PAUL A. CROTTY, District Judge.
Plaintiffs Anderson News, L.L.C. ("Anderson News") and Lloyd Whitaker (together, "Plaintiffs") claim that Defendants
Defendants seek to exclude the testimony of Professor Guhan Subramanian, Dr. Leslie Marx, Dr. Robert Picard, and Dr. Thomas Lys. Plaintiffs seek to exclude the testimony of Neil Beaton. Because this Court granted Defendants' motions for summary judgment, it is unnecessary to decide the motions relating to the parties' damages experts (Dr. Picard, Dr. Lys, and Beaton).
There are numerous gaps in Plaintiffs' theory of the case, which they attempt to cover over with experts. Anderson's mid-January proposal, instead of being a demand or ultimatum, becomes a benign invitation to negotiate (Professor Subramanian). Without direct evidence of an antitrust conspiracy, various methods of communication between Defendants are styled as "super plus events" which permit an inference of conspiracy, even though an inference of independent action is more compelling (Dr. Marx).
Federal Rule of Evidence 702 provides:
In considering whether an expert meets the requirements of Rule 702, the Court's inquiry "thus focuses on three issues: (1) whether the witness is qualified to be an expert; (2) whether the opinion is based upon reliable data and methodology; and (3) whether the expert's testimony on a particular issue will assist the trier of fact." Arista Records LLC v. Lime Group LLC, 2011 WL 1674796, at *7 (S.D.N.Y. May 2, 2011).
To determine whether a theory is the product of "reliable principles and methods," see Fed. R. Evid. 702(c), courts generally consider whether the theory can be tested, whether it has been subjected to peer review, the error rate associated with the methodology, and whether the theory is generally accepted by the scientific community. Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 593-94 (1993). An expert's data and methodology is reliable if there is a "rigorous analytical connection between [the] methodology and the expert's conclusions." Nimely v. City of New York, 414 F.3d 381, 396 (2d Cir. 2005).
In addition, "[a]n expert cannot be presented to the jury solely for the purpose of constructing a factual narrative based upon record evidence." In re Fosamax Prods. Liab. Litig., 645 F.Supp.2d 164, 192 (S.D.N.Y. 2009) (citation omitted). Expert testimony is not "helpful" to a jury if the jury is "as capable of comprehending the primary facts and of drawing correct conclusions from them" as an expert. Salem v. U.S. Lines Co., 370 U.S. 31, 35 (1962); see Nimely, 414 F.3d at 397 (an expert that "usurps . . . the role of the jury in applying [the] law to the facts before it . . . does not aid the jury in making a decision," but instead "attempts to substitute the expert's judgment for the jury's") (citation omitted). Moreover, experts who "merely recit[e] what is on the face of a document produced during discovery" do "no more than that which the finder of fact could him or herself do," and such experts' reports "may be precluded on this basis alone." See Cross Commerce Media, Inc. v. Collective, Inc., 2014 U.S. Dist. LEXIS 117244, at *22 (S.D.N.Y. Aug. 21, 2014).
Also inadmissible are "expert opinions that constitute evaluations of witness credibility, even when such evaluations are rooted in scientific or technical expertise," Nimely, 414 F.3d at 398, as well as testimony regarding "the intent or motive of parties," or a "party's state of mind," In re Rezulin Prods. Liab. Litig., 309 F.Supp.2d 531, 547 (S.D.N.Y. 2004); LaSalle Bank Nat'l Assoc. v. CIBC, Inc., 2012 WL 466785, at *7 (S.D.N.Y. Feb. 14, 2012).
Guhan Subramanian, a Harvard professor, specializes in business organizations and negotiation theory. Upon his review of, inter alia, the recording and transcript of the January 14, 2009 telephone interview to the single-copy magazine market in which Charles Anderson announced the price increase and inventory cost shift, the terms for acceptance, and the consequences for not accepting by February 1, 2009, Subramanian states that in his expert opinion: (1) Anderson intended the price increase and inventory cost shift to be negotiable, and (2) Defendants "knew or should have known" that, notwithstanding the February 1 deadline, the proposal was really an invitation to negotiate. Subramanian Report ¶ 105. Defendants move to exclude Professor Subramanian's testimony.
Professor Subramanian's testimony is inadmissible. There is ample, firsthand evidence of how the parties viewed Anderson's statement, expressed orally and in writing, which reflects the parties' contemporaneous understanding of what Anderson said and their reactions. A jury is more than capable of "comprehending the primary facts" and "drawing . . . conclusions" from this evidence, without expert assistance. See Salem, 370 U.S. at 35. Permitting expert testimony on these issues would improperly "substitute the expert's judgment for the jury's" in determining the import of both spoken words and written documents. See Nimely, 414 F.3d at 398 (citation omitted).
The expert report also improperly opines on the parties' knowledge, motivations, and intent. See, e.g., ¶ 105 ("Anderson intended its proposed Anderson Surcharge to be negotiable"); ¶ 67 ("Mr. Jacobsen . . . believed that follow-on negotiations with Anderson were possible"); ¶ 72 ("Mr. Anderson understood that Anderson and TWR had reached an agreement regarding the surcharge and discounts"); ¶ 77 ("I conclude from this e-mail chain that Kable knew that Anderson's proposal was negotiable"). This is not a proper subject for expert testimony.
Dr. Marx, an economics professor at Duke University, offers her opinion that Defendants' conduct was consistent with collusion. She bases her opinions on the presence of what she refers to as "super-plus factors," which are plus factors that "allow a strong inference of collusion." Report ¶ 67.
Dr. Marx's testimony regarding "super-plus" factors is inadmissible, because it appears to be a label conjured up for litigation rather than the "product of reliable principles and methods." See Fed. R. Evid. 702(c). Aside from works written by Dr. Marx and her co-authors, there is no scholarly or legal authority defining or using the term "super-plus factors." Nor is there an explanation of why "super-plus factors" demonstrate a stronger inference of collusion than traditional "plus factors." Instead, the Report merely states that "[p]lus factors differ in their strength," and cites to an article and a book, both authored by Dr. Marx and her colleagues. Report ¶ 67. The article identifies certain plus factors as "super-plus factors," based on general economic principals, and proposes an equation, based on the Bayes Theorem of probability, to determine the "strength" of a plus factor. Opp. Mtn., Ex. 5. Neither the article nor the book indicates that the proposed equation has been tested, or that it produces reliable results. Moskowitz Decl., Exs. 5, 6. Moreover, the fact that the term has not been adopted or used by anyone other than Dr. Marx and her colleagues indicates that this term has not been generally accepted by the scientific community.
Dr. Marx's opinions regarding "super-plus factors" are therefore excluded. Her opinions regarding the existence of plus factors, and whether she believes that those factors are consistent with Defendants' actions in this case, however, are permitted. See In re Titanium Dioxide Antitrust Litig., 2013 WL 1855980, at *4, *12; In re Processed Egg Prods. Antitrust Litig., 2015 WL 337224, at *7-*9 (E.D. Pa. Jan. 26, 2015).
Defendants also seek to exclude Dr. Marx's opinion that it was in each Defendant's independent economic self-interest to continue to supply Anderson News with magazines. Defendants argue that Dr. Marx failed to take into account factors such as the cost of agreeing to the surcharge, the financial risk to Defendants if Anderson News failed to deliver magazines, and the fact that Defendants had the option of shipping to other wholesalers who did not impose a surcharge.
Although Dr. Marx's report refers to record evidence, such as emails in which Defendants acknowledged that they were losing sales by not shipping magazines to Anderson News' competitor, Source, there is no indication that she performed any actual analysis regarding Defendants' financial incentives to continue supplying Anderson News with magazines. Without any such analysis, or explanation as to why it was not performed, Dr. Marx's opinions on this point "merely recit[e] what is on the face of . . . document[s] produced during discovery." See Cross Commerce Media, Inc., 2014 U.S. Dist. LEXIS 117244, at * 22. Her opinions on this topic are therefore excluded.
Finally, Dr. Marx's report contains a number of references to Defendants' motivations, thought processes, and understanding.
Defendants' motion to exclude Dr. Marx's testimony is GRANTED with respect to testimony regarding the term "super-plus factors," Defendants' economic self-interest, and the parties' motivations, thoughts, or intentions. The motion is DENIED with respect to Dr. Marx's opinions regarding "plus factors."
For the reasons set forth above, the motion to exclude Professor Guhan Subramanian's testimony is GRANTED. The motion to exclude Dr. Leslie Marx's testimony is GRANTED in part and DENIED in part.
In light of this Order, and the Order GRANTING Defendants' and Counterclaim Defendants' motions for summary judgment, the Clerk is directed to enter judgment and close this case.
SO ORDERED