Court Opinion

ID: 9494888
Source: CourtListenerOpinion
Date Created: 2023-08-05 15:49:24.056215+00
Date Added: 2024-06-11T17:56:41.215696
License: Public Domain

DIANE P. WOOD, Circuit Judge,
dissenting.
This case is about whether CTS must help Excel pay for some of the costs of cleaning up the Main Street Well Field. (I prefer to use the name “Excel” for the plaintiff, following the practice of the district court and both parties; this is the same company that the majority calls “Dura.”) As the majority opinion explains, that ultimate question turns largely on a highly technical determination about the size of the Field’s capture zone in the late 1970’s and early 1980’s. Hydrogeologists working for the Environmental Protection Agency (EPA) decided, based on their computer models and analysis, that CTS’s main factory and plastics plant (the most polluted properties in the entire area) lay outside the crucial capture zone, and thus that CTS need not contribute to the cleanup costs. Excel’s expert, Nicholas Valken-burg, challenges that interpretation of the data. His own research places much of the CTS property within the capture zone and identifies CTS as a major source of the Field’s pollution.
A number of factors account for the difference between the EPA’s and Valken-burg’s conclusions about the shape and size of the capture zone. First, based on records from the Elkhart water works office, Valkenburg instructed his computer modelers, who inputted the data used to draw the capture zone and then calibrated the models, to increase the assumed Field pumping rate to 6 million gallons per day (MGD) from the 5 MGD figure that the EPA used. Second, Valkenburg consulted pond level readings made by the U.S. Geological Survey and his own employees over a two-decade span and lowered the pond recharge rate from 5 MGD to 4 MGD. Third, Valkenburg adjusted the hydraulic convectivity rates used in the model. The USGS had determined that in different parts of the Field the convectivity rate ranged from 80 to 400 feet per day, but for estimation purposes the EPA used a rate of 200 feet per day for the entire model. Valkenburg asked his modelers to divide the region into zones based on available data to construct a more sophisticated model.
It is clear from reading CTS’s brief that its principal objection to Valken-burg’s research was to these adjustments — or, as CTS says more pejoratively, to his manipulation of these variables based on what CTS considers to be inadequate scientific foundation. Much of CTS’s four-day deposition of Valkenburg *617was devoted to the technical basis for his adjustments and estimates. Had a trier of fact in this case listened to both Valk-enburg and the CTS experts and then determined that the data utilized by CTS more accurately represented the characteristics of the Field circa 1980, I would probably have little quarrel with such a finding. But we are not faced with such a challenge today. Indeed, we are not even evaluating Valkenburg’s decision to adjust the three variables I have mentioned. Instead, the district court’s ruling and the majority’s opinion focus on a fourth difference between the EPA and Valkenburg studies: the computer program used by the computer modelers to represent the capture zone. The EPA used two computer programs called GWPATH and FEMSEEP, which apparently were not available to the general public. CTS argues that is best to rely on a “three-dimensional” modeling program called MODFLOW, while Excel used the “two-dimensional” programs QuickFlow and SLAEM. Both the district court and the majority believe that Excel’s evidence is fatally flawed because Valkenburg, who while an expert in hy-drogeology knows little about the technical aspects of hydrogeological computer modeling, played almost no role in selecting QuickFlow and SLAEM instead of MODFLOW or some other program. Instead, he left that task to four computer modelers employed by Geraghty & Miller. This specific decision is what then prompted the inquiry in this case and the district court’s ruling that Excel had failed to comply with the dictates of Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993).
Since Daubert was decided, the Supreme Court has addressed its scope on a number of occasions. It confirmed in General Electric Co. v. Joiner, 522 U.S. 136, 141, 118 S.Ct. 512, 139 L.Ed.2d 508 (1997), that the abuse of discretion standard applies to appellate review of decisions applying the Daubert framework. In Kumho Tire Co. v. Carmichael, 526 U.S. 137, 147, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999), it held that the Daubert approach applies to all expert testimony, not simply to scientific evidence. And recently, in Weisgram v. Marley Co., 528 U.S. 440, 457, 120 S.Ct. 1011, 145 L.Ed.2d 958 (2000), the Court held that a court of appeals has the authority to direct entry of judgment as a matter of law if it concludes that Daubert requires the exclusion of proffered expert evidence and the remaining evidence is insufficient to support a verdict. Moreover, Daubert’s approach has been codified in the Federal Rules of Evidence, in the form of the revised version of Rule 702 that took effect on December 1, 2000. The net result of all of this is a now well-recognized approach. First, we ensure that the district court took all of the steps that a correct application of the Daubert framework (or, where it applies, amended Rule 702) requires. That is a legal inquiry, for which de novo review is proper. See, e.g., United States v. Hall, 93 F.3d 1337, 1341-42 (7th Cir.1996). Beyond that, Joiner makes clear that our review of particular applications of Daubert is under the deferential abuse of discretion standard. Dhillon v. Crown Controls Corp., 269 F.3d 865, 869 (7th Cir.2001).
It is useful at this point to review what ought to happen under the Daubert framework, because in my opinion the flaw in both the trial judge and the majority’s analysis comes from a failure to follow this framework. A trial judge faced with proffered expert testimony must initially determine whether the proposed expert would be testifying about scientific (or other expert) knowledge that would assist the trier of fact. Here, the proffered testimo*618ny is easily characterized as scientific, so I will limit my discussion to that area. Determining whether evidence is scientific “entails a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and of whether that reasoning or methodology properly can be applied to the facts in issue.” 509 U.S. at 592-93, 113 S.Ct. 2786. To make this assessment, the court must investigate questions such as whether the expert’s methodology can be and has been tested, whether it has been subject to peer review or publication, what is its known or potential rate of error, and how generally accepted it is in the relevant scientific community. Id. at 593-94, 113 S.Ct. 2786.
The majority has jettisoned this established framework in its acceptance of CTS’s criticisms of the computer programs Valkenburg used. Under the framework, CTS should have challenged these programs through the use of its own experts. Presumably the CTS experts would have argued that QuickFlow and SLAEM are unreliable for backwards modeling (that is, predicting past conditions instead of projecting future conditions) or that a hydro-geologist would not reasonably rely on the results yielded from such a model. In response, Excel, as the party supporting Valkenburg’s methodology, would have been able to introduce additional expert testimony or written materials, since hearsay is admissible at a Daubert hearing and the rules of evidence do not apply. Daubert, 509 U.S. at 593 n. 10, 113 S.Ct. 2786.
No such Daubert hearing occurred in this case. CTS has offered no testimony from any experts even to hint that Quick-Flow and SLAEM are scientifically questionable. In contrast, as I discuss below, Excel offered considerable support for the proposition that they are widely accepted in the relevant expert community for substantive (that is, non-litigation) work. Moreover, the district court never convened a hearing on the issue; instead, it simply struck the supporting affidavits proffered by the computer modelers themselves. At this point, the majority criticizes Excel for not naming the modelers earlier, but it is not at all obvious that this should have been done. No one else had delved that deeply into the background programs and materials from which the hydrogeologists were forming their opinions; to the contrary, both the EPA and the other principal defendant also disclosed only a single expert hydrogeologist as a witness. While it is possible that these individuals are expert computer modelers, that seems unlikely.
I am deeply concerned that the majority’s approach will have the effect of transforming — in a manner uncontemplated by and unauthorized by Rule 702 — the way in which litigants approach the use of expert witnesses in all kinds of cases. All experts, and all people for that matter, rely on the expertise of others. Cautious parties will feel compelled to engage in something like an infinite regression of the naming of experts. Expert 1 may have relied on something prepared using the expertise of Expert 2, who in turn relied on the expertise of Expert 3, and on out until we reach Expert N. There is no reason to assume that Experts 2, 3, and others are “hiding behind” Expert 1, if the information they produce is commonly relied upon by people in the field of Expert 1. Indeed, Rule 702 permits exactly this kind of reliance, as I explain later. Thus, it makes no difference to my analysis whether we consider the computer modelers to be “mere” technicians or experts in their own right. The critical question is instead whether CTS ever introduced any evidence tending to show that a hydrogeol-ogist would not commonly rely on their choice of a computer model.
*619Recall that here Valkenburg ordered his modelers to increase the pumping rate used in the models based on a review of the Elkhart city water records. CTS also argued below that this evidence was suspect because Valkenburg himself did not inspect the water records, leaving that chore to his assistants, and because Valk-enburg testified that he did not know how Elkhart’s water records were kept. While the majority might decide that these tasks lack discretion and do not require testimony at trial, another district court might take a different view of the matter. The radiologist, the computer modeler, the data collector, the Water Department re-cordkeeper, even the lab technician who selects a test tube that is not of the highest quality on the market all exercise some measure of discretion that could conceivably influence an expert’s end product. And since the expert can never supplement an expert report in any way under the majority’s approach, the only responsible course would be to disclose all of these individuals as potential expert witnesses and have each submit a comprehensive Rule 26(b)(2)(B) expert report, fueling ever more time-consuming and expensive litigation.
Nothing in Daubert, any of the later Supreme Court decisions, or amended Rule 702 requires any such thing; the Daubert approach is designed only to ensure that an expert’s methodology is reliable and accepted rather than quack science. But that one central question was never explored here, because as I have already mentioned the district court never conducted a Daubert hearing or heard a single CTS expert opine that Valkenburg had made unreliable assumptions or had utilized an unaccepted computer program in reaching his conclusions about the Field capture zone and the migration of chemicals from the CTS plastics plant. This was a failure of procedure, not a discretionary decision about the way to apply the Daubert factors in a particular situation. I thus regard it as the kind of thing this court should review de novo. Cummins v. Lyle Indus., 93 F.3d 362, 367 (7th Cir.1996). Because the district court and the majority’s approach drastically modifies the Daubert analytical framework, I cannot accept its conclusions.
Turning briefly to the details of the Daubert analysis, let me suppose for a moment that we should disregard the affidavits of the four computer modelers who were prepared to testify about the general acceptance of the programs on which Valk-enburg relied. Even without those affidavits, the only evidence in the record is that SLAEM is a generally accepted computer program in the modeling community. The program has been used by the lead environmental agencies of the United States, the Netherlands, and Minnesota. It has been published and has sold well in commercial markets. Valkenburg unequivocally testified that SLAEM is widely used by hydrogeologists outside the litigation context, a major indicator of reliability. Daubert, 509 U.S. at 593, 113 S.Ct. 2786. (Most lawyers widely use computer research programs like LEXIS and West-Law, and they would be competent to testify about their general acceptance, even if they do not know how the programs were written.) Valkenburg also noted that his model can be validated and calibrated by visually comparing its projections to actual current water levels, which could help determine an error rate. Id. at 594, 113 S.Ct. 2786.
While CTS baldly asserts that Valken-burg’s methodology is unreliable and the majority “imagines” that hydrogeologists might find something controversial or suspect about visual calibration or two-dimensional modeling, CTS has presented no hydrogeologist or other scientist to attest *620to this fact. Indeed, the only information we have suggests exactly the opposite: Excel contends that CTS’s own environmental consulting experts used visual calibration in constructing their models. Even under abuse of discretion review, when CTS has offered nothing to challenge any of the support offered by Excel, I see no possible way to hold that either SLAEM or QuickFlow are inherently unreliable or that an expert hydrogeologist would for some other reason not rely on them.
As a theoretical matter, I have no problem with the majority’s proposition that a thoracic surgeon in a medical malpractice suit cannot testify that a radiologist was negligent for failing to diagnose lung cancer at an earlier time, or that a theoretical economist may not serve as a “mouthpiece” for an econometrician. But the real question is whether those analogies fit the situation of a hydrogeologist’s reliance on a computer modeler’s choice of a program. I think not. The dispute here is far more like the x-ray example from the Advisory Committee Notes to the 1972 Proposed Rules, which permits a physician to rely upon x-rays in formulating her diagnosis,1 or, even more appropriately, like a case in which the opposing party objected to a physician’s testimony on the ground that the radiologist who took the x-rays relied on an x-ray machine that was old, antiquated, or in some other way inadequate under modern day standards. The only objection ever voiced even by CTS’s counsel (whose expertise in these matters is certainly unproven) is that QuickFlow and SLAEM are inferior two-dimensional programs that require visual calibration and therefore give inaccurate and scientifically unsound results. Daubert and the Federal Rules of Evidence anticipate only a basic inquiry into whether an expert physician would reasonably rely on a radiologist to do her job and use adequate and up-to-date technology and whether an expert hydrogeologist such as Valkenburg would reasonably rely on his computer modelers to select an adequate and up-to-date computer model to crunch the data necessary for him to interpret his results. The record shows that he would.
This does not mean that if a physician really did rely on a radiologist who used an inferior x-ray machine the results could go unchallenged; it means only that such potential flaws go to the weight, not to the admissibility, of the evidence. The party’s opponent would have an opportunity to introduce an expert radiologist in rebuttal under Rule 26(a)(2)(C) who could assert that, although a physician would normally have every right to rely on a radiologist’s work, in this specific case that reliance was unjustified. But CTS has introduced no such expert here. The only evidence in the record is that an expert hydrogeologist would reasonably rely on computer modelers to select appropriate computer models and plug in the data the hydrogeologist *621provides to produce accurate capture zones.
In the end, even CTS’s argument makes it clear that the dispute here is about Valkenburg’s decisions as a hydrogeologist, not about the computer program he was using. As CTS repeatedly noted in its motion before the district court, Valken-burg acknowledged in his deposition that when he had earlier instructed his computer modelers to run QuickFlow and SLAEM using the same variables that CTS and the EPA had used, the CTS plants were not located within the capture zone. This indicates that the computer program used has little or nothing to do with the real dispute in this case: the correctness of Valkenburg’s expert opinion that the pumping, pond recharge, and hydraulic convectivity rates were different than the EPA had thought. That dispute is all about the valuables and data that Valk-enburg, not the computer modelers, decided to use for the program. Assuming that Valkenburg used reliable and generally accepted methods in determining those variables (another issue never reached by the district court) these questions should be resolved as a factual matter at trial. The fact that the selection of a computer program, whether a “two-dimensional” or “three-dimensional” model, seems largely irrelevant to the final analysis also likely explains why Excel considered it unnecessary to disclose any of its computer modelers as expert witnesses under Rule 26(a)(2)(A), as opposed to the majority’s speculation about strategic motivations. CTS was well aware of the existence of each of Excel’s four modelers since their work and computer models were turned over in response to discovery requests in August 1996. One of the modelers, Eric Evans, has even been deposed by CTS. It is quite hard to see what Excel could possibly have gained strategically through an attempt to hide them.
Finally, let us suppose that there is now some controversy regarding the use of QuickFlow and SLAEM for modeling in this case. Everyone agrees that Valken-burg cannot testify about the differences between these programs and others that might have been used because he is not an expert modeler, and so additional testimony is required to rebut this challenge. The district court found that because Excel had failed to disclose the four computer modelers earlier (as experts; at least two of the modelers were disclosed as fact witnesses), it was compelled to strike their testimony by Fed.R.Civ.P. 37(c)(1). Rule 37 is designed to prevent a party from springing new expert testimony on an opponent at the last minute. The remedy of striking testimony is admittedly a drastic one, and some circuits have found discretion to relax it, Newman v. GHS Osteopathic, Inc., 60 F.3d 153, 156 (3d Cir.1995); Orjias v. Stevenson, 31 F.3d 995, 1005 (10th Cir.1994). We, however, have held that exclusion is automatic unless the sanctioned party proves that its violation was either justified or harmless. NutraSweet Co. v. X-L Eng’g Co., 227 F.3d 776, 786 (7th Cir.2000).
I believe the failure to disclose was both justified and harmless. First, since the changes in variables, rather than the specific modeling program used, appear to account for most if not all of the change in the size of the capture zone, Excel was justified in producing an expert who could respond to these criticisms without worrying about the more technical aspects of its experts’ work. Furthermore, the only harm cited by the majority opinion is the seven years that have elapsed since this case began. But that is a misleading time frame. The case was stayed for nearly three years while the United States and most of the other parties negotiated a settlement. Then the district court took *622over thirteen months to rule on the motion to strike. The case has been pending before this court for over a year. Thus, the case was in active discovery for just a little under two years, hardly a great span of time in a complicated environmental cleanup suit. The only other harm noted by the district court was that CTS might have to hire additional computer modelers to testify. Presumably, though, CTS must already have some modelers on hand who dispute the validity of QuickFlow and SLAEM, or else its attorneys could not credibly raise a challenge to Valkenburg’s reliance on the programs. I therefore cannot conclude that CTS has been harmed. In summary, even if I am wrong about the need for the testimony of the computer modelers, I would find that their affidavits fit within the exception noted by NutraSweet, because Excel’s failure to present them earlier was both justified and harmless to CTS.
No one should be under any illusions about the importance of the difference of opinion between the majority and myself. The majority thinks that every party who wishes to proffer expert testimony has an obligation under the discovery rules to name as an expert everyone whose expertise in any way affects the opinion of another expert: my example of Experts 1 through N above. In my opinion, Rule 702 expressly permits one expert to rely on the informed opinion of other experts. An opposing party who wishes to argue that the underlying expert’s opinion is contestable, in the sense that both Daubert and amended Rule 702 use this idea, is entitled to produce evidence to that effect. That should occur during the Dau-bert/Rule 702 hearing. At that point, if the court agrees that it is confronted with a situation more like the theoretical economist and the econometrician than like the doctor and the x-ray technician, the court should afford the party proffering the evidence the opportunity to name Expert 2. That system respects the fact that in our complex society, all experts rely in countless ways on the conclusions of other experts, and it structures the process for deciding which of those many experts must testify at a trial. The majority’s rule does not; it proceeds from the unwarranted assumptions that experts are “hiding behind” the work of other experts, that there is no obligation on the resisting party to introduce so much as a scrap of evidence to challenge the secondary expert’s work, and that parties must name everyone from the hydrogeologist to the weatherman from Day 1. Although many might have thought that litigation in areas like environmental disputes, antitrust, and intellectual property could not become more unwieldy and expensive than it already is, the majority has shown them to be wrong. Its rule will hamper governmental plaintiffs (like the EPA in this very case, which named only a hydrogeologist) just as much as private plaintiffs, and defendants just as much as any plaintiffs. Furthermore, its approach is inconsistent with amended Rule 702, with the “just, speedy, and inexpensive determination of every action” command of Fed.R.Civ.P. 1, and with a fair balance of obligations on both parties.
I would ReveRse the district court’s judgment, and I respectfully dissent.

. The committee’s comments are instructive. It said "the rule is designed to broaden the basis for expert opinions beyond that current in many jurisdictions and to bring the judicial practice into line with the practice of the experts themselves when not in court. Thus a physician in his own practice bases his diagnosis on information from numerous sources and of considerable variety, including statements by patients and relatives, reports and opinions from nurses, technicians and other doctors, hospital records, and X-rays.” Advisory Committee Notes to Proposed Rule 703. It is evident that some of the information that the Committee considered legitimate as a basis for the expert's testimony is itself the product of the expertise of others, such as the work of other doctors, or the evidence from x-rays. Yet this was not a reason to forbid the first expert from testifying. Those who wished to challenge the testimony were responsible for impeaching the basis for it with their own counter-expertise.