Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_09-cv-00009/USCOURTS-caed-2_09-cv-00009-32/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

PATRIOT RAIL CORP., a

Delaware corporation,, No. 2:09-cv-00009-MCE-EFB

Plaintiff,

v. ORDER

SIERRA RAILROAD COMPANY, 

a California corporation,

Defendant.

______________________________

And Related Counterclaim.

______________________________

Plaintiff and Counterdefendant Patriot Rail Corp. (“Patriot

Rail”) request, through the motion presently before the Court, an

Order striking the Supplemental Expert Report of Forrest Vickery,

dated December 19, 2011, and submitted by Defendant and

Counterclaimant Sierra Railroad Company (“Sierra”) to support

Sierra’s damage claims in this matter. Patriot Rail asserts that

Mr. Vickery’s Supplemental report impermissibly discloses new

opinions, and new areas of damage, that fall outside the scope of

a proper supplemental report.

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Patriot also requests sanctions for Sierra’s alleged “continuing

misconduct and bad faith in violating the Court’s Scheduling

Orders and abusing the judicial process.” Patriot’s Mot. to

Strike, iii:13-14.

Although Patriot Rail posits that deadline for expert

disclosures expired in late 2010, more than a year before

Vickery’s supplemental report was forthcoming, Federal Rule of

Civil Procedure 26(e)(2) expressly provides for supplementation

of an expert witness’ report irrespective of whether the expert

discovery guidelines have passed. Rule 26 permits a supplemental

report up until the time pretrial disclosure are made, which

under Rule 26(a)(3) may be made until 30 days before trial. The

trial in this matter is presently set for February 25, 2013.

Patriot nonetheless argues that Sierra has demonstrated no

substantial justification for not submitting its supplemental

sooner, and therefore urges the Court to strike the supplemental

report as untimely. According to the Declaration of Forrest

Vickery submitted in opposition to Patriot’s motion, however,

Vickery did not have additional information with respect to

actual carloads of freight handled by Patriot on its Sacramento

Valley line until October of 2011, when one of his business

associates obtained copies of newsletters published by Patriot

and made available to attendees at the Sacramento Business Expo

held at McClellan Park, where Patriot’s short-line railroad

operates. Vickery Decl., ¶ 5. After receiving that information,

Vickery states he obtained information in the form of a June 26,

2011, newspaper article from the Sacramento Bee. 

///

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Both the newsletters and the newspaper piece, according to

Vickery, contained additional freight carload data that Vickery

states affected fundamental assumptions set forth in his original

expert report. Id. Vickery opines that the new information was

materially different than the carload information he had at the

time of his earlier projections, and enabled him to project

profits with greater accuracy over the terms of the McClellan

contract, making inclusion of a disgorgement approach

appropriate. Id. at ¶¶ 5-6. Vickery also maintains that more

current financial information enabled him to update other

information contained in the report, which included altering some

items of damages and eliminating others entirely.

Patriot Rail takes issue with the propriety of Mr. Vickery’s

conclusions in this regard. Patriot argues that Vickery already

had sufficient data prior to his supplemental report and that

Vickery’s conclusions are simply impermissible new opinions reached

in the wake of a failed mediation session between the parties.

It would be improper for this Court to reject out of hand

Mr. Vickery’s sworn explanation attesting to the importance of

the new information with respect to profit projections and other

damages data. Significantly, it appears uncontroverted that

Vickery did receive updated carload data, which he concluded was

materially different than that relied upon at the time his

original report was prepared. The reliability of import of

Vickery’s conclusions in that regard must be relegated to crossexamination and rebuttal at the time of trial; to strike

Vickery’s report altogether in the face of the explanation he has

proffered would be in error.

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It should also be noted that Patriot Rail’s claim of

prejudice with respect to the Supplemental Report is undermined

by the fact that it elected not to depose Mr. Vickery with

respect to the conclusions he initially offered. Additionally,

it is undisputed that additional carload data was in fact

generated that Patriot Rail did not itself provide to Sierra

(even though it had the data and later provided confirmation of

same by way of supplemental discovery responses) before Vickery’s

supplemental report was generated through third-party

information. For Patriot Rail to argue prejudice under those

circumstances is disingenuous indeed. 

Patriot Rail’s Motion to Strike the Supplemental Expert

Report of Forrest Vickery (ECF No. 205) is accordingly DENIED. 

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Patriot’s request for sanctions against, as well as Sierra’s own

request for sanctions, are also denied. Given the impending

February 2013 trial, the parties are advised to focus their

attention on preparing for that trial.

IT IS SO ORDERED.

Dated: July 23, 2012

_____________________________

MORRISON C. ENGLAND, JR.

UNITED STATES DISTRICT JUDGE

 Because oral argument was not of material assistance, the 1

Court ordered this matter submitted on the briefs. E.D. Cal.

Local Rule 230(g). 

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