Tag: litigation

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Expert WitnessExpert Witness Testimony

Expert Witness 101 (Part 1): What You Need To Know

on April 16, 2024

INTRODUCTION

Have you watched any major court trials, like DEPP V. HEARD on Netflix or Casey Anthony: An American Murder Mystery on Hulu? If so, then you are familiar with a courtroom scene, the judge, jury, attorneys, and their clients. There are always witnesses, but what is the difference between a regular witness and an expert witness? Why are they necessary, and how would an attorney go about finding one? Who knows, YOU may qualify as an expert witness yourself but you just don’t know it. In this blog post you will learn if you have the qualifications and, if so, how to establish a new source of income.

Fair Trial or Deposition for Expert Witness

WHAT IS AN EXPERT WITNESS?

Expert Witness Definition

The significant benefit of this industry is that anyone can become an expert witness! According to Federal Rule of Evidence 702, “An expert witness is a person with specialized knowledge, skills, education, or experience in a particular field who is called upon to provide their expertise in legal proceedings to assist the court with understanding complex, technical, or scientific issues.” Attorneys serving the plaintiff and defendant can both hire expert witnesses and pay them for their testimony and consultation. The expert witness must also qualify under specific FRE 702 criteria to certify their testimony is “relevant” and “reliable.” As of December 1st, 2023, the amendments to the federal rule have gone into effect (photo credit – Perkins Coie):

Amendments for FRE R 702 Expert Witness Testimony

Proskauer similarly describes the new language added by the amendment as:

  1. A court may not admit expert testimony unless the proponent establishes its admissibility by a preponderance of the evidence.
  2. A court must find that an expert’s opinion follows from a reliable application of the methodology to the facts at issue before that opinion is heard by a jury.

Business Consultant Definition

Some experts choose not to work in litigation. They do not want to subject themselves to the possibility of grueling questions or contentious court proceedings. These professionals would be considered Business Consultants or Consulting Experts. They receive payment for their assistance in a settlement or mediation. These experts act in the same way as Expert Witnesses, but they do not testify in trial or present evidence to a court. 

How Much Experience Do You Need?

Unfortunately, a straightforward answer to this question does not exist. It is relative to your chosen industry. For instance, experience in the medical and engineering fields vastly differs from experience in more creative and less analytical fields. However, that is not to say one industry is superior to the other purely based on years of experience. Comparing experiences to others is like comparing apples to oranges; it can not be done. Ultimately, as long as you qualify under Federal Rule of Evidence 702, or the applicable state test, then you can be an expert witness.

Movie: My Cousin Vinny

One of the most unexpected yet hilarious examples of expert witness testimony is from the movie My Cousin Vinny.

Vinny Gambini, played by Joe Pesci, a fairly new street-smart lawyer from New York who’s prone to verbal shenanigans, accepts the opportunity to defend his cousin accused of murder. During the trial scene he puts his girlfriend, Mona Lisa Vito, played by Marisa Tomei, on the stand. From her looks (sequin sweater, short leather skirt, and bright red lipstick), one wouldn’t expect her to be qualified to testify about cars, a pivotal aspect of the case. It turns out her expertise stemmed from her practical experience working in her father’s garage since childhood. Mona Lisa’s hands-on knowledge of cars, engines, and automotive mechanics helped her analyze the tire marks in the scene.

I will spare the rest of the details to avoid revealing any spoilers. While the movie is fictional, the testimony scene is possible at a judge’s discretion. Here is Mona Lisa’s expert witness testimony scene from My Cousin Vinny.

EXPERT WITNESS TESTIMONY CRITERIA

The Daubert Standard

The court has a systematic framework to assess the relevance, validity, and reliability of expert witness testimony before it is presented to the jury. The Daubert Standard grants trial judges the responsibility to be “gatekeepers” of scientific evidence and aims to mitigate their reliance on an expert’s reputation and credentials. Lastly, all Federal Courts use the Daubert Standard. Some states may use the original framework, the Frye Standard.

From the Daubert Standard, trial courts use these five factors to prove the validity of expert witness testimony and methodology:

  • Whether the technique or theory in question can be, and has been tested.
  • Whether it has been subjected to publication and peer review.
  • Its known or potential error rate.
  • The existence and maintenance of standards controlling its operation.
  • Whether it has attracted widespread acceptance within a relevant scientific community.
Expert Witness Testimony

PARTING WORDS

To summarize, becoming an expert witness is not a complicated process. An expert witness is responsible for objectively opining on the facts of the case using industry knowledge to support their testimony. The law offers guidelines to ensure you qualify as an expert witness to secure valid and unbiased testimony from legitimate professionals. Becoming an expert witness or a business consultant builds credibility and expands business and networking opportunities. With the requisite knowledge, you can be confident and secure in your testimony. Stay tuned for Part 2 of this blog series, which will give tips for starting your business and the best practices to do so!

EvidenceExpert WitnessExpert Witness TestimonyUncategorized

Safeguarding Your Reputation as an Expert Witness

on January 16, 2024

In 20 years in the legal industry and nearly 14 working with expert witnesses, I’ve never seen such a damaging assault on an expert witness practice as I did at the end of 2023. Something so destructive it has the potential to erase an expert’s practice. It must be discussed as a cautionary tale.

DISCLAIMER: We are not taking a position on the performance or practice of Professor Eli Bartov. We have not read his reports, seen his trial testimony, or reviewed trial transcripts in the case of New York v. Trump. This article is about the impact of judicial statements on your expert witness practice and serve as caution when taking high profile cases. We still want you to take high profile cases.

What Happened?

On December 18, 2023, Reuters wrote an article that may absolutely destroy the expert witness practice of Professor Eli Bartov. Professor Bartov is a professor of accounting at NYU Stern School of Business. He served as an expert witness in the New York civil fraud trial against former President Donald Trump.

Other major news publications (CNBC, Newsweek, NBC News), with search engine domain authority, also wrote articles on and around the same date.

In each of these articles, the publishers quoted presiding Justice Arthur Engoron’s analysis of Professor Bartov’s testimony which stated, “All that his testimony proves is that for a million or so dollars, some experts will say whatever you want them to say.”

That statement, my dear friends and colleagues, can be a career killer for nearly any expert witness. The judge’s statement may not only affect Professor Bartov’s practice, but the rippling effect of its repetition by major publications tarnishes his online reputation. It is just the beginning of the trouble.

Worst Negative Statement by a Judge I’ve Ever Seen:

If you are an expert witness, you never, ever want a judge of any court to comment in such a negative way about your work. Judge Engoron’s statement essentially calls Professor Bartov a “hired gun,” and questions his competency by indicating the analysis is trash.

You cannot control what a judge says or does. Judges may find your methodology lacking or your opinions to be unsupported. A comment on those issues would be unfortunate but it would not destroy your credibility or reputation. Should the comment resurface in a future proceeding, a capable attorney would probably be able to rehabilitate your credibility as an expert witness.

We have long discussed the need to protect your reputation and credibility. Nothing is more important. The job of opposing counsel is to chip away at your credibility. A high-profile case like this is going to put your expertise and opinions under broader and more intense scrutiny. Not just by counsel but by the media.

After a while, some might ignore the comments of this judge. They may say it was a high-profile political case and the judge was biased against the defendant and thereby biased against the defendant’s experts. I’m not here to discuss those items. Leave the politics at the door. We take the outcome as a lesson to be used in your expert witness practice.

Impact of a Minor Negative Statement by a Judge:

Opposing counsel, in future cases, may scour records of previous cases to find your reports, deposition, and trial transcripts, and may read rulings by judges to find ways to discredit your work. It is their job to undermine your expertise for the benefit of their client. Do not take it personally. It is an unfortunate side effect of our adversarial judicial system.

If they find a negative statement by a judge, they may use it against you in trial to impeach your credibility or question your reputation.

It is the job of the lawyer or law firm that retains your services to counter impeachment-attempts and to rehabilitate your credibility. You assist your counsel in countering impeachment attempts by doing objectively good work, using defensible scientific methodologies and taking cases where you know you can provide an objective and dispassionate analysis.

With some effort, a normal run-of-the-mill disparaging or negative comment by a judge is easily outweighed by your other solid work.

Why this is so Damaging Beyond the Courtroom:

As I mentioned above, so many major news organizations reported about this statement by Judge Engoron. When reading the Reuters article and the damaging comment about Professor Bartov’s efforts in the case, I had to dig further to see how this proliferated. More than4 weeks later the problem continues. I’m not sure SEO geniuses can rehabilitate the online reputation.

Here are some searches a lawyer is likely to do in the preliminary stages of due diligence before hiring this expert in the future.

I encourage you to conduct the following searches, noting that the results may vary by date and location. Here is one search a lawyer is likely to do:

Professor Bartov, NYU Stern School of Business has excellent domain authority and ranks right at the top of a Google search. It is the 3rd organic search result that lets you know the professor testified in a trial involving a former US President. That’s an article of interest for any attorney considering retaining an expert.

There’s nothing horrifically bad in this article. It talks about the amount of fees, but reporters love to write about the amount of expert witness fees. You do see that out of the first seven results, the last 2 results discuss credibility. That becomes a significant issue for any expert.

Let’s try another search. How about “eli bartov expert witness.”

Ouch. We now have several search results discussing credibility.

Most attorneys concerned about hiring an expert witness to assist with a client matter may be now totally unable or unwilling to take a chance on an expert with this sort of easily identifiable negative coverage.

You see, even if the judge was wrong in his statement, the media could have entirely destroyed any chance for this expert to be hired in a future matter because an attorney cannot take the chance of hiring this person and having their credibility called into question.

Finally, let’s assume another simple search. What if counsel searches “eli bartov trump.” This is the worst result.

Okay, well let’s try Bing and see if the results are any different. We try “eli bartov” again.

You get the drift. Second result discusses credibility. It’s very damaging.

In Conclusion:

Any lawyer considering retaining your services is going to be nearly impossible if they find this kind of coverage because opposing counsel is going to have a field day with these stories.

Might you be able to rehabilitate this reputation? Maybe. Will counsel be willing to take on that fight when they’re trying to win a matter on behalf of their client? Unlikely. Remember, you’re in business and you must sell your reputation.

I do not want to dissuade you from taking high-profile matters. They can be great for your practice. They can also be awful for your practice.

If you’re on a high-profile case, it is that much more important to do objectively good work, using defensible scientific methodologies and taking cases within your expertise where you know you can provide an objective and dispassionate analysis. Remember that your analysis will be under more microscopes than normal.

Expert WitnessUncategorizedWeather

Meteorology and Atmospheric Science Expert Witness Informs on 2023 California Storms

on January 12, 2023

If you’re a Californian, the last two weeks of storms has felt like a storm season that will never end!

If you’re a Californian, the last two weeks of storms has felt like a storm season that will never end! In the past, I’ve written about major weather related events such as hurricanes and the resulting property damage, insurance issues, and lawsuits. Most weather-related events and their litigation aftermath always seem to happen somewhere else. On the East Coast. Or, in the Midwest. Rarely do they seem to impact California.

California, my home state. A state known for beautiful views. From sandy beaches to exquisite mountain vistas. The San Francisco Bay Area to Yosemite. It’s a wonderful place.

The people… We’re a spoiled, complaining bunch. Until approximately 12/31/2022, you’d have heard regular complaints about the severe drought plaguing our state. We’re filled with fear and non-stop commentary about how we really “need the water.” This drought has been a part of California-life for my entire lifetime. Same sayings. Same complaints. Mostly the same conservation efforts.

As of 1/11/2023, our daily complaints have changed dramatically. Now, we’re bemoaning 13 days of snow, rain, hail and wind. I have to be clear here. These storms have now happened for 13 consecutive days. There have been breaks. The severity of the storms, however, have been unlike anything I’ve ever experienced as a lifelong Californian. Our Governor declared a State of Emergency for the entire State. For weather? Yes! For weather.

Please realize I’m making light of our current situation, albeit briefly, because of my perspective as a Californian. In reality, tens of thousands of people have been negatively impacted by flooding, snow, and wind. Dangerous and long-lasting power outages, property damage, and lives lost as a result of never before experienced weather events.

It’s weird to us because in most parts of the state it’s sunny 300 days a year. Is it cold in January and February? Yes, a little, but it’s sunny. Some years, we hardly get rain worth remembering. In fact, I can’t recall a storm since the winter of 2017, when there was a crisis at the Oroville Dam after rain damaged the spillways. Almost 6 full years with no notable weather events (at least in Northern, CA, where I’m located).

The Santa Barbara mountains face flood issues a little more regularly. They had substantial flooding and mudslides in 2018. Five years later, they are dealing with significant floods once again.

If I haven’t been clear, major weather events in California are rare compared to our fellow US States. Phrases like “bomb cyclones” and “atmospheric rivers” are uncommon here. Let alone multiple continuing atmospheric rivers over a 2-2.5 week time frame.

As I do when I have questions about events in which I have no expertise, I reached out to one of our expert witnesses to provide some insight.

Meteorology and Atmospheric Science Expert Witness Timothy Minnich

Timothy R. Minnich MS, QEP, President of Minnich & Scotto, Inc., is a Meteorologist and Atmospheric Scientist with over 40 years experience in the design and management of a wide range of ambient air and meteorological investigations under CERCLA and the Clean Air Act. He is a recognized technical expert on high-profile legal cases, with assignments involving forensic meteorology and reconstruction of inhalation scenarios in relation to community exposure to hazardous air pollutants (HAP). 

Mr. Minnich is accomplished in presenting conclusions and opinions derived from analysis of complex technical data in a well-reasoned and easily understood manner. He is a skilled technical writer and proven manager in a highly specialized arena. He is a nationally recognized expert in the application of optical remote sensing (ORS) for hazardous waste site remediation. He has designed and managed more than 25 ORS field investigations and air dispersion model validation studies since the promulgation of U.S.EPA (EPA) Method TO-16 for open-path FTIR (Fourier-transform infrared) spectroscopy in 1988. 

After about 11 or 12 days of continuous storms, I reached out to Tim with some questions because I was hearing weather-related terms I’d never before heard. Below, you’ll find my questions and Tim’s answers!

Questions & Answers

Nick Rishwain: California is dealing with a series of storms to which we’re not accustomed. As a meteorologist, can you explain for the layperson, the concept of a “bomb cyclone?”

Tim Minnich: A “bomb cyclone” is a term recently coined to identify a storm (non-tropical) which is rapidly deepening. It comes from the term “bombogenesis,” which means a non-tropical storm in which the atmospheric pressure drops at least 24 millibars in 24 hours or less.

Nick Rishwain: According to news reports, we’re also experiencing a number of “atmospheric rivers.” Or, maybe it is one ongoing atmospheric river? Can you explain the concept of “atmospheric river?”

Tim Minnich: An “atmospheric river” is a term that simply refers to a rapidly moving plume of moisture at high altitudes. It is generally associated with a storm which provides heavy rain or snow.

Nick Rishwain: As a Northern, Californian, we’re not used to the weather impacting us since the New Year. What type of litigation / lawsuits are likely to stem from the wind, rain, snow, and flooding we’re experiencing?

Tim Minnich: I would expect the most common form of litigation would likely involve property damage claims caused by flooding, wind damage, and roof collapses associated with extreme snow loading.

Nick Rishwain: What types of meteorological investigations might a forensic meteorologist like yourself be asked to conduct in the aftermath of a storm ravaged California?

Tim Minnich: Working with engineers, such investigations would provide direct evidence – such as official meteorological observations – to support whether or not the actual damage was caused by the extreme weather conditions at the time.

Nick Rishwain: I’m assuming it would be a good idea for counsel, businesses, or insurance companies to contact you in the early aftermath of these storms. How might a meteorologist assist in the immediate aftermath of these storms?

Tim Minnich: By providing an early technical analysis as to the likelihood of success in either filing a claim (plaintiff) or denying a claim (defendant).

Nick Rishwain: I’m also assuming there are going to standard property damage and insurance claims stemming from wind, rain, snow, and flooding. What are some of the hidden dangers/damages resulting from storm damage?

Tim Minnich: Structural damage to buildings represents the most serious situations arising from extreme storms. The immediate danger of building collapse from strong winds or downed trees is obvious, but compromised foundations represents a risk that should be swiftly investigated by a qualified engineer if serious flooding or long periods of saturated soil has occurred.

Nick Rishwain: You have expertise in “exposure to hazardous pollutants.” Are those a danger to Californians as a result of flooding? Or, as a result of some other storm damage?

Tim Minnich: I would say that exposure to hazardous pollutants arising from direct contact with contaminated water would generally not be a problem, unless flood waters have breached industrial areas — specifically containment facilities which house hazardous materials.

More to Come

We’re grateful for Tim’s willingness to participate in this timely blog post. I wish I could tell you this topic is complete, but the existing storm watch says California may not have any reprieve until 1/18/2023. To the best of my understanding, that only means a reprieve from the currently identified storm front. Not sure what to expect for the remainder of the winter and spring. As such, I may be back with another weather-related update before you know it!

EvidenceExpert Witness

Proposed Changes to FRE 702 Daubert Standard – Expert Witness Testimony

on March 31, 2022

It appears we’re poised to see some changes to Federal Rule of Evidence section 702 for the first time since the 2000 amendments.

In an excellent article published by Butler Weihmuller Katz Craig LLP, attorney Scott Hefner provided an excellent history of FRE 702 and a summary of the proposed amendments which if adopted by the Supreme Court, will go into effect in 2023.

Mr. Hefner provided an outstanding summary of the Daubert Standard and its codification and I encourage you to read his article for further depth. I just wanted to provide the existing rule and the proposed changes for your review, so that you and your expert witness practice can be prepared for the possible changes to FRE 702.

Existing Rule 702:

A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if:

a. the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;

b. the testimony is based on sufficient facts or data;

c. the testimony is the product of reliable principles and methods; and

d. the expert has reliably applied the principles and methods to the facts of the case.

Proposed Rule 702:

A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if the proponent has demonstrated by a preponderance of the evidence that:

a. the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;

b. the testimony is based on sufficient facts or data;

c. the testimony is the product of reliable principles and methods; and

d. expert’s opinion reflects a reliable application of the principles and methods to the facts of the case.

For your convenience, I’ve bolded the changes in the proposed rule. In my reading, the only real substantive change is “the proponent has demonstrated by a preponderance of the evidence…” This is the standard that has always applied, but the advisory committee decided they needed to clarify the standard. Mr. Hefner’s article notes that the committee included the standard to “dispel the notion that expert testimony is presumed to be admissible.” In the years I’ve been working in the expert witness field, I’ve never known this to be presumed. In fact, since law school (i.e. as long as I can remember), the rule has always been that the court serves as the gatekeeper for allowing expert testimony.

Now, I would love feedback from readers on the other “substantive” change to section 702(d). When I look at the existing subsection and the proposed changes, it is difficult to identify how this will actually change anything in practice.

In fact, it seems Mr. Hefner and I are in full agreement on this subsection change. He even mentions, “The practical implications of the amendments remain up for debate.” To take it a step further, he quotes the Federal Magistrate Judges Association as viewing the proposal as not making changes at all but rather “largely clarifying existing practice.”

What do you think?

Do you think this proposal will have any substantive or practical effects? Let us know what you think in the comments or drop us an email at support@experts.com.

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Cancer Verdict Overturned: Trial Court did not follow Daubert Expert Witness Standard

on July 26, 2021

$117 million talcum powder Mesothelioma verdict overturned by failure of the trial court to follow their gate-keeping role.

In an article today from Husch Blackwell, they highlight a case in which a significant verdict for the plaintiffs was recently overturned by the appellate court for failures to conduct a proper Daubert analysis.

As most of our members are aware, a “Daubert hearing” or “Daubert review” is the standard used by the trial court for admitting expert witness testimony. It is the federal standard for admitting expert witness testimony, but the standard has been adopted by a majority of US states.

For your brief review, I’ve decided to add the elements of the Daubert test below, from Cornell Law School:

  1. whether the theory or technique in question can be and has been tested;
  2. whether it has been subjected to peer review and publication;
  3. its known or potential error rate;
  4. the existence and maintenance of standards controlling its operation;
  5. whether it has attracted widespread acceptance within a relevant scientific community.

There have been a wide variety of mesothelioma lawsuits against manufacturers and distributors of baby powder products. Generally speaking, the issue arises from long-term talcum powder use allegedly exposing plaintiffs to asbestos in the talcum powder which causes mesothelioma.

In my 11 years in the expert witness field, there have only been a couple toxic tort matters where the science has been as fiercely contested as it is in the talcum powder cases. The only other cases in recent memory where the science is hotly debated involves lymphoma resulting from the herbicide Round-Up. The Round-Up lawsuits resulted in an $11B settlement between plaintiffs and defendants.

This talcum powder case out of New Jersey, was very similar to the other talcum powder cases. The plaintiffs, Stephen Lanzo III and his wife sued a variety of defendants including one Johnson & Johnson subsidiary, claiming Mr. Lanzo’s long-term use of baby powder caused him to contract mesothelioma.

The trial judge permitted testimony from two of plaintiffs’ expert witnesses, Dr. James S. Webber, Ph.D. and Jacqueline Moline, M.D. On appeal, the 3-judge panel overturned the verdict because they didn’t think the trial court applied a proper Daubert standard in permitting the testimony from doctors Webber and Moline.

According to the article from Husch Blackwell attorney Brittany Lomax, the appellate court basically found that three prongs of the Daubert test were not met, “Namely, the opinions and theories were not tested, not subject to peer review and publication, and were not generally accepted in the scientific community. The panel further held that the trial court did not perform ‘its required gatekeeping function’ by failing to conduct a proper analysis to determine whether the expert opinions met the Daubert standards and failing to assess the methodology or the underlying data used by the two experts to form their opinions.”

As a result, the appellate court remanded to the trial court and ordered new trials for two of the defendants.

It is worth noting, this is a major win for defendants in these talcum powder cases. It appears the appeals courts, at least in New Jersey, are going to review scientific evidence with exceptional rigor.

Emergency MedicineExpert Witness

Emergency Medicine: Medical Malpractice Lawsuits During COVID-19

on June 16, 2021

According to the U.S. National Library of Medicine, “Medical malpractice is defined as any act or omission by a physician during treatment of a patient that deviates from accepted norms of practice in the medical community and causes an injury to the patient.” Medical malpractice is a component of tort law, which addresses professional negligence and offers reparations for civil offense. Some common examples of medical malpractice include misdiagnosis / delayed diagnosis, prescription drug errors, surgical / procedural errors, and failure to treat. However, until the recent COVID-19 outbreak, medical malpractice suits related to a pandemic have rarely been discussed. In this blog post, Experts.com aims to shed light on the topic with insight from Emergency Medicine Members, Sajid R. Khan, MD, and Vipul Kella, MD, MBA FACEP.

The COVID-19 pandemic brought about a plethora of problems for citizens, businesses, and industries all over the globe. According to Dr. Kella, “The pandemic placed enormous strain on our health systems: hospitals were operating at maximum capacity, supply shortages were well-publicized, and healthcare providers were scarce and overworked.” To add, during the pandemic, medical professionals had to simultaneously learn about the nature of the virus, its symptoms, and how it affected people of all ages. Despite the circumstances, essential workers in the medical field have abided by their ethical duty to commit no harm and to save their patients to the best of their ability. With the mystery of an unprecedented illness, and the learning curve associated with it, should the medical community be held to the same medical malpractice standard for COVID-19 as for other illnesses?

To his knowledge, Dr. Khan is unaware of any COVID-related malpractice lawsuits. However, to make a medical malpractice claim in most states, deviation from the standard of care must be demonstrated. Dr. Khan confirmed that the standard of care has frequently changed throughout COVID-19 due to the oddity of the situation. “Therapeutic recommendations change from month to month, making establishment of medical malpractice that more challenging,” he added. During the pandemic’s inception, healthcare professionals had to care for patients and prioritize their own physical well-being. Especially in populated areas like New York City, the medical community faced a scarcity of supplies. Dr. Khan, and many other Emergency Medicine professionals, have participated in a multitude of discussions about how to best select the patients who had the strongest chance of surviving. This of course is not the preferred method of treatment, but desperate times call for desperate measures. He stated, “It would be irresponsible to hold providers responsible for failing to provide optimal care to patients with such an illness.” Through the news and social media, the whole world has seen the medical community in action to help minimize the spread of COVID-19. Has the United States government taken any action to minimize the legal ramifications towards the healthcare industry? What measures can healthcare providers take to reduce the risk of medical malpractice involvement?

According to Dr. Kella, there have been a few acts passed by the federal government to alleviate the stress of the medical community. He mentions the Public Read and Emergency Preparedness (PREP) Act and the Coronavirus Aid Relief and Economic Security (CARES) Act. The PREP Act, amended by the US Department of Health and Human Services, provides legal protections to medical providers, whereas the CARES Act protects healthcare providers offering volunteer services during the pandemic against liability. “These regulations were good news for physicians as they allowed more leeway for trying to deliver care during difficult circumstances that were often out of their direct control,” Dr. Kella mentioned. Although there is protective legislation, this does not mean the medical community should not maximize efforts to minimize medical malpractice lawsuits. COVID-19 is known to advance a patients’ pre-existing or chronic disease. For instance, the standard of care has altered throughout the pandemic and, as such, Dr. Kella has suggested healthcare providers to meticulously check the documentation and routines of their patients to avoid negligence.

As the United States produces and administers vaccinations, the medical community’s knowledge of COVID-19 expands. Medical malpractice may not have played a large role throughout the beginning of the pandemic. As the days pass and perhaps more litigation arises, holding COVID-19 medical professionals to a strict standard of care, unless it is an egregious departure, could have a chilling effect on the medical community. As was apparent in the middle of the outbreak, the last outcome our country needs is fewer doctors and nurses.

ElectronicsExpert WitnessLitigation

Apple v. Epic Games Trial: What You Need To Know

on May 19, 2021

Introduction

Technology giants like Amazon, Facebook, and Google face legal battles yearly. Recently, another behemoth has followed suit (pun intended). On August 13th, 2020, Apple found itself involved in an antitrust lawsuit against Fortnite video game creator, Epic Games. The trial began on May 3rd, 2021 and is ongoing, so this blog post will not have all the answers. As it unfolds, this post will delve into the perspectives of both businesses, describe the nature of the trial, introduce opening statements from the first day of the trial, and explain possible outcomes for both Epic Games and Apple.

Epic Games

Epic Games has filed an antitrust lawsuit against Apple Inc. in response to the removal of its most popular game, Fortnite, from the iPhone App Store. This prohibited 116 million of its 350 million users from updating the game and new consumers from downloading the app (this does not affect the remaining players using other smartphones or gaming consoles). Fortnite’s eradication from iOS App Stores has caused players from around the world to unite in a social media campaign called #FreeFortnite. Epic Games accused the tech giant of monopolizing purchasing options for apps by restricting other methods of conducting transactions. Due to Apple’s renowned international success, Epic Games has filed lawsuits against Apple in Australian, United Kingdom, and European courts. Epic Games not only wants Fortnite back on the iOS App Store, but it also wants to launch a rival App Store on all Apple devices so users can purchase Epic Games products through non-Apple means.

Apple

The catalyst for Fortnite’s removal from Apple’s App Store was the release of a new update by Epic Games which included the implementation of an in-game purchasing currency called “V-Bucks.” This currency allows players to buy items through non-App Store channels. Users who purchase Fortnite items such as outfits, pickaxes, and the latest season’s Battle Pass get to enjoy a 20% discount, which incentivizes players to continue using V-Bucks. Since these purchases are not made through the App Store, V-Bucks circumvents Apple’s chances of receiving its 30% share of any transaction, hence its removal from the App Store and the foundation of #FreeFortnite. In response to Epic Games’ claim of Apple becoming a monopoly, Apple explains the fairness in its decision to remove the game from its App Store. According to Apple, Epic Games violated its agreement by installing V-Bucks without Apple’s permission. If Apple wins the trial, this contract violation could keep Fortnite and all other apps made by Epic Games, or apps run by its game engine, Unreal Engine, from the App Store (The Verge).

The Trial

The trial began on Monday, May 3rd, 2021 in federal court in Oakland, California. This proceeding is a bench trial; thus, the judge will be making the final ruling with no jury. The trial will be held in person and the press and public are prohibited from entering the courtroom. The presiding judge for the United States trial is Judge Yvonne Gonzalez Rogers. Pending trial, she declined Epic Games’ request for Apple to host Fortnite on iOS devices. Trial dates for the international lawsuits against Apple are unknown. However, Epic Games has recently filed lawsuits in November 2020 (Australia), January 2021 (United Kingdom), and February 2021 (Europe).

Opening Statements and Trial Arguments (photo credits from The Verge)

In its opening statement, Epic Games compares Apple’s restrictive policies to a “Walled Garden.” Its argument is based on the unfairness of Apple’s control over purchasing options. Two expert witnesses testified on behalf of Epic Games. University of Chicago economist, Dr. David Evans, told the court, “Apple’s rules unfairly prevent developers from letting consumers know if their prices for in-app purchases take into account the iPhone maker’s 30% commission or that consumers may be able to get better deals elsewhere,” (Wall Street Journal). To add, Susan Athey, an Economics of Technology professor at the Stanford Graduate School of Business, explained Apple’s stronghold over consumers is due to their prohibitive iOS mobile operating system. In the case of this trial, if a consumer wanted to access Fortnite an iPhone, the user would need to switch to a different smartphone brand and repurchase all the apps originally purchased from iOS devices. Since the internet is needed to play Fortnite, Evans highlights how gaming consoles could never replace smartphones, as it lacks cellular data for users who want to play the game from anywhere.

Apple’s opening statement was a defensive response to Epic Games’ claims. According to The Wall Street Journal, Apple hired University of Pennsylvania Wharton School professor, Lorin Hitt, to discuss in-app purchases. Hitt claims, “anticompetitive measures tend to result in reduced quality, yet that hasn’t happened with iPhone and iPads apps, as developers have seen their revenue increase over time.” Essentially, consumers notice the value in the offers proposed by Apple. As noted by the graph below, Mr. Hitt also denounced Epic Games’ claim about Apple’s monopoly-like practices. Users switch devices frequently because people like the products acquired for different reasons. If this were not the case, Play Station and XBOX would not generate over 50% of Fortnite’s revenue for the last two years. This also infers that most Fortnite users are not on iOS devices, which is surprising considering there are 1.5 billion active Apple devices. In addition, Apple insists the iPhone offers multiple avenues for financial transactions. Although difficult to decipher, the second picture provided by Apple indicates that the iPhone, compared to its competitors and subsidiaries, offers three types of digital game transactions options: The App Store, Web Applications, and Purchasing on Other Platforms to play on iOS. Ultimately, Apple is arguing that its practices are not prohibitive nor remotely resemble a “Walled Garden.”

Possible Outcomes

The outcome of the trial between Epic Games and Apple Inc. can end in multiple ways. One hypothetical is the verdict will resume the current situation: users could not access Fortnite on iOS devices, but other games produced by Unreal Engine will remain on Apple’s App Store. If the judge rules in favor of Epic Games, it may be able to create and launch its own App Store on iOS devices.

Legislation

In addition to the trial, a new state bill that recently passed the House 31-29 may negatively impact Apple’s case. According to The Verge, Arizona’s House Bill 2005, “prevents app store operators from forcing a developer based in the state to use a preferred payment system…,” which would ultimately force Apple to provide various payment methods on iOS. This development could be beneficial for Epic Games.

FraudSecurities

Nikola: The Next Tesla, Or A Fraud?

on October 8, 2020

Nikola founder, Trevor Milton, recently resigned from his position as Executive Chairman of the Board after facing accusations of fraud. Before delving into the fraud allegations, it is important to understand the genesis of the company, which adds to the gravity of the situation. You may recall, last week we delved into the upcoming fraud trial for former Theranos CEO Elizabeth Holmes. We wanted to continue covering this topic of high profile fraud.

Milton built Nikola in 2014 hoping to reform the transportation sector. His plan in accomplishing this goal was to create mainstream battery-electric and hydrogen-powered vehicles from state-of-the-art zero-emissions technology. Establishing a company based on the same inventor and mission as another company, Tesla to be specific, is not the only suspicious act Milton has committed.

According to Business Insider, on September 10th, 2020, a report published by the Hindenburg Research investment firm contains evidence of Milton providing false statements about his products. More specifically, the report accuses Milton of exaggerating the viability of his products and thus misinforming investors, partners, and consumers. An example of these fraudulent statements is based on a video demo advertising Nikola’s debut semi-truck, the allegedly hydrogen-powered “Nikola One.” The report revealed an exchange of text messages from a Nikola employee developing a plan to roll the vehicle down a hill to manipulate the “high-speed” aspect of the truck. Nikola diverted from the issue by stating the prototype was discarded and therefore irrelevant. To add, they thought the Hindenburg report was released as sabotage considering Nikola’s partnership with General Motors was finalized two days prior. It should be noted, Hindenburg is a short-seller, so they were interested in seeing Nikola’s stock price decline. (Photo Source: Twitter @HindenburgRes).

The company started trading on June 4th, after a reverse merger with VectoIQ. VectoIQ is a publicly-traded special purpose acquisition organization led by Stephen Girsky, the former Vice Chairman of General Motors. Before the Hindenburg report, Nikola was performing well in the stock market. A CNBC article stated that shares of Nikola Corporation increased by 20% at the end of the month. According to the closing price, Nikola was valued at almost $28.8 billion, making the corporation more valuable than Ford. However, Nikola’s stock market surge stemmed from Milton’s announcement of the company’s new battery-electric fuel-cell truck, the Badger. He followed his announcement confirming the company’s partnership with General Motors, a necessary move to get the new truck to market. Nikola did not anticipate to generate income until 2021, but investors were willing to provide a hefty sum for promising vehicles.

Despite the incident that led to his resignation, analysts think Milton’s exodus is a positive and necessary step for the progression of both Nikola and General Motors. Whether the motive for resigning was personal or strictly business, with Milton absent there will be less negative publicity.

What does this mean for Trevor Milton? Along with his resignation, he agreed to relinquish $166 million of equity and a two-year $20 million consulting contract. However, Milton gets to possess $3.1 billion in stock due to a recently finalized separation agreement. He agreed to assist the corporation as an unpaid consultant, but his role in company operations and decision-making are paused for at least three years. In the aftermath of Milton’s resignation, Nikola’s shares decreased significantly in premarket trading, opening Monday, September 21st, at $24.97, the lowest opening price since the company went public in June. It ended the day, closing down 19% at $27.58. As he continues to defend himself against the Hindenburg Research report, Milton’s legal expenses are paid for by Nikola as long as they receive copies of evidence.

With Milton out of the picture, Stephen Girsky has been appointed chairman of the board. General Motors’ main priority is to plan production of the battery-powered Badger truck starting late 2021 or early 2022, ultimately continuing the partnership with Nikola. Although General Motors bears the responsibility for its creation, Nikola will remain in charge of marketing and selling the product upon its release. Because Nikola lacks the cushion of intellectual property and revenue, they heavily rely on the investor’s contribution through the stock market. Nikola’s tarnished reputation requires damage control in order to maintain enough revenue until the Badger is released.

UPDATE: Now that time has passed from Nikola’s public fraud incident, the aftermath has unraveled. As of Monday, November 30th, 2020, General Motors decided to remove themselves from their deal with Nikola, thus relinquishing their $11 million equity stake. Because Nikola failed to live up to their “fast-paced” evolution of electric and hybrid vehicles, General Motors believed it was in their best interest to maintain distance for their future business ventures. Since the manufacture of Nikola’s hydrogen-powered Badger pickup truck relied on a partnership with an automaker, the vehicle’s production has been paused. According to The Verge, the two companies will cooperate to bring, “GM’s Hydrotec fuel-cell technology into Nikola’s Class 7 and Class 8 zero-emission semi-trucks for the medium- and long-haul trucking sectors.” With Nikola partly out of the picture, General Motors can focus on their multi-billion-dollar pursuit for a future involving all-electric vehicles. This requires the automaker to invest $2.2 billion to reconfigure their vehicle assembly plant and create the development process for its modular battery-electric platform, Ultium. They announced last week their $2.2 billion electrification investment will become $27 billion through 2025.  

UPDATE – 07/29/2021

We sort of knew it was coming. The grand jury had been convened. Mr. Milton had a lot of very public statements that were likely false or misleading. So, it was no surprise today when the grand jury indicted him on three counts of fraud. Here’s an update on the matter from CNBC.

Accident Investigation & ReconstructionAccident SafetyExpert Witness

Tesla and Uber Self-Driving Systems Result in Fatal Crashes

on April 3, 2018

In the last few weeks we have read several news reports about self-driving car accidents. Tesla and Uber, two companies leading innovation in driverless automobiles, have recently experienced fatal collisions which have hampered their autonomous testing. These are not the first instances of fatal crashes using the self-piloting systems. However, the collisions happened in such a close time frame, the public had to take notice.

On March 18, an Uber autonomous vehicle (AV) was involved in a fatal crash with a pedestrian. A Phoenix Business Journal article describes video of incident as follows:

“The video shows the victim Elaine Herzberg walking her bike in the middle of the road. It does not show the actual collision “due to the graphic nature of the impact,” said Det. Liliana Duran in an email. The video also shows an interior view of the driver looking down at something off and on, possibly a phone or computer screen, before looking up in surprise right before the car hits the woman.”

Due to the graphic nature of the video, we have decided not to share it here. There appears to be some elements of distracted driving involved in this crash. Human error seems to have combined with a failure by the autonomous (self-piloting) system, to identify the pedestrian and brake or take evasive action to avoid the collision.

About 5 days after the Uber crash, Tesla experienced a similar incident while their autopilot system was engaged. Engadget reported on this accident explaining:

“The driver of a Model X has died after his electric SUV collided with a median barrier on Highway 101 in Mountain View and was subsequently struck by two other vehicles. The incident destroyed the front half of the vehicle and sparked a fire that involved the battery, leading to Tesla sending an employee to investigate. Witnesses reported seeing a fireball during the crash.”

In a follow-up article today, Engadget has gone on to state that the NTSB is unhappy that Tesla shared information about the accident. Tesla CEO, Elon Musk, went ahead and blogged that autopilot was engaged but that the driver had removed his hands from the steering wheel for the six seconds prior to impact. The NTSB says Tesla has been cooperative in all previous accident investigations, but evidently they did not want this information made public. Also, it seems the deceased driver, had some concerns about the autopilot system according to his family.

The family claims “he had brought concerns to a Tesla dealership that his Model X had previously swerved toward the same median where the accident happened.”

What gets investigated when autopilot fails?

Readers may think that some elaborate investigation needs to take place since we are dealing with driverless automobiles. The truth is, this boils down to an automotive / vehicular accident reconstruction issue.

Certainly there is advanced programming involved and the crash data retrieval (CDR) may require new methods or new technologies to access information, but the data must be recovered nonetheless.

The NTSB even states, “At this time the NTSB needs the assistance of Tesla to decode the data the vehicle recorded.” They probably require help in accessing the data from Tesla’s proprietary system, but it is still a matter of CDR. If Elon Musk knows that the driver removed his hands from the wheel for six seconds prior to impact, he must have learned of this through the data retrieval process used by Tesla.

The same is true in the Uber crash. They already have dash-cam footage that shows the vehicle did not slow before striking the pedestrian. In that instance, an accident recontstructionist, automotive engineer, or automotive software engineer will have to analyze the self-driving sensors, data, and response of the software, to determine why the car failed to respond while on autopilot.

Both of these accidents require failure analysis. What seems new to us as a society, is that these crashes involved a failure of software, rather than brakes, tires, steering columns, or seat belt failures (failures that have become common and often result in a recall to fix a feature).

The technology and collection methods may change. However, the theories of liability and the investigation remain pretty constant. We have two automobile crashes resulting in death. They require a thorough accident reconstruction investigation to determine the cause of the accidents. Once determined, matters of negligence, product liability, and fault still apply.

 

AccountingComputer ForensicsExpert WitnessExpert Witness TestimonyForensic Accounting

Paul Manafort Indicted: What expert witnesses can we expect to see from defense and prosecution?

on October 30, 2017

Robert Mueller’s investigation into Russian interference in the US Presidential Election has resulted in the indictment of Paul Manafort and one of his business associates, Rick Gates. It has been reported that a third individual, George Papadopolous, has pleaded guilty for making false statements to the FBI.

None of this is particularly surprising. On Friday we learned the first indictments would be handed down as early as today, and that is exactly what happened. As of this writing, Paul Manafort has turned himself into the FBI’s Washington Field Office.

ABC News reported the list of charges against Mr. Manafort and Mr. Gates. The 12 counts include: “conspiracy against the United States, conspiracy to launder money, serving as an unregistered agent of a foreign principal, false and misleading Foreign Agents Registration Act statements, false statements, and seven counts of failure to file reports of foreign bank and financial accounts.”

We are not writing to take any political side and it should be noted that an indictment does not mean the defendants are guilty of the charges. In fact, they are innocent until proven guilty. Rather, we wanted to discuss the expertise which may come into play in this matter.

What types of expert witnesses can you expect to see?

Forensic Accountants:

Based on the counts enumerated above, it appears the FBI has followed the money. As such, we expect the forthcoming prosecution will hinge on financial transactions and accounting related issues. As stated above, Manafort and Gates were charged with seven counts of failure to file reports of foreign bank and financial accounts in addition to conspiracy to launder money. If money is flowing in and out of multiple bank accounts forensic accountants are going to be needed to analyze the transactions and explain those transactions to the trier of fact.

Money Laundering / Anti-Money Laundering Experts:

Are you surprised to hear this type of expertise exists? Money laundering experts may have a background in forensic accounting, financial fraud, banking, and banking compliance. Again, there was a charge of failure to file reports of foreign bank and financial accounts. Failure to report these accounts might be a compliance issue. The prosecution could argue such a failure was purposeful and intended to evade reporting. Whereas, the defense may contend failure to report was accidental or negligent. We expect to see both sides presenting expert evidence on financial transactions and reporting.

Computer/ Digital Forensics:

Nothing in the counts of the indictment specify a digital forensics expert will be necessary. We are assuming that many of the financial transactions were done electronically and therefore attributing the transactions to the defendants may require electronic discovery and other digital forensic investigation / analysis.

This list should not be viewed as exhaustive. Looking at the counts in the indictment, it appears the upcoming case will be heavily litigated on financial matters. Going forward, we will look for news items related to forensic accounting and inform our readers as we know more.

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