Free Opening Brief in Support - District Court of Delaware - Delaware

Case 1 :04-cv-0O582—Gl\/IS Document 57-4 Filed 08/15/2005 Page 1 of 3
LEXSEE 2004 U.S. DIST. LEXIS 3258
GEORGE P. HEBBLER, JR., ET AL. VERSUS EMILE L. TURNER, ET AL.
CIVIL ACTION NO. 03-388 SECTION "K" (4)
UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF
LOUISIANA
2004 (LS. Dist. LEXIS 3258
March 1, 2004, Decided
March 3, 2004, Filed; March 4, 2004, Entered
SUBSEQUENT HISTORY: Partial summary judgment I. BACKGROUND
granted by, in part, Partial summa.ry judgment denied by, . . . . .
an part Hebbler u. Turnnr, 2004 us. nn:. Laxzs 3264 1 ;I.1“s l“’s““ “°““ f'°m dw f°“’°d l‘q“"i“‘°“ °f *h°
(ED. La- Mm, 2 2004) aw 1rm of Turner, Young, Hebbler & Babm, A.P.L.C.
’ ' ("Lawfimi") commencing June l, 2002, at the hands of
anion msronvr Hebbler u Turner, 2004 us. on:. 1** ‘“°J°“‘V Sh“'°"°1°?’· ."°f°“d“'“ .[ 2] E““l° L
MS 692 M M-- JM M- 2004} l.“;‘.L‘;"§I.;.l.4:.°"§’...E.*‘.;’.,°"{;‘r€i“_rZi‘2.»t'i §£ti.f‘“~‘3l§’.%$§f E2
_ . . , . Fuxan. Plaintiffs assert various breach of Iiduciary duty
gggcd Plamuffs Mmm to Exclude claims relating to the pre-liquidation affairs of the firm
‘ and to the handling of the liquidation by Turner, as self-
. . appointed liquidator, as well as certain claims for unpaid
L£msN°ms(R) Hmdmtcs compensation and for a distribution to Hebbler and
Young of the value of their ownership interest in the
COUNSEL: For GEORGE P HEBBLER, IR, THOMAS firm'
M YOUNG, GREG C FUXAN, plaintiffs: Mitchell J. The disputed expert testimony relates to plaintiifs
Hofiinan, Marynell Lapuyade Piglia, Lowe, Stein, claim that defendant Turner breached his fiduciary duty
Hoffman, Allweiss & Hauver, New Orleans, LA. to Lawfrm and its minority shareholders by overcharg-
ing the tirm rent for use of a building that he owned. The
For EMILE L TURNER, TURNER, YOUNG, proposed expert in question, Andrea A. Huseman, is a
HEBBLER & BABIN, A.P.L.C., defendants: Scott T. commercial real estate agent with Corporate Realty, Inc.
Whittaker, Phillip A. Wittmann, Rachel Wendt Wisdom, Huseman has been a commercial agent since 1986. She
Ashlee Megan Robinson, Stone, Pigman, Walther, Witt- is neither a licensed appraiser nor a licenced real estate
mama & Hutchinson, LLP, New Orleans, LA. broker. The majority of her work is office leasing in the
Central Business District of New Orleans, Louisiana,
JUDGES: Stanwood R. Duval Jr. whe1·e the office space at issue is located. She has not
testified as an expert at trial or by deposition in the last
OPINIONBY: Stanwood R. Duval lr. four years and has not authored any publications in the
last ten years. [*3]
OPINION: . .
Huseman's expert report asserts the opinion that the
Before the Court is a Daubzrt Motion to Exclude the rent defendant Turner charged Lawfirm for properties
Expert Testimony of Andrea Huseman (Rec Doc. 32) located at 422 and 424 Gravier Street from l992 to 2002
filed by plaintiffs George P. I-Iebbler, Jr., Thomas M. was "fair and consistent with market values." Huseman
Young and Greg C. Fuxan. Having reviewed the plead- expert report at 2. She further states that the disputed rate
ings, memoranda, expert report, and relevant law, the structure was advantageous to the tenant, Lawtirm, be-
Court GRANTS plaintiffs motion on the grounds of in- cause it was in the lower range of rents for similar types
sufficient expert methodology. of property and it remained constant for ten years. Id
I-iuseman based her opinion on her knowledge of market

Case 1:04-cv-0O582—Gl\/IS Document 57-4 Filed 08/15/2005 Page 2 of 3
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2004 U.S. Dist. LEXIS 3258, *
terms for comparable commercial office space, personal
experience, company listings, and general market knowl-
edge. id In preparation for rendering her opinion, Huse· the trial judge must determine at the
man reviewed the leased premises and various docu- outset, pursuant to Rule 104(rr), whether
ments and records. Id. She also interviewed defendant the expert is proposing to testify to (1)
Turner, Mrs. Tamer, and Cindy Walker, Lawfirm's for- scientitic knowledge that (2) will assist
mer office manager. Id the trier of fact to understand or determine
a fact in issue.
II. ANALYSIS
Plaintiffs charge that I-Iusemau's testimony does not
meet the samrssasrrtty criteria set tons in Doubert V. Dlgbffgg f;i·H;fs·: ti ggsgzdzgggéfg;
Merrell Dow Pharmaceuticals, Inc., and it should, there- P Kgs d rt mstimon ma be admitted M I 595
tore, noise allowed. soc its sm 113 sx ct. 2786] 125 *};*3 _§'°C,°’;t";796 The gu fm com als;) mfd tha;
L. Ed. 2d 469 (1993). "Trial courts have ‘wide discretion' this émlifsis Hemzuils a Ezlhnmnry assessment of
in deciding whether [*4] or not a particular witness whether the reasoning or methodology underlying the
‘i““"E°S as °“ °"*’°“ "“d°" “‘° F°d°“" R“l°‘ °f E"' [*6] testimony ri scrcmtncsrry write out or whether that
dance" Hidden Oaks Limited v. City of Austin, 138 FZ3d reasoning or methodology properly can bc applied to the
1036, 1050 (5th Cir. 1998). Federal Rule of Evidence facts in issue ,, M
702 governs the admissibility of expert testimony: `
The first prong of Daubert requires the trial court to
determine whether expert testimony is based on a meth-
. . . . . odology that is reliable. It is this aspect of I-Iuseman's
g;=;;j·;ggg·_;—j;g*¤;;;g;;glggtggrsgpgggg testimony that _pr...sa»r, shrugs. In amos, an
missed **·= avid ¤¤¤= 0* *¤ ·*·=*¤¤¤i¤= ¤ °’r“r'Z.‘Z`{°it§*°E`§1i1%$`§0ii,°“"Z0tl°Zi'rSrlZ"£’sirZ°TtS$Zi”ZtYa'I
fm is s Wi¤·=¤==¤¤¤i¤=·* as M- his Zn,s.o··n otsysgiiss or .11797 mr in
pm by '°‘°""'°dg°· skim °"*’°'i°“°°· 2d)h?484 sévaar two}; which may be considered at
mining Or education' may testify thcrctc detemrinirig the soundness of the scientific methodology
in the form of an opinion or otherwise, if includ?
(1) the testimony is based on sufficient '
facts or data, (2) the testimony is the 1) whether the theory or technique
product of reliable principles and meth- can be and has been tested;
ods, and (3) the witness has lied the .
principles and moans stil? is at h 21 their me mesa or *s·=h·¤··-i¤=
facts ofthe case. ailpglrgnsubjected to peer review and
Pu I
3) the known or potential rate of error
Fed R. Evid 702. Rule 702 was amended in 2000 to and the existence and maintenance of
reflect the United States Supreme Court's decisions of standards; and
Douber; 509 US. 579, 113 S. C:. 2784 125 1.. Ed 2d 4) whether the than or mimi uc
469 (1993) and Kumho Tire Co. v. Carmichael 526 US Sed h be mu ry wd q
137, 119 s. cr. 1167, 143 ri art 2d 238 (1999). Doreen “ “s °" gm Y“°°°l’ ·
changed the criteria for the admissibility [*5] of expert
testimony and charged trial courts to act as "gate-
keepers" to ensure that the proffered testimony is both Id at 593-94, 113 Si Ct. at 2796-9Z 125 L. Ed 2d at
relevant and reliable. Dcubert 509 UCS o1589,592-93, 482-83. 'Ihese factors do not constitute a definitive
113 .51 Ct. at 2795, 2796. Kumho Tire held that the rele- checklist or test. Kumho Tire, 526 US or 144, 119 S. Ct.
vant and reliable standard announced in Dcrubcrt for sci- at 1175. [*7] Instead, they compose a nonexclusive,
entific expert testimony applied to all types of expert flexible test to ascertain the validity or reliability of the
testimony. Id, 526 DES. ct14Z 119 S. Ct. at 1171. methodology the expert employed. Id The applicability
In Dunham the Supreme com articulated 8 tw0_ pi each factor depends on the particular facts ofthe case.
prong test for determining the admissibility of expert
testimony. When faced with a proffer of expert testi- When expert testimony is challenged under Doubert,
mony: the burden of proof rests with the party seeking to pre-
sent the testimony. Moore v. Ashland Chemical, Inc., 151

Case 1:04-cv-0O582—Gl\/IS Document 57-4 Filed 08/15/2005 Page 3 of 3
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2004 U.S. Dist. LEXIS 3258, *
F.3d 269 (5th Cir. 1998). To meet this burden, the de- has no application to the expert testimony of a comrner-
fendants cannot simply rely on their experts assurances cial real estate agent testifying lrom personal knowledge
that she has utilized generally accepted scientific meth- and experience as to the market terms and rates for
odology. Rather, some objective, independent validation commercial office leases. ln other words, defendants
ofthe expert's methodology is required. Id argue that "Huseman's testimony cannot be evaluated
In the me at bar, pm I cmrmwmial mal mm under the specific factors set forth rn Dauberr, and rt rs
value expert Huseman‘s two-page report reveals an ab- t° bc' Dcfcndamls Mcmm-mdum m Opp°`
sence of methodology sufficient to satisfy the Dauberr `
prong of reliability. Huseman has opined as to real prop- The Court disagrees with defendants' interpretation
erty lease valuation, however, she has not demonstrated of Kuhmo Tire “It is unquestionable that the Dauber:
any adherence to standard principles of appraisal. The analysis applies to all expert testimony, whether based on
proposed expert is neither a licensed appraiser nor a li- scientific knowledge or on experience, training, or other
censed real estate broker. Furthermore, her report does specialized [*10] knowledge." American Tourmaline
not indicate that Huseman has any formal training in the Fields v. International Paper Company, 1999 US. Dist.
methods of appraisal. [*8] Nowhere in her report does LEXIS 5790, 1999 WL 242690 OLD. Tex. 1999). Defen-
Huseman indicate that she employed generally accepted dants correctly point out that Drruber: is meant to be a
methods of commercial lease appraisal. The Fifth Circuit flexible test enabling trial courts to succeed as "gate-
has upheld a district court's rejection of just such a wit- keepers" in both scientific and non-scientific expert de-
ness in Hidden Oaks Limited v. City of Austin, 138 F.3d terminations, however, defendants misapply Daubertis
1036. 1050 (5th Cir. 1998) (Trial court was within its flexibility in the case at bar. Huseman's proffered testi-
"wide discretion" in disqualifying property appraisal mony is not unacceptable because the proposed expert
witness who was not a licensed appraiser, was not a li- neglected to employ the scientific method; rather, her
censed real estate broker, who lacked formal training in expert opinion is inadmissable because she failed to il-
the methods of appraisal, and who neglected to outline lustrate a reliable adherence to real estate valuation
standard appraisal theory) methodology. Huseman is not a license real estate ap-
d H·;5~=m==·lg'j gg¤=¤f¤¤=*¤i¤¤ is ged =>¤ he {agi'- iiaigthiii Qi`Z°hi§°v§EZ1`ZZ`EX.i,§ir$°r`$°L`E.°iti2°iii?
6 gc O mar B rms . °r ccmpm ° Cimimcrcm ° '°° than to say she relied on her knowledge, company list-
spam persona] cxpcmncm company hStmgs’ md gm` in and other materials Huseman ne lects to vide
as am ks¤w'=¤s= ¤s~t·‘=**¤=*·¤*=~#*=~*¤*’t*¤=*=a==·=<* rtitsstitpmpsrt, site stamfr. r.m.rE§°.s..d a
ph°m1s°s’ vmws dwumcms md r°c°rds’ ind mtcmcws to arrive at her opinion. In short, defendants have sup-
with defendant Tum°r’ Mm Tumm-’ Cmdy walker" lied the Court with little more than their ro sed ex-
Hi·S=¤=¤¤'é gg¤¤·i¤ was ¤¤*· *·¤·*a=*· ¤ta—i·*¤h·**= Qpgg gems hermit em, is opinion rarmEn,Y°md at
gghagriélglcnggiigg gasi;‘;§;°§°i*:,;’1f;;*‘;}j;‘jmfnggéial promise that she relied on unprovided, non-referenced
lease in dispute Consequentlylal-Irrsen1an’s expert opin- ;°mpmblcT1wrml?Ig*l1] in Taching im! c°§`ch;s,§0n§`
. . . . ` ’ , ocusing "soey on useman's princip es an m -
fggugegssumclent t° med the dcfmdams burden undcr ology, not on the conclusions that they generate,” this
' Court is unable to f'md that defendants have met their
Plaintitis object to Husemarfs [*9] testimony on the burden Doubert and Moore v. Ashland Chemical. See l
grounds that here techniques did not evince a scientific Dmrbert, 509 US. or 595, H3 S. Cr. 2797. 'I`hus, Andrea
methodology. Defendants countered with the observation A. Huseman should not be permitted to testify as an ex-
that thc Supreme Court, in Kumho Tire, emphasized that pert in corrunercial real estate valuation. Accordingly,
the Doubert analysis is meant to be a flexible one, and . . , .
**·¤*."*·‘·= tam i¤s=¤*i**=s* it Pam" ma M my Mt is sxaiiii.?$,E¥iZr`i`Z2E§?Zi“iftir?s?§°rL'tl§lZir`i'iZZ
pertment m assessing reliability, depending on the nature Dm 32) is hmby GRANTED
of the issue, the expert's particular expertise, and the sub- ' °
ject of his testimony} Kumho Tire, 526 US or 150, 119 Stanwood R. Duval Jr.
S Ct at 1175. Defendants aver that the scientific method ‘ .

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