In a recent case, the Judge in a bench trial issued an opinion
on damages which illustrated the true cost of retaining the
wrong expert.
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JOE EPPS, CPA/CFF/ABV, CFE, CVA, PRESIDENT
EPPS FORENSIC CONSULTING PLLC
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How to Assess and Select
the Right Expert
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The case involved a start-up company. One of the founders filed
to form a corporation on behalf
of the group, and then after a few
months dissolved the company
and walked away. The plaintiff alleged that, among other things,
the dissolution of the company
resulted in the plaintiff not being
able to follow through on a “
tremendous business opportunity”.
A Tale of Two Experts
The plaintiff hired two damages
experts. One expert issued a
report with the opinion that
the loss of business value at
the time of dissolution was
$3,000,000. The second expert
issued a report opining that
the loss of future income was
$85,369,940. The defense expert
issued a report which opined that
neither of the plaintiff experts
had a legitimate foundation for
the economic damage opinions;
they were pure speculation.
A Daubert Challenge Filed
A Daubert challenge was filed by
the Defense attorney, and the
Judge ruled against the motion
stating in part that the Court
could properly separate the
“Wheat from the Chaff”. In the
Judge’s written opinion, he start-
ed out by stating that with regard
to the opinions of the plaintiff
experts, the Court found that “…
as to damages there was no
‘wheat’ and only ‘chaff’.”
What’s in a CV?
Based on their CV’s, both experts
would appear to be capable of
performing their engagements in
a professional manner. However,
having an attractive CV does not
necessarily mean the expert will
do a professional job. The judge
quoted the defense damages expert, and agreed the opinions of
both plaintiff experts were essentially speculation devoid of
legitimate foundation.
How to Assess an Expert
So, how does an attorney who is
not an expert in an area, assess
the opinions of the experts
in order to avoid a costly trial
if the expert does not have an
adequate foundation for those
opinions?
The first rule is that if the attorney does not understand the
opinion, and the foundation for
the opinion, a judge or jury is also
not likely to understand it, and
the opinion may not be supportable. Experts should be able to
explain their opinions and the
foundation for those opinions in
a manner that does not require
the knowledge and background
held by the expert.
The best strategy is for an attorney to approach the opinion
of their experts with a healthy
dose of professional skepticism.
The attorney should ask their expert the tough questions that
would be asked if the attorney
were representing the opposing
party. The expert should be willing and eager to answer every
question. It would be far better
for the attorney and expert to
identify the weaknesses in an
opinion prior to the report being
issued, than to have the expert
be excoriated in a rebuttal report,
deposition, or worst of all, on the
witness stand.
