Experts — Accepted Methodology

In Inline Connection Crop. v. AOL Time Warner Inc., 2007 U.S. Dist. LEXIS 4761 (D.Del. Jan. 23, 2007), a patent infringement case, the Magistrate Judge rejected a Daubert challenge to defense expert testimony concerning damages and royalty calculations. Some of the testimony was based on conversations between the expert and employees of other corporations in the field and, according to the plaintiff, the experts failed to as substantiating questions or obtain any business records supporting the oral representations. The Magistrate Judge refused to disallow the testimony because the experts ‛gathered data and generated their reports using methodologies consistent with the Litigation Services and Applicable Professional Standards of the AICPA-that is, they obtained information of a type and in a manner acceptable under the AICPA standards in forming opinions.“ As reprinted in the opinion, these standards, cited as AICPA Special Report 03-1, 2003, provide that: ‛The data gathering process may include a review of relevant documents, research analysis, and interviews. The nature and extent of the data will vary with each engagement and may include the practitioner's computations and analysis and other information-supporting conclusions.... The quantity, type, and content of documentation are determined by several factors, including the practitioner's professional judgment, the nature of the engagement and the directives of counsel.“ These standards are so broad that one wonders how it would be possible not to comply with them. The Court also found, under the Rule 703 balancing test, that the defense experts could disclose this inadmissible information to the jury.

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