Source: http://asset-protection.ultratrust.com/court-cases/ridge-clearing-outsourcing-v-adnan-khashoggi.html
Timestamp: 2019-04-21 22:52:37+00:00

Document:
At trial Khashoggi’s counsel moved to strike in part the reports and testimony of plaintiff’s two expert witnesses, Mary Jepperson and Andrew Malec. Defense counsel argued that the two were not rendering expert opinions as required by Fed. R. Evid. 702. took notice of the motions and stated that it would resolve them following trial should the expert opinions be material to the Court’s decision. Having now reviewed the expert reports and the trial testimony, the Court is persuaded that the motions to strike should be granted in part and denied in part.
(2) the opinion is based upon reliable data and methodology; and (3) the expert’s testimony on a particular issue will assist the trier of fact. See Nimely v. City of New York, 414 F.3d 381, 396-97 (2d Cir. 2005).
First, “[t]o determine whether a witness qualifies as an expert, courts compare the area in which the witness has superior knowledge, education, experience, or skill with the subject matter of the proffered testimony.” United States v. Tin Yat Chin, 371 F.3d 31, 40 (2d Cir. 2004).
Second, to decide whether a proffered expert opinion has the required indicia of reliability, courts apply the non-exhaustive list of factors identified by the Supreme Court in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993): whether a theory or technique had been and could be tested, whether it had been subjected to peer review, what its error rate was, and whether scientific standards existed to govern the theory or technique’s application or operation. See Daubert, 509 U.S. at 593-94. In addition, reliability requires a “sufficiently rigorous analytical connection between that methodology and the expert’s conclusions.” Nimely, 414 F.3d at 396; see General Electric Co. v. Joiner, 522 U.S. 136, 146 (1997) (“[N]othing in either Daubert or the Federal Rules of Evidence requires a district court to admit opinion evidence which is connected to existing data only by the ipse dixit of the expert.
A court may conclude that there is simply too great an analytical gap between the data and the opinion proffered.”). Thus, “when an expert opinion is based on data, a methodology, or studies that are simply inadequate to support the conclusions reached, Daubert and Rule 702 mandate the exclusion of that unreliable opinion testimony.” Amorgianos v. Nat’l R.R. Passenger Corp., 303 F.3d 256, 266 (2d Cir. 2002).
Finally, Rule 702 requires the district court to decide whether the expert’s testimony as to a particular matter will “assist the trier of fact.” Fed. R. Evid. 702. Expert testimony that “usurp[s] either the role of the trial judge in instructing the jury as to the applicable law or the role of the jury in applying that law to the facts before it,” United States v. Bilzerian, 926 F.2d 1285, 1294 (2d Cir. 1991), does not “aid the jury in making a decision.” Instead, it “undertakes to tell the jury what result to reach” and thus “attempts to substitute the expert’s judgment for the jury’s.” United States v. Duncan, 42 F.3d 97, 101 (2d Cir. 1994).
1.) The report concludes that Khashoggi became the president of Ultimate; that he began to authorize Ultimate transactions in late 2000; and that he participated in various business activities on behalf of Ultimate in 2001.
1.) These facts are not in dispute; even if they were, a layperson could easily make these findings without the need to resort to expert testimony. Simply rehashing evidence about which an expert has no personal knowledge is impermissible under Rule 702. See Highland Capital Mgmt., L.P. v. Schneider, 379 F. Supp. 2d 461, 469 (S.D.N.Y. 2005) (Gorenstein, M.J.) (“While an expert must of course rely on facts or data in formulating an expert opinion, an expert cannot be presented to the jury solely for the purpose of constructing a factual narrative based upon record evidence.”) (internal citation omitted); In re Rezulin Prods. Liability Litig., 309 F. Supp. 2d 531, 551 (S.D.N.Y. 2004) (Kaplan, J.) (rejecting portions of expert’s testimony that was “a narrative reciting selected regulatory events” because “[s]uch material, to the extent it is admissible, is properly presented through percipient witnesses and documentary evidence”); LinkCo, Inc. v. Fujitsu Ltd., No. 00- 7242, 2002 WL 1585551, at *1-*2 (S.D.N.Y. July 16, 2002) (where expert’s report was based on a review of, among other things, “documents, computer documents, computer files, deposition transcripts and exhibits,” the “testimony by fact witnesses familiar with those documents would be far more appropriate . . . and renders [the expert witness’] secondhand knowledge unnecessary for the edification of the jury”) (citation and internal quotation marks omitted) (alterations in original).
Accordingly, the following paragraphs of Jepperson’s report are stricken: 10-26, 32, and 35 of the “Stock Loan Chain Activity” section; 25-30 of the “Cash Tracing” section; and 1 of the “Conclusions” section.
4.) Khashoggi’s motion is denied as to these opinions. III. Andrew Malec Khashoggi’s counsel also moved to strike “at least significant portions” of Malec’s expert report. (Tr. 192:22-24.) He did not specify which portions or on what basis. In his report and at trial, Malec opined that loaning stock, as opposed to selling it in the open market, “avoids downward price pressure on the stock” by “maintain[ing] the supply of shares in the marketplace.” (Malec Stmt. at 2.) He further opined that Ultimate’s ownership of GENI stock, as a percentage of total GENI stock outstanding, increased dramatically between October 2000 and June 2001 and that Ultimate and El-Batrawi together owned during the relevant period 80% of GENI shares which reduced the “float” of freely traded shares in the marketplace and put upward pressure on GENI stock price. During that period, Malec calculated that GENI stock generated a return of 241 %, or 138% over the benchmark return. (ld. at 3-4.) These opinions contain the indicia of reliability that Daubert requires. Malec purportedly renders two other opinions in his report: (1) that Khashoggi “was active in negotiating private sales ofGENI shares held by [Ultimate],” which would have “resulted in [Ultimate’s] receiving cash for its GENI stock without increasing the number of freely-traded shares”; and (2) that a television commentator “touted GENI’s stock” to keep the price artificially inflated. (Id. at 4-5.) But these are simply factual allegations repackaged as expert opinions. The allegations are not in evidence; they are apparently drawn from the deposition testimony of Kenneth D’Angelo, which was not admitted at triaL (See Tr. 255:8-15.) Accordingly, these two sections of Malec’s report are stricken.
For the foregoing reasons, Khashoggi’s motions to strike are granted in part and denied in part.

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