Court Opinion

ID: 9563205
Source: CourtListenerOpinion
Date Created: 2023-08-21 18:37:44.438399+00
Date Added: 2024-06-11T09:17:46.475587
License: Public Domain

HENRY, J.,
dissenting, joined by
KELLY, Circuit Judge:
I join the dissent of Judge McConnell that fully covers these matters. However, I feel strongly enough to add a few thoughts of my own.
*1279This was not an easy case. Following a sixteen-day trial, involving a massive 42-count indictment, a jury deliberated for six days prior to reaching a decision. Yet, the district court, seemingly driven by some internal time schedule, deprived Mr. Nac-chio of his key expert witness, Professor Daniel Fischel. Professor Fischel would have testified in this complex case on an issue that is a specific example of the very testimony contemplated by Rule 702. See McConnell Dissent at 1274-75.
While the majority declares that the district court “made clear [its] need for some proffer of data or literature underlying [Professor Fischel’s] assumptions and conclusions,” Maj. Op. at 1251, the majority acknowledges that the district court made “ambiguous” and “enigmatic” references. See id. at 1242-43. The subsequent multi-page explanation of the district court’s ambiguous directions belies that the district court was clear; indeed, the fact that Mr. Nacchio’s experienced team of lawyers, as well as a few judges of this court, missed the district court’s “enigmatic” direction suggests a certain opacity.
The majority would have us believe Mr. Nacchio’s lead counsel simply and inexplicably failed to perform the basic task of qualifying the witness, for no good reason. According to the majority, the defense knew what was necessary and had a number of opportunities to qualify the witness, but instead did nothing. This is highly unlikely. Far more likely, in my opinion, is that the defense was blind-sided: defense counsel expected to be able to qualify the witness in the usual way and was never told otherwise — only to find out, too late, that the district judge had made up his mind on the basis of the skeletal disclosure statement, and had decided to exclude the witness without hearing argument or testimony. If the majority is correct that the defense had notice that it had to present the expert’s methodology in writing, or had to file a motion, then why did counsel not do so?
It would not have been difficult to establish the admissibility of Professor Fischel’s expert testimony. Indeed, Professor Fis-chel has provided expert testimony on financial and securities issues at least 200 times, including for the government. See Aplt’s Br. of October 9, 2007, at 40. I know of no court that has ever excluded his testimony.
Of course, eminent scholarship alone does not guarantee admissibility. Mr. Nacchio was also required to comply with the rules of evidence, and, in particular, Rule 16. His Rule 16 disclosure provides the requisite summary of Professor Fis-chel’s opinions, and the bases and reasons for those opinions: Professor Fischel was expected to testify that, among other things, based upon his analysis of the economic evidence, Mr. Nacchio’s stock sales during the disputed period were not based on material non-public information. Defs filing of March 29, 2007, at 3. To reach this conclusion, Professor Fischel engaged in
(i) a comparison of the magnitude and timing of the Questioned Sales with the magnitude and timing of Mr. Nacchio’s sales in prior periods; (ii) a comparison of the magnitude and timing of the Questioned Sales with public statements by Mr. Nacchio and requests made by the Qwest Board as to how and when sales should occur; (iii) the relationship between the magnitude of the Questioned Sales and Mr. Nacchio’s saleable holdings; (iv) a comparison of the Questioned Sales with other contemporaneous stock transactions by Qwest; (v) an analysis of whether the Growth Share Payment created any incentive to trade on the basis of inside information; (vi) stock sales by other Qwest insiders in the period in which the Questioned Sales occurred; and (vii) stock sales by senior *1280executives of other companies in the period ....
Id. In essence, Professor Fischel was to opine on Mr. Nacchio’s trading conduct during the disputed period, basing his opinion on the following: a comparison of the disputed sales with Mr. Nacchio’s selling history, as well as other similarly situated senior executives; an evaluation of the incentives to trade throughout the disputed period; and the reaction of the market to disclosure of the information on which Mr. Nacchio allegedly traded. Had the district court admitted this evidence, we would not have questioned it for a nanosecond.
If the district court had any doubts about the reliability or relevance of this testimony, all it had to do was allow the defense and the prosecution to question Professor Fischel and thus compile a record. This would not have taken much time and could have been done out of the presence of the jury, as the government asked.
In Anglo-American jurisprudence, the goal is to admit all relevant, reliable, and useful evidence. The judicial process reflects this goal — our rules of evidence have a “liberal thrust.” Beech Aircraft Corp. v. Rainey, 488 U.S. 153, 169, 109 S.Ct. 439, 102 L.Ed.2d 445 (1988). The rules on expert testimony are “notably liberal.” Krist v. Eli Lilly & Co., 897 F.2d 293, 298 (7th Cir.1990) (citing Fed.R.Evid. 702). When Fed.R.Evid. 702 was amended to account for the Supreme Court’s decision in Daubert, the Advisory Committee emphasized that “the trial court’s role as gatekeeper is not intended to serve as a replacement for the adversary system.” Fed.R.Evid. 702 advisory committee’s note (citing United States v. 14.38 Acres of Land Situated in Leflore County, Mississippi, 80 F.3d 1074, 1078 (5th Cir.1996)). Instead, “[vigorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence.” Id. (citing Daubert v. Merrell Dow Pharms., 509 U.S. 579, 595, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993)). Thus, under Fed.R.Evid. 702’s codification of Dau-bert, the general rule of liberal admission of proper evidence is retained. The role of the district court is that of a gatekeeper, a tender or monitor who liberally allows the entrance of proper evidence; it is not a portcullis, excluding qualified patrons for indeterminate reasons.
Although, as Judge McConnell points out, we review a district judge’s ultimate decision to admit or exclude expert testimony for an abuse of discretion, we review de novo whether the district court performed its gatekeeper function and applied the proper legal standards in doing so.1 Dodge v. Cotter Corp., 328 F.3d 1212, 1223 (10th Cir.2003). In evaluating the conduct of the district court, it is important to keep in mind context — the purpose of trial is to ascertain the truth. See Maryland v. Craig, 497 U.S. 836, 857, 110 S.Ct. 3157, 111 L.Ed.2d 666 (1990) (discussing the “truth-finding function of the trial itself’ (citing Coy v. Iowa, 487 U.S. 1012, 1032, 108 S.Ct. 2798, 101 L.Ed.2d 857 (1988) (Blackmun, J., dissenting))). The United States Constitution, and in particular the Sixth Amendment, protect and support the “truth seeking goal” of criminal trials. Id. Thus, the trial judges, as evidentiary “gatekeepers,” must screen and balance the evidence. See, e.g., Kumho Tire Co. v. Car*1281michael, 526 U.S. 137, 145, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999).
We, as an appellate court, are charged with reversing district court judgments that are “arbitrary, capricious, whimsical or manifestly unreasonable.” Dodge, 328 F.3d at 1223 (internal quotation marks omitted). And, reviewing the district court’s ultimate determination of whether to admit or exclude testimony under the proper legal standard for abuse of discretion, I would reverse. It was plainly wrong for the district court to make its Daubert determination on the basis of a Rule 16 disclosure alone. And it was plainly wrong for the district court to deny the defendant the right to establish admissibility without prior, clear notice of how he was supposed to proceed.
The district court’s draconian decision to exclude Professor Fischel as an expert flies in the face of the truth-finding goals of trial, the constitutional safeguards to a full defense, the liberal thrust of the rules of evidence, and amounts to exactly the type of manifest unreasonableness we, as a reviewing court, should reverse.
And, though I fear for today’s result, I do not believe this case is over. If “the district judge made clear his need for some proffer of data or literature underlying the expert’s assumptions and conclusions, [and] the defense offered practically nothing, despite repeated opportunities to do so,” Maj. Op. at 1251, (citing United States v. Brien, 59 F.3d 274, 277 (1st Cir.1995)), then defense counsel behaved inexplicably, which is to say they performed below the level expected of competent counsel. That means we will most likely see these issues return in the form of a § 2255 claim for ineffective assistance of counsel. The fact that a possibly meritorious § 2255 claim is waiting has no direct effect on what we do here now. Nonetheless, the majority’s scenario, which depends on a holding that counsel’s ineffectiveness possibly rose to a level of constitutional infirmity, suggests to me an alternative explanation: the district court simply was not clear, and it abused its discretion in excluding Mr. Nacchio’s expert.

. Because Mr. Nacchio did not argue for de novo review under the theory that the district court failed to perform its gatekeeper function and failed to apply the proper legal standard in doing so, and because I believe Mr. Nac-chio succeeds under an abuse-of-discretion theory, I will refrain from further discussion of the de novo standard.