation's breach has been ongoing and continues to this day. 12. Simultaneously with its efforts to obtain approval for the Access Road, the Joint

Venture was proceeding through the Mineral County approval process for its Preliminary Development Plan ("PDP") for a 2,172-unit Village. The Ski Corporation had agreed to "use good faith efforts" to implement the PDP in the 1999 SURP Agreement and wrote letters in support of the Joint Venture's PDP to Mineral County. On August 24, 2000, the Board of County Commissioners of Mineral County (the "Board") approved Resolution 2000-13 which set forth the road map for final approval. In keeping with its commitment to the PDP set forth in the 1999 SURP Agreement, in August 2000, the Ski Corporation approved Resolution 2000-13, including all revisions to the PDP described therein, as evidenced by the signature of CEO Kingsbury Pitcher who also approved the Resolution on behalf of himself individually, and as Trustee of the Kingsbury and Charity Jane Pitcher Trust.

10

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13.

Consistent with the requirements of Resolution 2000-13, the Joint Venture

submitted its Final Development Plan ("FDP") to Mineral County in June 2004. Other than the changes called for in Resolution 2000-13, the FDP was the same as the PDP approved by the Ski Corporation in 2000 when it approved Resolution 2000-13. However, the Ski Corporation (now under the management of Davey Pitcher) reversed its earlier position, choosing to oppose the FDP in derogation of its obligations under the 1999 SURP Agreement "to use good faith efforts...to implement" the PDP. Such action constituted a new and additional breach of the 1999 SURP Agreement. Over the course of several months, the Ski Corporation continued to

openly criticize the FDP and the Joint Venture personally, waging an escalating media campaign against the Joint Venture with allegations of corruption, bias, and big money influence. This conduct also constituted a new and separate breach of the 1999 SURP Agreement. Despite the Ski Corporation's efforts to whip up popular opposition, Mineral County unanimously voted to approve the FDP by Resolution 2004-21 in November 2004. 14. Thus, in the fall of 2004, at the same time it was hiring its environmental

consultant to fight the Forest Service approval of the Access Road, the Ski Corporation filed a lawsuit in Mineral County Court to overturn agency approval of the FDP. The filing and prosecution of the Mineral County lawsuit constituted yet another breach of the Ski Corporation's duties as set forth in the 1999 SURP Agreement. After a year of litigation, in which the Joint Venture expended over $130,000.00 in legal fees,16 the Ski Corporation was

16

See March 2006 expert report of Lisa Meer, p. 16.

11

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successful in its challenge. Ironically, the sole reason that the FDP was found inadequate by the Mineral County court was that it did not provide for reasonable access to the Village Property.17 15. Meanwhile, the Forest Service approval process on the Joint Venture's

Application and the accompanying DEIS was proceeding. After months of review and comment by the public (a process in which the Ski Corporation actively and vocally participated), on March 15, 2006, Peter L. Clark, Rio Grande Supervisor for the Forest Service and decisionmaker on the Application, issued a Record of Decision (the "ROD"). Selected excerpts from that 55-page ROD are attached hereto as Exh. A-4. Therein, the Forest Service selected DEIS Alternative 4 as the required course of action with modifications as set forth in the ROD. Id. § 3.2, at p. 5. The ROD required the Joint Venture to construct the Snow Shed Road within a 750-foot-long by 60-foot-wide corridor from Highway 160 to the border of the Village Property. Id. at p. 6. It also gave approval to build the Tranquility Road extension. Id. However, the approval contained use limitations virtually prohibiting the Joint Venture's use of the road during the Ski Area operating season.18 Id. The ROD also set forth the Final Design Criteria for both the Snow Shed Road and the Tranquility Road extension. Id. § 3.3, at p. 8. Obviously, until the ROD was issued, the Joint Venture could not know what alignment(s) would be approved or required, or the accompanying scope of the Final Design Criteria. Nor could it obtain Forest

17

Because the Ski Corporation had reneged on obtaining approval for the full Access Road, the FDP relied upon FSR 391 as the access road from Highway 160 to the Village Property.
18

During the DEIS public comment process, the Ski Corporation requested that the Forest Service not grant the Joint Venture access to the Village Property through Ski Area's Tranquility Parking Lots. The use prohibition in the ROD essentially granted the Ski Corporation's request. 12

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Service permission to have surveyors, geo-technical coring teams, and engineers map and estimate the costs for the two roads. 16. Four parties appealed the Forest Service's decision, including the Joint Venture,

which preferred to have only the one Access Road contemplated by the parties to the 1999 SURP Agreement, as described in the original Application and in the Proposed Action of the DEIS. 17. Last month, on Thursday, July 13, 2006, Deputy Regional Forester for the Rocky

Mountain Region, Greg Griffith, issued decisions with respect to each of these appeals upholding Peter Clark's March 2006 ROD and comprising the Forest Service's final decision (the "Final Decision") on the matter. Exh. A-5. The Joint Venture has filed a request for a discretionary review of the Final Decision with the Secretary of Agriculture urging that only one road, the Tranquility Road, is necessary for the Village and that the second access road, the Snow Shed Road, constitutes an unnecessary environmental impact on Forest Service lands. That appeal is pending and the outcome is uncertain. 18. As a result of the Forest Service's ROD and Final Decision, the Joint Venture has

begun to move forward to map the locations for easement grants for both roads, to survey the easement topography in order to lay out the road alignments, and to prepare final engineering designs. Currently, the design for the Tranquility Road contemplates a 250-foot extension from the end of the existing road across the face of a 30° slope. Exh. A-6, Brown Affidavit, ¶ 4. A modest amount of cutting (into the uphill slope) and filling (of the downhill slope) is expected, along with the construction of associated retaining walls. Id. ¶ 5. The projected cost of the Tranquility Road completion is about $537,000.00. Id. ¶ 6.

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19.

The Snow Shed Road, however, poses a considerably more difficult, and costly,

challenge.19 That road, crossing both public and private lands, will be close to 2,100 feet long, and will likely span three streams and one wetland area. Id. ¶ 7 Because of the steep and challenging terrain, massive retaining walls, anchors, and other specialized mechanical stabilization structures will need to be constructed. Id. ¶ 8. Of the four bridges necessary to span the water features and ravines, the longest will be 400 feet and the shortest approximately 100 feet and is necessary to bring this road up to the grade of the platted road system previously approved by Mineral County. Id. ¶ 9. In addition, the Joint Venture will have to construct a portion of the road, approximately 600 feet, underground. Id. ¶ 10. Accordingly, the cost of the Snow Shed Road will be far greater than for the Tranquility Road completion, almost $15 million according to newly obtained (July 26, 2006) estimates. Id. ¶ 11; and see Exh. A-7. The cost differential is not adequately explained simply by the ratios in the lengths of the two roads and may require some understanding of topography and engineering design. 20. The Joint Venture reasonably anticipates that the Tranquility Road will be

completed as early as this year and that the Snow Shed Road will be completed as early as next summer. The Joint Venture has already retained a road design-build firm and will be signing final contracts for both roads before November of this year.

19

To avoid legal challenges to its next PUD Application, the Joint Venture is not making any changes to the Final Plat approved by Mineral County in 2004. Therefore, the Snow Shed Road must feed into the existing platted entry to the Village Property. It cannot do so by merging with the Tranquility Road outside the Village Property line because the Forest Service will not permit that. As per Forest Service dictates, the Snow Shed Road will have to approach the platted entry from a vastly different elevation. To maintain the 6% grade required by Mineral County, the Snow Shed Road must bridge over and then tunnel thirty feet under the existing terrain.

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21.

Despite its reasonable expectations, the Joint Venture is aware that the Ski

Corporation may yet again file litigation challenging the Forest Service approval or seek other avenues to prevent or delay completion of the two roads, further increasing the Joint Venture's damages at an exponential rate. And, as these costs continue to be deferred to the future, they will more than likely increase along with the need for expert testimony to assist the jury. IV. LEGAL STANDARD Federal Rule of Civil Procedure 16(b) provides that scheduling orders "shall not be modified except upon a showing of good cause and by leave of the district judge or, when authorized by local rule, by a magistrate judge." With respect to an earlier motion to amend the Scheduling Order to reopen discovery, add new experts, and amend pleadings, the Ski Corporation argued and this Court ruled that "`good cause' means that the scheduling deadlines cannot be met despite a party's diligent efforts." See Findings and Order Re: Defendant's Motion to Amend Scheduling Order, docket # 116 (quoting Colorado Visionary Academy v. Medtronic, Inc., 194 F.R.D. 684, 687 (D. Colo. 2000)). In the context of amending a scheduling order for the sole purpose of adding witnesses, as the Joint Venture requests here, the Tenth Circuit has applied the following four factor test: (1) the prejudice or surprise in fact of the party against whom the excluded witnesses would have testified, (2) the ability of that party to cure the prejudice, (3) the extent to which waiver of the rule against calling unlisted witnesses would disrupt the orderly and efficient trial of the case or of other cases in court, and (4) bad faith or willfulness in failing to comply with the court's order.

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Summers v. Missouri Pac. R.R. Sys., 132 F.3d 599, 604 (10th Cir. 1997) (Judge Wiley Y. Daniel sitting by designation; reversing district court's denial of motion to amend scheduling order to permit designation of new expert witnesses filed 80 days before trial). The standard of review on appeal from the denial of a motion to amend a scheduling order is "abuse of discretion." See Burks v. Oklahoma Publ'g Co., 81 F.3d 975, 978 (10th Cir.), cert. denied, 519 U.S. 931, 117 S. Ct. 302 (1996). V. ARGUMENT A. AMENDING
THE SCHEDULING ORDER IS WARRANTED BECAUSE THE JOINT VENTURE HAS BEEN DILIGENT IN DISCOVERY AND BECAUSE GOOD CAUSE EXISTS UNDER APPLICABLE TENTH CIRCUIT AND DISTRICT OF COLORADO PRECEDENT.

1. The Joint Venture has been diligent in meeting scheduling deadlines. Under Colorado Visionary Academy, "good cause" exists to amend the Scheduling Order because the Joint Venture has done everything in its power to meet the scheduling deadlines. Although the Joint Venture could not control or predict the outcome of the Forest Service approval process, it nevertheless endeavored to provide as much information on the Tranquility Road, Snow Shed Road, and CDOT connectivity costs (collectively the "Road Costs") as permitted under the circumstances. The Forest Service could have accepted or rejected any of the proposed Alternatives and could in fact have specified a completely different alternative(s) with completely different point(s) of access. Exh. A-8, Schroeder Affidavit, ¶ 4. Even in the face of these uncertainties, over a year before the Forest Service's Record of Decision and Final Decision, the Joint Venture provided as much detail as possible on these potential damages in the very first report of its damages expert, Lisa Meer. .

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At the time of that initial expert report,20 the Joint Venture's only evidence of the Road Costs were the estimates and invoices cited in Ms. Meer's report. As indicated on the estimates, these were only possible costs based on speculative scenarios and therefore would be of dubious evidentiary value at trial. As the Application and DEIS advanced through the Forest Service approval process, constant changes were made in response to public criticism and comments (including those raised by the Ski Corporation in an effort to completely block approval). Obviously, the Joint Venture had no control over the dictates of the Ski Corporation, the public, or the Forest Service and therefore could not predict any particular outcome. Nevertheless, the Joint Venture provided its best estimate of the anticipated Road Costs so as to put the Ski Area on clear notice that such costs might materialize and, should that prove to be so, would be claimed as damages herein. Arguably, Rule 26 itself prevented the Joint Venture from previously designating an expert to opine on the Road Costs. Under Rule 26(a)(2)(B), expert disclosures must be

accompanied by a written report containing "a complete statement of all opinions to be expressed and the basis and reasons therefor." The report must also contain "the data or other information considered by the witness in forming the opinions." Since the fact of the damages was uncertain and almost no reliable data could possibly have been contained in any separate expert disclosure back in February 2005, there was no possible way for the Joint Venture to make a separate disclosure with respect to the Road Costs. Although the Joint Venture hoped that the Tranquility Road would be approved and knew that the Snow Shed Road might ultimately be required, it

Although Ms. Meer has twice supplemented her report, both supplements occurred prior to the Forest Service ROD and Final Decision.

20

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could not predict either of their precise contours or the easement locations that the Forest Service might select for their placement.21 (Indeed, the metes and bounds of the easements still have not been finalized and approved by the Forest Service.) Without knowing the metes and bounds of these easements, much less having Forest Service approval to enter onto its property to conduct necessary surveys, soils analyses, and mapping, the Joint Venture simply had no evidentiarily acceptable means to calculate the Road Costs. Given the facts set forth above, there was simply no way for the Joint Venture to have better disclosed the fact and the amount of the Road Costs or provided a Rule 26(a)(2)compliant, separate report for same at an earlier date. The "place holders" in Ms. Meer's reports were the only possible way for the Joint Venture to meet the existing Scheduling Order deadlines while complying with the requirements of Rule 26. Accordingly, the Joint Venture has been

diligent in conducting discovery and has shown the requisite "good cause" under Rule 16(b) and Colorado Visionary Academy warranting amending the existing Scheduling Order to permit the Joint Venture to designate an expert to opine on the Road Costs. 2. The Joint Venture has "good cause" to amend the Scheduling Order under applicable 10th Circuit Court of Appeals precedent. In the context of deciding whether to permit the addition of new witnesses, the Tenth Circuit has held that the "manifest injustice" test (the "Smith Test")22 applies equally to motions to amend scheduling orders and to final pretrial orders. See Burks v. Oklahoma Publ'g Co., 81

21

The Forest Service considered two Snow Shed Road alternatives, the second of which was eliminated from detailed study. See Exh. A-4 § 6.5, at p. 46. Nevertheless, the Forest Service could have elected that alternative alignment, or indeed, an entirely different one. Exh. A-8, Schroeder Affidavit, ¶ 4. The test derives from Smith v. Ford Motor Co., 626 F.2d 784, 795 (10th Cir. 1980).

22

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F.3d 975, 979 (10th Cir.), cert. denied, 519 U.S. 931, 117 S. Ct. 302 (1996) ("Although the Smith rule addresses the modification of a final pretrial order, we discern no reason why it should not also apply to a decision to modify a scheduling order before a final pretrial order has been entered."). The Smith Test essentially considers whether amendment is necessary to prevent manifest injustice. Smith, 626 F.2d at 797. In order to make such a determination, the court weighs the following four factors: (1) the prejudice or surprise in fact of the party against whom the excluded witnesses would have testified, (2) the ability of that party to cure the prejudice, (3) the extent to which waiver of the rule against calling unlisted witnesses would disrupt the orderly and efficient trial of the case or of other cases in court, and (4) bad faith or willfulness in failing to comply with the court's order. Summers v. Missouri Pac. R.R. Sys., 132 F.3d 599, 604 (10th Cir. 1997) (Judge Wiley Y. Daniel sitting by designation; reversing district court's denial of motion to amend scheduling order to permit designation of new expert witnesses filed 80 days before trial). This Court previously rejected application of the Smith Test in the Joint Venture's November 2005 motions to amend the Scheduling Order to add new claims, parties, and experts and to reopen both fact and expert discovery. Here, in contrast, the Joint Venture simply seeks to designate one new expert and, unlike previously, does not seek to assert any new claims or new theory of damages. Thus, the evidence will be no different from that already contemplated, nor will the claims, defenses or the parties. The legal standard in such circumstances is the fourfactor test set forth in Smith, Burks and Summers. In a prior brief to this Court, the Ski Corporation argued that, in the context of motions to amend to add new experts, the Tenth Circuit Court of Appeals and others "consistently" apply the more "stringent" good cause standard set forth in Marcin Engineering LLC v. Founders of

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Grizzly Ranch, LLC, 291 F.R.D. 516, 521 (D. Colo. 2003) (holding that the party seeking amendment must have been diligent in its discovery efforts yet could not complete discovery by the court-ordered deadline).23 This assertion is erroneous in two respects. First, the "diligent efforts" test is only employed in the context of motions to amend scheduling orders under Rule 16(b), while the Smith Test applies to motions to amend final pretrial orders under Rule 16(e). See Burks, 81 F.3d at 979 n.1. Since scheduling orders are more flexible than final pretrial orders, the standard for amendment thereof cannot reasonably be construed to be more stringent than for final pretrial orders. See Colorado Visionary Academy, 194 F.R.D. at 688 (applying the `diligent efforts' good cause standard in the context of a motion to amend the pleadings and explaining that, since the scheduling order is entered early in the litigation, this standard is more appropriate than the `manifest injustice' test employed under Rule 16(e) for amending a final pretrial order). Thus, there is no logic to the Ski Corporation's assertion that the "diligent efforts" standard is more "stringent" than the Smith Test. Second, the Ski Corporation is just flat wrong in its assertion that the Tenth Circuit and others throughout the country "consistently apply" the diligent efforts test in the context of motions to amend to add new expert witnesses. In fact, virtually every circuit court of appeals case cited by the Ski Corporation in support of that contention involved motions to amend pleadings that would have expanded litigation.24 Likewise, all but one of the federal district

23

See Wolf Creek Ski Corporation's Combined Opposition to Motion for Leave to Join Additional Parties and to File Amended Counterclaims and Motion to Amend Scheduling Order, Docket # 112 at 15 n.5. SIL-FLO, Inc. v. SFHC, Inc., 917 F.2d 1507, 1518 (10th Cir. 1990) (amending to add counterclaims); Parker v. Columbia Pictures Indus., 204 F.3d 326 (2d Cir. 2000) (amending to add breach of contract claim); In re Milk Products Antitrust Litig., 195 F.3d 430, 437 (8th Cir. 20

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court cases cited by the Ski Corporation are inapposite.25 In fact, the only case on point, Lory v. General Elec. Co., 179 F.R.D. 86 (N.D.N.Y. 1998) wholly contradicts the Ski Corporation's position. Therein, the court concluded, despite a local rule mandating exclusion of untimely expert designations, that exclusion of the belatedly disclosed economic expert would "significantly impair" the plaintiff's ability to prove his case (in other words, it would be manifestly unjust to preclude the expert). Id. at 88-89. It further concluded that (1) the

defendant had suffered no prejudice; (2) the prejudice could be cured by permitting the defendant to depose the expert and designate a similar economic expert of its own; (3) there was no disruption to the trial date; and (4) noncompliance was limited to this single instance, i.e., no bad faith. Id. at 89-90. In short, all four factors of the Smith Test were employed and the movant was permitted to designate its new expert.26

1999) (amending to add new parties); Sosa v. Airprint Syst., Inc., 133 F.3d 1417, 1418 (11th Cir. 1998) (amending to add new defendant); Riofrio Anda v. Ralston Purina Co., 959 F.2d 1149, 1151 (1st Cir. 1992) (amending to add new claim).
25

Harrison Beverage Co. v. Dribeck Importers, Inc., 133 F.R.D. 463, 470 (D. N.J. 1990) (amending answer); Julian v. Equifax Check Serv., Inc., 178 F.R.D. 10, 16 (D. Conn.1998) (seeking amendment to file motion for summary judgment); Forstmann v. Culp, 114 F.R.D. 83, 85 (M.D.N.C. 1987) (amending complaint).

The Ski Corporation later cited DAG Enterprises, Inc. v. Exxon Mobile Corp., 226 F.R.D. 95 (D. D.C. 2005) in further support of denying the Joint Venture's earlier motion to amend. However, that case is likewise distinguishable. In DAG, the plaintiff sough "highly confidential, competitively significant information" from a non-party via subpoena after the close of all discovery. Id. at 96. The court found that the requested information was of dubious value to the plaintiff's damage model. Id. at 108 n. 6. The court also deemed that discovery of the materials would be prejudicial, both to the defendant and to the third party to whom the subpoena was directed, and that denial of discovery did not pose a substantial risk of unfairness to the plaintiff. Id. at 110. In short, DAG bears little resemblance to the case at bar.

26

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Similarly, Marcin Engineering, while persuasive authority, is not on point with our facts. That case involved a request to reopen discovery to avoid summary judgment under circumstances in which the movant and its counsel had behaved outrageously, repeatedly engaging in sanctionable conduct. More specifically, in Marcin Engineering, the

movants/defendants (collectively "Grizzly Ranch") defied a direct order by Judge Kane to produce documents in discovery. 219 F.R.D. at 519. When Grizzly Ranch finally produced the documents, two weeks later than directed by a subsequent order, not only was its production incomplete, Grizzly Ranch incorrectly certified to the court that it had fully complied with the court's order to produce. Id. As a result of its recalcitrance, Grizzly Ranch was sanctioned $35,000.00, and its California counsel was stricken from the case. Id. Because the discovery and dispositive motion deadlines set in the original scheduling order were out-of-date as a result of Grizzly Ranch's misbehavior, Judge Kane extended discovery for the benefit of the plaintiff ("Marcin"), which had been precluded from completing discovery by Grizzly Ranch's misconduct. Id. at 520. During that time, Grizzly Ranch twice revised and resubmitted its expert report without leave of court and, shortly before the extended deadline, requested a three-month extension for expert discovery. Id. at 520-521. Finally, in the face of Marcin's motion for summary judgment, Grizzly Ranch filed a Rule 56(f) motion arguing that it could not respond to the motion without further discovery. Id. In light of Grizzly Ranch's repeated and flagrant disregard and disobedience, the court denied Grizzly Ranch's requests for extended expert discovery and additional discovery under Rule 56(f). In so doing, the court relied as much, if not more, on the applicable standard under Rule 56(f), i.e., "if the party filing the Rule 56(f) affidavit has been dilatory, or the information sought is either irrelevant to the summary judgment motion

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or merely cumulative, no extension will be granted." Id. at 521 (citing Jensen v. Redevelopment Agency of Sandy City, 998 F.2d 1550, 1554 (10th Cir. 1993)). As a further basis for refusing to extend discovery, the Marcin Engineering court observed that the engineering plans and drawings Grizzly Ranch claimed to need in its Rule 56(f) motion were not material to the case and had been superseded by final versions that had in fact been produced by Marcin almost a year earlier, and that Grizzly Ranch had been dilatory in reviewing that production and untimely in failing to complain that the production was incomplete. Id. at 521-22. On a separate matter, the court found that Grizzly Ranch had violated two court orders and, as sanctions, ordered the exclusion of certain evidence and payment of Marcin's attorneys' fees. Id. at 526. Finally, the court emphasized that the amount at issue in the case did not justify the energy and expense consumed by the parties and the court and made no "economic sense." Id. Thus, the court's harsh sanction in Marcin Engineering was

appropriate given Grizzly Ranch's continuing recalcitrance and repeated infractions, which conduct failed not only the diligent efforts test and the requirements of Rule 56(f), but would have dismally failed the more stringent Smith Test as well. Here, on the other hand, there has been no such behavior by the Joint Venture. The Joint Venture has not defied any court orders. The Joint Venture has not been sanctioned or engaged in sanctionable conduct. The Joint Venture has complied with all deadlines or sought prior leave before filing papers outside such deadlines. The Joint Venture is not seeking to extend discovery under Rule 56(f) to avoid the harsh effects of summary judgment occasioned by any lack of diligence in pursuing discovery. Furthermore, the amounts at issue in this case are running into the tens of millions of dollars. The Ski Corporation alone has itemized its alleged damages at

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over $30 million. The Road Costs for the Snow Shed Road and the Tranquility Road, by comparison, are less than half that amount and represent the Joint Venture's single largest item of damages. Accordingly, the harsh sanction of expert preclusion only hurts the trier-of-fact and is not warranted here. Moreover, all four factors of the Smith Test weigh in favor of permitting the Joint Venture to designate a new expert to opine on the Road Costs and related engineering issues (if necessary). (1) There is no surprise/prejudice to the Ski Corporation.

While the potential of the Road Costs has been known as a possibility, it was not known as a factual certainty until July 13, 2006. The Ski Corporation has known about the possibility of the Road Costs for almost a year-and-a-half, since February 28, 2005, when the Joint Venture first produced the report of its accounting expert Lisa Meer. Therein, Ms. Meer set forth, as a speculative "placeholder," the basis for both the anticipated fact and amount of the costs. The report has been twice supplemented, both times including estimates on the Road Costs. Indeed, in its previous brief opposing the Joint Venture's November 2005 Motion to Amend, the Ski Corporation conceded that the "placeholders" in Ms. Meer's report provided adequate notice for the Ski Corporation to conduct discovery. See Wolf Creek Ski Corporation's Combined

Opposition to Motion for Leave to Join Additional Parties and to File Third Amended Counterclaims and Motion to Amend Scheduling Order, docket #112, at 22 n.11. Thus there can be no surprise or unfair prejudice to the Ski Corporation. (2) There is ample opportunity to cure.

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Even if there were any prejudice here, the Ski Corporation can cure that prejudice by deposing the expert (expert depositions still have not been completed, so there is no need to alter any expert discovery deadlines). And, the Court may permit the Ski Corporation to designate a rebuttal expert. Accordingly, not only is the Ski Corporation not prejudiced, it will likely benefit by permitting the Joint Venture to designate a new expert since the Ski Corporation would also likely be allowed to designate a rebuttal expert. (3) There would be no disruption to trial.27 Accordingly, there is no possibility for disrupting the

No trial date has been set. orderliness and efficiency of trial. (4)

There is no evidence of bad faith or willful non-compliance with existing deadlines.

As set forth above, the events leading up to ROD and Final Decision were beyond the Joint Venture's control; therefore, there is no indication of bad faith.28 To the contrary, the Joint Venture did everything permitted under the Rules and the existing Scheduling Order to diligently pursue discovery. It has not failed to meet any existing deadlines or filed any pleadings or legal papers outside the deadlines without first seeking leave of this Court. Moreover, the amount at stake, over $15 million, comprises the single largest item of the Joint Venture's damages. And the need for an expert has been occasioned by the ongoing breaches of the Ski Corporation. Accordingly, it would be manifestly unjust to preclude the

FED. R. CIV. P. 26(a)(2)(C) itself contemplates that experts may be disclosed as little as 90 days before trial by providing a 90-day pretrial default deadline. The Ski Corporation, on the other hand, has done virtually everything in its power to prolong the approval process thus deferring the Road Costs further and further into the future. 25
28

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Joint Venture from designating an engineering expert to opine on the Road Costs if such have not been expended by the time of trial. B. ALTHOUGH EXPERT TESTIMONY IS NOT REQUIRED TO PROVE THE FACT AND AMOUNT OF THE ROAD COSTS, DESIGNATING AN EXPERT ON THIS ITEM OF DAMAGES WOULD ASSIST THE JURY IN UNDERSTANDING HOW THE ROAD COSTS WERE CALCULATED. The Ski Corporation will likely argue that it was foreseeable that the Forest Service would grant the Joint Venture's Application and that, therefore, the Joint Venture should have designated an expert to opine on the Road Costs. There are several problems with this argument. First, while some costs were certainly foreseeable (indeed to the extent they were, the Joint Venture disclosed them in the report of its accounting expert, Lisa Meer), foreseeability is not the test for admissibility of damages evidence. Rather, the fact of the damages must be proved with "reasonable certainty." Carder, Inc. v. Cash, 97 P.3d 174, 185 (Colo. App. 2003). Until the Forest Service issued its ROD and Final Decision, the Joint Venture had no reasonable certainty, indeed any certainty, that its June 2001 Application would be approved and therefore no legitimate basis on which to formally opine on possible costs. Second, and even more importantly, even if the Joint Venture could have been certain as to the fact of its damages, i.e., that the Forest Service would approve the Application, before the Final Decision was issued, the Joint Venture had no fair basis to calculate those damages because it had no way of knowing what general alignment(s) the Forest Service would approve. Each different alignment poses unique construction and environmental challenges that significantly impact costs. Therefore, not only the fact of the damages but the amounts as well were legally speculative until July 2006.

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Finally, the Joint Venture did not need an expert to opine on the Road Costs because it anticipated that those costs would be largely expended or contractually committed by the time of trial, therefore, Mr. Honts's testimony would suffice (see below). If any, the Joint Venture's only error was in underestimating the lengths to which the Ski Corporation would go to prevent the roads and the Village development from ever being completed. Each successive breach of the 1999 SURP Agreement and each new legal challenge mounted by the Ski Corporation pushes the completion date farther and farther into the future, rendering future costs more and more speculative, with or without expert testimony. Thus, as long as no amendments to the

Scheduling Order are permitted to assert new claims and new damages, there is no deterrent to the Ski Corporation's ongoing breaches, which, like the Joint Venture's mounting damages, are moving targets. The Joint Venture still believes that the Road Costs will be largely expended by the time of trial. Nonetheless, in view of the proven willingness of the Ski Corporation to litigate at every step of the process, the Joint Venture cannot idly discount the possibility that the Ski Corporation will appeal the Forest Service approval to the courts and/or challenge the Joint Venture's revised Final Development Plan when it is submitted to Mineral County. Nor can it predict what other grassroots or legislative assaults the Ski Corporation might mount that could further delay completion of the project. Thus, in an abundance of caution, the Joint Venture seeks leave to designate an engineering expert to opine on the Road Costs. 1. Lack of an expert does not preclude the Joint Venture's presentation of damage elements for the Road Costs relative to its breach of contract claim.29

The Ski Corporation has suggested in past briefing that the Joint Venture cannot prove up certain of its damages including EIS costs, lynx mitigation costs and the Road Costs because it has not designated an expert to opine on the reasonableness and necessity of same. This premise 27

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Colorado has specifically rejected the notion that expert testimony is required to establish either the fact or the amount of future damages. See Pomeranz v. McDonald's Corp, 843 P.2d 1378, 1383 n.7 (Colo. 1993) (rejecting defendant's "best obtainable evidence rule," which would almost always require expert testimony, and stating that "[e]xpert testimony is not always required to establish the amount of future damages"). While a fact witness testifying as to future damages must possess the proper foundation, such foundation can consist of a familiarity with the business records of the company supported by documentary evidence of past or future costs. See, e.g., id. at 1384 (co-owner and manager of plaintiff company could opine on future taxes based on his experience in paying past taxes and on introduction of past tax bills); Tull, 709 P.2d 940 at 945 (president of plaintiff company could opine on costs of completion based on estimates prepared by his company); Terrones v. Tapia, 967 P.2d 216, 219-20 (Colo. App. 1998) (plaintiff's testimony that an engineer had informed him that it would cost more than $10,0000 to

is incorrect. It is black letter law in Colorado that the burden is on the party opposing mitigation costs, in this case the Ski Corporation, to demonstrate that such costs are unreasonable and unnecessary. See Tull v. Gunderson, 709 P.2d 940, 947 (Colo. 1985); Holland v. Green Mountain Swim Club, Inc., 470 P.2d 61, 64 (Colo. App. 1970). Where a plaintiff desires to recover the expenses of an attempt to avoid a loss, in such circumstances it is prima facie sufficient for him ordinarily to establish the fact of payment, and then the burden of introducing the evidence that the means employed, and the expense thereof, were unnecessary or unreasonable, is on the defendant. Hoehne Ditch Co. v. John Flood Ditch Co., 233 P. 167, 170-71 (Colo. 1925). The Joint Venture anticipates having paid or contracted for much of the Road Costs by the time of trial. Therefore, the paid invoices and contracts will be considered prima facie evidence of reasonableness. See Holland, 470 P.2d at 64. To the extent that any costs remain to be paid, all the Joint Venture need do is establish, by a preponderance of the evidence, the fact of the damages and present sufficient evidence of same from which the jury can arrive at a reasonable calculation thereof. Western Cities Broadcasting, Inc. v. Schueller, 849 P.2d 44, 48 (Colo. 1993); Pomeranz v. McDonald's Corp., 843 P.2d at 1382 (Colo. 1993).

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remodel "was sufficient to compute a fair approximation of the cost of building modifications"). See also Thompson v. Kerr-McGee Refining Corp., 660 F.2d 1380, 1388 (10th Cir. 1981) (evidence of past monthly income over a nine-year period as well as plaintiff's age were sufficient to permit the lower court to reasonably infer that plaintiff would have continued to work another six years and that earnings from that time period would approximate the amount of damages awarded, thus such award would not be disturbed on appeal). Nor does Colorado law on calculating future damages collide with FED. R. EVID. 701 or 702. Lay opinion testimony on the issue of damages is admissible where it is rationally based on the perception of the witness and is helpful to a clear understanding of the witness's testimony or the determination of a fact in issue. Lightning Lube, Inc. v. Witco Corp., 4 F.3d 1153, 1175 (3d Cir. 1993) (business owner could opine on future lost profits because of his knowledge and participation in the day-to-day affairs of his business; his partial reliance on an accountant's report did not render his testimony beyond the scope of Rule 701). To the contrary, "[t]he modern trend favors the admission of lay opinion testimony, provided that it is well founded on personal knowledge and susceptible to specific cross-examination." Id. at 1175. See also State Office Sys., Inc. v. Olivetti Corp. of Am., 762 F.2d 843, 846 (10th Cir. 1985) (plaintiff's president/treasurer's lengthy experience in marketing and selling subject computers and his personal knowledge of plaintiff's operations, sales, and profits qualified him as a witness able to render an opinion concerning lost future profits and to present the exhibit containing projections of same); MCI Telecommunications Corp. v. Wanzer, 897 F.2d 703, 706 (4th Cir. 1990) (district court erred in excluding testimony of defendant's bookkeeper, who had not been identified as an expert witness under Rules 702 and 703; testimony was based on facts and data perceived by her

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in her capacity as an accountant and bookkeeper); Joy Mfg. Co. v. Sola Basic Indus., Inc., 697 F.2d 104, 111 (3d Cir. 1982) (trial court abused its discretion in striking testimony of plaintiff's plant supervisor insofar as he had sufficient personal knowledge of plaintiff's heat treating facility to make an estimate of what amount of downtime was allocable to problems created by defendant furnace manufacturer); Teen-Ed, Inc. v. Kimball Int'l, Inc., 620 F.2d 399, 403 (3d Cir. 1980) (personal knowledge of plaintiff's balance sheets acquired by plaintiff's accountant was sufficient under rule to qualify him as witness eligible under rule to testify to both his opinion of how lost profits could be calculated and to inferences that he could draw from his perception of plaintiff's books; fact that he might have been able to qualify as expert witness on use of accepted accounting principles in calculation of business losses should not have prevented his testifying on basis of his knowledge of plaintiff's records about how lost profits could be calculated from data contained therein); Farner v. Paccar, Inc., 562 F.2d 518, 529 (8th Cir. 1977) (in wrongful death action against truck manufacturer wherein recovery was sought on a negligence theory of products liability, it was within the trial court's discretion to permit witness who had been in the trucking business almost 30 years to give his opinion on the proper design of suspension systems for trucks either as a lay or expert witness). In sum, where a lay witness possesses sufficient foundational knowledge, he or she may testify as to damage estimations, projections, or calculations. "The heart of expert testimony is the foundation." Lifewise Master Funding v. Telebank, 374 F.3d 917, 929 (10th Cir. 2004) (plaintiff's CEO could not testify as to lost future profits because he was not qualified in the methodology employed in calculating such profits, i.e., moving averages, compounded growth rates, and S-curves).

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Here, Mr. Honts has the necessary foundational knowledge to testify as to not only the Road Costs, but all costs incurred by the Joint Venture with respect to every aspect of the Village development. For the last ten years, Bob Honts Properties, Inc. (of which Mr. Honts is

president) has been the commercial real estate broker and pre-development coordinator for the Village. Exh. A-9, Honts Depo 16:15-21. Mr. Honts is the president, and 100% owner, of the Village at Wolf Creek Development Corporation, the managing venturer of the Joint Venture. Id. at 13:20-14:2; 18:2-4. Through that entity, Mr. Honts personally administers contracts with engineers, consultants, planners, and others in carrying out the budget and work program goals of the Joint Venture. Id. at 16:22-17:6. It will be Mr. Honts who will sign the final contracts and the checks to pay for all the Road Costs. Accordingly, Mr. Honts will have the first-hand factual knowledge necessary to testify as to the amounts expended by the Joint Venture in connection with the Roads Costs, the Forest Service approval process (including the Application, DEIS, and FEIS), and the lynx mitigation costs. Thus, expert testimony on these items of damages is not necessary. To the extent Mr. Honts testifies in the way of opinion regarding any aspect of the Village development, he is qualified to so opine not only as an owner of the Village Property and because of his personal involvement in the project, but because of his background as well. Mr. Honts has extensive experience in community planning and administration, holding a Masters Degree in Public Administration, and serving as a County Commissioner for Travis County, Texas (wherein the city of Austin is located) for twelve years. Exh. A-9, Honts Depo, 27:10-21. As County Commissioner, Mr. Honts was the primary liason for development activities and for the county engineer in writing Travis County development policies. Id. Mr. Honts also served

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as Administrative Assistant to the City Manager for the City of Fort Worth, Texas, and in that capacity regulated all real estate development, permits, and applications to that city. Id. 26:2225. Later, as Director of Administration for the City of Lubbock, Texas, Mr. Honts reviewed, supervised, and made recommendations regarding development applications and permit proposals for development within the City. Exh. A-9, Honts Depo, 27:1-5. He subsequently

served as City Manager for the City of White Settlement, Texas, where he was directly responsible for reviewing/writing development contracts and regulating development in that small city. Id. at 27:6-10. With respect to highways and roads in particular, Mr. Honts was the Chairman of the Austin Transportation Study Policy Advisory Committee, led the effort to pass the largest road bond issue in the history of Travis County, gaining approval for more than $1 billion in area highways by the Texas Department of Transportation, and obtained contracts for widening and realigning existing roads. Exh. A-10 at p. 1 and 5. Thus, to the extent Mr. Honts's testimony regarding costs consists of opinion, such opinions are well-founded based on the foregoing credentials. 2. Having an expert testify as to the Road Costs would assist the jury.

Even though Mr. Honts is qualified to testify as to the Road Costs and other costs described above, and expert testimony is not required, the Joint Venture believes that having an expert available to opine on the Road Costs would assist the trier of fact. Under the Federal Rules of Evidence: 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, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and

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methods, and (3) the witness has applied the principles and methods reliably to the facts of the case. FED. R. EVID. 702 (emphasis added). The "touchstone" of admissibility of expert testimony is helpfulness to the trier of fact. Werth v. Makita Elec. Works, Ltd., 950 F.2d 643, 648 (10th Cir. 1991). "The test express