Experts — New Opinion Based on Info Known at Time of Original Report Not Supplemental Report — If Facts Unchanged, 2d Report = Impermissible New Opinion — Preclusion Is Drastic, Imposed Rarely (Good Quotes)
Coene v. 3M Co., 2014 U.S. Dist. LEXIS 128150 (W.D.N.Y. Sept. 11, 2014):
Rule 26(a)(2)(B)(i) of the Federal Rules of Civil Procedure provides that a written expert report must contain "a complete statement of all opinions the witness will express and the basis and reasons for them." Fed. R. Civ. P. 26(a)(2)(B)(i). "It should be assumed that at the time an expert issues his report, that report reflects his full knowledge and complete opinions on the issues for which his opinion has been sought." Innis Arden Golf Club v. Pitney Bowes, Inc., 2009 U.S. Dist. LEXIS 125609, 2009 WL 5873112, *3 (D. Conn. 2009) (quotation omitted). Parties are required to make their expert disclosures "at the times and in the sequence that the court orders." Fed. R. Civ. P. 26(a)(2)(D). In addition, parties have thirty days after another party's expert disclosure to produce any expert evidence "intended solely to contradict or rebut evidence on the same subject matter identified by another party." Fed. R. Civ. P. 26(a)(2)(D)(ii).
Rule 26 also imposes an affirmative duty to supplement an expert report "in a timely manner if the party learns that in some material respect the disclosure or response is incomplete or incorrect, and if the additional or corrective information has not otherwise been made known to the other parties during the discovery process or [*24] in writing." Fed. R. Civ. P. 26(a)(2)(E) and 26(e)(1)(A). Supplemental reports must be provided at the same time that a party's pretrial disclosures are due. Fed. R. Civ. P. 26(e)(2).
"The duty to supplement arises when the expert subsequently learns of information that was previously unknown or unavailable, and the new information renders the earlier report incomplete or inaccurate." Lewis v. FMC Corp., 786 F. Supp. 2d 690, 705 (S.D.N.Y. 2011) (citing Fed. R. Civ. P. 26(e)). The rule does not, however, permit a party to supplement an expert report at any time it wishes, "but instead imposes an obligation to supplement the report when a party discovers the information that it has disclosed is incomplete or incorrect." Id. (quoting Coles v. Perry, 217 F.R.D. 1, 3 (D.D.C. 2003)).
"Although Rule 26(e) 'does not itself define the word supplement[,] . . . common sense suggests (and numerous decisions confirm) that an expert report that discloses new opinions is in no way a mere supplement to a prior report.'" Stuhlmacher v. Home Depot USA, Inc., 2012 U.S. Dist. LEXIS 164722, 2012 WL 5866297, *3 (N.D. Ind. 2012) (quoting Trinity Homes, LLC v. Ohio Cas. Ins. Co. Grp., 2011 U.S. Dist. LEXIS 61701, 2011 WL 2261297, *3 (S.D. Ind. 2011)). To interpret Rule 26(e)'s supplementation provision more broadly, particularly by permitting supplementation whenever a party seeks to bolster its expert, "would [wreak] havoc [on] docket control and amount to unlimited expert opinion preparation." Lewis v. FMC Corp., 786 F. Supp. 2d at 705 (alterations in original) (quoting Akeva LLC v. Mizuno Corp., 212 F.R.D. 306, 310 (M.D.N.C. 2002)).
Rule 37(c)(1) provides that if a party fails to disclose information "as required by Rule 26(a) or (e), the party is not [*25] allowed to use that information . . . unless the failure was substantially justified or is harmless." Fed. R. Civ. P. 37(c)(1). The party seeking Rule 37 sanctions bears the burden of showing that the opposing party failed to timely disclose information. See Lodge v. United Homes, LLC, 787 F. Supp. 2d 247, 258 (E.D.N.Y. 2011). "Rule 37(c)(1)'s preclusionary sanction is automatic absent a determination of either substantial justification or harmlessness." Innis v. Arden Golf Club v. Pitney Bowes, Inc., 2009 U.S. Dist. LEXIS 125609, 2009 WL 5873112 at *2. The purpose of this rule is "to prevent the practice of 'sandbagging' an adversary with new evidence." See Ritchie Risk-Linked Strategies Trading (Ireland), Ltd. v. Coventry First LLC, 280 F.R.D. 147, 156 (S.D.N.Y. 2012) ("Ritchie Risk") (quoting Ebewo v. Martinez, 309 F. Supp. 2d 600, 607 (S.D.N.Y. 2004)).
As an alternative to preclusion, the rule also affords the court discretion to impose lesser sanctions, such as monetary sanctions or an adverse jury instruction, "in addition to or instead of this sanction." Fed. R. Civ. P. 37(c)(1); Ritchie Risk, 280 F.R.D. at 156 ("imposition of the preclusion sanction remains within the trial court's discretion"). Indeed, the Second Circuit has counseled district courts to consider lesser sanctions prior to precluding evidence as a sanction for discovery violations. See Outley v. City of New York, 837 F.2d 587, 591 (2d Cir. 1988) ("[b]efore the extreme sanction of preclusion may be used by the district court, a judge should inquire more fully into the actual difficulties the violation causes, and must consider less drastic responses"); Hunt v. CNH Am. LLC, 857 F. Supp. 2d 320, 340 (W.D.N.Y. 2012) (noting that courts should consider lesser [*26] sanctions before precluding a new expert opinion disclosed after discovery deadline in violation of Rule 26(a)(2)(B)), aff'd, 511 F. App'x 43 (2d Cir. 2013).
a. Coene's Violation of Rule 26(a)
I must first determine whether the Second Meggs Report may properly be characterized as a supplemental report and is therefore timely under Rule 26(e), or whether it is properly characterized as a new opinion and is therefore untimely under Rule 26(a)(2)(D). Coene argues that the Second Meggs Report is a supplemental report based upon new information contained in the Root Affidavit.7 Coene's contention is belied by the record.
7 3M argues that the Second Meggs Report is not properly classified as a rebuttal report. Coene does not contend that the Second Meggs Report was a rebuttal to any of 3M's experts, and thus this Court need not address 3M's argument.
The Second Meggs Report neither states nor suggests that it was prompted by previously unknown information or by reliance upon any of the information contained in the Root Affidavit. Instead, it simply states that Meggs's new opinion was "in follow-up to my report and earlier deposition[;] . . . [i]n light of questioning by defense counsel regarding current studies relating to occupational disease in laser sintering." (Docket # 62-1 [*27] at 16). According to Meggs, although there are no published articles addressing occupational disease in laser sintering, there were "studies illustrating a new occupational lung disease resulting from exposure to nylon dust." (Id.). According to the report, Meggs formed his opinion that Coene was exposed to nylon and resin dust after reviewing Coene's deposition testimony and two articles that were published in the late 1990s. (Id.). Of course, these materials were available to Coene prior to his initial report in March 2013. See Levinson v. Westport Nat'l Bank, 2013 U.S. Dist. LEXIS 90640, 2013 WL 3280013, *5 (D. Conn. 2013) ("[t]here is no evidence that the information [the expert] added was previously unknown or unavailable to him[;] . . . the failure to include in his original report discussions of regulations, statutes and regulatory guidance that are publically available cannot be substantially justified"); Stuhlmacher v. Home Depot USA, Inc., 2012 U.S. Dist. LEXIS 164722, 2012 WL 5866297 at *3 (second report was a new opinion and not a supplemental report where "[t]he information on which [the expert] based his opinions was available prior to the defendants deposing him"); Lewis, 786 F. Supp. 2d at 705 ("[the expert] does not attest that the historical documents and data appended to his declaration were unknown or unavailable to him when he prepared his initial report and subsequent supplementations"). [*28]
In addition, the opinion contained in the Second Meggs Report presents potentially new causes for Coene's injuries. Meggs's original report opined that Coene was exposed to respirable silica that caused his lung disease. His second report contends that the work environment also exposed him to other dangerous dusts, including nylon and resin, which contributed to his lung injuries. (Docket # 62-1 at 16-17). Accordingly, the Second Meggs Report does not supplement or correct his previous theories, but instead constitutes a new opinion concerning additional causes of Coene's injuries. See Stuhlmacher, 2012 U.S. Dist. LEXIS 164722, 2012 WL 5866297 at *3 (concluding that second report was new opinion, not a supplemental report; "[the expert's] report does not correct or enhance his pre-existing theory[,] [r]ather, it puts forth a new potential cause for the incident"); Lewis, 786 F. Supp. 2d at 690 ("[t]o the extent [the expert's] declaration presents 'additional' and 'new' evidence and opinions[,] . . . the declaration cannot be construed as a supplemental report under Fed. R. Civ. P. 26(e)"); Innis, 2009 U.S. Dist. LEXIS 125609, 2009 WL 5873112 at *3 (second report was not supplemental report where it included an "additional opinion and the bases therefore").
Finally, Coene's litigation actions in response to 3M's disclosure of the existence of and the information [*29] contained in the Root Affidavit suggest that the information was not the impetus for Meggs's new opinion. First, as early as March 4, 2013, Coene himself listed Root in his expert disclosures. On June 19, 2013, 3M disclosed Whysner's report stating that "sandblasting is a misnomer because sand or any silica containing material was not used in this process." (Docket # 64-3 at 18). In support of that assertion, Whysner cited the Root Affidavit. (Id.). Upon receipt of Whysner's report, Coene did not request a copy of the Root Affidavit, nor did he ask Meggs to reevaluate his opinion in light of Whysner's statement that silica was not used in the sandblasting process. During oral argument, the Court asked counsel for Coene whether there was any additional information contained in the Root Affidavit that was not conveyed by the statement contained in the Whysner report. Counsel for Coene did not identify anything. (Docket # 102 at 34-36).
Instead, Coene contended that had he known that Root not only existed but also had relevant information, he would have sought to depose her before proceeding with Meggs's deposition. (Id. at 33). According to Coene, an industrial hygienist is a critical witness [*30] who could have "valuable information." (Id. at 42). Yet, Meggs was asked during his deposition whether he had reviewed an affidavit from a Kodak industrial hygienist. This question evidently did not prompt Meggs or Coene's counsel to request a copy of the affidavit, an adjournment of the deposition or Root's contact information in order to subpoena her for deposition. Indeed, by October 29, 2013, the day the pending motion was argued before the Court, Coene still had made no attempts to secure Root's deposition. (Id. at 44-48).
Finally, there is no indication that Coene was surprised by the information contained in the Root Affidavit when counsel reviewed it during Whysner's deposition. Counsel did not seek to adjourn the deposition to consider the information in the affidavit; instead, Coene's counsel questioned Whysner about the affidavit's contents. At the time, counsel for Coene did not indicate that he thought the information was new or would require additional expert discovery; nor did he reserve any rights with respect to the late disclosure of the affidavit. Instead, counsel for Coene waited until after he received the transcript from Whysner's deposition and only then provided Meggs with the Root [*31] Affidavit and asked him to reevaluate his opinion assuming that no native respirable silica was used at Kodak. In sum, counsel's conduct significantly undercuts Coene's arguments that the information in Root's Affidavit prompted the second report. For these reasons, I conclude that the Second Meggs Report contains a new opinion and is not merely a supplement to his previous opinion. Accordingly, the second report was not timely disclosed by the deadline set forth in this Court's scheduling order, as required pursuant to Rule 26(a)(2)(D).
b. Substantial Justification and Harmlessness
Courts should not impose sanctions under Rule 37(c)(1) "where a party's failure to comply" with Rule 26(a) or (e) "was 'substantially justified' or where the conduct was 'harmless.'" Ritchie Risk, 280 F.R.D. at 158-59. "Substantial justification means justification to a degree that could satisfy a reasonable person that parties could differ as to whether the party was required to comply with the disclosure request." Kunstler v. City of New York, 242 F.R.D. 261, 264-65 (S.D.N.Y. 2007) (internal quotations and citations omitted). "Harmlessness means an absence of prejudice." Ritchie Risk, 280 F.R.D. at 159. The party that failed to comply with its discovery obligations bears the burden of proving that its failure was both substantially justified and harmless. Id.
Here, Coene's only [*32] proffered justification is that the tardily disclosed Root Affidavit prompted the Second Meggs Report. Having rejected that justification, I likewise conclude that the failure to timely disclose Meggs's nylon and resin exposure opinion was not substantially justified.
Coene also has not satisfied his burden of demonstrating that his untimely disclosure was harmless. The new opinion was disclosed after Whysner had prepared his report and after both Meggs and Whysner were deposed. Thus, Whysner did not have the opportunity to address the opinion in his report or during his deposition, and 3M has not had an opportunity to depose Meggs concerning his new opinions. In addition, the introduction of new causes for Coene's injuries may require additional, possibly time consuming and expensive, fact discovery that was not previously explored by 3M in order to defend against the claim.
c. Appropriate Sanction
The decision whether to issue a preclusion order, or a lesser sanction, is within the discretion of the trial court. See Design Strategy, Inc. v. Davis, 469 F.3d 284, 297-98 (2d Cir. 2006). "[P]reclusion of evidence is a harsh remedy, [and] it should be imposed only in rare situations." Ritchie Risk, 280 F.R.D. at 156-57 (internal citations and quotations omitted). In determining whether preclusion or [*33] another sanction is appropriate, a court should consider: "(1) the proponent's explanation for failing to provide the subject evidence; (2) the importance of such evidence to the proponent's case; (3) the opponent's time needed to prepare to meet the evidence; and (4) the possibility of obtaining a continuance to permit the opponent to meet the evidence." Turley v. ISG Lackawanna, Inc., 803 F. Supp. 2d 217, 229 (W.D.N.Y. 2011) (citing Outley v. City of New York, 837 F.2d at 589). "While a showing of 'bad faith' is not required for preclusion to be ordered under Rule 37(c), a party's bad faith 'can be taken into account' by the [c]ourt in considering the party's explanation for its failure to satisfy its discovery obligations." Ritchie Risk, 280 F.R.D. at 157 (quoting Design Strategy, Inc. v. Davis, 469 F.3d at 296).
Although Coene failed without substantial justification to comply with his discovery obligations, consideration of the above four factors leads me to conclude that preclusion is too harsh a sanction for his conduct.8 First, nothing in the record suggests that Coene's conduct involved bad faith. Second, Meggs's opinion may be critical to Coene's ability to establish that he was exposed to harmful substances while employed by Kodak. Although Coene contends that he can establish exposure through the testimony of his treating physicians, 3M has taken the position that Meggs's testimony [*34] is critical to Coene's ability to establish causation. (Docket # 84 at 5) ("Meggs is the only expert designated to testify on [Coene's] theory of exposure, a necessary prerequisite to any causation proof. Although [Coene] designated several treating physicians who may testify that silicosis is the cause of [Coene's] medical symptoms[,] . . . they designated only [Meggs] to testify about how [Coene] was allegedly exposed to silica.").
8 In reaching this determination, the Court is not addressing or determining whether the Second Meggs Report is otherwise admissible under Federal Rule of Evidence 702 or whether Coene should be permitted to proceed to trial on claims of exposure to nylon or resin dust without seeking leave to amend his complaint. Those issues are not raised in any motions pending before this Court.
Although 3M has been prejudiced by Coene's failure to timely disclose Meggs's nylon and resin exposure opinions, 3M's conduct in this litigation is not without fault. As discussed in greater detail below, 3M violated Rule 26(e) by failing to timely inform Coene that it would be relying on testimony from Root in support of Whysner's opinion. Although I ultimately conclude that such failure was harmless, 3M's failure [*35] to promptly notify Coene of Root has nonetheless unnecessarily complicated resolution of the issues surrounding the Second Meggs Report.
Finally, although fact and expert discovery closed during the pendency of the motions, Coene did disclose Meggs's new opinions before that occurred and well in advance of any trial of this matter. Indeed, no trial date has been set, and the pending summary judgment motions have not yet been decided by the district court. Thus, a continuance to allow 3M time to conduct limited discovery related to the new opinion and to supplement its expert report is not unreasonable. See Safespan Platform Sys., Inc. v. EZ Access, Inc., 2011 U.S. Dist. LEXIS 154113, 2011 WL 7473467, *4 (W.D.N.Y. 2011) ("unlike the cases cited by defendants, this discovery issue did not arise at the eve of trial or present a novel theory late in the proceedings"), report and recommendation adopted, 2012 U.S. Dist. LEXIS 31015, 2012 WL 777305 (W.D.N.Y. 2012); see also Boyde v. Monroe Cnty., 2011 U.S. Dist. LEXIS 108452, 2011 WL 4457668, *4 (W.D.N.Y. 2011) (preclusion not appropriate sanction where court could grant a continuance by reopening discovery).
Although I find that Coene's discovery failures do not warrant an order of preclusion, they do justify the reopening of the discovery period to allow 3M to conduct additional discovery relating to the untimely disclosure, see Boyde v. Monroe Cnty., 2011 U.S. Dist. LEXIS 108452, 2011 WL 4457668 at *4, and the imposition of fee shifting for any supplemental expert reports [*36] and discovery, see Ritchie Risk, 280 F.R.D. at 157 (where a party's failure to comply with its discovery obligations causes an opposing party to incur additional expenses, those expenses may properly be shifted to the non-compliant party).
For the reasons set forth above, I direct that:
(1) the parties confer regarding 3M's additional discovery and 3M's supplemental expert reports and jointly propose to this Court by no later than fourteen (14) days from the entry of this Decision and Order an amended scheduling order setting deadlines for such fact and expert discovery; and
(2) Coene pay 3M's expert's fees and expert's costs resulting from the additional discovery and supplemental reports.
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