Powerweb Energy, Inc. v. Hubbell Lighting, Inc. et al
RULING denying 215 Motion to Strike New Opinions from Powerweb's Unauthorized Damages Report. Signed by Judge Holly B. Fitzsimmons on 4/16/2014. (Katz, Samantha)
UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
POWERWEB ENERGY, INC.
HUBBELL LIGHTING, INC. AND
HUBBELL BUILDING AUTOMATION,
CIV. NO. 3:12CV220 (WWE)
RULING ON DEFENDANTS‟ MOTION TO STRIKE [DOC. #215]
Defendants Hubbell Lighting, Inc. and Hubbell Building
Automation, Inc. move to strike certain portions of plaintiff‟s
expert, Rod P. Burkert‟s, supplemental expert report.
reasons articulated below, defendants‟ motion to strike new
opinions from plaintiff‟s unauthorized damages report [Doc.
#215] is DENIED.
In this action, the plaintiff, Powerweb Energy, Inc.,
accuses defendants, Hubbell Lighting, Inc. and Hubbell Building
Automation Inc., of breaching licensing contracts and of
misappropriating trade secrets and confidential information in
connection with wireless lighting controls, known as the Wi-Con
project. [Doc. #1].
Plaintiff seeks monetary damages “in excess
of a billion dollars.” [Id.].
On July 5, 2013, to support its claim for economic damages,
plaintiff disclosed several experts, including Rod P. Burkert,
CPA/ABV, CVA.1 Plaintiff retained Mr. Burkert “to opine, with a
On June 3, 2013, the Court granted the parties‟ joint motion for
reasonable degree of professional certainty, as to the amount of
damages suffered by Plaintiff as a result of the alleged actions
of Defendants, as generally described by the court documents and
Mr. Burkert‟s report is dated July 5, 2013, and is
related to the “economic loss of plaintiff.”
On August 9, 2013,
in response to Mr. Burkert‟s report, and in accordance with the
scheduling order, defendants served the “responsive expert
report” of Suzanne M. Buckley.
Defendants engaged Ms. Buckley
to “review and comment” on plaintiff‟s alleged economic loss, as
opined by Mr. Burkert and to independently evaluate plaintiff‟s
Ms. Buckley‟s fifty (50) page report largely
criticizes Mr. Burkert‟s methodology and opinions.
Ms. Buckley opines, inter alia, that plaintiff‟s damages, “if
any, should be less than $358,656.”
On September 3, 2013, in response to Ms. Buckley‟s report,
plaintiff served Mr. Burkert‟s supplemental expert report,
portions of which defendants now seek to strike as untimely and
unauthorized by the scheduling order.
2. Legal Standard
Rule 26(a)(2)(B)(I) of the Federal Rules of Civil Procedure
requires that a written expert report contain “a complete
statement of all opinions the witness will express and the basis
and reasons for them[…]”.
“It should be assumed that at the
time an expert issues his report, that report reflects his full
extension of time and entered the parties‟ proposed revised scheduling
order. [Doc. #171]. Pursuant to this Order, expert reports or
disclosures and affirmative damages analysis or disclosures were to be
served by July 5, 2013. Responsive expert reports or disclosures and
responsive damages analysis of disclosures were to be served by July
26, 2013. [Id.].
knowledge and complete opinions on the issues for which his
opinion has been sought.” Innis Arden Golf Club v. Pitney Bowes,
Inc., No. 3:06 CV 1352(JBA), 2009 WL 5873112, at *3 (D. Conn.
Feb. 23, 2009) (quoting Sandata Techs., Inc. v. Infocrossing,
Inc., Nos. 05 Civ. 09546(LMM)(THK), 06 Civ. 01896(LMM)(THK),
2007 WL 4157163, at *4 (S.D.N.Y. Nov. 16, 2007) (citation
However, an expert witness has a duty to supplement his or
her report “in a timely manner if the party learns that in some
material respect the disclosure or response is incomplete or
incorrect, and if additional or corrective information has not
otherwise been made known to the other parties during the
discovery process or in writing…”
Innis Arden, 2009 WL 5873112,
at *2 (quoting Fed. R. Civ. P. 26(e)(1)(A), (2)).
“If a party
fails to provide information… as required by Rule 26(a) or (e),
the party is not allowed to use that information… to supply
evidence… at trial, unless the failure was substantially
justified or is harmless…” Innis Arden, 2009 WL 5873112, at *2
(quoting Fed. R. Civ. P. 37(c)(1)).
preclusionary sanction is automatic absent a determination of
either substantial justification or harmlessness.” Innis Arden,
2009 WL 5873112, at *2 (quoting Lore v. City of Syracuse, No.
5:00-CV-1833, 2005 WL 3095506, at *3 (N.D.N.Y. Nov. 17, 2005)).
“Plaintiff's duty to supplement its initial expert report
does not arise when plaintiff seeks to bolster its earlier
submission but, rather, arises „only if the expert subsequently
learns of information that was previously unknown or
unavailable, that renders information previously provided in an
initial report inaccurate or misleading because it was
incomplete....‟” Innis Arden, 2009 WL 5873112, at *3 (D. Conn.
2009) (quoting Sandata Techs., 2007 WL 4157163, at *4 (emphasis
in original); see Buxton v. Lil' Drug Store Prods., Inc., No.
2:02CV178KS–MTP, 2007 WL 2254492, at *5 (S.D. Miss. Aug. 1,
2007) (citations omitted) (“Courts have ... made it clear that
supplemental expert reports cannot be used to „fix‟ problems in
initial reports.”) (multiple citations omitted), aff'd, 294 Fed.
Appx. 92 (5th Cir. 2008)).
Defendants move to strike certain portions2 of Mr. Burkert‟s
supplemental expert report.
Defendants argue that the
supplemental report is not a true “supplement” because it
contains new opinions that could have been disclosed in the
Defendants also argue that the Court should
strike portions of the supplemental report because it violates
the Court‟s scheduling order, plaintiff has not offered
substantial justification for the untimely report, and the
supplemental report prejudices defendants.
Plaintiff argues that the supplemental report is proper
under Rule 26(e).
Plaintiff also argues that the factors for
excluding relevant and important information have not been met,
and therefore, the Court should not strike the challenged
portions of the supplemental report.
In total, defendants seek to strike sixty three (63) bulleted
paragraphs. [Doc. #219-2].
a. Timing and Contents of Supplemental Report
Mr. Burkert‟s original report consists of six (6) pages,
attached to which are two (2) appendices3 and, twenty two (22)
pages of schedules reflecting Mr. Burkert‟s damages calculations
and supporting information. Mr. Burkert opens his expert report
with a summary of his opinions, including, inter alia, that
plaintiff “has suffered economic damage in the form of lost
profits” in the amount of $752,721,475 for the period of March
2011 through August 2018, and $1,209,945,325, for the period of
March 2011 through August 2020.
These amounts include
prejudgment interest, discounted to June 30, 2013, the
approximate date of Mr. Burkert‟s report.
Burkert opines that defendants have been unjustly enriched in
the amount of $2,373,160.
After briefly addressing the
underlying facts and the scope of his engagement, Mr. Burkert
sets forth the bases and reasons for his expressed opinions. He
explains the methodologies used to measure economic damages and
lost profits, as well as the steps followed to calculate
plaintiff‟s lost profits and defendants‟ alleged unjust
Mr. Burkert notes that he “anticipate[s]
being called to render rebuttal testimony responsive to experts
called by Defendants.”
By contrast, the September 3 supplemental report is twenty
four (24) pages long, attached to which are one (1) appendix4 and
The appendices total eight (8) pages. Appendix A sets forth the data
and information Mr. Burkert considered in formulating his opinions.
Appendix B is Mr. Burkert‟s curriculum vitae.
The appendix lists the data and information Mr. Burkert considered in
three (3) pages of supplemental calculation schedules.5 The
supplemental report purports to “address various comments and
criticisms levied by the Buckley Report against [Mr. Burkert‟s]
Mr. Burkert also states that the
“supplemental responses and the opinions expressed in [his]
original report continue to be based on the same assumptions as
[his] original report.”6 The supplemental expert report is
formatted as a point-counterpoint to Ms. Buckley‟s report and
sets forth Mr. Burkert‟s responses to the criticisms levied by
the Buckley report.
These responses include Mr. Burkert‟s criticisms of the
Buckley report (i.e., “The Buckley Report does not consider that
Wi-Con is a more cost-effective solution that would attract new
customers who are not part of McKinsey‟s revenue data and would
expand the entire lighting controls market.”), as well as
statements further explaining his critiqued opinions and/or why
he did or did not consider certain information in forming his
opinions (i.e., in response to Ms. Buckley‟s criticism that Mr.
Burkert did not consider a Wi-Con forecast prepared by plaintiff
in early 2010, Mr. Burkert states, “The 2010 plan does not
provide a reliable comparison because it is an unfinished and
outdated draft and was never intended to project all of the
formulating the opinions expressed in the supplemental report.
Including, updated unjust enrichment calculations to correct an error
in the prior report and, a supplemental schedule “10a” entitled
“Excluded United States Installed Base of „Retrofitable‟ Fixtures.”
Following Mr. Burkert‟s expert deposition, plaintiff served
defendants with an “Amendment to Supplemental Expert Report” dated
September 18, 2013, which is not challenged here.
unexpected revenue” and “The draft plan was prepared before WiCon was expanded into additional types of Hubbell fixtures with
a larger relay, which would change the penetration rate.”).
After a careful review of Mr. Burkert‟s expert reports, the
Court finds that the challenged portions of the supplemental
report are not proper supplementation. Rather, the Court finds
that these portions are a curious mix of “rebuttal”7 and
statements aimed at bolstering Mr. Burkert‟s prior opinions in
light of Ms. Buckley‟s criticisms.
Indeed, as plaintiff admits
in its opposition brief, “Mr. Burkert‟s supplemental report did
not state new opinions – it simply explained the deficiencies in
Ms. Buckley‟s criticisms of opinions stated in the original
report.” [Doc. #246, 4].
As briefly discussed above, a
supplemental report cannot be used to bolster an earlier
submission or to otherwise “fix” problems in initial reports.
See Lidle, 2009 WL 4907201, at *5 (“Rule 26(e) is not, however,
a vehicle to permit a party to serve a deficient opening report
and then remedy the deficiency through the expedient of a
Rather, supplementation is proper
where, unlike here, it is used to correct mistakes.
Assoc. Elec. Gas Ins. Serv. v. Babcock & Wilcox Power Generation
Group, Inc., Civ. No. 3:11CV715(JCH)(HBF), 2013 WL 4456640, at
The better word to describe the supplemental report, and many of the
opinions expressed therein is “reply.” C.f. Lidle v. Cirrus Design
Corp., No. 08 Civ. 1253(BSJ)(HBP), 2009 WL 4907201, at *1 n.1
(S.D.N.Y. Dec. 18, 2009) (compiling cases)(“With respect to expert
disclosures, [the word “rebuttal”] is frequently used to refer to the
second of two rounds of expert discovery.”). However, for ease of
reference, the Court will refer to the challenged report as the
“supplemental report”, and certain of the opinions expressed therein
as “rebuttal” material.
*4 (D. Conn. Aug. 16, 2013) (denying motion to strike
supplemental expert report correcting calculations).
Moreover, plaintiff‟s argument that “Mr. Burkert could not
have rebutted Ms. Buckley‟s erroneous criticisms before they
were made,” further reinforces the Court‟s conclusion that
certain portions of the supplemental report constitute rebuttal
material (emphasis added).
Although Rule 26(a)(2)(D)(ii) of the
Federal Rules of Civil Procedure permits rebuttal expert
testimony that is “intended solely to contradict or rebut
evidence on the same subject matter identified by another party
under Rule 26(a)(2)(B) or (C)[…],” the Court is cognizant that
the scheduling order did not permit a third-round of expert
reports. Therefore, because the Court finds that the challenged
portions of the report constitute either improper
supplementation and/or unauthorized rebuttal, the Court must now
determine whether to strike the challenged portions of the
supplemental report as an appropriate sanction.8
b. Exclusion of Supplemental Opinions
Courts in the Second Circuit are directed to consider the
following factors in determining whether to exclude expert
testimony: “(1) the party‟s explanation for the failure to
comply with the discovery order; (2) the importance of the
testimony of the precluded witness; (3) the prejudice suffered
by the opposing party as a result of having to prepare to meet
the new testimony; and (4) the possibility of a continuance.”
The Court rejects plaintiff‟s argument that the supplementation was
appropriate under Rules 26(a)(3) and 26(e)(2) in light of this
Sofitel Inc. v. Dragon Med. & Scientific Comm., Inc., 118 F.3d
955, 961 (2d Cir. 1997) (citing Outley v. City of New York, 837
F.2d 587, 590-91 (2d Cir. 1988)).
“None of these factors are
dispositive and each factor is to be balanced against the others
in making the determination.”
Lab Crafters, Inc. v. Flow Safe,
Inc., No. CV-03-4025 (SJF)(ETB), 2007 WL 7034303, at *6
(E.D.N.Y. Oct. 26, 2007) (citing Sofitel, 118 F.3d at 962).
i. Explanation for Failure to Comply with Court
Plaintiff asserts that there was no failure to comply with
the disclosure requirement because it would have been impossible
for Mr. Burkert to address Ms. Buckley‟s criticisms in his
initial report and that it was timely served pursuant to Rule
In light of the Court‟s finding that the supplemental
report is not a proper supplement, this argument is now moot.
Even construing the supplemental report as a substantively
proper reply, the report still runs afoul of the scheduling
order because it did not call for a third round of expert
Here, while the Court finds plaintiff has failed to
allege good cause for failing to comply with the scheduling
order, the Court cannot further find that plaintiff was
motivated by a dilatory purpose. Moreover, on the current record
it is not evident that plaintiff acted in bad faith or truly
sought to place defendants at an unfair disadvantage. Indeed,
the Court credits that plaintiff served the supplemental report
in short order and, more importantly, prior to Mr. Burkert‟s
deposition (albeit just one day before).
By taking such steps,
defendants had an opportunity to address the report at Mr.
Although the proper course would have
been for plaintiff to seek leave to serve the supplemental
report, such an omission does not necessarily rise to bad faith.
Therefore, although the first Sofitel factor weighs in favor of
preclusion, it does not require it.
See also Lab Crafters, 2007
WL 7034303, at *7 (“Exclusion of expert testimony should be
reserved for those rare cases where a party‟s conduct represents
flagrant bad faith and callous disregard for the Federal Rules
of Civil Procedure.”).
ii. Importance of Testimony Sought to be Excluded
With respect the second Sofitel factor, plaintiff argues
that the opinions defendants seek to strike are “indisputably
important” where defendants are seeking to prevent Mr. Burkert
from responding to criticisms of his analysis.
After a careful
review of the challenged portions of the supplemental report,
the Court agrees that as a whole, the information defendants
seek to strike is central to the determination of damages, a
hotly contested and significant issue.
importance of Mr. Burkert‟s opinion weighs in favor of its
admission. See, e.g., Zerega Ave. Realty Corp. v. Hornbeck
Offshore Transp., LLC, 571 F.3d 206, 213 (2d Cir. 2009) (finding
trial court abused its discretion in excluding expert opinion
for noncompliance with pretrial order where, inter alia, the
excluded expert‟s testimony was critical to party‟s defense on
the issue of causation).
iii. Prejudice Suffered by Defendants
The third factor to consider is the prejudice suffered by
defendants “as a result of having to prepare and meet new
Sofitel, 118 F.3d at 962.
Plaintiff discounts any
prejudice suffered because defendants were able to depose Mr.
Burkert regarding the supplemental report and received it
several months prior to trial. Defendants, however, argue they
are prejudiced because (1) plaintiff‟s failure to submit a
complete report prevented Ms. Buckley from fully responding to
plaintiff‟s entire damages case; (2) plaintiff relies on the new
opinions to challenge the admissibility of Ms. Buckley‟s
opinions; and (3) defendants have incurred the costs of taking
Mr. Burkert‟s deposition, bringing the motion to strike, and
defending against plaintiff‟s attempt to exclude Ms. Buckley‟s
The Court credits plaintiff‟s argument that any prejudice
suffered by defendants has been mitigated by defendants‟ having
deposed Mr. Burkert after receiving the supplemental report. See
Equant Integration Serv., Inc. v. United Rentals, Inc., 217
F.R.D. 113, 118 (D. Conn. 2003)(finding plaintiff could cure
prejudice by producing expert for additional deposition); Lab
Crafters, 2007 WL 7034303, at *8 (finding no prejudice to
plaintiff where plaintiff already had an opportunity to depose
expert, and had done so, as to the contents of the expert‟s
Because defendants have already had the opportunity to
depose Mr. Burkert on the contents of his supplemental report,
defendants are “therefore able to amply prepare for [his]
testimony by the time trial commences”, and in this regard,
“there is no significant prejudice” to defendants in allowing
the challenged opinions. Id.
Nevertheless, the Court finds that defendants have suffered
some prejudice by being denied the opportunity to respond to Mr.
Burkert‟s supplemental report. However, this prejudice may also
be mitigated if defendants are provided an opportunity to so
Accordingly, within thirty (30) days of this Order,
defendants may seek leave to serve Ms. Buckley‟s sur-reply
report. Assuming that permission is granted to serve a sur-reply
report, and to the extent that any of the opinions expressed
therein implicate issues in the pending motion in limine,
defendants may also seek leave to file a supplemental memorandum
in opposition to the motion in limine.9
As to the financial harm
allegedly suffered by defendants, the Court will not award fees
or costs incurred for deposing Mr. Burkert, opposing the motion
in limine, or bringing the motion to strike.
The Court will,
however, require plaintiff to bear the cost of Ms. Buckley‟s
sur-reply report, assuming that permission is granted for
defendants to serve such a report.
iv. Possibility of Continuance
Finally, the Court considers the possibility of
In this case, no trial date has been set, and the
deadline for filing pretrial memoranda has been stayed pending
the resolution of the pending summary judgment and Daubert
motions. [Doc. #311].
Although allowance of the supplemental
The Court will not permit any sur-sur reply reports.
report may require further briefing on the Daubert motion
regarding Ms. Buckley‟s opinions, it does not appear at this
juncture that allowing the opinions will adversely affect the
progress of the case in a significant way.
factor also weighs in favor of allowing the entirety of Mr.
Based on the Court‟s balancing of the Sofitel factors, and
the general preference to determine issues on the merits,
defendants‟ motion to strike is DENIED.
See Lab Crafters, 2007
WL 7034303, at *2 (“[C]ourts generally favor the determination
of issues on the merits.”); Scientific Components Corp. v.
Sirenza Microdevices, Inc., No. 03 CV 1851(NGG)(RML), 2008 WL
4911440, at *4 (E.D.N.Y. Nov. 13, 2008) (multiple citations
omitted)(“[P]recluding testimony of an expert, even where there
has not been strict compliance with Rule 26, may at times tend
to frustrate the Federal Rules‟ overarching objective of doing
substantial justice to litigants.”). The Court notes that
nothing in this ruling should be construed as an opinion on the
admissibility of the expert reports or testimony.
For the reasons set forth herein, the defendants‟ motion to
strike [Doc. #215] is DENIED.
This is not a Recommended Ruling. This is a discovery
ruling or order which is reviewable pursuant to the “clearly
erroneous” statutory standard of review. 28 U.S.C. §
636(b)(1)(A); Fed. R. Civ. P. 72(a); and D. Conn. L. Civ. R.
72.2. As such, it is an order of the Court unless reversed or
modified by the district judge upon motion timely made.
ENTERED at Bridgeport, this 16th day of April 2014.
HOLLY B. FITZSIMMONS
UNITED STATES MAGISTRATE JUDGE
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?