Lexington Insurance Company et al v. Newbern Fabricating, Inc. et al

Filing 319

OPINION AND ORDER by Judge Claire V Eagan ; accepting 311 Report and Recommendation; granting in part and denying in part 132 Motion to Exclude (RGG, Chambers)

UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF OKLAHOMA
LEXINGTON INSURANCE COMPANY;
GAVILON FERTILIZER, LLC; CERTAIN
UNDERWRITERS AT LLOYD’S OF
LONDON; and GAVILON GRAIN, LLC,
Plaintiffs,
v.
NEWBERN FABRICATING, INC., and
BAUCOM CONCRETE CONSTRUCTION,
INC.,
Defendants,
and
NEWBERN FABRICATING, INC.,
Third-Party Plaintiff,
v.
DOVELAND ENGINEERING CO.,
Third-Party Defendant.

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Case No. 14-CV-0610-CVE-TLW

OPINION AND ORDER
Now before the Court is the report and recommendation (Dkt. # 311) of Magistrate Judge
T. Lane Wilson recommending that the Court grant in part and deny in part Newbern Fabricating,
Inc.’s Motion to Exclude or Limit Testimony of Lauran Larson (Dkt. # 132). Plaintiffs Gavilon
Grain, LLC and Gavilon Fertilizer, LLC have filed an objection (Dkt. # 315) to the report and
recommendation, and Newbern has filed a response (Dkt. # 317).

I.
This action arises from the collapse of a wall of a storage facility at the Tulsa Port of
Catoosa. Plaintiff Gavilon Grain owned the building, which Gavilon Fertilizer used to store
fertilizer.1 Dkt. # 132, at 6. In 2004, Gavilon Grain contracted with Newbern, a construction
company that builds river terminals and equipment, to build a concrete storage facility. Id. Baucom
Concrete Construction, Inc. worked as the subcontractor responsible for the concrete work on the
project. Id. On March 7, 2013, a reinforced concrete wall of the facility collapsed. Id. at 6-7.
Plaintiffs Lexington Insurance Company and Lloyd’s of London paid a number of claims related to
the losses sustained from the wall collapse. Dkt. # 54, 4-5. The Gavilon plaintiffs assert that they
both suffered losses from the wall collapse, including damage to the building and associated
equipment and loss of profit and use of facilities. Id. at 5. Plaintiffs filed this action against
defendants Newbern and Baucom, asserting that the damages were caused by inadequate design and
installation of the concrete columns. Id. at 5-9.
The Gavilon plaintiffs hired Lauran Larson, P.E., S.E., immediately after the collapse to
observe conditions and assist in the temporary stabilization of the remaining structure. Dkt. # 132-1,
at 2. Subsequently, Larson was asked to review information relevant to the collapse and opine on
the cause of the collapse, the scope and cost of the required repairs and remediation, and whether
any structural deficiencies existed with respect to the applicable building code or construction

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In 2011, Gavilon Grain merged with DeBruce Grain, the party that contracted for and
oversaw the construction of the storage facility. For clarity’s sake, the Court refers to both
entities as Gavilon Grain. Also in 2011, Gavilon Fertilizer merged with DeBruce Fertilizer.
The Court refers to Gavlion Fertilizer as representative of both entities. See Dkt. # 285, at
3 n.2. When referencing Gavilon Grain and Gavilon Fertilizer together, the Court uses the
Gavilon plaintiffs.
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standard. Id. at 2-3. Larson issued a report pursuant to Federal Rule of Civil Procedure 26(a)(2)(B)
in which he concluded that the primary cause of the collapse was “flexural failure of the concrete
columns due to failure of the column vertical steel reinforcing bars.” Id. at 3. The discussion of
Larson’s findings includes a section titled “Reinforcing Bar Fracture Surface,” which states in
relevant part:
[T]he fracture surface [of the rebar], which is roughly perpendicular to the long axis,
exhibits a gradient in surface roughness transition from “fine” profile to “rough”
profile in approximate relation to distance from the weld. In general, finer surface
profile of a material crack is consistent with small, incremental damage accumulation
progress over repeated load cycles. Conversely, rough surface profile is consistent
with failure of an area of single event surface rupture. This observed surface profile
would be consistent with a process of damage accumulation over multiple load
cycles within the relatively short life of the West Wall as batches of product were
alternately stockpiled and removed as market demand dictated.
Id. at 6.
Larson is a civil/structural engineer with 35 years of experience in dynamic and static
structural design. Id. at 24. Larson earned a bachelor of science degree in civil/structural engineering
from the University of Minnesota and a master of science degree in civil/structural engineering from
Cornell University. Id. Larson testified that he is not a metallurgist, but that he took classes in the
failure behaviors of steel during his undergraduate and graduate studies, including a seminar on
structural steel failure in 1982. Dkt. # 192-1, at 6-10. Larson further testified that his opinion
regarding the fracture surface of the rebar was based on the structural steel failure course he took
in 1982. Id. at 118.
Newbern filed a motion to exclude or limit the testimony of Larson, arguing that Larson’s
opinions regarding (1) the cost of repairs and remediation, (2) fatigue or damage accumulation in

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the rebar, and (3) defects in welding on columns that did not fail, are inadmissible.2 Dkt. # 132. The
magistrate judge issued a report and recommendation recommending that (1) that Larson cannot
testify as to the cost of repairs of the facility because he lacks the required expertise and his
methodology is unreliable and based on insufficient data; (2) that Larson cannot testify about fatigue
or damage accumulation in the rebar because he lacks the required expertise and the Gavilon
plaintiffs have failed to meet their burden of establishing that Larson’s methodology is reliable; and
(3) that Larson is qualified to testify that the rebar was not welded and/or installed according to
design. Dkt. # 311. The Gavilon plaintiffs object only to the magistrate judge’s recommendation
regarding Larson’s proposed testimony on fatigue and damage accumulation on the rebar. Dkt. #
315.
II.
The Court may refer any pretrial matter pending before it to a magistrate judge for a report
and recommendation. 28 U.S.C. § 636(b)(1)(A). However, the parties may object to the magistrate
judge’s recommendation within fourteen days of service of the recommendation. Schrader v. Fred
A. Ray, M.D., P.C., 296 F.3d 968, 975 (10th Cir. 2002); Vega v. Suthers, 195 F.3d 573, 579 (10th
Cir. 1999). The Court “shall make a de novo determination of those portions of the report or
specified proposed findings or recommendations to which objection is made.” 28 U.S.C. § 636(b)(1).
The Court may accept, reject, or modify the report and recommendation of the magistrate judge in
whole or in part. Fed. R. Civ. P. 72(b).

2

Newbern also argued that Larson’s testimony regarding alleged building code violations
should be excluded. Dkt. # 132, at 22-25. Newbern subsequently withdrew this objection.
See Dkt. # 278.
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III.
The Gavilon plaintiffs object only to part five of the report and recommendation (Dkt. #
311), which recommends that Larson should be barred from testifying at trial regarding damage
accumulation, fatigue, or weakening in the failed rebar because Larson is not qualified in the area
of metallurgy, and the Gavilon plaintiffs failed to establish Larson’s methodology is reliable. Dkt.
# 315, at 3.
In Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), the Supreme Court
held that district courts must initially assess the admissibility of “scientific” expert testimony under
Rule 702 of the Federal Rules of Evidence. The Supreme Court extended the gatekeeper role of
federal district courts to all expert testimony in Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137
(1999). In Bitler v. A.O. Smith Corp., 400 F.3d 1227 (10th Cir. 2005), the Tenth Circuit discussed
the role of district courts in considering a Daubert challenge to the admissibility of expert testimony.
First, the court should make a preliminary finding that the expert is qualified to testify. Id. at 123233. Next, the proponent of expert testimony must establish that the expert used reliable methods to
reach his conclusion and that the expert’s opinion is based on a reliable factual basis. Id. at 1233.
The Tenth Circuit cited four factors that district courts should apply to make a reliability
determination:
(1) whether a theory has been or can be tested or falsified; (2) whether the theory or
technique has been subject to peer review and publication; (3) whether there are
known or potential rates of error with regard to specific techniques; and (4) whether
the theory or approach has “general acceptance.”
Id. at 1233 (citing Daubert, 509 U.S. at 593-94). The Tenth Circuit was clear that “a trial court’s
focus generally should not be upon the precise conclusions reached by the expert, but on the
methodology employed in reaching those conclusions.” Id. In other cases, the Tenth Circuit has
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emphasized that any analytical gap in an expert’s methodology can be a sufficient basis to exclude
expert testimony under Daubert. Trucks Ins. Exchange v. MagneTek, Inc., 360 F.3d 1206, 1212-13
(10th Cir. 2004); Goebel v. Denver & Rio Grande Western R. Co., 346 F.3d 987, 992 (10th Cir.
2003). Under Daubert, “‘any step that renders the analysis unreliable . . . renders the expert’s
testimony inadmissable. This is true whether the step completely changes a reliable methodology
or merely misapplies that methodology.’” Mitchell v. Gencorp Inc., 165 F.3d 778, 783 (10th Cir.
1999) (citing In re Paoli R.R. Yard PCB Litigation, 35 F.3d 717, 745 (3d Cir. 1994)).
A.
The Gavilon plaintiffs argue that Larson’s education and experience as a structural engineer
qualify him to testify about the damage accumulation and fatigue in the failed rebar. Dkt. # 315 at
4. Larson testified that his undergraduate and graduate studies included instruction on the failure
mechanisms of steel. Dkt. # 192-1, at 6-10. In particular, Larson attended a seminar on fatigue of
steel while an undergraduate student in 1982. Id. at 8. At the seminar, the students were shown
pictures of fractured steel. Id. at 16. The Gavilon plaintiffs have presented no evidence that Larson
has ever examined fractured rebar outside of the steel fatigue seminar and this case. Larson’s
education and experience are as a structural engineer, and he does not consider himself a
metallurgist. Id. at 6. Moreover, Larson could not answer questions in his deposition about
metallurgical concepts or their application to this case. His deposition included the following
exchange:
Q: Okay. Do you know what beach marks are?
A: I don’t recall.

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Q: In looking at the fracture surfaces on the steel reinforcing bars in Figures 12, 13,
14, or any of the other photographs that you saw or fracture surfaces that you saw in
person, did you see any physical evidence of subcritical crack propagation?
A: I saw weld flaws, but the term subcritical crack propagation, these photographs
and my description of the surface profile represent my interpretation of the failure.
Id. at 17.
“[A]s long as an expert stays within the reasonable confines of his subject area, . . . a lack
of specialization does not affect the admissibility of the expert opinion, but only its weight.” Ralston
v. Smith & Nephew Richards, Inc., 275 F.3d 965, 969 (10th Cir. 2001) (quoting Wheeler v. John
Deere Co., 935 F.2d 1090, 1100 (10th Cir. 1991)) (internal quotation marks omitted). The question
here is whether metallurgy is “within the reasonable confines” of Larson’s subject area. See id.
Structural engineering and metallurgy are two related, but distinct, areas of expertise. Structural
engineering involves calculating the stability and strength of structures and analyzing and critiquing
designs for structures to ensure they are designed with the requisite stability and strength.
Metallurgy involves understanding the composition and behavior of metals. A structural engineer
must understand some general aspects of metallurgy, such as how welding affects rebar, in order to
effectively analyze the strength and stability of structure. However, at issue here is Larson’s opinion
on why the wall collapsed based on his observations of the failed rebar. It is not within the purview
of structural engineering to examine failed rebar for fractures in order to draw conclusions about
what caused the failure; this requires specific education and/or experience. Discussing steel failure
in some of his classes and one 1982 steel fatigue seminar do not constitute a sufficient educational
background to render Larson’s metallurgy opinions reliable, especially when Larson admitted he
is not a metallurgist, relied solely on the undergraduate seminar for his opinions, has no other
experience with damage accumulation and fatigue in steel, and in his deposition could not discuss
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metallurgical concepts. Therefore, the Court finds that Larson is not qualified to testify as to damage
accumulation, fatigue, weakening, or fracturing of the rebar in this case.
B.
The Gavilon plaintiffs also object to the magistrate judge’s finding that they failed to show
that Larson’s methodology, of observing the gradient of the fracture surface of the rebar to draw
conclusions about the cause of the failure, is reliable. Dkt. # 315, at 6. The party proffering an expert
“must show that the method employed by the expert in reaching the conclusion is scientifically
sound and that the opinion is based on facts which sufficiently satisfy Rule 702's reliability
requirements.” Mitchell, 165 F.3d at 781. However, the proffering party “need not prove that the
expert is undisputably correct or that the expert’s theory is ‘generally accepted’ in the scientific
community.” Id. (citing Moore v. Ashland Chem., Inc., 151 F.3d 269, 276 (5th Cir. 1998)).
Newbern attached to its motion a declaration by Edward Cox, Ph. D, P.E., C.W.I., a
metallurgist with over 40 years of experience in metallurgical engineering. Dkt. # 132-7. Dr. Cox
states that Larson’s methodology is not common or accepted, and that no commonly accepted
fracture analysis textbook or industry handbook supports his methodology. Id. at 2. In response, the
Gavilon plaintiffs offered no defense of the reliability of Larson’s methodology. See Dkt. # 192, at
11. Newbern has raised credible concerns regarding the reliability of Larson’s methodology, and the
record before the Court provides no reason to find Larson’s methodology sound. Thus, the Court
finds that, even if Larson were a qualified expert in metallurgy, the Gavilon plaintiffs have failed
to meet their burden of establishing that his methodology is reliable.

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No objection has been made to the remaining recommendations in the report and
recommendation (Dkt. # 311). The Court has conducted an independent review of the record and
finds no reason to disturb the magistrate judge’s proposed findings and recommendations.
IT IS THEREFORE ORDERED that the report and recommendation (Dkt. # 311) is
accepted, and Newbern Fabricating, Inc.’s Motion to Exclude or Limit Testimony of Lauran Larson
(Dkt. # 132) is granted in part and denied in part as set forth in the report and recommendation
(Dkt. # 311).
DATED this 31st day of January, 2017.

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