UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF FLORIDA 

CASE NO: 20-21707-CV-MARTINEZ-BECERRA 

RAYMOND JAMES FINANCIAL, INC., 

Plaintiff, 

vs. 

FEDERAL INSURANCE COMPANY; 

TRAVELERS CASUALTY AND SURETY 

COMPANY OF AMERICA; GREAT 

AMERICAN INSURANCE COMPANY; 

BEAZLEY INSURANCE COMPANY, INC.; 

AND ST. PAUL MERCURY INSURANCE 

COMPANY 

Defendants.

DEFENDANTS’ RESPONSE IN OPPOSITION TO 

PLAINTIFF’S MOTION TO EXCLUDE DEFENDANTS’ 

EXPERTS AND MEMORANDUM OF LAW IN SUPPORT THEREOF 

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TABLE OF CONTENTS 

TABLE OF CONTENTS ................................................................................................................. I

TABLE OF AUTHORITIES .......................................................................................................... II

INTRODUCTION .......................................................................................................................... 1

OVERVIEW OF EXPERT OPINIONS ......................................................................................... 2

A. GREGORY HAGARTY ......................................................................................... 3

B. SANDER RESSLER .............................................................................................. 4

STANDARD OF REVIEW ............................................................................................................ 5

ARGUMENT .................................................................................................................................. 6

I. HAGARTY’S OPINION ON FRAUD INVESTIGATIONS AND INDICIA OF FRAUD 

ARE ADMISSIBLE, RELIABLE AND HELPFUL. ......................................................... 6

A. HAGARTY’S LAW ENFORCEMENT EXPERIENCE QUALIFIES HIM AS AN 

EXPERT. ................................................................................................................ 8

B. HAGARTY’S OPINIONS ARE ADMISSIBLE AND HELPFUL...................... 10

C. HAGARTY RELIED UPON RELIABLE METHODS DERIVED FROM HIS 

EXPERIENCE. ..................................................................................................... 12

D. HAGARTY’S OPINIONS ARE ADMISSIBLE TO REBUT RJF’S PURPORTED 

EXPERT. .............................................................................................................. 15

II. RESSLER OFFERS ADMISSIBLE EVIDENCE OF INSURANCE PRACTICES. ...... 16

A. RESSLER IS QUALIFIED TO PROVIDE THE PROPOSED EXPERT 

TESTIMONY AND HIS TESTIMONY IS RELIABLE. .................................... 18

B. RESSLER’S PROPOSED EXPERT TESTIMONY IS HELPFUL TO THE JURY 

AND WILL NOT CONFUSE OR MISLEAD THE JURY. ................................ 19

CONCLUSION ............................................................................................................................. 20

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TABLE OF AUTHORITIES 

Cases

Alfalfa Elec. v. Travelers Indem. Co., 376 F. Supp. 901 (W.D. Okla. 1973) ............................... 19 

Allison v. McGhan, 184 F.3d 1300 (11th Cir. 1999) .................................................................... 14 

American General Life Ins. Co. v. Schoenthal Family, LLC, 555 F.3d 1331 (11th Cir. 2009) .. 4, 6 

Benner v. NCL (Bahamas) Ltd., No. 15-20585-civ, 2016 WL 11547583 (S.D. Fla. April 8, 2016).

................................................................................................................................................... 14 

Braddy v. Infinity Assurance Ins. Co., No. 615CV119ORL28GJK, 2016 WL 1446202 (M.D. Fla. 

Apr. 11, 2016) ............................................................................................................................. 8 

Branch Banking & Trust Co. v. Witmeyer, No. 10-cv-55, 2011 WL 3297682 (E.D. Va. Jan. 6, 

2011) ......................................................................................................................................... 11 

CGC Holding Company, LLC v. Hutchens, No. 11-cv-01012, 2017 WL 1435857 (D. Co., Apr. 

20, 2017) ............................................................................................................................... 9, 10 

Clarke v. Healthsouth, No. 14-cv-778, 2021 WL 129821 (M.D. Fla., Jan. 14, 2021) ................. 10 

Coquina v. Rothstein, No. 10-60786, 2011 WL 4949191 (S.D. Fla. Oct. 8, 2011) ............... passim 

Cordoves v. Miami-Dade Cty., 104 F. Supp. 3d 1350 (S.D. Fla. 2015) ......................................... 5 

Corwin v. Walt Disney, 475 F.3d 1239 (11th Cir. 2007) ................................................................ 5 

Cotromano v. United Tech., No. 13-cv-80928, 2018 WL 2047468 (S.D. Fla., May 2, 2018) ....... 5 

Daubert v. Merrell Dow Pharms., 509 U.S. 579 (1993) .................................................. 5, 6, 9, 14 

Gomez v. General Nutrition, 323 F. Supp. 3d 1368 (S.D. Fla. 2018)............................................. 6 

Hemmings v. Tidyman’s Inc., 285 F.3d 1174 (9th Cir. 2002) ....................................................... 14 

Hendrix ex rel G.P. v. Evenflo, 609 F.3d 1183 (11th Cir. 2010) .................................................... 5 

Jack v. Glaxo Wellcome, Inc., 239 F. Supp. 2d 1308 (N.D. Ga. 2002) .......................................... 5 

Jennings v. U.S., 2005 WL 1387987 (S.D.N.Y. June 6, 2005) .................................................... 11 

King v. Cessna Aircraft, No. 03- 20482, 2010 WL 1980861 (S.D. Fla. May 18, 2010) ................ 6 

Kirstein v. Parks Corp., 159 F.3d 1065 (7th Cir. 1998) ............................................................... 13 

Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999) .................................................................... 6 

McClain v. Metabolife Internat’l, Inc., 401 F.3d 1233 (11th Cir. 2005) ...................................... 13 

Nemir v. Mitsubishi Motors, 200 F. Supp. 2d 770 (E.D. Mich. 2002), rev'd, 381 F.3d 540 (6th 

Cir. 2004). ................................................................................................................................... 8 

New England Petroleum v. Daibes Oil, LLC, No. 14-cv-726, 2018 WL 1358819 (D. N.J. Mar. 

16, 2018) ............................................................................................................................. 11, 12 

Perlman v. Am. Express Centurion Bank, No. 19-61386, 2021 WL 2592175 (S.D. Fla. Mar. 26, 

2021) ................................................................................................................................. 2, 7, 11 

Quiet Tech. DC-8, Inc. v. Hurel-Dubois UK Ltd., 326 F.3d 1333 (11th Cir. 2003) ..................... 14 

Rink v. Cheminova, Inc., 400 F.3d 1286, (11th Cir. 2005) ............................................................. 8 

Rosado v. Deters, 5 F.3d 119 (5th Cir. 1993) ............................................................................... 10 

Rosenfeld v. Oceania Cruises, Inc., 654 F.3d 1190 (11th Cir. 2011) ........................................... 14 

Royal Trust Bank v. Nat’l Union Fire Ins. Co., 788 F.2d 719 (11th Cir. 1986) ........................... 19 

Serrano v. American Airlines, Inc., No. 15-23382-Civ, 2016 WL 6600499 (S.D. Fla. Nov. 8, 

2016) ......................................................................................................................................... 13 

St. Paul Fire & Marine Ins. Co. v. Bank of Stockton, 213 F. Supp. 716 (N.D. Calif. 1963) ........ 19 

U.S. ex rel. Armfield v. Gills, No. 07-cv-2374, 2013 WL 371457 (M.D. Fla. Jan. 30, 2013) ...... 10 

U.S. v. Benitez, No. 14-cr-124, 2015 WL 5542449 (M.D. Fla. Sept. 15, 2015) ......................... 2, 9 

U.S. v. Brown, 415 F.3d 1257 (11th Cir. 2005) ............................................................................ 13 

U.S. v. Burchfield, 719 F.2d 356 (11th Cir. 1983) .......................................................................... 5 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 3 of 26
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U.S. v. Frazier, 387 F.3d 1244 (11th Cir. 2004) .................................................................... passim 

U.S. v. Long, 300 F. App’x 804 (11th Cir. 2008) ......................................................................... 10 

U.S. v. Motsenbocker, No. CR-10-371, 2011 WL 902121 (S.D. Ohio, Mar. 15, 2011) ................. 9 

U.S. v. Nelson, No. 17-cr-00533, 2021 WL 75757 (N.D. Ca., Jan. 8, 2021) .................................. 9 

U.S. v. Parkhurst, 865 F.3d 509 (7th Cir. 2017) ............................................................................. 9 

U.S. v. Rouco, 765 F.2d 983 (11th Cir. 1985)................................................................................. 5 

United States v. Smith, 919 F.3d 825 (4th Cir. 2019) ..................................................................... 9 

USLIFE Savings & Loan Assoc. v. Nat’l Sur. Corp., 115 Cal. App. 3d 336 (Cal. Ct. App. 1981)

................................................................................................................................................... 19 

Utica Mut. Ins. Co. v. Fireman’s Fund Ins., 748 F.2d 118 (2d Cir. 1984) ................................... 19 

Ward v. Carnival Corp., No. 17-24628-CN, 2019 WL 1228063 (S.D. Fla. Mar. 14, 2019)....... 14 

Statutes

Federal Rule of Evidence 702 ......................................................................................................... 5 

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Federal Insurance Company, Travelers Casualty and Surety Company of America, Great 

American Insurance Company, Beazley Insurance Company, Inc., and St. Paul Mercury Insurance 

Company (collectively, the “Insurers”) submit the following response in opposition to Plaintiff’s 

motion to exclude the testimony of Gregory Hagarty and Sander Ressler. (D.E. 127). 

INTRODUCTION 

Raymond James Financial, Inc. (“RJF”) seeks insurance coverage on the theory that Joel 

Burstein (“Burstein”) colluded with Ariel Quiros (“Quiros”) to embezzle money from a series of 

limited partnerships associated with the Jay Peak ski resort. Insurers denied coverage, in part, on 

the basis that (1) RJF did not prove that Burstein acted dishonestly or colluded with Quiros; and 

(2) RJF was aware of the conduct it now characterizes as dishonest prior to the inception of its 

financial institution bonds. In light of these disputed issues, Insurers disclosed two credentialed 

experts to address these focused issues: Greg Hagarty (“Hagarty”) and Sander Ressler (“Ressler”). 

RJF never addresses the true point of Hagarty’s and Ressler’s opinions. It unnecessarily 

emphasizes insurance claim handling, contractual definitions, obligations of good faith, and other 

contractual duties, even though those issues have nothing to do with Hagarty’s or Ressler’s 

opinions. Neither offered any opinions on those topics or purported to offer opinions on those 

topics. Instead, they offered opinions directed to RJF’s allegations of dishonesty and its inaction 

upon learning of conduct now characterized as dishonest. Both experts opine why RJF’s conduct 

(in accusing Burstein of dishonesty and failing to report a claim upon learning of the alleged 

dishonesty) deviated from industry standard and why application of industry standards refutes 

RJF’s theory of coverage. Those opinions are intended to help the jury evaluate the basis for RJF’s 

claim and render a decision on two disputed issues above. RJF ignores the relevance of these 

opinions because Hagarty and Ressler offer admissible, reliable and helpful opinions consistent 

with local precedent. 

First, RJF’s manufactured allegation of dishonesty ignores exculpatory facts – including 

repeated disclosures to and approvals by RJF’s executives. Because lay jurors are unfamiliar with 

indicia of fraud, Insurers disclosed Hagarty, a Certified Fraud Examiner and former FBI agent 

with over 25 years of experience, to explain to common indicia of dishonesty and collusion. That 

experience will assist the jury in evaluating the basis for RJF’s allegations, whether RJF accounted 

for exculpatory factors, understand the complex transactions underlying RJF’s claim and resolve 

the disputed issues. While RJF may prefer the jury render an uneducated decision, this Court 

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commonly admits such opinions as helpful and relevant in claims. Perlman v. Am. Express 

Centurion Bank, No. 19-61386, 2021 WL 2592175 at *1 (S.D. Fla. Mar. 26, 2021) (opinion on 

indicia of fraud admitted to assist jury evaluate fraud claim); Coquina v. Rothstein, No. 10-60786, 

2011 WL 4949191 at *4 (S.D. Fla. Oct. 8, 2011) (expert allowed to opine on “red flags” of fraud). 

Second, Insurers denied coverage because RJF knew about the conduct it characterizes as 

dishonest prior to the inception of its current financial institution bonds. RJF does not deny such 

knowledge or its failure to provide notice of a claim upon learning of the conduct it now paints as 

collusive, but disclosed an expert (Clay Grumke (“Grumke”)) to defend its inaction. While Insurers 

contest the admissibility of Grumke’s opinions, they disclosed Ressler as a rebuttal expert to opine 

on custom and practice in the insurance industry. That opinion directly rebuts Grumke’s opinion 

and will help the jury understand risk management practices (a subject outside the knowledge of a 

lay jury) and evaluate RJF’s claim. 

Faced with focused opinions offered by documented experts that directly undermine its 

claim, RJF seeks exclusion with disjointed arguments divorced from Ressler’s and Hagarty’s 

actual opinions. It over-emphasizes Hagarty’s alleged inexperience with insurance, despite the fact 

that he was not offered as an insurance expert and his law enforcement credentials provide a standalone basis for his opinions. U.S. v. Benitez, No. 14-cr-124, 2015 WL 5542449, at *3 (M.D. Fla. 

Sept. 15, 2015). It criticizes Hagarty and Ressler for failing to identify textbook support for their 

opinions, despite the fact that their experience alone can (and does) provide sufficient basis for 

expert opinion. U.S. v. Frazier, 387 F.3d 1244, 1261 (11th Cir. 2004). 

Unlike RJF, Insurers disclosed experts to assist the jury with understanding the context of 

this claim, and industry principles directly relevant to their evaluation of RJF’s claim. Those 

experts will explain industry practices outside the knowledge of a lay juror – thereby providing 

context to RJF’s claim and enabling the jury to properly weigh the disputed issues. Because 

Ressler and Hagarty offer expert opinions helpful to the jury based upon documented expertise, 

RJF’s motion to exclude should be denied. 

OVERVIEW OF EXPERT OPINIONS 

RJF’s motion glosses over Hagarty’s and Ressler’s expertise, and mischaracterizes the 

scope and substance of their opinions. Before explaining the legal flaws in RJF’s arguments, 

Insurers will explain Hagarty’s and Ressler’s backgrounds, the scope of retention, substance of 

their opinions and the nexus between their opinions and RJF’s allegations. 

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A. GREGORY HAGARTY

Hagarty is a Certified Fraud Examiner in New York. (D.E. 127-1, p. 7).1 From 1989 

through 2015, Hagarty worked as a Special Agent of the FBI. During his tenure at the FBI, he 

investigated white-collar crime, and supervised a squad of agents investigating white-collar 

crimes. Id. Hagarty’s experience included participating in the investigation of Bernard Madoff’s 

Ponzi scheme and large mortgage fraud scheme. Id. Following his work with the FBI, Hagarty 

worked at a private investigation firm (Alpha Group) from (February 2015 through August 2016), 

the consulting division of Baker Tilly from (August 2016 through April 2018), and operated his 

own consulting firm (Lighthouse Strategies LLC). (Id. at 8). In those positions, he was routinely 

engaged to assist in the investigation of and evaluation of cases involving fraud. Id. 

Relying upon his law enforcement and consulting experience, Hagarty has experience 

analyzing evidence for “indicia of collusion, dishonesty, and concealment of relevant 

information.” Id. at 7. For example, Hagarty investigated a multi-year mortgage fraud scheme to 

determine whether individuals were colluders with the alleged fraudulent actor or whether the 

individuals had fallen for the alleged fraudulent actor’s “persuasive, convincing stories.” Id. He 

investigated the New York mafia for evidence of “collusion, dishonesty, concealment, and 

participation in criminal activities.” Id. He also investigated a public corruption scheme, looking 

for “collusion among elected officials and an individual seeking to obtain county government 

contracts through bribery and other corrupt means.” Id. at 8. 

In light of that experience, Insurers retained Hagarty to opine on how investigators identify 

and evaluate evidence when evaluating allegations of dishonestly and collusion. (D.E. 127-1, p. 

9). Insurers did so as a means of assisting the jury in identifying indicia of fraud/collusion, and 

factors undermining allegations of fraud/collusion. As a result of his expertise in acting in the 

role of an investigator and analyzing available evidence, and through a reasonable degree of 

professional certainty, Hagarty reached the opinion that RJF (and its expert, Steve Urcia (“Urcia”)) 

“did not adopt a reasonable investigatory approach designed to objectively weigh whether Burstein 

acted dishonestly and colluded with Quiros,” and that they “discounted (or ignored) exculpatory 

evidence reflecting wide-ranging knowledge and approval of the transactions they now 

characterize as dishonest.” Id. Hagarty opines that RJF’s failure to apply a reasonable investigatory 

approach “omits critical context and events that in [his] experience are inconsistent with the 

 

1

 Hagarty attested to his qualifications during his deposition. (Dkt. 127-2, pg. 55-56, 64). 

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conclusion that Burstein colluded with Quiros.” Id. 

B. SANDER RESSLER

Ressler has been the Managing Director of Essential Edge Companies from June 2011 to 

present, a firm devoted to performing independent investigations of broker-dealers suspected of 

fraudulent and abusive sales practices. (D.E. 127-3, pp. 7, 21).2 Prior to forming Essential Edge, 

Ressler served as the President and Chief Compliance Officer of EMG Capital, Inc. from June 

2012 to August 2014. In that role, he ensured compliance with anti-money laundering and other 

federal and state regulations. Id. Ressler also served as Compliance Officer and Anti-Money 

Laundering Officer at Summit Brokerage Services, Inc.; Multi-Financial Securities Corporation, 

and American General. Id. at pp. 8, 21. In these roles, Ressler drafted and implemented written 

supervisory procedures, handled FINRA and SEC examinations, and managed compliance. Id. 

The Insurers retained Ressler to rebut Grumke’s opinion as to “whether [RJF] acted in a 

prompt and timely manner in reporting a loss to the insurers assuming its allegations of dishonesty 

as true and in light of facts disclosed to [RJF]’s legal department.” (Id. at 7). In light of RJF’s 

allegation that it timely disclosed its claim, Ressler opined on: 

A. whether a reasonable securities broker-dealer would expect that the events and 

transactions disclosed to RFI’s legal department would likely result in a loss; 

B. whether a reasonable securities broker-dealer would provide notice after [RJF]’s legal 

department learned of the specific events and transactions discussed below; C. whether 

[RJF]’s legal department acted in accordance with industry custom and practice in 

reporting (or failing to report) an insurance claim after Burstein’s SEC testimony in March 

27, 2014; and 

D. explain how a reasonable broker-dealer would have reacted after Burstein’s SEC 

testimony on March 27, 2014. 

Id. As a result of his expertise in acting as a Compliance Officer and AML Officer, and through a 

reasonable degree of professional certainty, Ressler reached the opinion: 

that attorneys in [RJF]’s legal department learned on at least eight occasions before October 

2015, of events that (1) would cause a reasonable securities broker-dealer to assume that a 

loss of a type covered by the bonds had been or would be incurred; and (2) would lead a 

reasonable securities broker-dealer to provide notice to its insurers. As detailed below, 

[RJF]’s legal department was aware as early as March 2014 of questionable transactions in 

a client account and transactions suggesting that Quiros used partnership funds for personal 

benefit and to pay his debt to Raymond James. A reasonable securities broker-dealer 

following industry customs and practices would have appreciated the implications of those 

transactions, the potential for a loss, and provided notice at the time they first learned of 

those transactions in order to preserve their rights to recover under the bonds. They would 

 

2

 Ressler attested to his qualifications during his deposition. (Dkt. 127-2, pg. 29). 

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have done so because customers commonly pursue claims against securities broker-dealers 

once they learn of misuse or alleged misuse of their funds. 

Id. In sum, Ressler opines on how a reasonable securities broker-dealer would handle the events 

and transactions involved in this matter (D.E. 127-3, p. 7) and whether RJF’s Legal Department 

acted in accordance with industry custom and practice. Id. 

STANDARD OF REVIEW 

While Federal Rule of Evidence 702 allows expert testimony, an expert can only testify 

where: (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. Daubert v. 

Merrell Dow Pharms., 509 U.S. 579, 592 (1993); Cotromano v. United Tech., No. 13-cv-80928, 

2018 WL 2047468 at *14 (S.D. Fla., May 2, 2018). The trial court acts as the “gatekeeper” to such 

testimony. Corwin v. Walt Disney, 475 F.3d 1239, 1250 (11th Cir. 2007). To facilitate that analysis, 

the Eleventh Circuit has established a three-part test: “(1) the expert is qualified to testify 

competently regarding the matters he intends to address; (2) the methodology by which the expert 

reaches his conclusions is sufficiently reliable as determined by the sort of inquiry mandated in 

Daubert; and (3) the testimony assists the trier of fact, through the application of scientific, 

technical, or specialized expertise, to understand the evidence or to determine a fact in issue.” 

Hendrix ex rel G.P. v. Evenflo, 609 F.3d 1183, 1994 (11th Cir. 2010). 

Qualifications: A party must demonstrate each of its experts is “qualified as an expert by 

knowledge, skill, experience, training, or education.” Cordoves v. Miami-Dade Cty., 104 F. Supp. 

3d 1350, 1356 (S.D. Fla. 2015). This analysis requires the Court to “... examine the credentials of 

the proposed expert in light of the subject matter of the proposed testimony.” Jack v. Glaxo 

Wellcome, Inc., 239 F. Supp. 2d 1308, 1314 (N.D. Ga. 2002). The expert must demonstrate 

knowledge of something “beyond the understanding and experience of the average citizen.” U.S.

v. Rouco, 765 F.2d 983, 995 (11th Cir. 1985). In effect, the expert must offer testimony of “the 

kind that enlightens and informs lay persons without expertise in a specialized field.” U.S. v. 

Burchfield, 719 F.2d 356, 357 (11th Cir. 1983). 

Reliability: After determining an expert is qualified to testify competently, the court must 

determine whether the methodology the expert used in reaching his conclusions is reliable. Frazier, 

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387 F.3d at 1260. The Daubert Court specified “[t]he inquiry envisioned by Rule 702 is [] a 

flexible one.” Daubert, 509 U.S. 579 at 594; see also Kumho Tire Co. v. Carmichael, 526 U.S. 

137, 139 (1999) (interpreting Daubert and explaining that “reasonable measures of reliability in a 

particular case is a matter that the law grants the trial judge broad latitude to determine”). Expert 

testimony may be deemed reliable if it is based upon personal knowledge or experience, as 

“[s]tandards of scientific reliability, such as testability and peer review, do not apply to all forms 

of expert testimony.” American General Life Ins. Co. v. Schoenthal Family, LLC, 555 F.3d 1331, 

1338 (11th Cir. 2009) (citing Kumho Tire, 526 U.S. 137 at 151). When a witness relies “on 

experience, then the witness must explain how that experience leads to the conclusion reached, 

why that experience is a sufficient basis for the opinion, and how that experience is reliably applied 

to the facts.” Coquina, 2011 WL 4949191 at *1.

Helpfulness: Expert testimony must assist the trier of fact. Expert testimony is helpful to 

the trier of fact “if it concerns matters that are beyond the understanding of the average lay person.” 

Frazier, 387 F.3d 1244 at 1262; King v. Cessna Aircraft, No. 03- 20482, 2010 WL 1980861, at *5 

(S.D. Fla. May 18, 2010). Expert testimony is helpful if it is precise, specific, and the factual basis 

is adequately explained. Gomez v. General Nutrition, 323 F. Supp. 3d 1368, 1378 (S.D. Fla. 2018). 

ARGUMENT 

I. HAGARTY’S OPINION ON FRAUD INVESTIGATIONS AND INDICIA OF 

FRAUD ARE ADMISSIBLE, RELIABLE AND HELPFUL. 

Although RJF accuses Burstein of dishonesty, RJF could not identify any employees 

willing to support its false narrative or to testify that they ever witnessed Burstein commit a 

dishonest act. In fact, not a single RJF fact witness deposed during discovery testified that Burstein 

acted dishonestly or was willing to accuse him of conspiring with Quiros. Unable to identify any 

percipient witnesses willing to support its claim, RJF manufactured a claim by mischaracterizing 

Burstein’s role and conduct, and ignoring repeated disclosures of Quiros’ transactions and 

executive approval of those transactions. It then disclosed an alleged expert, Steve Urcia, to narrate 

its self-serving and subjective allegations. 

Because an expert cannot opine on the ultimate question of dishonesty, Defendants ask this 

Court to exclude Urcia as an expert and disclosed Hagarty as an expert. Unlike Urcia, Hagarty 

does not offer opinions on the ultimate question of Burstein’s conduct, but instead, educates the 

jury on investigatory techniques employed to evaluate allegations of dishonesty and indicia of 

dishonesty/collusion. Those opinions will assist the jury with defining a process to evaluate the 

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allegations of dishonesty, and whether the disclosures and approvals RJF ignores undermine if 

allegations of dishonesty/collusion. Hagarty will assist the jury in structuring its analysis of RJF’s 

allegations by explaining whether RJF’s bald allegations of dishonesty “deviated from reasonable 

investigatory techniques designed to objectively weigh whether Burstein acted dishonestly or 

colluded with Quiros...” and assist the jury in identifying indicia of fraud/collusion and identifying 

“... exculpatory evidence reflecting wide-ranging knowledge and approval of the transactions they 

now characterize as dishonest.” (D.E. 127-1, p. 9). Such testimony comports with this Court’s 

precedent – which recognizes that former law enforcement officers can offer expert opinions on 

investigatory techniques and that experts can offer opinions on the indicia of fraud. Perlman, 2021 

WL 2592175 at *1; Coquina Investments, 2011 WL 4949191, at *4. 

Faced with precedent admitting analogous opinions, RJF falsely critiques an educated and 

experienced expert based upon immaterial arguments. For example, RJF complains that Hagarty 

lacks insurance experience – an irrelevant fact given that Insurers did not offer Hagarty as an 

insurance expert and his opinions do not depend upon any insurance experience. RJF treats 

insurance experience as a mandatory prerequisite, but its own experts lack such experience too. 

Each of RJF’s own experts openly acknowledged that they lack relevant insurance experience: 

Expert Admission Citation 

Steve 

Urcia 

Q: So would you agree that you have no expertise in 

financial institution bonds or insurance? 

A: That would be correct. 

Exhibit 1, 

pp. 261:17-262:02 

Clay 

Grumke 

“I’ve not worked for an insurance company, nor have I 

practiced in that area, worked in that area.” 

Exhibit 2, 

p. 28:05-16 

Jorge 

Baez 

Q: ... Do you have any experience with financial 

institution bonds? 

A. No, I have not seen these types of bonds before. 

Exhibit 3, 

p. 12:05-12:08 

RJF resorts to a hypocritical argument to distract from the admissibility of Hagarty’s opinions. 

RJF pursued a claim on the false notion that Burstein colluded with Quiros to defraud the 

Jay Peak partnerships. That claim, RJF admits in its complaint, depends upon proof that Burstein 

(1) acted dishonestly; and (2) colluded with Quiros. While an expert cannot opine on the existence 

of dishonesty and collusion, he can assist the jury in identifying indicia of dishonesty/collusion 

and valid investigatory techniques applied when identifying dishonesty/collusion. Therein lies 

Hagarty’s expertise and helpfulness – assisting the trier of fact in evaluating RJF’s allegations and 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 11 of 26
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the merits of those allegations. 

A. HAGARTY’S LAW ENFORCEMENT EXPERIENCE QUALIFIES HIM AS AN EXPERT. 

RJF’s challenge to Hagarty’s experience and qualifications teeters on a series of false 

premises. Seeking to narrowly paint this case as an insurance dispute, RJF argues that Hagarty 

lacks experience in insurance, at a broker/dealer, with insurance claims handling and the insured’s 

duty under a financial institution bond. (D.E. 127, pp. 3, 7-8). This entire discussion is a red 

herring. RJF spends pages discussing an Insurers’ duty to investigate and act in good faith and 

claim handling testimony [D.E. 127, pp. 3-4, 9, 11-12], despite the fact that Hagarty provides no 

opinions about claim handling and claim handling is irrelevant in this contract action. Braddy v. 

Infinity Assurance Ins. Co., No. 615CV119ORL28GJK, 2016 WL 1446202, at *2 (M.D. Fla. Apr. 

11, 2016) (insured’s bad faith claim against insurer cannot be pursued until after liability for 

coverage is determined under the policy). 

RJF focuses on immaterial claims because in reality it cannot dispute Hagarty’s experience 

and relevance. RJF’s claim rises and falls on RJF’s ability to prove that Burstein acted dishonestly 

and colluded with Quiros. That question is not an issue of law, a matter of insurance or a matter 

of claim handling. Absent summary judgment, the jury will be asked to weigh Burstein’s conduct 

and identify indicia of fraud. Hagarty can assist in that process based upon his law enforcement 

experience, investigatory experience and credentials as Certified Fraud Examiner. That experience 

qualifies him to offer an opinion in this case.3 

Rule 702 permits a person to qualify as an expert based upon knowledge, skill, experience, 

training, or education. Frazier, 387 F.3d at 1261. Reliability is different than believability or 

persuasiveness (which are and remain an issue for the trier of fact). Rink v. Cheminova, Inc., 400 

F.3d 1286, 1293 n. 7 (11th Cir. 2005). Accordingly, courts recognize that law enforcement 

experience amply qualifies a witness to offer expert opinion on investigatory techniques and 

indicia of fraud/collusion. U.S. v. Nelson, No. 17-cr-00533, 2021 WL 75757, at *10 (N.D. Ca., 

 

3

 RJF wrongly disputes Hagarty’s qualifications as an expert based upon whether he applied 

scientific methods, or textbook standard. RJF cites to Nemir v. Mitsubishi Motors, 200 F. Supp. 

2d 770 (E.D. Mich. 2002) to support the notion that an expert must document how his experience 

supports his opinions (D.E. 127, pp. 10-11), but the Sixth Circuit reversed Nemir. 381 F.3d 540, 

554 (6th Cir. 2004). Consistent with that decision, Hagarty explained that his law enforcement and 

investigatory experience guided his evaluation in this matter and how he applied that to 

engagement. (D.E. 127-1, pp. 7-8). He demonstrates knowledge beyond the experience of a lay 

juror and that will assist lay jurors. 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 12 of 26
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Jan. 8, 2021); CGC Holding Company, LLC v. Hutchens, No. 11-cv-01012, 2017 WL 1435857, at 

*4-5 (D. Co., Apr. 20, 2017); U.S. v. Poulsen, 543 F. Supp. 2d 809, 811-12 (S.D. Ohio 2008); U.S. 

v. Motsenbocker, No. CR-10-371, 2011 WL 902121, at *4 (S.D. Ohio, Mar. 15, 2011); U.S. v. 

Benitez, No. 14-cr-124, 2015 WL 5542449, at *3 (M.D. Fla., Sept. 15, 2015). 

Benitez recognized law enforcement credentials as a basis for expert testimony. In that 

case, the witness sought to offer opinions based upon his experience as a police officer. Like RJF, 

the government challenged the witness’ credentials and argued that his law enforcement and 

investigatory experience did not qualify him as an expert. The district court rejected that argument: 

And finally the Government states that Olsen’s expert opinion does not meet the 

Daubert standards. ... The Government’s arguments go to the weight of the 

testimony offered by Olsen rather than its admissibility. Olson has substantial 

experience in private investigations and law enforcement. His years of experience 

can assist the jury in understanding the issues in Count II more than the opinion of 

the average layman. 

2015 WL 5542449, at *3. 

Benitez is consonant with that of other courts of appeals. United States v. Smith, 919 F.3d 

825, 835 (4th Cir. 2019) rejected a Daubert-based challenge to admission of opinions upon 

experience investigating gang-related crimes. The court explained that the witness was qualified 

“as an expert in drug and gang terminology” because he “was a twelve-year veteran of the FBI 

with substantial experience in drug and gang investigations (conducting controlled buys, 

interviewing drug dealers and gang members, using gang members as confidential sources, 

listening to thousands of recorded conversations, and so forth).” Id. Finding the witness qualified 

to testify as an expert, the court next held that he “employed a sound methodology” because he 

compared the facts at issue in that case with “his experience with other investigations....” Id. at 

836; see also U.S. v. Parkhurst, 865 F.3d 509, 516-17 (7th Cir. 2017) (stating that “(t)raining and 

experience are proper foundations for expert testimony,” that such testimony is admissible 

“without requiring ‘scientific methodologies’ or ‘peer review,’” and that law-enforcement experts 

may point to “factors such as the officer’s years of experience and number of investigations”). 

CGC Holding Company applied that rationale while upholding admission of expert opinion 

on common methodologies employed to commit theft. In that case, the witness sought to offer 

opinion testimony about the characteristics of fraud. Citing the witness’ experience with the FBI, 

the district court held that law enforcement experience (including experience investigating fraud) 

qualified the witness to testify about the characteristics of fraud: “Baker’s FBI career enhanced 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 13 of 26
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his basic accounting background and provided training and hands-on experience at a high level in 

investigating fraudulent schemes. That is what makes him qualified, perhaps uniquely qualified, 

to express opinions in this area.” 2017 WL 1435857 at *3.4

As in CGC Holding, Hagarty possesses specialized knowledge and experience 

investigating and identifying indicia of fraud, dishonesty and collusion. After being accredited as 

a Certified Fraud Examiner, Hagarty worked at the FBI and as a private consultant. During his 

expansive experience, he investigated organized crimes and white-collar crimes – including 

participating in the investigation of Bernard Madoff, participating in the investigation of mortgage 

fraud, and investigating bribery and collusion among public officials. (D.E. 127-1, pp. 7-8). That 

documented experience qualifies Hagarty to offer expert opinions about the common indicia of 

fraud/collusion; common techniques applied to investigate and evaluate allegations of fraud and 

collusion; and factors commonly weighed when evaluating allegations of fraud and collusion. 

B. HAGARTY’S OPINIONS ARE ADMISSIBLE AND HELPFUL. 

Supported by a single sentence, RJF baldly asserts without support that Hagarty’s 

testimony is not helpful to the trier of fact because Hagarty did not reach an opinion on the ultimate 

question of whether Burstein acted dishonestly. (D.E. 127, pp. 17-19). Hagarty did not offer such 

an opinion because any such opinion is inadmissible as it infringes on the role of the jury. U.S. v. 

Long, 300 F. App’x 804, 814–15 (11th Cir. 2008) (statement that company “was an artifice or 

scheme to defraud” was “plainly inadmissible”); U.S. ex rel. Armfield v. Gills, No. 07-cv-2374, 

2013 WL 371457, at *3 (M.D. Fla. Jan. 30, 2013) (expert “not be permitted to ... testify to whether 

Defendants committed Medicare fraud or fraud in general”); Clarke v. Healthsouth, No. 14-cv778, 2021 WL 129821, at *6 (M.D. Fla., Jan. 14, 2021) (excluding expert witness from opining 

on whether defendant acted “fraudulently”). 

Rather than interfering with the jury’s role, Insurers disclosed Hagarty to assist the jury by 

explaining to them common indicia of fraud and reasonable investigatory techniques used to 

 

4

 RJF relies upon Rosado v. Deters, 5 F.3d 119 (5th Cir. 1993) to argue that Hagarty’s prior 

compliance experience is outdated. (D.E. 127, p. 8). Rosado excluded an accident reconstruction 

expert solely because he had not practiced for twenty-five years, had not taken any refresher 

courses, and admitted that he could not establish the bases for his opinion. Id. at 124. That is not 

the case here, as Hagarty is a certified fraud examiner with over twenty years of experience 

investigating white collar crimes. (D.E. 127-1, pp. 7-8). RJF ignores Hagarty’s vast experience 

including, among others, the investigations into the Bernie Madoff securities fraud scheme and a 

multi-year mortgage fraud scheme. Id. 

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evaluate the existence of dishonesty and collusion. Unlike opinions on the ultimate question of 

whether collusion and dishonesty exist, Hagarty’s opinions are admissible because indicia of 

fraud/collusion and weighing allegations of such conduct are beyond the common knowledge of a 

lay juror. Courts commonly hold such opinions to be admissible because they are helpful to the 

jury in weighing allegations of fraud. Perlman, 2021 WL 2592175 at *1; Coquina Inv., 2011 WL 

4949191, at *4; see also Branch Banking & Trust Co. v. Witmeyer, No. 10-cv-55, 2011 WL 

3297682, at *9 (E.D. Va. Jan. 6, 2011); New England Petroleum v. Daibes Oil, LLC, No. 14-cv726, 2018 WL 1358819, at *7 (D. N.J. Mar. 16, 2018); Jennings v. U.S., 2005 WL 1387987, at *3 

(S.D.N.Y. June 6, 2005). 

This Court upheld the admissibility of an analogous opinion less than six months ago in 

Perlman. In that case, the plaintiff disclosed a certified fraud examiner to offer an opinion on 

specific circumstances that exhibited indicia of fraud. The defendant challenged the admissibility 

and helpfulness of such an opinion, but this Court rejected that challenge: “Provided that 

Defendants properly qualify Kapila, he may testify about his observations made during the forensic 

accounting investigation and identify the specific circumstances that, in his expert opinion, 

exhibited indicia of fraud.” 2021 WL 2592175, at *1. 

Coquina Investments reached the same conclusion. In that case, a defrauded investor sued 

a bank alleging that it facilitated a Ponzi scheme. In support of that claim, the defendant disclosed 

an expert to offer opinions on “red flags” of fraud. The plaintiff sought to exclude such opinions 

as “unhelpful” to the jury. While the court acknowledged that an expert cannot weigh facts and 

opine on the existence of fraud, the court allowed the expert to identify indicia of fraud: “I also 

find that Lessner’s opinions regarding due diligence would be helpful to the jury. Whether Coquina 

adequately performed its due diligence and failed to identify or recognize certain ‘red flags’ are 

matters beyond the understanding of the average lay person.” 2011 WL 4949191, at *4. 

Hagarty’s opinions track the decisions in Perlman and Coquina. As in those cases, Hagarty 

reaches the conclusion that RJF “...discounted (or ignored) exculpatory evidence reflecting wideranging knowledge and approval of the transactions they now characterize as dishonest.” (D.E. 

127-1, p. 9). He then supports that conclusion and will explain to the jury how RJF’s allegations 

fail to account for exculpatory factors – such as Burstein’s disclosures about Quiros’s accounts 

and transactions to his supervisor, in-house counsel, the AML department, and employees in other 

departments; Burstein’s termination of the relationship with Quiros when it no longer served 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 15 of 26
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Raymond James; processing and approval of Quiros’s allegedly fraudulent transactions by other 

employees and supervisors; and Burstein’s testimony before the SEC and disclosure to in-house 

counsel. (Id. at p. 10). A jury unfamiliar with fraud may not recognize these factors as inconsistent 

with fraud/collusion and why these factors undermine RJF’s claim. That is why this Court 

admitted analogous opinions in Perlman and Coquina. 

RJF criticizes Hagarty for failing to opine on whether Burstein acted dishonestly and 

colluded with Quiros, but as this Court recognized in Coquina an expert cannot opine on that issue. 

Accordingly, the fact that Hagarty did not reach an opinion on whether Burstein acted dishonestly 

does not negatively impact the admissibility of his opinion, but instead reflects faithful adherence 

to this Court’s precedent. That is why New England Petroleum considered and rejected that very 

argument. In that case, the expert offered opinions on the indicia of fraud, without offering an 

opinion on whether fraud in fact existed. Like RJF, the movant argued that the failure to reach an 

opinion on whether fraud existed rendered the expert’s opinion inadmissible. The district court 

rejected that argument as “meritless.” 2018 WL 1358819, at *6. The district court admitted the 

opinion because while an expert may not opine on the ultimate question of whether a party engaged 

in fraud, the expert may assist the jury to identify indicia of fraud: 

Accordingly, although the Spector Defendants contend that Love refused to opine 

that the Spector Defendants had committed fraud, Love’s true contention was that 

whether the Spector Defendants are in fact guilty of fraud is a question for the jury. 

For the same reason, Love chose to opine on whether “indicia” of fraud existed in 

the present case, rather than conclude fraud occurred. The Court does not find that 

such qualifications make Love’s opinion so speculative as to render it excludable. 

Id. at *7. 

Unlike RJF and its experts, Insurers and Hagarty do not seek to infringe on the jury’s role 

as the ultimate arbiter of fact. Instead, Insurers disclosed Hagarty – an experienced investigator 

with expertise identifying indicia of fraud and collusion – to assist the jury in understanding the 

context of RJF’s claim, factors suggestive of fraud/collusion, and factors inconsistent with 

fraud/collusion. Such expertise will assist the jury in its evaluation of RJF’s allegations and are, 

under this Court’s precedent, the proper subjects of admissible expert opinion. 

C. HAGARTY RELIED UPON RELIABLE METHODS DERIVED FROM HIS EXPERIENCE. 

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Citing irrelevant cases involving distinguishable opinions,5 RJF attempts to nail a square 

peg in a round hole by relying largely upon scientific expert cases in asserting that Hagarty must 

perform testing, or consult relevant publications or studies, to reach his conclusions. (D.E. 127, 

pp. 13-14). Hagarty explained his methodology and basis for his opinions in his report. As detailed 

therein, Hagarty explained common techniques employed to investigate allegations of fraud – 

detailing how an investigation into such allegations must be objective, apply a healthy sense of 

skepticism, look at facts from the accused perspective, consider contemporaneous communication 

(as memories faded), and organize information chronologically. (D.E. 127-1, p. 9). 

That methodology – derived from years of experience – provides a reliable basis for 

Hagarty’s opinions. Since Hagarty’s opinions are based upon experience, and not scientific 

principles, whether they can be “tested” is beside the point; Hagarty must explain how his 

experience leads to his conclusions. Frazier, 387 F.3d at 1261; McClain v. Metabolife Internat’l, 

Inc., 401 F.3d 1233, 1237 (11th Cir. 2005); U.S. v. Brown, 415 F.3d 1257, 1268 (11th Cir. 2005). 

Hagarty clearly does so. His report addresses how his experience leads to his conclusions and 

provides a detailed explanation as to what a reasonable investigator considers under each different 

analysis of certain facts and why the reasonable investigator considers those items. (D.E. 127-1, 

pp. 12-50). Thus, Hagarty’s testimony is reliable when considered under the appropriate standard. 

RJF intends to ask the jury to weigh complex financial transactions and to reach the 

conclusion that a financial advisor dishonestly colluded in a fraud. Hagarty cannot and will not 

offer any opinion on whether the financial advisor acted dishonestly or colluded with Quiros. 

Instead, he will assist the jury in its consideration of the case by explaining how investigators 

commonly evaluate allegations of dishonesty, and the indicia of fraud. Such opinions are 

admissible and will be helpful to the jury in evaluating RJF’s allegations. 

RJF attempts to persuade the court by criticizing Hagarty’s analysis and falsely accusing 

him of applying a standard he could not define. In an effort to manufacture a motion, it falsely 

alleges that Hagarty could not define “reasonable investigatory techniques.” (D.E. 127, p. 11). In 

 

5

 RJF cites Serrano v. American Airlines, Inc., No. 15-23382-Civ, 2016 WL 6600499 (S.D. Fla. 

Nov. 8, 2016) and Kirstein v. Parks Corp., 159 F.3d 1065, 1067 (7th Cir. 1998), but those cases 

involved scientific opinions not supported by testing or publications. Hagarty’s opinions contrast 

those within Serrano and Kirstein. Hagarty is not providing scientific opinions that can be tested. 

He provides nonconclusory opinions, based upon his years of experience investigating dishonest 

and collusive acts. 

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fact, Hagarty fully describes what he means by “reasonable investigatory techniques” as 

“techniques that are commonly employed in investigations.” (D.E. 127-2, 82:01-83:07). While 

RJF criticizes that definition, any such criticisms go to the weight of the testimony, not its 

admissibility. 

It is well-settled that the district court’s gatekeeper role under Daubert “is not intended to 

supplant the adversary system or the role of the jury.” Allison v. McGhan, 184 F.3d 1300, 1311 

(11th Cir. 1999). In other words, it is not the role of the trial court to make conclusions about the 

persuasiveness of the expert’s opinions, rather, “[v]igorous cross examination, presentation of 

contrary evidence, and careful instruction on the burden of proof are the traditional and 

appropriate means of attacking [debatable] but admissible evidence.” Daubert, 509 U.S. at 596 

(emphasis added). Challenges to assumptions made by an expert, as well as challenges to the 

expert’s opinions, go to the weight and credibility of the expert’s testimony, not to its admissibility. 

Ward v. Carnival Corp., No. 17-24628-CN, 2019 WL 1228063, at *7 (S.D. Fla. Mar. 14, 2019). 

“Indeed, ‘in most cases, objections to the inadequacies of a study are more appropriately 

considered an objection going to the weight of the evidence rather than its admissibility.’” 

Rosenfeld v. Oceania Cruises, Inc., 654 F.3d 1190, 1193 (11th Cir. 2011) (quoting Hemmings v. 

Tidyman’s Inc., 285 F.3d 1174, 1188 (9th Cir. 2002)); see also Quiet Tech. DC-8, Inc. v. HurelDubois UK Ltd., 326 F.3d 1333, 1345 (11th Cir. 2003) (noting that “[n]ormally, failure to include 

variables will affect the analysis’ probativeness, not its admissibility”).6

RJF cites to Benner v. NCL (Bahamas) Ltd., for support of the proposition that “[p]referred 

expert testimony generally will not help the trier of fact when it offers nothing more than what 

lawyers for the parties can argue in closing arguments.” No. 15-20585-civ, 2016 WL 11547583, 

at *4 (S.D. Fla. April 8, 2016). In that case, the court recommended excluding part of an expert 

opinion stating the plaintiff was pushed through a door when the jury could see the same through 

a video capturing the incident. Id. The court determined that the expert’s opinion regarding whether 

“the passengers’ actions whatever they were (be it pushing, lifting, or some other action), were in 

fact a decisive factor in Plaintiff’s fall” was helpful to the trier of fact. Id. Here, Hagarty opines on 

 

6

 RJF’s motion cites to numerous cases on the reliability of an expert’s testimony based upon the 

scientific methodology of an expert. (D.E. 127, pp. 12-13). Hagarty opines on whether RJF and 

Urcia employed reasonable investigatory techniques commonly employed to objectively weigh 

allegations of dishonesty and collusion. (D.E. 127-1, p. 9). Because Hagarty’s opinions are derived 

from his experience (not scientific methodology), RJF’s cases are irrelevant. 

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common indicia of fraud and reasonable investigatory techniques used to evaluate the existence of 

dishonesty and collusion. These are not simple observations based on facts that the jury can see 

through a video or anywhere else. Similar to the helpful testimony in Benner, Hagarty opines on 

how to identify decisive factors in evaluating the existence of dishonesty and collusion. 

Hagarty applied his documented experience in law enforcement and compliance to this 

case, as a means of assisting the jury identify indicia of fraud and collusion and to evaluate whether 

RJF’s allegations are the product of recognized investigatory techniques (or subjective perspective 

designed to manufacture an insurance claim). To the extent that RJF seeks to criticize Hagarty’s 

experience, it can do so through cross-examination. That criticism does not, however, provide a 

basis for exclusion of his opinions. 

D. HAGARTY’S OPINIONS ARE ADMISSIBLE TO REBUT RJF’S PURPORTED EXPERT. 

RJF disclosed an expert, Urcia, to opine on whether Burstein acted dishonestly. Because 

Urcia simply narrates RJF’s theory of coverage and infringes on the role of the jury, Insurers have 

moved to exclude his opinion. Without waiving their objections to Urcia’s opinion, Insurers 

alternatively disclosed Hagarty in response to Urcia and to rebut his opinions. RJF never addresses 

Hagarty’s direct rebuttal of Urcia’s opinions or explains why Hagarty cannot directly rebut his 

opinions because RJF cannot viably admit Urcia’s opinions while objecting to the admission of 

Hagarty’s opinions. 

As reflected in Urcia’s report, RJF has proffered Urcia to purportedly opine on whether 

Burstein acted dishonestly. Urcia does not offer such testimony based upon any specialized 

knowledge of bonds or insurance. (Exh. 1, pp. 261:2-4; 261:17-262:2; 339:14-18.) Instead, Urcia 

subjectively interpreted facts RJF cherry-picked (Id. at pp. 338:23-339:7), weighed the credibility 

of witnesses he never met (Id. at pp. 63:3-6 and 116:5-10), and narrated a conclusion RJF spoonfed to him. While such opinions are inadmissible for the reasons detailed in Insurers’ motion to 

exclude, RJF cannot offer Urcia and object to Hagarty’s opinions because Hagarty expressly 

responds to Urcia’s opinions and explains that the methodology underlying his opinions deviates 

from commonly applied investigatory techniques. 

As explained in Hagarty’s opinion, Hagarty evaluated Urcia’s opinions and methodology 

underlying his opinions and reached the conclusion that Urcia reached an unsupported and 

unreliable conclusion: 

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While Raymond James and Mr. Urcia concluded that Burstein committed 

dishonest acts and colluded with Quiros, their approach deviated from 

reasonable investigatory techniques designed to objectively weigh whether 

Burstein acted dishonestly and colluded with Quiros in that they failed to factor in 

the totality of circumstances; Raymond James’s policies and procedures; 

knowledge and approval of Burstein’s supervisor (Frank Amigo) and other 

Raymond James personnel; review and approval by Raymond James’s Anti-Money 

Laundering (“AML”) department; and disclosure to and approval from Raymond 

James’s management and legal department. Thus, in my opinion, their conclusions 

are unsupported and unreliable.

(D.E. 127-1, pp. 9-10) (emphasis added). RJF never addresses that opinion, let alone explains how 

it can reasonably object to the admission of a witness to challenge the reliability of its own expert 

and the methodology its own expert applied. It cannot do so based upon an alleged inexperience 

with insurance policies and financial institution bonds because Urcia lacks any such experience: 

Q: So would you agree that you have no expertise in financial institution bonds 

or insurance? 

A: That would be correct. 

(Exh. 1, pp. 261:17-262:2.) Nor did Urcia even attempt to educate himself. Incredibly, he did not 

even read the Bonds themselves: “I didn’t read the bond.” (Id. at pp. 339:14-18; 261:2-4.). 

 *** 

Insurers disclosed Hagarty, a Certified Fraud Examiner and experienced fraud investigator, 

to assist the jury in explaining the indicia of fraud and collusion, and flaws in the methodology 

RJF applied when accusing Burstein of dishonesty. Such opinions are admissible, reliable and 

helpful under this Court’s precedent as it will assist the jury in understanding a subject beyond the 

knowledge of a lay juror. Alternatively, to the extent that the Court admits RJF’s expert (Urcia), 

Hagarty’s response to Urcia’s opinions are the proper subject of a rebuttal opinion as Hagarty 

addresses and responds to flaws in Urcia’s methodology. 

II. RESSLER OFFERS ADMISSIBLE EVIDENCE OF INSURANCE PRACTICES. 

The Bonds are written on a “discovery” basis – meaning that they apply to loss first 

discovered during the bond period. (D.E. 39-1, p. 53). The Bonds define Discovery as occurring 

“when the Vice President of Corporate Insurance and/or Legal Department of the Insured first 

becomes aware of facts which would cause a reasonable person to assume that a loss of a type 

covered by this bond has been or will be incurred, regardless of when the act or acts causing or 

contributing to such loss occurred, even though the exact amount or details of loss may not then 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 20 of 26
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be known.” (Id.). While RJF alleges that it provided notice of its claim in 2016 after a Receiver 

and investors filed suit, RJF knew about the conduct it now characterizes as dishonest long before 

those lawsuits. 

Insurers deny that Burstein acted dishonestly, but if RJF’s allegations are true, Discovery 

occurred before the inception of the Bonds because RJF’s Legal Department knew about the 

conduct it now characterizes as dishonest, at the latest, in March 2014. For example, RJF’s 

complaint alleges that Burstein colluded with Quiros by allowing him to use partnership funds to 

purchase the Jay Peak Resort, despite a directive prohibiting such a transaction: “Burstein then set 

in motion Quiros’ and his scheme, and began facilitating Quiros’ use of limited partnership assets 

to fund Q Resorts’ purchase of Jay Peak.” (D.E. 39, ¶ 36). Burstein openly disclosed that 

transaction in testimony before the SEC on March 27, 2014. RJF’s Associate General Counsel, 

Barracca, attended Burstein’s SEC examination and based upon that testimony, acknowledged 

learning that: 

 “...the funds used to purchase the ski resort and other assets were derived from EB-5 assets, 

EB-5 investments” (Exhibit 3, Vol. II of Barracca Dep., p. 10:21-23); 

 “...that Burstein was testifying that investor assets were put up for the purchase of the Jay 

Peak resort” (Id. at p. 11:12-16); 

 “...Raymond James issued a margin loan secured by the funds MMSI (sic) transferred to 

Raymond James simultaneously with the transaction...” (Exhibit 5, Vol. I of Barracca Dep., 

pp. 84:22-85:2); and 

 Burstein recalled the seller advising that investor funds could not be used as collateral for a 

margin loan. (Id. at 88:2-20). 

Barracca – and, thus RJF’s legal department – was aware of the very transactions RJF now paints 

as corrupt by, at the latest, March 27, 2014. 

Insurers challenge RJF’s inconsistency, arguing that knowledge of the conduct RJF now 

characterizes as dishonest automatically constitutes Discovery – meaning that any claim is subject 

to the Bonds in effect, at the latest, in 2014. (D.E. 129, pp. 22-24). However, to the extent that 

the Court finds a question of fact, Insurers proactively disclosed Ressler as an expert. It did so 

because RJF intends to suggest to the jury that an insured can sit idle while aware of conduct it 

intends to later rely upon to support its claim. A jury unfamiliar with insurance could be confused 

by RJF’s tactics and wrongly perceive such conduct is normal and customary – when such conduct 

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is in fact contrary to recognized insurance practices. 

Therein lies the relevance of Ressler’s insurance expertise. Ressler has experience working 

for financial institutions, conducting investigations into incidents that may implicate insurance and 

deciding how and when to report such incidents. He can therefore educate the jury on normal and 

customary insurance practices within financial institutions and whether it is normal and customary 

for a financial institution to report a claim upon learning of conduct it may later rely upon to 

support a claim. That subject is outside the scope of a lay jury’s common knowledge and directly 

relevant to RJF’s intended argument – rendering Ressler’s opinions relevant and helpful. RJF’s 

arguments to the contrary contravene the record. 

A. RESSLER IS QUALIFIED TO PROVIDE THE PROPOSED EXPERT TESTIMONY AND 

HIS TESTIMONY IS RELIABLE.

RJF’s critique of Ressler’s qualifications focuses on an immaterial fact – namely that he is 

not an attorney. (D.E. 127, pp. 4, 12). Ressler is not, however, offering any opinions that require a 

law degree, as he is not seeking to opine on a legal duty. Instead, Ressler opines about whether, 

and when, RJF should have provided notice to the Insurers of a potential claim based upon what 

RJF claims is dishonest conduct. (D.E. 127-3, p. 7). Ressler has over 15 years of relevant 

experience in the financial industry. (D.E. 127-3, pp. 7-8, 21-22). It does not matter whether 

Ressler is an attorney. Ressler opines about the internal operations of a broker/dealers and how 

they decide whether to provide notice to an insurer. He does not opine how RJF’s Legal 

Department should have performed its legal duties – only on whether notice should have been 

provided to the Insurers to preserve RJF’s claim. (D.E. 127-3, p. 7). Thus, having a bar license is 

not a necessary predicate for his opinions. 

RJF tries to paint the dispute in legal terms, misleadingly suggesting that Discovery is tied 

to allegations of “loss of a type covered by this bond.”7 This is not a matter of law, but logic. RJF 

cannot now accuse Burstein of dishonesty, while denying that knowledge of such transactions 

constitutes Discovery. Either such conduct is not dishonest (in which case RJF is not entitled to 

coverage) or it is dishonest (and thus constitutes Discovery and triggers the required timely notice 

to the Insurers, which was not provided). Royal Trust Bank v. Nat’l Union Fire Ins. Co., 788 F.2d 

 

7

 RJF also challenges Ressler’s reliability based upon his scope of opinions as compared to the 

Bonds’ Discovery language. (D.E. 127, pp. 16-17). Just because RJF interprets the Bonds’ 

language one way does not mean Ressler cannot opine on whether RJF needed to provide notice 

under a similar, but different, interpretation. (D.E. 127-4, pp. 115:09-116:22). 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 22 of 26
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719, 721 (11th Cir. 1986); Utica Mut. Ins. Co. v. Fireman’s Fund Ins., 748 F.2d 118, 123 (2d Cir. 

1984); Alfalfa Elec. v. Travelers Indem. Co., 376 F. Supp. 901, 906 (W.D. Okla. 1973); St. Paul 

Fire & Marine Ins. Co. v. Bank of Stockton, 213 F. Supp. 716, 719–21 (N.D. Calif. 1963); USLIFE 

Savings & Loan Assoc. v. Nat’l Sur. Corp., 115 Cal. App. 3d 336, 344–45 (Cal. Ct. App. 1981). 

Ressler does not and will not offer a legal opinion, but he can explain to jury the practical 

handling of insurance claims and why an insured who desires to preserve a claim will immediately 

report conduct that it may later cite as a basis for coverage. (D.E. 127-3, pp. 14, 17-19). Ressler’s 

compliance experience qualifies him to testify about whether a reasonable insured, upon learning 

of facts it characterizes as dishonest, would immediately provide notice or await lawsuits. Ressler’s 

knowledge is beyond the understanding of the average citizen – individuals likely to be unfamiliar 

with commercial insurance policies and the decision-making process underlying the decision to 

provide notice of a claim under a commercial insurance policy. (D.E. 127-4, pp. 97:16-21, 108:07-

109:01). 

RJF further contends that Ressler is not qualified to testify as an expert in this matter due 

to his lack of experience with fidelity bonds and testifying about fidelity bonds. (D.E. 127, p. 10). 

This argument applies equally to RJF’s experts – Urcia, Grumke, and Baez. None of those expert 

have any experience with financial institution bonds, but RJF nonetheless disclosed them as 

experts. RJF never explains why it can introduce experts without such experience, but then argue 

that such experience is a minimum qualification for Ressler.8 That inconsistency aside, RJF’s 

argument fails because Ressler (unlike RJF’s experts) has experience with fidelity bonds. (D.E. 

127-4, pp. 97:16-21,111:06-112:07). 

Given the subject matter of Ressler’s proposed testimony, he has sufficient credentials and 

knowledge beyond the understanding of the average citizen. (D.E. 127-3, pp. 21-22). Moreover, 

his opinions are reliable because he explains how his experience forms the basis for his opinions. 

(Id. at pp. 10-19). The Insurers retained Ressler solely as a rebuttal expert. To the extent that RJF’s 

expert, Grumke, is permitted to testify on this issue then Ressler should be permitted to rebut his 

opinions, and methodology. 

B. RESSLER’S PROPOSED EXPERT TESTIMONY IS HELPFUL TO THE JURY AND WILL 

NOT CONFUSE OR MISLEAD THE JURY.

 

8

 To the extent that the Court finds that Ressler’s experience with fidelity bonds is a basis to 

exclude his testimony, then it must also exclude the testimony of Urcia, Grumke, and Baez. 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 23 of 26
20 

RJF contends that Ressler’s testimony is not helpful to the jury because his testimony is 

disconnected from the language of the Bonds. (D.E. 127, p. 18). This argument, however, ignores 

the fact that Ressler was offered as a rebuttal expert designed to address and respond to arguments 

RJF’s expert, Clay Grumke, offered. Insurers have moved to exclude Grumke’s opinions. 

However, to the extent that the Court admits Grumke’s opinions, Ressler’s opinions are necessarily 

admissible and helpful too. 

RJF seeks to offer Grumke to place his imprimatur on its untimely notice and inaction in 

the face of conduct it now characterizes as dishonest. In effect, it seeks to admit his testimony to 

suggest that an insured can disclaim dishonesty and later contradict itself by accusing an employee 

of dishonesty based upon conduct it long ago uncovered. Such an opinion is inadmissible, but to 

the extent that the Court allows that opinion, Ressler’s opinions are admissible because he directly 

addresses and rebuts Grumke’s premise – offering an opinion that a reasonable insured following 

industry practices would provide notice of a claim at the time of learning of potential dishonesty. 

(D.E. 127-3, p. 8). That opinion directly addresses and rebuts Grumke’s opinion and therefore is 

admissible for that purpose. RJF’s critiques about the opinions go to their weight, not their 

admissibility. 

CONCLUSION 

Insurers disclosed two qualified experts to offer expert opinions on subjects beyond the 

knowledge, skill and expertise of a lay jury. Their opinions were directed to the heart of RJF’s 

claim and are both reliable, relevant and admissible. For the reasons set forth herein, Insurers ask 

this Court to deny Plaintiff’s motion and for all other relief the court deems necessary and 

appropriate. 

Dated: August 20, 2021 Respectfully submitted, 

s/ Chantel Wonder 

Chantel C. Wonder 

Florida Bar No. 0087601 

GORDON REES SCULLY MANSUKHANI 

Miami Tower 

100 SE Second Street, Suite 3900 

Miami, FL 33131 

Telephone: 813-523-4945 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 24 of 26
21 

Facsimile: 813-377-3505 

cwonder@grsm.com

and 

Scott L. Schmookler, Esq. 

Sarah Riedl Clark, Esq. 

GORDON REES SCULLY MANSUKHANI 

One North Franklin, Suite 800 

Chicago, IL 60606 

Telephone: 312-980-6779 

sschmookler@grsm.com

srclark@grsm.com

Counsel for Federal Insurance Company 

/s/ Ryan J. Weeks 

E.A. “Seth” Mills, Jr., Esq. 

Florida Bar No. 339652 

Ryan J. Weeks, Esq. 

Florida Bar No. 5 7 8 9 7 

MILLS PASKERT DIVERS 

100 N. Tampa Street, Suite 3700 

Telephone: (813) 229-3500 

Facsimile: (813) 229-3502 

smills@mpdlegal.com

rweeks@mpdlegal.com

csoltis@mpdlegal.com

Counsel for Travelers Casualty and Surety 

Company of America & St. Paul Mercury Insurance 

/s/ James M. Kaplan 

James M. Kaplan 

Florida Bar No. 921040 

KAPLAN ZEENA LLP 

2 South Biscayne Boulevard, Suite 3050 

Miami, Florida 33131 

Telephone: (305) 530-0800 

Facsimile: (305) 530-0801 

James.kaplan@kaplanzeena.com

Elizabeth.salom@kaplanzeena.com

service@kaplanzeena.com

and 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 25 of 26
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Michael Keeley 

Admitted Pro Hac Vice 

John R. Riddle 

Admitted Pro Hac Vice 

Clark Hill Strasburger 

901 Main Street, Suite 6000 

Dallas, Texas 75202-3794 

Telephone: (214) 651-4718 

Facsimile: (214) 659-4121 

mkeeley@clarkhill.com

jriddle@clarkhill.com

Counsel for Beazley Insurance Company, Inc. 

/s/ Dustin C. Blumenthal 

Dustin C. Blumenthal 

Florida Bar No. 0149871 

Goldberg Segalla 

222 Lakeview Avenue, Suite 800 

West Palm Beach, FL 33401 

Telephone: (561) 618-4485 

Facsimile: (561) 618-4549 

dblumenthal@goldbergsegalla.com

lparker@goldbergsegalla.com

 

and 

Stephen N. Dratch, Esq. 

Admitted Pro Hac Vice 

Franzblau Dratch, P.C. 

354 Eisenhower Parkway 

Livingston, New Jersey 07039 

Telephone: (973) 992-3700 

Counsel for Great American Insurance Company 

1211057/60671056v.1 

Case 1:20-cv-21707-JEM Document 155 Entered on FLSD Docket 08/20/2021 Page 26 of 26