Radiologix, Inc. et al v. Radiology and Nuclear Medicine, LLC

Filing 333

MEMORANDUM AND ORDER granting 303 Motion to Exclude Report and Testimony of Gregory M. Kusiak. Signed by District Judge Daniel D. Crabtree on 02/26/2018. (mig)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
RADIOLOGIX, INC. and RADIOLOGY
AND NUCLEAR MEDICINE IMAGING
PARTNERS, INC.,
Plaintiffs,
v.
Case No. 15-4927-DDC-KGS
RADIOLOGY AND NUCLEAR
MEDICINE, LLC,
Defendant.
_____________________________________
MEMORANDUM AND ORDER
This case involves a breach of contract dispute. Plaintiff Radiologix is a national
provider of imaging services based in California. Defendant RNM is a Kansas limited liability
company and physician-owned radiology practice based in northeast Kansas. Since 1997,
plaintiff Radiologix (or one of its predecessors-in-interest) has provided management services to
defendant RNM under a long-term management service agreement.
In 2002, plaintiffs and defendant executed an Amended and Restated Service Agreement
(“Agreement”). Under this Agreement, plaintiffs agreed to provide certain management services
to defendant in exchange for specified fees. The parties agreed to a 40-year term for the
Agreement’s duration. But, in 2014, defendant terminated the Agreement for cause because,
defendant contends, plaintiffs had defaulted materially on their obligations under the Agreement
and thus provided cause to terminate.
In response, plaintiffs filed this lawsuit. They assert three claims: (1) breach of contract,
(2) conversion, and (3) unjust enrichment. Defendant responded to plaintiffs’ Complaint by
asserting a Counterclaim for breach of contract. On November 2, 2017, the court denied cross

motions for summary judgment filed by both parties. Doc 300. Plaintiffs had moved for
summary judgment against defendant’s claim that the parties’ contracts were void and
unenforceable under Kansas law. Defendant also had moved for summary judgment against
plaintiffs’ claims, asserting that the parties’ contracts violate Kansas law. The court disagreed
with defendant. Instead, the court found, the undisputed facts demonstrated that the parties’
contracts did not violate Kansas’s prohibitions against the corporate practice of medicine and
illegal fee splitting. So, the court granted plaintiffs’ summary judgment motion against
defendant RNM’s claims and defenses that the contracts are illegal and unenforceable under
Kansas law, and thus provide defendant RNM a valid, legal basis for terminating the parties’
management service agreement. But the court denied plaintiffs’ other arguments supporting
summary judgment against RNM’s breach of contract claim because, it concluded, genuine
issues of material fact exist that the trier of fact must decide. So, the trier of fact will decide the
remaining issues at a trial scheduled to begin on March 6, 2018.
Anticipating that trial, plaintiffs have filed a Motion to Exclude Report and Testimony of
Gregory M. Kusiak (Doc. 303). Plaintiffs assert that the court should exclude Mr. Kusiak’s
opinions because they are: (1) irrelevant opinions about industry standards and customs; (2)
impermissible legal conclusions about the meaning of an unambiguous contract; or (3) subjective
opinions about the fairness of the contract at issue in this case. For these reasons, plaintiffs
contend, the court should exclude Mr. Kusiak’s expert report and testimony under Fed. R. Evid.
702 because his opinions “will not help the trier of fact to understand the evidence or to
determine a fact in issue.” Fed. R. Evid. 702(a). The court agrees. It thus grants plaintiffs’
Motion to Exclude Report and Testimony of Gregory M. Kusiak (Doc. 303). It explains why,
below.

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I.

Factual Background
To support defendant’s breach of contract claim against plaintiffs in this lawsuit,

defendant has designated Gregory M. Kusiak as an expert witness. On August 31, 2016, Mr.
Kusiak provided a Preliminary Expert Report. Doc. 304 at 21–25. It recites that Mr. Kusiak has
formed opinions after reviewing documents and contracts at issue in this case. These
preliminary opinions include whether the Service Fee that defendant RMN agreed to pay under
the parties’ Agreement was “reasonably related” to the services plaintiffs provided. Id. at 23.
Mr. Kusiak’s opinions also address whether certain provisions in the parties’ Agreement are
“unusual” or differ from what he believes is “customary” for traditional practice management
agreements. Id. at 24–25. Mr. Kusiak also opines that the Agreement contains several
provisions that are “legal ‘red flags.’” Id. at 23. Specifically, his Preliminary Report recites:
3.
In my opinion, several provisions in the Service Agreement are
legal “red flags.” First, the Service Agreement does not permit RNM to select the
individuals who would fill key positions in its practice management, such as the
practice manager. It is customary in the practice management industry for a
management company to employ the practice manager, but the physician group
should have decisionmaking authority regarding the individual who will fill that
position.
4.
The next legal “red flag” I identified in the Service Agreement is
the handling of the operating and capital budgets in Section 3.5 of the Service
Agreement, under which RNM’s operating and capital budgets are subject to
review, modification, and approval by the Radiologix board of directors, and any
disagreement regarding those budgets default to Radiologix and the nonprofessional members of the Joint Planning Board for decision. It is customary in
the practice management industry, and essential for a successful radiology
practice, for the medical practice professionals to hold final decision-making
authority regarding its budgets.
...
6.
Another legal “red flag” is the managed care contracting provision
in Section 3.7 of the Service Agreement. Under that provision, if any of RNM’s
managed care contracts are determined to “affect” a “contract relationship” with
any other group to which Plaintiffs or any of their affiliates provide management
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services, then physicians from other practices may vote to approve, disapprove,
terminate or amend RNM’s managed care contract. This provision that allows
outside individuals to make decisions regarding RNM’s contracts over RNM’s
objection is highly unusual and may present a variety of legal problems, including
potential antitrust problems.
...
11.
The service fee provided for in the Service Agreement is not
related to the services Plaintiffs provide under the Service Agreement and is
significantly inflated. In my opinion, the only purpose of such a service fee is to
provide Plaintiffs with a means to siphon professional revenues from a Kansas
medical practice.
Id. at 23–25.
On February 6, 2017, Mr. Kusiak completed his Final Expert Report. Doc. 304 at 26–41.
The Final Report removed the references to “legal red flags” that the Preliminary Report
contained. But, otherwise, the Final Report’s substance is similar to the Preliminary Report. It
continues to opine that the parties’ Agreement “differs from a traditional practice management
agreement in significant and material ways.” Id. at 27. Mr. Kusiak’s Report describes several of
these purported differences:
a.
The Service Agreement prohibits RNM from taking any action or
implementing any decision that would have a “material adverse effect” on the
amount of Administrator’s management fee or Administrator’s financial interests.
b.
The Service Agreement requires RNM to consult with nonphysicians – the Plaintiffs and non-physician members of the Joint Planning
Board – in making decisions to increase or decrease the number of physicians in
the practice. The Service Agreement and the Employment Agreements between
RNM and its employed radiologists (the “Employment Agreement”) also grant
Plaintiffs control over aspects of physician employment. Such an arrangement is
highly unusual in a practice management contract.
c.
The Service Agreement does not permit RNM to select the
individuals who would fill key positions in its practice management, such as the
practice manager. It is customary in the practice management industry for a
management company to employ the practice manager, but the physician group
should have decision-making authority regarding the individual who will fill that
position.
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d.
RNM’s operating and capital budgets are subject to review,
modification and approval by the Radiologix board of directors, and any
disagreement regarding those budgets default to Radiologix and the nonprofessional members of the Joint Planning Board for decision. It is customary in
the practice management industry, and essential for a successful radiology
practice, for the medical practice professionals to hold final decision-making
authority regarding its budgets.
e.
Under § 3.7 of the Service Agreement, if any of RNM’s managed
care contracts are determined to “affect” a “contract or relationship” with any
other group to which Plaintiffs or any of their affiliates provide management
services, then physicians from other practices may vote to approve, disapprove,
terminate or amend RNM’s managed care contract. This provision that allows
outside individuals to make decisions regarding RNM’s contracts over RNM’s
objections is highly unusual and may present a variety of legal problems,
including potential antitrust problems.
f.
It is highly unusual in the practice management industry for a
practice manager to purchase a physician practice’s accounts receivable on a daily
basis. It is much more common, and more reflective of an appropriate superiorsubordinate relationship, for the ownership of the accounts receivable to remain
with the professional practice. The physician group then pays the practice
management company its fee. Under the Service Agreement, Plaintiffs collect all
fees and then pay “retention” to the physician group.
g.
Under the Service Agreement, Plaintiffs treat 100% of RNM’s
professional fees as their own top-line revenue and treat payments to the
physician group as an expense. This is highly unusual in the practice
management industry and has the practical effect of simply inflating Plaintiffs’
revenue numbers to make them more attractive for investors.
h.
It is customary in the medical field for a physician or physician
practice to set their own fees for services and to hold decision making authority
regarding payer contracts. The Service Agreement vests such decision making
authority in Plaintiffs, requiring only “appropriate consultations” with RNM.
Id. at 27–29. Mr. Kusiak also opines that the Agreement gives plaintiffs control over RNM’s
practice:
In my opinion, the structure of the Service Agreement, is designed to, and does,
give Plaintiffs control over nearly all aspects of RNM’s practice. Such an
agreement differs significantly from a traditional management agreement where
support is provided to multiple aspects of the practice, but a bright line is drawn
between management duties and professional prerogatives.
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Id. at 29. And, Mr. Kusiak provides several opinions about the Agreement’s Service Fee and
how he believes the fee is not reasonably related to the services plaintiffs provided. These
opinions include:
3.
The service fee provided in the Service Agreement is not
reasonably related to the services provided by RDLX and RNMIP (collectively
“Plaintiffs”) in the Service Agreement. The service fee is significantly higher
than the value of the services provided.
4.
A radiology practice with professional-only billing (no global
billing) should expect to pay 6–7% of its collections for professional billing and
collection services. In addition to those services, a radiology practice should
expect to pay additional amounts for a practice manager. In total, a radiology
practice should expect to pay 10% of its collections for billing and management
services.
5.
The Service Agreement contains provisions under which certain
circumstances trigger an obligation of the parties to “meet and confer” to discuss
the terms of the Service Agreement and the fees thereunder. Notably, a decision
by Plaintiffs to sell the assets of the imaging center that existed at the time of the
Acquisition does not trigger such an obligation. Selling the assets of the imaging
center would effect a significant change in the relationship of the parties and the
obligations of each under the Service Agreement. The fact that this situation does
not trigger a meet and confer obligation, in my opinion, is further evidence that
the fees under the Service Agreement are not tied to the services provided
thereunder.
6.
The service fee provided for in the Service Agreement is not
related to the services Plaintiffs provide under the Service Agreement and is
significantly inflated. In my opinion, the only purpose of such a service fee is to
provide Plaintiffs with a means to siphon professional revenues from a Kansas
medical practice.
Id. at 29–30. After listing his opinions, the remainder of Mr. Kusiak’s Final Expert Report
explains the reason for his opinions in more detail. Mr. Kusiak first describes the reasons he
believes the parties’ Agreement “is not a Standard Management Contract.” Id. at 30–36. He
next explains why he believes the Agreement’s “Service Fee is Unrelated to the Services
Provided.” Id. at 36–38.

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When Mr. Kusiak was deposed in this lawsuit, he affirmed that he formed his opinions by
examining documents and contracts at issue in the case. Doc. 304 at 45 (Kusiak Dep. 169:10–
170:15). Mr. Kusiak conceded that he has not “looked at any of the facts of what actually
happened in carrying out or executing” the Agreement. Id. (Kusiak Dep. 169:21–170:1).
Instead, Mr. Kusiak agreed that his “opinions are strictly interpreting the contract in isolation.”
Id. (Kusiak Dep. 170:13–15).
Plaintiffs’ motion asks the court to exclude Mr. Kusiak’s expert report and testimony
under Fed. R. Evid. 702 because, they contend, his opinions “will not help the trier of fact to
understand the evidence or to determine a fact in issue.” Fed. R. Evid. 702(a). The court
considers plaintiffs’ request in the analysis, below.
II.

Legal Standard
The court has a “gatekeeping obligation” to determine the admissibility of expert

testimony. Kumho Tire Co. v. Carmichael, 526 U.S. 137, 147 (1999) (citing Daubert v. Merrell
Dow Pharm., Inc., 509 U.S. 579, 589 (1993)). When performing this gatekeeping role, the court
has broad discretion when deciding whether to admit expert testimony. Kieffer v. Weston Land,
Inc., 90 F.3d 1496, 1499 (10th Cir. 1996) (quoting Orth v. Emerson Elec. Co., 980 F.2d 632, 637
(10th Cir. 1992)). The admissibility of expert testimony is governed by Federal Rule of
Evidence 702. It provides:
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
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(d) the expert has reliably applied the principles and methods to the facts
of the case.
Fed. R. Evid. 702.
This court must apply a two-part test to determine admissibility. Conroy v. Vilsack, 707
F.3d 1163, 1168 (10th Cir. 2013). First, the court must determine “whether the expert is
qualified ‘by knowledge, skill, experience, training, or education’ to render an opinion.” United
States v. Nacchio, 555 F.3d 1234, 1241 (10th Cir. 2009) (quoting Fed. R. Evid. 702). Second,
the court “‘must satisfy itself that the proposed expert testimony is both reliable and relevant, in
that it will assist the trier of fact, before permitting a jury to assess such testimony.’” Id.
(quoting United States v. Rodriguez-Felix, 450 F.3d 1117, 1122 (10th Cir. 2006)) (further
citations omitted).
To qualify as an expert witness, the witness must possess “such skill, experience or
knowledge in that particular field as to make it appear that his opinion would rest on substantial
foundation and would tend to aid the trier of fact in his search for truth.” LifeWise Master
Funding v. Telebank, 374 F.3d 917, 928 (10th Cir. 2004) (internal quotation omitted). To
determine whether the expert’s testimony is reliable, the court must assess “whether the
reasoning or methodology underlying the testimony is scientifically valid and . . . whether that
reasoning or methodology properly can be applied to the facts in issue.” Daubert, 509 U.S. at
592–93.
In Daubert, the Supreme Court identified four factors—though not exhaustive-that trial
courts may consider when determining reliability of proffered expert testimony under Fed. R.
Evid. 702. They are: (1) whether the theory used can be and has been tested; (2) whether it has
been subjected to peer review and publication; (3) the known or potential rate of error; and (4)

8

general acceptance in the scientific community. Id. at 593–94. The Supreme Court has
emphasized, however, that these four factors are not a “definitive checklist or test,” and that a
court’s gatekeeping inquiry into reliability “must be tied to the facts of a particular case.”
Kumho Tire, 526 U.S. at 150.
But in some cases, “the relevant reliability concerns may focus upon personal knowledge
or experience,” rather than the Daubert factors and scientific foundation. Id. For such testimony
to satisfy the reliability standard, it “must be ‘based on actual knowledge, and not mere
“subjective belief or unsupported speculation.”’” Pioneer Ctrs. Holding Co. Emp. Stock
Ownership Plan & Trust v. Alerus Fin., N.A., 858 F.3d 1324, 1341–42 (10th Cir. 2017) (quoting
Mitchell v. Gencorp, Inc., 165 F.3d 778, 780 (10th Cir. 1999) (quoting Daubert, 509 U.S. at
590)). “When expert opinion ‘is not supported by sufficient facts to validate it in the eyes of the
law, or when indisputable record facts contradict or otherwise render the opinion unreasonable, it
cannot support a jury’s verdict’ and will be excluded.” Id. at 1342 (quoting Brooke Grp. Ltd. v.
Brown & Williamson Tobacco Corp., 509 U.S. 209, 242 (1993)).
“The proponent of expert testimony bears the burden of showing that the testimony is
admissible.” Conroy, 707 F.3d at 1168 (citing Nacchio, 555 F.3d at 1241). “[R]ejection of
expert testimony is the exception rather than the rule.” Fed. R. Evid. 702 advisory committee
notes. While Daubert requires the court to serve as a gatekeeper for expert testimony,
“[v]igorous cross-examination, presentation of contrary evidence, and careful instruction on the
burden of proof” remain “the traditional and appropriate means of attacking shaky but admissible
evidence.” Daubert, 509 U.S. at 596 (citation omitted).
The court has discretion to determine how to perform its gatekeeping function under
Daubert. Goebel v. Denver & Rio Grande W. R.R., 215 F.3d 1083, 1087 (10th Cir. 2000). “The

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most common method for fulfilling this function is a Daubert hearing, although such a process is
not specifically mandated.” Id. (citations omitted). In this case, the parties do not request a
hearing. And after reviewing the exhibits filed with the motions carefully, the court finds that
this review provides a sufficient record to render a decision without a hearing.
III.

Analysis
Plaintiffs provide three reasons for the court to exclude Mr. Kusiak’s expert report and

testimony. First, plaintiffs assert that Mr. Kusiak’s opinions about industry standards and
customs are irrelevant to the parties’ remaining claims and defenses in this lawsuit. Second,
plaintiffs argue that Mr. Kusiak’s opinions are impermissible legal conclusions about the
meaning of an unambiguous contract. Finally, plaintiffs contend that Mr. Kusiak cannot testify
about the purported “fairness” of the parties’ Agreement. Plaintiffs assert these three reasons
render Mr. Kusiak’s projected testimony not helpful to the trier of fact. And thus, plaintiffs
contend, the court should exclude them under Fed. R. Evid. 702. The court considers each of the
three reasons, in turn, below.
A. Mr. Kusiak’s Opinions are Irrelevant to the Remaining Issues in the Case.
Plaintiffs assert that the court should exclude Mr. Kusiak’s opinions as irrelevant for
three subsidiary reasons. First, plaintiffs argue, to the extent Mr. Kusiak’s opinions address the
legality of the parties’ Agreement, the court already has decided, as a matter of law, that the
Agreement does not violate Kansas’s prohibition against the corporate practice of medicine or
illegal fee splitting. So, Mr. Kusiak’s opinions that the Agreement conferred decision-making
authority or control to plaintiffs over defendant RNM’s practice and his opinions that the
Agreement’s Service Fee is not related to the services plaintiffs provided (thus amounting to a
means to “siphon” professional revenues from a Kansas medical practice) are not relevant to the

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issues remaining for trial. The court agrees with plaintiffs. These opinions address the legality
of the Agreement under Kansas law—an issue assigned to the court and, indeed, one that the
court already has decided on summary judgment as a matter of law.1 These opinions are not
relevant to the issues remaining for trial—i.e., whether plaintiffs breached the Agreement by
defaulting materially on their obligations or whether defendant breached the Agreement by
terminating the contract without cause. The court thus concludes that Mr. Kusiak’s opinions
about the Agreement’s delegation of decision-making authority or control or his opinions about
the Service Fee’s relation to the services plaintiffs provided under the Agreement are not helpful
to the trier of fact’s ability to decide the remaining issues in the case.
Second, plaintiffs assert that Mr. Kusiak’s testimony about the “usual” or “customary”
structure of practice management agreements is not relevant to the Agreement that the parties
specifically adopted as their contract. The court also agrees with this argument. Our court has
held unequivocally that, “in the absence of an ambiguous contract provision, evidence of
industry custom is simply irrelevant and properly excluded pursuant to Rule 702 and Daubert.”
Hutton Contracting Co. v. City of Coffeyville, No. 02-4130-JAR, 2004 WL 2203449, at *12 (D.
Kan. Sept. 24, 2004) (first citing Questar Pipeline Co. v. Grynberg, 201 F.3d 1277, 1288 (10th

1
Defendant makes the perplexing assertion that its claim “that the fees paid under the Service
Agreement amounted to illegal fee-splitting are still alive in this case.” Doc. 308 at 9. It’s not.
The court’s summary judgment Order explicitly concluded that the Agreement’s Service Fee
provision does not violate Kansas’s prohibition against fee-splitting. Doc. 300 at 67–70. Defendant takes
out of context the court’s acknowledgement that “even if the 15% Service Fee constituted illegal-fee
splitting, this finding would not void the 2002 Amended Service Agreement” because the Agreement
includes provisions requiring the parties to modify or sever portions of the contract that are deemed
illegal, invalid, or unenforceable. Id. at 70. The court’s observation in this passage simply provided
another reason for the court to conclude that the Agreement is not void under Kansas law. But the court’s
acknowledgment never left open the issue of fee-splitting. Instead, the court specifically entered
“judgment as a matter of law against all of RNM’s claims and defenses claiming that the parties’
contracts are illegal and void under Kansas law.” Id. So, Mr. Kusiak’s opinions about fee-splitting are
not relevant at trial. These opinions also amount to legal conclusions, and the court excludes them for
that reason as well. See supra Part III.B.

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Cir. 2000) (where expert testimony was extrinsic evidence contradicting the plain language of
the contract, the testimony was properly stricken); then citing Emp’rs Reinsurance Corp. v. MidContinent Cas. Co., 202 F. Supp. 2d 1212, 1217 (D. Kan. 2002)).
Although a court may admit expert testimony about standard industry practices to help a
fact-finder interpret an ambiguous contract, see id. (citing Havens v. Safeway Stores, 678 P.2d
625, 629 (Kan. 1984)), defendant here never asserts that the Agreement at issue here contains
any ambiguity. Instead, “where the contract is clear and complete,” like the Agreement here is,
“it cannot be changed or supplemented by evidence of prevailing industry practice.” Id. Thus,
expert opinion testimony about usual or customary practices in the industry is irrelevant to the
issues remaining for trial. See id. (excluding proffered expert testimony opining about “the
norm” in contracting work and was based on the expert’s experience in the “construction
contract arena” but not “knowledge of the actual project” at issue in the lawsuit because the
expert testimony “focus[ed] not on the Contract, but instead on industry custom”).
As plaintiffs argue, the trier of fact must decide in this case whether the parties performed
the obligations that the Agreement imposed on them. Whether those obligations differed from
the terms found in a “usual” or “customary” practice management contract is not relevant to the
dispute here. The parties agreed to the terms of this Agreement—not some other agreement that
Mr. Kusiak contends is the “usual” or “customary” structure for practice management
agreements. Simply, the contract is the contract.
Also, this Agreement may differ significantly from other “usual” or “customary” practice
management agreements depending on whether such other agreements included the payment of
consideration for entering a long-term management contract. Here, the summary judgment facts
established that the physician members and shareholders of the radiology practice management

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group received “Merger Consideration” of some $14 million as consideration for entering the
parties’ original practice management agreement for a term of 40 years. Doc. 300 at 8. So,
testimony about other agreements, none of which are issue in this case and perhaps different
significantly from the Agreement, will serve only to distract and confuse the jury. The court thus
excludes Mr. Kusiak’s opinions about the “usual” or “customary” structure of practice
management agreements.
Finally, plaintiffs assert that Mr. Kusiak’s opinion about the Agreement’s Service Fee—
i.e., it was higher than the fees usually established in practice management agreements—is not
relevant to defendant’s damages claim. The court agrees Mr. Kusiak’s opinions about
defendant’s alleged damages are not relevant because, as he concedes, he has no knowledge
about the parties’ performance under the Agreement. Defendant’s damages claim “seek[s] to
recoup amounts collected by Plaintiffs under the Service Agreement that exceeded the fair
market value of the services that Plaintiffs provided.” Doc. 227 at 41. Defendant estimates its
damages as excess services that it paid by using “the difference between the 15 percent service
fee collected by Plaintiffs from RNM [under the Agreement] and the fair market value of the
services provided calculated at 7 percent of RNM’s professional revenues[ ].” Id. at 41–42. But,
Mr. Kusiak concedes, he has no knowledge about the value of the services plaintiffs actually
provided to defendant under the Agreement. Indeed, Mr. Kusiak testified that he does not know
the facts about how the parties executed the Agreement. Doc. 304 at 45 (Kusiak Dep. 169:21–
170:1). Instead, Mr. Kusiak agreed that his “opinions are strictly interpreting the contract in
isolation.” Id. (Kusiak Dep. 170:13–15).
Defendant counters, asserting that Mr. Kusiak’s testimony about customary service fees
will help the trier of fact evaluate defendant’s damages. Defendant contends that Mr. Kusiak

13

will provide testimony about the fair market value for basic billing and administrative services—
which is what defendant contends it received after 2010. But defendant never identified Mr.
Kusiak as a damages expert. Instead, Mr. Kusiak testified that he was asked to opine “whether
this is a traditional management relationship or how it differs from a traditional management
relationship.” Doc. 308-3 at 3 (Kusiak Dep. 39:16–22). Mr. Kusiak also admitted that he is not
a valuation expert and testified that he would not provide valuation opinion testimony in the
case. Doc. 219 at 11 (Kusiak Dep. 142:11–17). Nor could he provide a valuation of the services
that plaintiffs actually provided because he knows no facts about plaintiffs’ performance under
the Agreement. Instead, Mr. Kusiak’s opinions only address what he believes a radiology
practice should pay for practice management services. Such opinions are irrelevant to the issues
that the trier of fact must decide here—i.e., whether the parties satisfied their obligations that
they specifically agreed to perform when they entered the Agreement.
B. Mr. Kusiak’s Opinions Include Improper Legal Conclusions.
Plaintiffs also assert that Mr. Kusiak’s opinions include improper legal conclusions. An
“expert’s testimony is proper under Rule 702 if the expert does not attempt to define the legal
parameters within which the jury must exercise its fact-finding function.” Specht v. Jensen, 853
F.2d 805, 809–10 (10th Cir. 1988). But the court must exclude testimony when “the purpose of
testimony is to direct the jury’s understanding of the legal standards upon which their verdict
must be based.” Id. at 810. “[T]estimony which articulates and applies the relevant law . . .
circumvents the jury’s decision-making function by telling it how to decide the case.” Id. at 808.
So, “[w]hile testimony on ultimate facts is authorized under [Federal Rule of Evidence] 704,” an
expert “may not give opinions on ultimate issues of law.” See id. at 808 (emphasis added).

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Here, Mr. Kusiak’s opinions interpreting various provisions of the Agreement, ones
asserting that the Agreement violates the law, are improper legal conclusions. Indeed, Mr.
Kusiak’s Preliminary Report identified several provisions of the contract that he characterized as
“legal red flags” in the way that the Agreement delegated decision-making and control among
the parties. Although Mr. Kusiak’s Final Report removed the references to “legal red flags,” his
Report still includes his opinions about the Agreement’s provisions that, he contends, improperly
delegate control—provisions that he previously had identified as “legal red flags.” The court
excludes these improper legal conclusions.
Defendant asserts that Mr. Kusiak’s opinions are not improper legal conclusion but,
instead, permissible expert testimony about business terms and common practices in the
radiology industry. To support this argument, defendant relies on Ji v. Bose Corp., 538 F. Supp.
2d 354 (D. Mass. 2008). Ji involved a dispute about the contractual effect of two documents that
a model signed on the day of a photography shoot. Id. at 356. Both parties proffered experts to
testify about the contracts at issue. Id. The court held admissible the experts’ opinions about
standard industry practices for models signing releases like the ones at issue in the case. Id. at
358, 360. The court also found that the experts’ testimony about extraneous evidence would
help the jury interpret ambiguous contract terms. Id. at 360. But the court prohibited the experts
from testifying about the legal effect of each document the model had signed because such
opinions amounted to inadmissible legal conclusions. Id. at 358, 359. Unlike Ji’s experts, Mr.
Kusiak’s proffered testimony will not help the jury to understand extraneous evidence necessary
to interpret ambiguous contract terms. Instead, Mr. Kusiak opines about the legal effect of
certain provisions in the Agreement. And, like Ji, the court must exclude these opinions because
they are improper legal conclusions. See id. See also Koch v. Koch Indus., Inc., 2 F. Supp. 2d

15

1385, 1400 n.4 (D. Kan. 1998) (“[E]xpert opinion testimony to interpret contract language is
inadmissible” unless a need exists “to clarify or define terms of art, science, or trade.” (citations
and internal quotation marks omitted)).
C. Mr. Kusiak Cannot Testify about the Fairness of the Agreement.
Last, to the extent Mr. Kusiak opines that the Agreement was not fair to defendant, such
opinions are inadmissible. See, e.g., Cimarron Feeders v. Bolle, 17 P.3d 957, 965 (Kan. Ct. App.
2001) (holding that the trial court erred by allowing an expert to testify whether an agreement
was fair because “the normal experience possessed by jurors should permit them to determine
whether a particular agreement is ‘fair’ or not.”). Here, two sophisticated parties entered into an
Agreement requiring plaintiffs to provide practice management services in exchange for
defendant’s payment of a Service Fee. The trier of fact need not decide whether the terms of that
Agreement are fair. Instead, it merely needs to decide whether the parties breached their
obligations that Agreement. Mr. Kusiak’s opinions will not help the jury make that
determination.
IV.

Conclusion
The court finds that Mr. Kusiak’s Expert Report and proposed testimony consist of

opinions that are not helpful to the trier of fact to decide the remaining issues in the case. Mr.
Kusiak’s opinions either are irrelevant to the claims and defenses remaining for trial, improper
legal conclusions, or inadmissible testimony about the fairness of the parties’ Agreement—one
that is unambiguous and was entered by sophisticated parties knowingly and voluntarily.
Because Mr. Kusiak offers no other expert opinions that are relevant to the issues left for trial,
the court excludes his Expert Report and testimony in their entirety. And for this reason, the
court grants plaintiffs’ Motion to Exclude.

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IT IS THEREFORE ORDERED BY THE COURT THAT plaintiffs Radiologix, Inc.
and Radiology and Nuclear Medicine Imaging Partners, Inc.’s Motion to Exclude Report and
Testimony of Gregory M. Kusiak (Doc. 303) is granted.
IT IS SO ORDERED.
Dated this 26th day of February, 2018, at Topeka, Kansas.
s/ Daniel D. Crabtree
Daniel D. Crabtree
United States District Judge

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