Examining the Validity of
Expert Opinions
Determining whether an opinion given by an expert is probably a correct or
reliable opinion—as
distinguished from a mere assumption or belief—can
be critical in litigating a case. To this end, the application of statistics
can be a powerful tool.
A party offering expert testimony bears the burden of proving that the
witness is qualified and that his or her opinion is reliable. As a practical
matter, financial experts assist in litigation by either supporting or
disproving a particular analysis. Being able to walk a fine line between
providing statistical evidence sufficiently technical to be compelling and
having the testimony also be understandable is tricky. Courts seem to weigh
whether the expert witness’s testimony will be helpful to the finder of
fact.
Statistically Reliable Opinions
The United States Supreme Court, in General Electric Co. v. Joiner [522 U.S.
136 (1997)], set the standard that the expert witness’s opinions be
statistically reliable. The key finding that was upheld involved the
determination that the plaintiff’s expert’s opinions were not statistically
significant. The lower court had found that the testimony of the plaintiff’s
expert failed to demonstrate a causal connection between the particular type
of cancer at issue and the alleged exposure to certain toxins. The Supreme
Court stated that courts may conclude that there is too great of an
analytical gap between existing relevant data and an expert witness’s
opinion. Having a financially savvy expert can help you expose such a gap in
an adversary’s position.
Reasonable Degree of Certainty
Some courts apply a standard of a reasonable degree of certainty in
determining the statistical validity of an expert’s opinion. In Soldo v.
Sandoz Pharmaceuticals Corp. [244 F.Supp.2d 434 (W.D. Pa. 2003)], the court
found that the particular study at issue, on which the expert had based his
opinion, had no meaning in and of itself. Rather, the study “had to be
interpreted in conjunction with its statistical degree of confidence.”
Reliable Testimony
Every litigator wants a financial expert to deliver testimony and evidence
that will have a powerful impact on the case. Through statistics and other
financial analyses, your expert can make a determination about a key issue
in your case—is it reliable? A landmark decision in Daubert v. Merrell
Dow Pharm. Inc. [509 U.S. 579 (1993)] shaped how expert testimony that you
may put on is viewed in terms of reliability. The following factors are to
be weighed in assessing an expert witness’s opinion:
- Whether there is a basis for the expert asserting a conclusion—i.e., whether the expert witness’s opinions are directly supported by the facts, or are connected to or tied to the underlying data.
- Whether the expert witness had excluded other possibilities that would contradict his or her explanation of events.
- Whether the expert can show why other explanations for the underlying facts are not at least as consistent with his or her own opinions.
- Whether the expert witness can show that what he or she believes could have happened actually did happen.
- Whether the scientific methodology used by the expert witness to form his or her opinion is acceptable. (Is it the generally accepted methodology used within the industry or profession? Have other experts used the same methods to determine the same type of issues? Are there neutral treatises of commonly accepted professional periodicals that support the expert’s conclusions and methodology?)
- The extent to which the opinion offered relies upon the subjective interpretation by the expert witness of any facts or data.
Please contact a member of Somerset's Litigation & Valuation Team to discuss this article.
This newsletter is provided by
Somerset for our clients and other interested persons upon request.
Since technical information is presented in generalized fashion, no
final conclusion on these topics should be made without further review.
For additional information on the issues discussed, please contact
Steve Riddle,
Tom
Thieme,
Rex Collins or
Doug
Ayres
of our
Litigation & Valuation Team.
This document is not intended or written to be used, and cannot be used,
for the purpose of avoiding tax penalties that may be imposed on the
taxpayer.
Somerset CPAs,
P.C.
3925 River Crossing Parkway, Third Floor
Indianapolis, Indiana 46240
317.472.2200 • 800.469.7206 • FAX 317.208.1200
www.somersetcpas.com
