Paramount Media Group, Inc. v. Village of Bellwood et al
Filing
200
MEMORANDUM Opinion and Order. The Court overrules plaintiff's objections 183 , 185 to Magistrate Judge Cole's May 28, 2015 memorandum opinion and order and June 2, 2015 memorandum opinion and order and overrules in part and sustains in part plaintiff's objection 188 to the June 10, 2015 memorandum opinion and order. Signed by the Honorable Jorge L. Alonso on 9/10/2015 Notice mailed by judge's staff (ntf, )
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
PARAMOUNT MEDIA GROUP, INC.,
an Illinois corporation,
Plaintiff,
v.
VILLAGE OF BELLWOOD, an Illinois
municipal corporation, and IMAGE MEDIA
ADVERTISING, INC., an Illinois corporation,
Defendants.
)
)
)
)
)
)
)
)
)
)
)
)
No. 13 C 3994
Judge Jorge L. Alonso
MEMORANDUM OPINION AND ORDER
Before the Court are plaintiff’s objections to three of Magistrate Judge Cole’s rulings.
For the reasons stated below, the Court overrules plaintiff’s objections [183, 185] to the May 28,
2015 memorandum opinion and order and the June 2, 2015 memorandum opinion and order and
overrules in part and sustains in part plaintiff’s objection [188] to the June 10, 2015
memorandum opinion and order.1
BACKGROUND
Paramount Media Group, Inc. (“Paramount”) is a company that buys and leases property,
builds outdoor billboards on the property, and sells advertising on those billboards. (R. 81, First
Am. Compl. ¶ 2.) Paramount brought this action against the Village of Bellwood (“Bellwood”)
and Image Media Advertising, Inc. (“Image Media”) alleging that defendants have violated
Paramount’s First and Fourteenth Amendment rights and that they have conspired to restrain
1
Although plaintiff also filed an objection [125] on November 7, 2014 to Magistrate Judge
Cole’s order of October 29, 2014 [124], plaintiff withdrew that objection in open court on June 18,
2015.
trade and monopolize the billboard market in Bellwood. Paramount also alleges that Image
Media tortiously interfered with Paramount’s contract with third parties to lease the property at
1133-35 Bellwood Avenue in Bellwood for the purpose of building and maintaining a billboard.
Judge Norgle, to whom this case was previously assigned, referred the case to Magistrate
Judge Cole for all pretrial issues except dispositive motions. (R. 53.) Recently, the parties have
conducted expert discovery and have been briefing various discovery and evidentiary disputes.
On May 28, June 2, and June 10, 2015, Judge Cole issued rulings [169, 176, 182] on certain of
Image Media’s motions. Paramount has filed objections to those rulings.
DISCUSSION
A.
Legal Standards
As Paramount and Image Media recognize, where, as here, a district court considers
timely objections to a magistrate judge’s rulings on nondispositive matters, the magistrate
judge’s rulings will be modified or set aside only if they are “clearly erroneous or . . . contrary to
law.” Fed. R. Civ. P. 72(a); see also Domanus v. Lewicki, 742 F.3d 290, 295 (7th Cir. 2014).
Under the clear-error standard of review, “the district court can overturn the magistrate judge’s
ruling only if the district court is left with the definite and firm conviction that a mistake has
been made.” Weeks v. Samsung Heavy Indus. Co., 126 F.3d 926, 943 (7th Cir. 1997).
B.
Damages Claim for a Digital Billboard
On May 28, 2015, Judge Cole issued a memorandum opinion and order granting Image
Media’s motion to bar Paramount’s damages claim for a digital billboard (as opposed to a static
billboard). (R. 169.) Judge Cole held that Paramount failed to show that its untimely disclosure
of this claim was either substantially justified or harmless.
2
Federal Rule of Civil Procedure 26(a)(1)(A)(iii) requires parties to initially disclose to
the other parties, without waiting for a discovery request, “a computation of each category of
damages claimed by the disclosing party—who must also make available for inspection and
copying as under Rule 34 the documents or other evidentiary material, unless privileged or
protected from disclosure, on which each computation is based, including materials bearing on
the nature and extent of injuries suffered.” A party must supplement its initial disclosures and
discovery responses “in a timely manner if the party learns that in some material respect the
disclosure or response is incomplete or incorrect, and if the additional or corrective information
has not otherwise been made known to the other parties during the discovery process or in
writing.” Fed. R. Civ. P. 26(e)(1)(A). “If a party does not follow these rules, ‘the party is not
allowed to use that information . . . to supply evidence on a motion, at a hearing, or at a trial,
unless the failure was substantially justified or was harmless.’” Dynegy Mktg. & Trade v.
Multiut Corp., 648 F.3d 506, 514 (7th Cir. 2011) (quoting Fed. R. Civ. P. 37(c)(1)). The
following factors guide the court’s discretion: “(1) the prejudice or surprise to the party against
whom the evidence is offered; (2) the ability of the party to cure the prejudice; (3) the likelihood
of disruption to the trial; and (4) the bad faith or willfulness involved in not disclosing the
evidence at an earlier date.” David v. Caterpillar, Inc., 324 F.3d 851, 857 (7th Cir. 2003).
This case was filed on May 30, 2013.
In the complaint, Paramount alleged that
defendants are “taking away Paramount’s rights under its lease and IDOT [Illinois Department
of Transportation] permit to construct a billboard on” the property at 1133-35 Bellwood Avenue
in Bellwood (the “Property”). (R.1, Compl. at 12 ¶ 11, 35.) Attached to the complaint is
Paramount’s IDOT “Application for Outdoor Advertising Permit,” in which Paramount checked
the “Painted bulletin” box under “Description of Proposed Sign” and “Type.” Another possible
3
sign type on the form that Paramount did not check was “Multiple Message.” (R. 1-2, Compl.,
Ex. 2.)
As Judge Cole noted, when Paramount filed its amended complaint on January 28,
2014, “nothing had changed—the sign at issue was a static one.” (R. 169 at 2 (citing R. 81-2,
First Am. Compl., Ex. 2).) On February 21, 2014, Paramount made its amended Rule 26(a)(1)
damages disclosure, stating that in addition to declaratory and injunctive relief, it was “seeking
damages in the amount of $1,678,000.00, the fair market value of the outdoor advertising sign,
and its attorneys’ fees and costs.” (R. 151-1 at 3.) The same day, Paramount stated the same
figure in response to defendants’ interrogatory that asked Paramount to “[i]dentify and itemize
all lost profits and monies that Paramount claims to have lost from its inability to construct and
operate a billboard” on the Property. (R. 151-2 at 10 ¶ 12.) Paramount did not supplement or
update its damages computation again before the close of fact discovery on August 31, 2014.
On October 20, 2014, the last day for plaintiff to disclose its expert witnesses, Paramount
served a set of “Second Amended” Rule 26 disclosures that included the following addition to
the $1,678,000.00 claim: “It is also believed that the present value of projected net income for a
double faced 20' x 60' vinyl sign at 1133-35 Bellwood Avenue, Bellwood, Illinois is
$3,611,173.00 and for a double faced 20' x 60' digital sign is “$13,993,808.” (R. 151-3 at 3.)
This set of disclosures was served in conjunction with the Amended Report of plaintiff’s
president and CEO, David Quas. (R. 121, Pl.’s Resp. Image Media’s Mot. Bar Evidence at 4-5.)
Evidently, the first mention of a digital billboard in this case had occurred in Quas’s original
report of March 13, 2014, where he had stated as follows regarding damages:
In my opinion, based on my experience of owning and operating billboards, that
[sic] a billboard structure and two 20'X60' advertising faces generate
approximately $7,500 net per face per year at 70% occupancy (which is an
industry average) or $180,000 in gross revenues per year . . . . [After accounting
4
for certain itemized expenses,] it is my belief that the expected profits from the
sign each year would be $105,180.00.
Further, in my opinion of [sic] the fair market value of the outdoor advertising
will be approximately $1.6 million and could be significantly more if a digital
billboard space is installed. Current revenues for a digital face in this location
should total $470,000.00 per year. This is based on my over 20 years of
experience selling and purchasing billboards in the Chicagoland area.
(R. 183-1, Paramount’s Objection, Ex. 1, Quas Report 3.) In contrast, Quas’s October 20, 2014
amended report states as follows in pertinent part:
In my opinion, based on my experience of purchasing, selling, owning and
operating billboards, a double sided 20'X60' vinyl sign located at 1133-35
Bellwood Avenue, Bellwood, Illinois should produce income with a net present
value of $3,611,6732. . . .
Also, in my opinion, based on the same calculations and analysis, the net
present value of projected net income of a double faced 20' X 60' structure with a
digital display would be $13,993,808. . . .
(R. 183-2, Paramount’s Objection, Ex. 2, Am. Quas Report 3.)
On October 24, 2014, Image Media moved to bar as untimely, among other things, the
new damages claims set forth in Paramount’s October 20 disclosures. (R. 119.) Judge Cole
denied the motion without prejudice because it was unclear at that point whether the recent
damages assertion was merely an updated calculation or an entirely new theory. (R. 124.) Judge
Cole indicated that the matter could be revisited after Paramount’s experts were deposed. (Id.;
R. 145, Tr. of 10/29/14 Hr’g 47.)
Subsequently, on March 31, 2015, Image Media brought a renewed motion to bar the
$13,993,808 damages claim for a digital sign. In his memorandum opinion and order granting
the motion, Judge Cole found that Paramount was asserting a new damages theory based on
undisclosed facts. Expert discovery confirmed this; aside from Quas, Paramount’s experts were
2
This figure is $500 more than the corresponding figure set out in Paramount’s second
amended disclosures.
5
unaware of plans for a digital sign and were not asked to opine on the value of such a sign.
Judge Cole noted that Paramount offered no excuse for not having disclosed its “huge” digitalsign damages assertion until near the close of expert discovery:
[Paramount] does not say that when disclosures were made, it had not “fully
investigated” its case; but there can be no other explanation, and, under Rule
26(a)(1)(E), that’s unacceptable. If, as Paramount claims, it had the idea about a
digital sign all along, it’s even worse (and more indicative of intentional
concealment) that its disclosures failed to address the damages related to such a
sign. It had no problem, at the time, calculating damages for a static sign. The
evidence is clear: the claim for a digital sign is clearly new, a Trojan horse
smuggled in at the eleventh hour.
(R. 169, Mem. Op. & Order at 6.) Judge Cole also found that Paramount failed to show that its
untimely disclosure of a new damage theory was either substantially justified or harmless, as
required by Rule 37(c)(1). (Id. at 6-7.)
Paramount first contends that its damages computation for a digital billboard is not a
“bombshell” or “surprise” because “Quas’ opinion regarding the estimated revenue of a digital
billboard was disclosed well before the August 31, 2014 fact discovery cut-off.” (R. 183, Pl’s
Objection at 6.) Paramount asserts that the $13,993,808 claim was a “recalculat[ion] at a net
present value” and an “updated calculation of damages previously disclosed in Quas’ original
report.” (Id.) The Court rejects these characterizations. As Judge Cole correctly pointed out,
Quas’s reference in March to “a digital billboard space” was a “casual aside.” It was not a
computation and cannot even be called an “opinion.”
Quas used the noncommittal words
“could” and “should,” referred to a single “digital face,” not a double-faced structure, and
provided no indication whatsoever that plaintiff was claiming nearly $14 million in damages.
Paramount also contends that its damages calculation for a digital billboard “is an
alternative measure of compensatory damages and is relevant to punitive damages.” (Id. at 5.)
6
Paramount made a similar throwaway statement about punitive damages before Judge Cole and
continues to repeat it. But Paramount fails to explain, and the Court does not see how, the claim
for a digital billboard is “relevant to punitive damages.”
And whether the claim is an
“alternative measure of compensatory damages” is not the salient issue; it is whether this
computation was disclosed in a timely manner. It was not. This Court agrees with Judge Cole’s
“Trojan horse” assessment of Paramount’s claim. Although Paramount maintains that its claim
was “not new,” it cannot cite any point prior to the close of fact discovery at which it claimed
$13,993,808 or anything in that ballpark in damages. And it provides no excuse for this failure.
As Judge Cole stated, if Paramount “was able to do the calculation for static sign damages in a
timely fashion, it ought to have been able to provide a similar calculation for a digital sign.” (R.
169, Mem. Op. & Order at 5-6.) Pursuant to Rule 26(a)(1)(E), “[a] party is not excused from
making its disclosures because it has not fully investigated the case.”
Paramount’s disclosure of its damages computation based on a digital sign was untimely.
Therefore, it is barred from proceeding on its claim for that category of damages unless it can
show that its failure to timely supplement its disclosures was harmless or substantially justified.
Judge Cole concluded that with no explanation for what took so long, Paramount failed to show
substantial justification. (R. 169, Mem. Op. & Order at 6.) And Paramount did not argue that its
tardiness was harmless. (R. 154.) Paramount has also failed to explain to this Court what took
so long. As for harmlessness, Paramount presents a two-sentence argument that Image Media
“had ample opportunity to explore the updated calculation in expert discovery, through written
expert discovery and the deposition of Quas,” which took place after the October 2014
disclosures. (R. 183, Pl.’s Objection at 8.) But this argument fails to recognize that fact
discovery had closed two months prior to plaintiff’s disclosure, and defendants would
7
undoubtedly have pursued a great deal of discovery relating to the disclosure had it been made
during the fact-discovery period. It is no answer to say that defendants were able to depose Quas
about it. Paramount has not demonstrated an absence of prejudice to defendants stemming from
its inexcusable failure to comply with Rule 26. Judge Cole’s ruling was not clearly erroneous,
so the objection is overruled.
C.
Expert Testimony
On June 2, 2015, Judge Cole granted Image Media’s motion to bar Quas’s testimony and
that of another of Paramount’s experts, Rodolfo Aguilar, pursuant to Rules 26(a)(2)(B) and
37(c)(1). (R. 176.)
Rule 26 provides that the disclosure of a party’s expert witness’s identity must be
accompanied by a written report, prepared and signed by the witness, that must contain the
following:
(i) a complete statement of all opinions the witness will express and the basis and
reasons for them;
(ii) the facts or data considered by the witness in forming them;
(iii) any exhibits that will be used to summarize or support them;
(iv) the witness’s qualifications, including a list of all publications authored in the
previous 10 years;
(v) a list of all other cases in which, during the previous 4 years, the witness
testified as an expert at trial or by deposition; and
(vi) a statement of the compensation to be paid for the study and testimony in the
case.
Fed. R. Civ. P. 26(a)(2)(B). Failure to comply with these disclosure requirements results in
exclusion of the proffered witness, unless the failure was substantially justified or harmless, as
outlined above. See, e.g., Novak v. Bd. of Trs. of S. Ill. Univ., 777 F.3d 966, 972 (7th Cir. 2015).
8
1.
David Quas
Image Media moved to exclude Quas on the grounds that his amended report fails to
disclose that a third party named David Wiegman, and not Quas himself, is actually the author of
his opinions, and the report fails to disclose the factual bases for the estimate to construct
Paramount’s proposed sign. (R. 149 at 3.) After reviewing Quas’s deposition testimony and
concluding that he was no more than a “mouthpiece” for Wiegman, (R. 176, Mem. Op. & Order
at 3), who did the real work constructing a spreadsheet and calculating the present value of
future income for a billboard, Judge Cole granted Image Media’s motion.
Paramount maintains that Quas’s amended report complies with Rule 26 because Quas
provided some of the underlying data that was inputted into Wiegman’s spreadsheet and “did not
testify that all the work was done by” Wiegman. (R. 185, Pl’s Objection at 6.)3 In Paramount’s
view, Wiegman’s spreadsheet was “the ‘calculator’ [to] do the math, but the substance came
from Quas who has over 20 years of experience in the billboard industry.” (Id.) Paramount also
argues that Quas’s report “states his opinions and the basis for each of his opinions.” (Id. at 7.)
The Court disagrees. Quas’s report does not comply with Rule 26 because it fails to
provide the bases for Quas’s opinions and the facts and data considered by Quas and it fails to
disclose Wiegman’s role. Quas states merely that his “calculation was determined with the
assistance of a spreadsheet to perform a pro forma of projected revenues/expenses and net
income. The spreadsheet is accepted and commonly used within the industry to determine net
present value and is utilized, for example, by Clear Channel Outdoor.” He states that the
3
Although Paramount argues in a circular fashion that Image Media “cannot be said to be
harmed” because Quas’s report complied with Rule 26, it does not argue except in a conclusory
fashion in its reply that even if Quas’s report did not comply with Rule 26, the failure to comply was
substantially justified or harmless. (R. 185, Pl.’s Objection at 7; R. 198, Pl’s Reply at 5.)
9
calculation used an occupancy rate of seventy percent, “the industry average,” and that it took
inconsideration the expenses for the lease, electric, vinyl install, vinyl production and
construction” and “utilized a 5% interest rate to discount the net revenue to the net present
value,” and stops there. (R. 185-2, Am. Quas Report at 2-3.)
Attached to Quas’s report is a spreadsheet that shows the damages calculations for the
$3,611,673 net present value for a static billboard and $13,993,808 net present value for a digital
billboard. (Id. at 4-12.) At his deposition, Quas stated that he had never previously calculated,
by using a spreadsheet, the net present value of future income from a sign. (R. 185-3, Dep. of
David Quas 99-100.) When asked what the two numbers ($245,000 and $750,000) on the
spreadsheet that appear next to the “cashflow” amount represent, Quas testified that he did not
know. (Id. 72, 91.) Quas testified that Wiegman created the spreadsheet, chose the five percent
discount rate, and input the remainder of the data (such as construction costs and expenses),
which Quas gave him. (Id. 75-76, 94, 99-100.) Quas acknowledged that his report did not
disclose Wiegman’s involvement, the bases for the “construction cost” item in the spreadsheet,
or that Quas had relied upon (1) another of plaintiff’s experts, Gerald Page, to compute the
construction cost of a static billboard; (2) a 2012 quote for a digital billboard from a company
called Formetco to compute the construction cost of a digital billboard; or (3) the “Barclays Out
of Home Market Report” to calculate projected gross revenue.
(Id. 72-76, 81-83, 84-85.)
Moreover, Quas testified that when he stated that “[t]he spreadsheet is accepted and commonly
used within the industry to determine net present value,” he was not referring to the formulas
used in the spreadsheet and meant only that the Microsoft Excel program is accepted and
commonly used in the industry to create spreadsheets. (Id. 68-71.)
10
The Court agrees with Judge Cole that Quas did not simply base his opinion on
Wiegman’s work; rather, he adopted it and parroted Wiegman’s opinion. (R. 176, Mem. Op. &
Order at 5.) The fact that Quas supplied some of the data to Wiegman does not make the
calculations and opinion his own. Moreover, the amended report does not disclose where many
of the numbers come from that are considered in the calculation. And it is not sufficient for the
report (or plaintiff’s objection, for that matter) to simply cite Quas’s years of experience in the
billboard industry and leave it at that. Cf. Fed. R. Evid. 702 advisory committee’s note to 2000
amendments (“If the witness is relying solely or primarily on experience, then the witness must
explain how that experience leads to the conclusion reached, why that experience is a sufficient
basis for the opinion, and how that experience is reliably applied to the facts.”).
Paramount has not demonstrated that Judge Cole clearly erred in barring Quas’s
testimony.4 This objection is thus overruled.
2.
Rodolfo Aguilar
Paramount retained Rodolfo Aguilar (who is a real estate appraiser, architect, and
professional engineer) to provide an appraisal of the market value of a static billboard. (R. 1854, Aguilar Report at 2, 8.) Image Media moved to exclude Aguilar because he fails to provide in
his report a list of all publications he has authored in the past ten years and a list of all other
cases in which he testified as an expert at trial or by deposition in the past four years, as required
by Rule 26(a)(2)(B)(iv) and (v), and because the report fails to disclose the bases for Aguilar’s
4
Paramount contends that a “complete bar” of Quas’s testimony and amended report is not
warranted. (R. 185, Pl’s Objection at 7; R. 198, Pl.’s Reply at 5.) But Rule 37 allows the Court to
exclude the witness, not merely parts of his testimony or certain evidence, if the failure to comply
with Rule 26 is without substantial justification and not harmless. See Novak, 777 F.3d at 972; In
re Thomas Consol. Indus., Inc., 456 F.3d 719, 726 (7th Cir. 2006).
11
opinions and the facts or data considered in forming them, as required by Rule 26(a)(2)(B)(i) and
(ii). Judge Cole granted the motion.
Aguilar does not provide a list of cases in which he testified; rather, he merely provides
under the heading “Expert Witness Testimony” a list of judges and their chambers addresses
with no other information. (R. 185-4, Aguilar Report at 94-105.)5 Furthermore, he does not
provide a list of all publications he wrote in the past ten years, but only a list of “publications
and presentations in this field” (“this field” evidently referring to the valuation of billboards),
plus two older textbooks, a “monthly column,” and “sixty-one [unspecified] journal articles and
monographs.” (Id. at 91-92, 105.)
Paramount argues that Aguilar cannot provide case names because he “does not keep
track of that information” and that he has thus complied with Rule 26 “to the best of his ability.”
(R. 185, Pl.’s Objection at 7-8.) It submits that in the event the Court determines that Aguilar
has not complied with Rule 26, non-compliance was justified because “he has provided all the
information contained in his records.” (Id. at 8.) Although it was Aguilar’s testimony that he
does not keep information about cases in which he was deposed but did not testify at a hearing,
and not about all cases in which he participated, (R. 185-5, Dep. of Rodolfo Aguilar 24), the
Court will assume that Aguilar does not keep track of any case names.
Aguilar’s failure to keep records of the names of cases in which he has testified at trial or
deposition does not demonstrate substantial justification. See, e.g., Wallace v. Hounshel, No.
1:06-CV-01560-RLY-TAB, 2008 WL 2184907, at *3 (S.D. Ind. May 22, 2008) (rejecting the
5
At his deposition, Aguilar added that his list does not include judges presiding over cases
at which he provided deposition testimony but did not testify at any court proceeding. (R. 185-5,
Dep. of Rodolfo Aguilar 23-24.)
12
same argument and stating that “[i]gnoring the rule and allowing [defendants’ expert] to testify
would reinforce Defendants’ failure to follow the rules and would lower the bar for other
experts.”) (citing Norris v. Murphy, No. Civ. A. 00–12599–RBC, 2003 WL 21488640, at *3 (D.
Mass. June 26, 2003) (“An expert cannot deliberately put himself or herself in a position where
it is impossible to comply with a rule and then claim that he or she cannot comply. Self-induced
inability to comply with a rule is simply not justified.”) and Nguyen v. IBP, Inc., 162 F.R.D. 675,
681 (D. Kan. 1995) (“An expert’s failure to maintain records in the ordinary course of his
business sufficient to allow the disclosures to be made does not constitute ‘substantial
justification’ for the failure to provide required disclosures as to any retained expert expected to
testify at the trial of the case.”)). Paramount contends that the list of judges and their addresses
provided in Aguilar’s report is not “useless,” as Judge Cole found, because while knowledge of
the case names may lead to the discovery of inconsistent opinions, that “should not be a concern
here” because Aguilar is “providing an appraisal with respect to a specific site” and “prior
inconsistency should not be an issue.” (R. 185, Pl.’s Objection at 8.) Paramount’s view that
inconsistency “should not be a concern” is neither here nor there (not to mention something that
the Court would expect a party to say about its own expert).
As Judge Cole explained,
defendants are entitled to explore Paramount’s experts’ prior testimony to attempt to uncover
inconsistencies between the opinions they intend to express in this case and the opinions
expressed in other cases. See, e.g., Brown v. Overhead Door Corp., No. 06 C 50107, 2008 WL
1924885, at *1 (N.D. Ill. Apr. 29, 2008). Paramount does not get to pick and choose which of
Rule 26’s requirements it wishes to comply with, so its arguments are rejected.
Judge Cole also found that Aguilar’s testimony should be barred because Aguilar did not
disclose all the facts or data he considered in arriving at his conclusions. (R. 176, Mem. Op. &
13
Order at 8-11.) Aguilar’s “cost approach” analysis of market value involved a determination of
billboard construction costs, and Aguilar admitted at his deposition that although he had relied
on data that he has accumulated over the years in making this determination, he did not provide
that underlying data, nor did he have a record of what data he had relied upon. (R. 185-5,
Aguilar Dep. 95-97.) Moreover, when asked whether he had provided the underlying data,
Aguilar replied, “No. Please let me explain that I am an architect and also an engineer, so I have,
you know, some expertise in this.” (Id. 97.) As the Court explained with respect to Quas, an
expert cannot simply fall back on his experience when he acknowledges that he relied on
particular data in forming an opinion yet fails to disclose that information.
Paramount characterizes the bases on which Judge Cole excluded Aguilar as a witness as
“hyper-technicalities.” (R. 185, Pl’s Objection at 10.) The Court is unpersuaded. Judge Cole
did not clearly err in barring Aguilar, so the objection is overruled.
D.
Rebuttal Expert Reports
On June 10, 2015, Judge Cole granted Image Media’s motion to bar Aguilar’s rebuttal
report as well as that of Gerald Page, another of Paramount’s experts. (R. 182.) Judge Cole
agreed with Image Media that Paramount’s disclosure of the two rebuttal reports on April 24,
2015 violated the agreed-upon expert discovery schedule, which made no provision for rebuttal
reports, and that the reports were not genuine rebuttals. The Court will consider each issue in
turn. Paramount’s objection is moot with respect to Aguilar’s rebuttal, however, because the
Court has adopted Judge Cole’s recommendation to exclude Aguilar as an expert witness
altogether.
Rule 26(a)(2)(D) provides that “[a]bsent a . . . court order,” a party must make rebuttal
expert disclosures “within 30 days after the other party’s disclosure.” Although Paramount
14
served its rebuttal reports within this time period, Judge Cole ruled that they must be barred
because Paramount chose to leave the possibility of rebuttal reports unaccounted for in the
parties’ proposed scheduling order and it was bound by this “tactical decision” of its attorneys.
(R. 182, Mem. Op. & Order at 4-6.) In its response to Image Media’s motion, Paramount cited
decisions in which courts allowed the filing of rebuttal reports even though their discovery
schedule did not originally allow for them. Judge Cole distinguished all of them but one and
noted that the parties in most of those cases had not structured their own discovery. He declined
to
follow
the
remaining
decision,
McAtee
v.
Buca
Restaurants,
Inc.,
No.
1:10–cv–1090–SEB–DKL, 2011 WL 4861867 (S.D. Ind. Oct. 13, 2011), because it is not
binding and the court did not discuss all of the specific language of Rule 26(a)(2)(D).
In McAtee, the court denied the defendant’s motion to strike a rebuttal report that was
timely disclosed in accordance with Rule 26(a)(2)(D) and found that the report was a proper
rebuttal.
The court initially noted that “although the parties’ Case Management Plan set
deadlines for the parties’ initial disclosures and reports required under Rule 26(a)(2)(B), it did
not provide a deadline for disclosing rebuttal expert witnesses.” 2011 WL 4861867, at *1. The
court continued: “Absent a stipulation or a court order regarding the time at which a rebuttal
expert must be disclosed, Rule 26(a)(2)(D) provides that where ‘the evidence 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),’ such disclosures must be made ‘within 30 days after the other party’s
disclosure.’” Id. Because plaintiffs had disclosed their rebuttal witness within the thirty-day
period, the court reasoned that the only question was whether the testimony was truly a rebuttal.
Id.
15
The Court agrees with McAtee’s approach. There was no stipulation or court order in this
case regarding rebuttal reports. That might have been a tactical decision by counsel, but it
might have been an oversight. Furthermore, Rule 26 does not distinguish between cases in
which the parties proposed an expert discovery schedule and those in which the court entered its
own schedule.
That leaves the question of whether Gerald Page’s rebuttal report consisted of “evidence
[that] is intended solely to contradict or rebut evidence on the same subject matter identified” in
Image Media’s expert witness reports, Fed. R. Civ. P. 26(a)(2)(D)(ii), keeping in mind that
“[t]he rebuttal expert report is no place for presenting new arguments, unless presenting those
arguments is substantially justified and causes no prejudice.” Baldwin Graphic Sys., Inc. v.
Siebert, Inc., No. 03 C 7713, 2005 WL 1300763, at *2 (N.D. Ill. Feb. 22, 2005).
Page’s rebuttal, (R. 188-5), states that it is intended to respond to the report of Ted
Bratsos, who opines, among other things, that Paramount’s proposed sign as reflected on its
February 2014 Site Plan cannot be constructed as designed because the sign column would have
to “pass through” the overhanging eaves of the adjacent building. (R. 188-3, Bratsos Report at
2-3.) Judge Cole focused on the section of Page’s report that states as follows:
The placement of the column in relation to the building will be dictated by the
engineering design and the foundation of that design and this will place the steel
column itself outside of the building overhang. The steel pipe column is almost
always a smaller size than the concrete foundation itself and this will dictate the
placement. The building footing of the existing foundation will also be a factor
and those combined parameters will dictate the column placement.
(R. 188-5, Page Rebuttal Report at 1.) Page concludes, however, that “this entire sign structure
can be fabricated and constructed as designed, on this particular site, without any undue
16
influence on the existing building or foundation, and without affecting window sight lines,
ventilation, or building integrity.” (Id. at 2.)
The language in the block quote above is waffling, and, as Judge Cole correctly
concluded, a new opinion that contradicts Page’s ultimate conclusion. But instead of barring the
entire rebuttal report, the Court will strike the quoted paragraph.
Accordingly, the Court
overrules in part and sustains in part Paramount’s objection to the ruling barring the rebuttal
expert report of Gerald Page. The third paragraph of Page’s rebuttal report is stricken, but the
remainder of the report is not barred.
E.
“Animus”
As a final matter, the Court must address the statement made by Paramount’s counsel in
one of its objections that Judge Cole “appears to have an animus against Paramount and its
attorneys, which, respectfully, is unwarranted.” (R. 185, Pl.’s Objection at 8.) It is counsel’s
statement that is unwarranted. Counsel provide no reasoning and no evidence for their assertion;
they simply insinuate an “animus” from the fact that Judge Cole has repeatedly ruled against
them.
“‘Allegations of judicial bias are very serious and should never be cast without
substantiation.’” City of Chicago v. Matchmaker Real Estate Sales Ctr., Inc., 982 F.2d 1086,
1101 (7th Cir. 1992) (quoting Matter of Wade, 969 F.2d 241, 243 n.1 (7th Cir. 1992)). “Adverse
rulings do not demonstrate bias.” Messner v. Calderone, 447 F. App’x 725, 725-26 (7th Cir.
2011) (citing Liteky v. United States, 510 U.S. 540 (1994)). Paramount’s assertion of bias is
frivolous.
CONCLUSION
For the reasons explained above, the Court overrules plaintiff’s objections [183, 185] to
Magistrate Judge Cole’s May 28, 2015 memorandum opinion and order and June 2, 2015
17
memorandum opinion and order and overrules in part and sustains in part plaintiff’s objection
[188] to the June 10, 2015 memorandum opinion and order.
SO ORDERED.
ENTERED:
September 10, 2015
__________________________________
JORGE L. ALONSO
United States District Judge
18
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?