The Federal Deposit Insurance Corporation v. Icard, Merrill, Cullis, Timm, Furen & Ginsburg, P.A. et al

Filing 57

ORDER: Defendants' Motion in Limine to Exclude Improper Expert Testimony by Plaintiff's Expert, Mark Riley 37 is DENIED. See Order for details. Signed by Judge Virginia M. Hernandez Covington on 5/1/2013. (KAK)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
THE FEDERAL DEPOSIT INSURANCE
CORPORATION, as Receiver for
First Priority Bank, Bradenton,
Florida,
Plaintiff,
v.

Case No. 8:11-cv-2831-T-33MAP

ICARD, MERRILL, CULLIS, TIMM,
FUREN & GINSBURG, P.A., and
ROBERT E. MESSICK,
Defendants.
_______________________________/
ORDER
This cause is before the Court pursuant to Defendants’
Motion in Limine to Exclude Improper Expert Testimony by
Plaintiff’s Expert, Mark Riley (Doc. # 37), filed on April 15,
2013.

The FDIC filed a Response in Opposition to the Motion

in Limine (Doc. # 40) on April 24, 2013.

The Court denies the

Motion as follows.
I.

Background
This case is set for a jury trial during the Court’s May

2013, trial term.

As the parties indicate in their joint

statement of the case, “The FDIC alleges that Icard Merrill
and Bob Messick committed legal malpractice and breached their
fiduciary duties when representing First Priority Bank in
connection with the March 2006 closing of a $5.3 million real

estate acquisition and development loan to River Meadows
Development, LLC.” (Doc. # 46).
The FDIC indicates in the pretrial statement that it
plans

to

call

Mark

Riley

as

an

expert

witnesses,

and

summarizes his testimony as follows:
Mr. Riley [will] provide expert testimony on
commercial lending and underwriting practices, bank
management, bank operations and procedures, and the
standards of care in the banking industry.
Mr.
Riley will testify that Icard (1) either allowed or
conspired with Mark Brivik and his business
entities to mislead the Bank in terms of their
ongoing, and inadequately disclosed attorney-client
relationship with U.S. Funding Group and Brivik and
(2) improperly excluded key collateral from the
Loan documents which the Bank expressly approved
and required and (3) failed to provide an opinion
of counsel which would have impeded, if not
cancelled the settlement of the Loan altogether.
(Doc. # 31-5).

Mr. Riley’s expert witness report (Doc. # 37-

1) and a transcript of Mr. Riley’s deposition held on November
7, 2012 (Doc. # 37-2), are before the Court.
At this juncture, Defendants seek an Order excluding Mr.
Riley’s testimony on the grounds that he will impermissibly
testify regarding the credibility of other witnesses and
regarding the legal implications of the Defendants’ actions.
Defendants also contend that Mr. Riley should be barred from
offering testimony about “what the Bank would have done,” and
about “facts of common understanding.” (Doc. # 37 at 7-9).

-2-

Finally,

Defendants

contend

that

Mr.

Riley’s

proposed

testimony will exceed the boundaries of his expertise.
II.

Legal Standard
The admissibility of expert testimony is governed by

Federal Rule of Evidence 702, which states that:
A witness who is qualified as an expert by
knowledge,
skill,
experience,
training,
or
education may testify in the form of an opinion or
otherwise
if:
(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.
Fed. R. Evid. 702.
Rule

702

is

a

codification

of

the

Supreme

Court’s

landmark case of Daubert v. Merrell Dow Pharmaceuticals, Inc.,
509 U.S. 579 (1993).

In Daubert, the Court described the

gatekeeping function of the district court to ensure expert
testimony and evidence “is not only relevant, but reliable.”
Id. at 589.

As stated in the Advisory Committee Notes

accompanying Rule 702 of the Federal Rules of Evidence, “A
review of the case law after Daubert shows that the rejection
of expert testimony is the exception rather than the rule.”
See Advisory Committee Notes to the 2000 Amendment to Rule

-3-

702.

In

addition,

the

trial

judge

is

afforded

broad

discretion in deciding Daubert issues. See Kuhmo Tire Co. v.
Carmichael, 526 U.S. 137, 152 (1999).
In Rink v. Cheminova, Inc., 400 F.3d 1286 (11th Cir.
2005), the Eleventh Circuit set forth a three-pronged approach
for deciding Daubert issues:
To fulfill their obligation under Daubert, district
courts must engage in a rigorous inquiry to
determine whether: (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.
Id. at 1291 (internal citations omitted).

The party offering

an expert has the burden of satisfying each of these elements
by a preponderance of the evidence. Id. at 1292; see also
Allison v. McGhan Med. Corp., 184 F.3d 1300, 1306 (11th Cir.
1999).

Expert testimony is also evaluated under Federal Rule

of Evidence 403, which states: “The court may exclude relevant
evidence if its probative value is substantially outweighed by
a danger of one or more of the following: unfair prejudice,
confusing

the

issues,

misleading

the

jury,

undue

delay,

wasting time, or needlessly presenting cumulative evidence.”

-4-

III. Analysis
A.

Credibility Determinations and Legal Implications

Defendants assert that Mr. Riley’s testimony should be
excluded because “Mr. Riley bases many of his opinions in this
case

on

his

personal

assessment

witnesses.” (Doc. # 37 at 4).
Mr.

Riley’s

proffered

of

the

credibility

of

Defendants also contend that

testimony

is

subject

to

exclusion

because it is “riddled with impermissible legal conclusions,
such as conclusions that Defendants conspired or intentionally
misled

First

Priority

Bank

and

the

Defendants

acted

deliberately.” (Id. at 5) (internal quotation marks omitted).
Defendants’ arguments on these two issues, however,
appear to be moot.

In the FDIC’s response to the Motion in

Limine, the FDIC “acknowledges that expert witnesses may not
directly and expressly offer opinions on the credibility of
other witnesses.” (Doc. # 40 at 2).

The FDIC also clarifies

that “Mr. Riley is not being called to . . . testify on the
credibility of other witnesses.” (Id.).

In addition, in the

FDIC’s response to the Motion in Limine, the FDIC “stipulates
that Mr. Riley will not be called to testify on the legal
implications of the Defendants’ conduct.” (Id. at 3).
In light of these representations by the FDIC, the Court
determines

that

these

two

issues
-5-

are

moot.

However,

Defendants are free to raise an appropriate objection during
trial if it appears that Mr. Riley intends to comment on the
credibility of another witness or the legal implications of
Defendants’ actions.
B.

“What the Bank Would have Done”

Defendants argue that the Court should preclude Mr. Riley
from “offering speculative testimony regarding what First
Priority

Bank

information.”

would

have

done

if

it

had

known

certain

(Doc. # 37 at 7). Defendants further assert,

“the jury is perfectly capable of listening to the testimony
of the bank officers and directors who approved the loan if
they need to determine what the bank would have done under a
particular set of facts.” (Id.).
In this complex case, the Court determines that expert
testimony will be helpful, and it is important to note that
both sides have retained experts to discuss banking practices
to assist the trier of fact.

Like the FDIC’s expert Mr.

Riley, Defendants’ expert, Jerry L. Neff, has been retained to
“provide expert opinion testimony on the subject of banking
procedures, policies, and business practices attendant to loan
transactions, and more specifically, lending transactions
concerning real estate acquisition and development loans, like
the subject loan underlying this action.” (Doc. # 31-6).
-6-

Rather than offering “speculative testimony regarding
what First Priority Bank would have done . . .,” Mr. Riley is
being called upon to share his specialized knowledge about
banking practices with the jury. (Doc. # 37 at 7).

The Court

declines to strike his proffered testimony as speculative at
this juncture.

However, Defendants may raise an appropriate

objection at trial, if necessary, if Mr. Riley begins to offer
any testimony based upon pure speculation and conjecture,
rather than his expertise.
C.

“Facts of Common Understanding”

Defendants identify eleven statements from Mr. Riley’s
expert

report

and

assert,

“under

the

guise

of

expert

testimony, the FDIC is using Mr. Riley to tell its factually
unsupported story about what it believes happened in this
case.” (Id. at 9).

Defendants also point to the Eleventh

Circuit’s pronouncement in Hibiscus Associates Ltd. v. Board
of Trustees of Policemen and Firemen Retirement System of City
of Detroit, 50 F.3d 908, 917 (11th Cir. 1995), that “Expert
testimony is properly excluded when it is not needed to
clarify facts and issues of common understanding which jurors
are able to comprehend for themselves.”
The statements that Defendants have identified do not
fall into the category of “facts of common understanding” and
-7-

they are not the sort of facts that most jurors are capable of
understanding without the assistance of an expert.

For

instance, a typical juror would likely not consider the
following statements ones of “common understanding:”
•

The 25-acre option parcel was an integral part
of the collateral pool for the loan;
The project could not be completed without the
valuable option property; and
The Bank’s Senior Loan Committee approved a
loan that, in their opinion and deliberation,
required an option.

•
•

(Doc. # 37 at 9-10).
Indeed, both sides have proffered expert testimony on
these areas and the loan application and approval process.
While

some

jurors

may

have

banking

and/or

real

estate

development experience, the Court concludes that the average
juror would consider these areas challenging.

Upon due

consideration, the Court declines to exclude any portion of
Mr. Riley’s expert testimony on the basis that such testimony
pertains to “facts of common understanding.”

The Court has

considered the evidence under the prism of Rule 702 and Rule
403 of the Federal Rules of Evidence.

Neither rule calls for

the exclusion of Mr. Riley’s expert testimony.

However,

Defendants may re-raise any challenge made in this Motion in
Limine

during

trial

if

the

objection.
-8-

circumstances

call

for

an

D.

The Scope of Mr. Riley’s Expertise

Defendants correctly point out that Mr. Riley is not an
attorney and should not be permitted to testify regarding the
ethical

obligations

of

an

attorney.

However,

the

FDIC

responds that “Mr. Riley will not be called to provide any
expert opinions on ethics.” (Doc. # 40 at 6).

Accordingly,

Defendants’ concerns regarding the propriety of Mr. Riley
offering legal ethics opinions are moot.
Defendants

also

argue,

“Mr.

Riley

has

also

offered

opinions about the importance of certain parcels of real
property to a development in Manatee County, Florida, while
also admitting that he is not a developer or a Florida real
estate lawyer and that he has not developed real estate in the
state of Florida.” (Doc. # 37 at 11-12).
unavailing.
as

Mr.

This argument is

The Court determines that a banking expert, such

Riley,

does

not

necessarily

need

real

estate

development experience to provide an expert opinion regarding
the

value

of

collateral

and

related

bank

practices

and

procedures for real estate acquisition and development loans.
The

FDIC

indicates

that

“Mr.

Riley

will

provide

expert

testimony about the Bank’s policies and procedures that were
in place when the Loan was made, the Loan and its approval
process, the Loan documentation, and the collateral package
-9-

that secured the Loan.” (Doc. # 40 at 5-6).

In the instance

that Mr. Riley attempts to provide the jury with testimony
that exceeds the bounds of his expertise, Defendants are free
to raise an appropriate objection during trial.
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
Defendants’ Motion in Limine to Exclude Improper Expert
Testimony by Plaintiff’s Expert, Mark Riley (Doc. # 37) is
DENIED.
DONE and ORDERED in Chambers in Tampa, Florida, this 1st
day of May, 2013.

Copies:

All Counsel of Record

-10-