MAINE MEDICAL CENTER v. WILLIAM A BERRY & SON INC et al
ORDER granting in part and denying in part 130 Defendants' Joint Motion to Exclude Supplemental Expert Disclosure By JUDGE JON D. LEVY. (akr)
UNITED STATES DISTRICT COURT
DISTRICT OF MAINE
MAINE MEDICAL CENTER,
WILLIAM A. BERRY & SON, INC., )
PHOENIX BAY STATE
CONSTRUCTION, et al.,
ORDER ON DEFENDANTS’ JOINT MOTION TO EXCLUDE
SUPPLEMENTAL EXPERT DISCLOSURE
Plaintiff Maine Medical Center (“MMC”) submitted a supplemental expert
disclosure for Gus Doughty, one of its designated expert witnesses, on January 17,
2017. Defendants have moved to exclude the supplemental disclosure as untimely
under Federal Rules of Civil Procedure 26(e)(2) and 37(c). ECF No. 130.
This case arises out of alleged defects in the construction of Maine Medical
Center’s East Tower. MMC asserts that the Defendants, who were involved in the
initial design and construction of the East Tower, are liable for the costs associated
with fixing these defects. The parties have completed nearly all of the discovery, and
the Defendants and Third-Party Defendants have filed notice with the Court of their
intent to seek summary judgment.
Gus Doughty has been designated as an expert by MMC to offer his opinion on
the construction costs associated with the repairs to the East Tower. In accordance
with the Court’s scheduling order, MMC submitted its initial disclosures of its experts
in June 2016. At that time, MMC was claiming approximately 5 million dollars in
construction damages, and approximately 23 million dollars in lost revenue damages.
The lost revenue damage figure was based on a plan to fix the defects in the East
Tower by closing and renovating a few patient rooms at a time over the course of a
93-week construction schedule, so as to minimize impacts on patient care.
In November 2016, the MMC personnel involved with this litigation realized
that MMC needed to amend its damages theory after they consulted with Heidi
Morin, MMC’s Patient Care Service Director for the East Tower. Morin vehemently
objected to any construction plan that would involve the temporary closure of patient
rooms. As a consequence of that meeting, MMC developed a new remediation plan
that involves moving patient rooms to two new floors that MMC plans to add to the
East Tower. The two new floors will be constructed as part of an ongoing expansion
of the hospital unrelated to the construction that is the subject of this lawsuit. MMC
asserts that none of its personnel involved with this litigation was aware of the
unrelated plan to construct these two new floors at the time that MMC formulated
its initial remediation plan, and maintains that the initial remediation plan was the
best option available at the time.
The revised remediation plan calls for outfitting the two new floors to allow
them to house patients from the East Tower during construction, to be followed by
retrofitting those floors so that they will serve their original purpose once the
remediation of the East Tower is completed. This proposed construction is forecast
to cost approximately 16 million dollars, and the supplement to Doughty’s expert
disclosure describes those costs. MMC notified the Defendants in an email sent to
them in the days following the November 2016 meeting that it anticipated changes
to its damages claim, though it did not disclose the scope of those changes until it
submitted its supplement to Doughty’s expert disclosure on January 17, 2017.
II. LEGAL ANALYSIS
Defendants argue that MMC’s supplement to Doughty’s expert testimony is
not timely because it does not qualify as a supplement under Federal Rule of Civil
Procedure 26(e), and should be excluded under Rule 37(c) as untimely and prejudicial.
Plaintiff responds that the supplement qualifies as a timely supplement under Rule
26(e), or, in the alternative, that any lateness should be excused because the revision
of its damages theory was substantially justified and any prejudice to the Defendants
can easily be cured.
Federal Rule of Civil Procedure 26
Federal Rule of Civil Procedure 26 governs the conduct of discovery and the
parties’ duty to disclose information. Parties have a duty to supplement information
given by expert witnesses in their reports and at their depositions, and any additions
or changes must be disclosed at least 30 days prior to trial, unless the court orders
otherwise. Fed. R. Civ. P. 26(e)(2); Fed. R. Civ. P. 26(a)(3).1 Plaintiff asserts that its
submission qualifies as a supplement to Doughty’s disclosure under Rule 26, and was
therefore timely made.
Supplementation as contemplated by Rule 26 is a method of “correcting
inaccuracies, or filling the interstices of an incomplete report based on information
that was not available at the time of the initial disclosure.” Keener v. United States,
181 F.R.D. 639, 640 (D. Mont. 1998). “[I]f a supplemental expert disclosure presents
a new theory of the case, the district court has the discretion to exclude it and if it
represents a refinement, the expert should be allowed to testify.” Maine Human
Rights Comm’n v. Sunbury Primary Care, P.A., 770 F. Supp. 2d 370, 389 (D. Me.
The supplement offered by MMC in this case does not fit comfortably within
the contours of Rule 26(e)(2). The new damages theory proposed by MMC is not
properly characterized as a “refinement” of the original theory of damages presented
in Doughty’s initial disclosure. See id. It instead presents a new theory of damages.
As such, it is not a refinement of Doughty’s initial expert disclosure and was not
timely under Rule 26. Accordingly, its admissibility is properly analyzed under Rule
1 Fed. R. Civ. P. 26(e)(2) states: “Expert Witness. For an expert whose report must be disclosed under Rule
26(a)(2)(B), the party’s duty to supplement extends both to information included in the report and to information
given during the expert’s deposition. Any additions or changes to this information must be disclosed by the time
the party’s pretrial disclosures under Rule 26(a)(3) are due.” Rule 26(a)(3)(B) provides in relevant part: “Unless
the court orders otherwise, these disclosures must be made at least 30 days before trial.”
Federal Rule of Civil Procedure 37(c)
Federal Rule of Civil Procedure 37(c) provides that if a disclosure is untimely
and is not substantially justified or harmless, the court may order that the party
offering the disclosure is not allowed to use the information on a motion, at a hearing,
or at trial. Fed. R. Civ. P. 37(c)(1).2 The court also has the discretion to impose other
sanctions in addition to or in lieu of striking the disclosure, including payment of
expenses, informing the jury of the party’s failure, or “other appropriate sanctions.”
Id.; see also Gay v. Stonebridge Life Ins. Co., 660 F.3d 58, 62 (1st Cir. 2011) (noting
that “preclusion is not a strictly mechanical exercise” and district courts have
discretion to impose lesser sanctions) (quotation omitted). In determining whether
to impose sanctions and the severity of any sanctions to be imposed, courts consider
a number of factors, including:
(1) the history of the litigation; (2) the sanctioned party’s need for the
precluded evidence; (3) the sanctioned party’s justification (or lack of
one) for its late disclosure; (4) the opponent-party’s ability to overcome
the late disclosure’s adverse effects—e.g., the surprise and prejudice
associated with the late disclosure; and (5) the late disclosure’s impact
on the district court’s docket.
Esposito v. Home Depot U.S.A., Inc., 590 F.3d 72, 78 (1st Cir. 2009). I turn to address
Fed. R. Civ. P. 37(c)(1) states: “Failure to Disclose or Supplement. If a party fails to provide information or
identify a witness as required by Rule 26(a) or (e), the party is not allowed to use that information or witness to
supply evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless.
In addition to or instead of this sanction, the court, on motion and after giving an opportunity to be heard:
(A) may order payment of the reasonable expenses, including attorney’s fees, caused by the failure;
(B) may inform the jury of the party’s failure; and
(C) may impose other appropriate sanctions, including any of the orders listed in Rule 37(b)(2)(A)(i)-(vi).”
History of Litigation
Although the Defendants contend that this litigation “has not been without its
warts and wrinkles,” ECF No. 139 at 5, there is no evidence that MMC has repeatedly
violated discovery deadlines or otherwise abused the discovery process. Cf. SantiagoDíaz v. Laboratorio Clínico y De Referencia Del Este, 456 F.3d 272, 277 (1st Cir. 2006)
(imposing sanctions where party’s “dereliction was both obvious and repeated”). The
discovery deadlines in this case have been enlarged a number of times, at the joint
request of the parties.
MMC asserts that it has attempted to comply with all
deadlines for expert disclosures, and that it notified the Defendants promptly
regarding the changes to Doughty’s damages calculations.
Need for Evidence
MMC’s need for the proposed evidence is great. Given Morin’s assessment,
MMC’s original remediation plan is no longer feasible. MMC’s attorney confirmed at
oral argument that MMC will no longer approve the original remediation plan.
Preventing MMC from presenting evidence of the damages associated with its revised
remediation plan would therefore force it to forego the largest part of its damages
The justification offered by MMC for the delay in filing its supplemental
disclosure is that the information needed to develop its new remediation plan was not
available when the initial expert disclosures were due in June 2016. MMC maintains
that its original plan was the best option available at the time, and learned that it
was no longer a viable option only after MMC announced that two new floors would
be built on top of the existing East Tower. MMC did not, however, review its original
remediation plan with clinical staff prior to submitting its initial expert disclosures.
MMC pursued its original consequential damages claim through the majority of
discovery, and only submitted the supplemental disclosure containing the new
damages theory one week before the Defendants and Third-Party Defendants filed
their notices of intent to file summary judgment. The record establishes that MMC
would have recognized the problem with its original damages theory earlier than
November 2016 if its personnel and expert witness had discussed the feasibility of
the original damages theory with the clinical staff of the East Tower, including Morin,
the Patient Care Service Director, before that time.
In September 2016, the Defendants deposed Lugene Inzana, the hospital’s
Chief Financial Officer, whom MMC had designated to testify regarding its original,
lost-revenue damages claim. During the deposition, Inzana was asked if he had
consulted with any clinical staff in the affected departments in the East Tower on the
effect MMC’s proposed remediation plan, with its planned closure of patient rooms,
would have on the patient population. He confirmed that he had not yet met with
the hospital’s clinical staff regarding the plan, though he implied that such a meeting
would be appropriate, and perhaps standard practice. See ECF No. 130-2 at 3 (“In a
project like this, we would sit down with our clinical staff . . . and we would ascertain
whether or not this particular activity could . . . impede care.”). Also in September
2016, the Defendants deposed Dr. John Bancroft, MMC’s Chief of Pediatrics, whom
MMC had designated as a clinical expert to testify regarding the impact that the
original proposed remediation plan would have on the patient population.
Bancroft acknowledged that he was not aware of any detailed discussions with the
clinical staff regarding the impact of the proposed remediation plan, and that he had
not been involved in the planning process. See ECF No. 130-4 at 2-3.
Following these depositions, in November, MMC reviewed the original
remediation plan with Morin, the Patient Care Service Director in the East Tower.
She was later deposed on January 25, 2017, and testified that when she was asked
by MMC in November about the prospect of closing patient rooms to accommodate
construction pursuant to the original, 93-week construction plan, she responded,
“[t]hat is not something that we are going to be able to do at all.” ECF No. 137-1 at
20, 65:4-5. She was “adamant” in rejecting the proposal “unconditionally.” Id. at 20,
65:5-6; 29, 102:22-24. She testified that her unconditional rejection caused the Chief
Financial Officer to turn white at the time. Id. at 20, 65:5-6. She further opined that
closing patient rooms to perform repairs could have “catastrophic consequences.” Id.
at 27, 94:14-18. She also testified that she was the only person on the clinical side
consulted, because she is “considered the expert in that area.” Id. at 29, 103:13. It
was after the conversation between Morin and Inzana, which took place in November
2016, that MMC developed its revised remediation plan, which incorporated the two
new floors being constructed on top of the East Tower.
MMC asserted at oral argument that its initial disclosures and original
remediation plan would not have been different even if it had consulted with Ms.
Morin prior to June 2016; despite Morin’s strong opposition, MMC maintains that the
original plan was the only feasible option before its personnel learned of the plan to
build the two new floors on the East Tower. The revised remediation plan was
developed only after MMC formally committed itself to the construction of two new
floors, as the new floors provided an opportunity to better accommodate Morin’s
concerns. MMC therefore asserts that the late disclosure of its new remediation plan
is justified because the unexpected availability of the two new floors constitutes a
MMC has not, however, produced evidence that demonstrates that the
information regarding the two new floors was unavailable before Morin was consulted
in November 2016. The decision to formulate a new damages theory was prompted
by her input. MMC offers no justification for why Morin was not consulted until long
after the deadline for initial expert disclosures, and more than a month after the
deposition of Dr. Bancroft, who was the expert that MMC itself had designated to
offer a clinical perspective on the feasibility of the original remediation plan.
Regardless of precisely when the information regarding the two new floors became
available, MMC’s failure to involve a key member of its clinical staff in the
assessment of the feasibility of its original, 23-million-dollar remediation plan was a
The Defendants argue that they will suffer substantial prejudice if MMC is
allowed to pursue a damages claim based on its new remediation plan. The parties
have already completed the majority of the discovery in this case, and the Defendants
have devoted substantial resources to assessing and preparing to challenge MMC’s
original damages claim. The Defendants advised the Court in their notices of intent
to file for summary judgment that they intended to challenge the evidence underlying
MMC’s consequential damages claim during the summary judgment process. See,
e.g., ECF No. 109.
Accordingly, the discovery, investigation, and attorney time
already devoted to challenging MMC’s original damages claim will largely be wasted.
In addition, allowing MMC to pursue the new damages theory will necessitate
extending discovery deadlines and postponing the summary judgment process.
Defendants assert that they will need to engage in substantial new discovery to
evaluate MMC’s revised damages theory, which will include hiring multiple experts.
ECF No. 139 at 7. MMC counters that the discovery undertaken thus far related to
the consequential damages issue has not been extensive. MMC points out that
Doughty, the expert whose testimony is at issue here, has not yet been deposed.
Further, MMC argues that any prejudice can be cured by sanctions less drastic than
exclusion of the proposed evidence.
Impact on Court’s Docket
The impact on the Court’s docket is not substantial. The discovery deadlines
in this case have already been extended multiple times, and the Court has not yet
established a schedule for the summary judgment process.
Conclusion Regarding Sanctions
In light of the five Esposito factors, MMC’s proposed supplement is neither
substantially justified nor harmless. The lateness of the disclosure is due, in large
measure, to MMC’s unexplained failure to consult its clinical staff on the feasibility
of its original damages theory. And the Defendants have incurred costs in preparing
to counter MMC’s now-defunct damages claim, and will likely incur significantly
more costs in defending against the revised damages claim. A sanction is appropriate
in this case.
In crafting the appropriate sanction, I am mindful of the Esposito court’s
recognition that a more serious sanction requires a comparatively more robust
justification. See 590 F.3d at 79. While excluding the proposed evidence here would
not effectively amount to a dismissal, as did the sanction at issue in Esposito, it would
prevent MMC from pursuing the largest portion of its damages claim. Furthermore,
MMC’s misfeasance, while meriting a sanction, does not involve bad faith or a willful
disregard for the Court’s scheduling orders. A sanction less drastic than exclusion is
therefore appropriate. Cf. id. at 80 (“the punishment must approximately fit the
As a sanction, MMC will be required to compensate the Defendants for the
discovery costs, expert witness costs, and reasonable attorney’s fees expended in
preparing its defense against MMC’s original damages theory. Cf. Goodyear Tire &
Rubber Co. v. Haeger, 581 U.S. ---, --- (2017) (slip op. at 7) (sanctions should be limited
to costs that would not have been incurred but for the misconduct). In addition, MMC
will be restricted to using its current expert witness, Gus Doughty, to testify in
support of its new damages theory based on the revised remediation plan.
III. ADDITIONAL MATTERS
In light of the above, additional discovery will be required on MMC’s
consequential damages claim. It is possible that this discovery may bring to light
issues that will have a bearing on the remaining arguments to be addressed through
summary judgment. In addition, the interests of judicial economy are best served by
postponing summary judgment and addressing all claims and arguments in a single
summary judgment process.
Further, the outstanding requests for summary
judgment were premised on the parties’ understanding that MMC would proceed with
its original theory of consequential damages.
Given these considerations, it is
appropriate to postpone the summary judgment process until all discovery is
As noted, allowing MMC to revise its consequential damages theory will
necessitate the extension of discovery deadlines, and may require the parties to
engage in substantial new discovery. Accordingly, this matter is referred to the
Magistrate Judge for the establishment of a new schedule, as well as to determine
the reasonable discovery costs, expert witness costs, and attorney’s fees the
Defendants should be awarded as part of the sanction authorized by this Order.
Based on the foregoing, Defendants’ motion to exclude the supplemental report
of Gus Doughty (ECF No. 130) is hereby DENIED IN PART to the extent that it
seeks to exclude the supplemental report, and GRANTED IN PART to the extent
that the Court has awarded sanctions. Plaintiff Maine Medical Center is hereby
ORDERED to pay reasonable costs and expenses associated with Defendants’
defense of the original consequential damages theory. Maine Medical Center is
limited to the use of Gus Doughty as an expert witness in support of its revised
consequential damages claim.
Dated this 20th day of April 2017
/s/ JON D. LEVY
U.S. DISTRICT JUDGE
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