GEORGE F. LANDEGGER, and WHITTEMORE COLLECTION, LTD., Plaintiffs,
HOWARD S. COHEN, DENNIS YOUNG, ASPEN PACIFIC CAPITAL, INC., and ASPEN PACIFIC GROUP, INC., Defendants.
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO EXCLUDE EXPERT TESTIMONY
WILLIAM J. MARTÍNEZ, District Judge.
This matter is before the Court on the Motion to Exclude Expert Testimony ("Motion") by Defendants Howard Cohen, Dennis Young, Aspen Pacific Capital, Inc., and Aspen Pacific Group, Inc. (collectively "Defendants"). (ECF No. 114.) Defendants move to exclude opinion testimony from two experts identified by Plaintiffs George Landegger and the Whittemore Collection, Ltd. ("Plaintiffs"). Plaintiffs filed a Response to the Motion. (ECF No. 118.) Defendants filed no Reply.
For the reasons set forth below, the Motion is GRANTED IN PART and DENIED IN PART.
I. LEGAL STANDARDS
A district court must act as a "gatekeeper" in admitting or excluding expert testimony. Bitler v. A.O. Smith Corp., 400 F.3d 1227, 1232 (10th Cir. 2004). Admission of expert testimony is governed by Federal Rule of Evidence 702, which provides:
If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case.
"The touchstone of the admissibility of expert testimony is its helpfulness to the trier of fact." U.S. Aviation Underwriters, Inc. v. Pilatus Bus. Aircraft, Ltd., 582 F.3d 1131, 1150 (10th Cir. 2009) (quotation marks and brackets omitted). The proponent of the expert testimony bears the burden of proving the foundational requirements of Rule 702 by a preponderance of the evidence. United States v. Nacchio, 555 F.3d 1234, 1241 (10th Cir. 2009).
To be admissible, evidence must also comply with Federal Rule of Evidence 403. Rule 403 provides that, "[a]lthough relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence." "Expert testimony, like any other evidence, is subject to exclusion if it fails the Fed.R.Evid. 403 balancing test." Thompson v. State Farm Fire & Cas. Co., 34 F.3d 932, 941 (10th Cir. 1994).
Plaintiffs have obtained expert reports from two attorneys, Mr. Philip A. Feigin and Mr. S. Lee Terry, Jr., both of whom are partners at their respective law firms and experts in securities transactions. (ECF Nos. 114-2 & 114-3.) Particularly where an expert witness is an attorney, the expert's testimony may not include legal conclusions regarding essential elements of a cause of action, because such testimony would "supplant both the court's duty to set forth the law and the jury's ability to apply [the] law to the evidence." Specht v. Jensen, 853 F.2d 805, 808 (10th Cir. 1988) ( en banc ).
Here, Defendants do not challenge either expert's qualifications, nor do they challenge the reliability of the experts' opinions. (ECF No. 114 at 2.) However, Defendants move for the exclusion of all of Mr. Feigin's opinions and some of Mr. Terry's opinions as expressed in their respective expert reports, arguing that they usurp the roles of both the Court and the jury by impermissibly attempting to interpret and define the law, apply the law to the facts, and state legal conclusions. ( Id. ) Defendants also contend that expert testimony on these issues would not assist the jury, and that the challenged opinions should be excluded because their marginal probative value is outweighed by the danger of needlessly cumulative evidence. ( Id. ) The Court will discuss each of Defendants' arguments in turn.
A. Rule 702
Defendants argue that both Mr. Terry's and Mr. Feigin's expert reports contain statements of the law governing the central issue in this case, namely whether Defendants acted as brokers. (ECF No. 114 at 10-14.) Both reports review the six factors that courts consider in evaluating whether a person acted as a broker,  apply those factors to the facts in this case, and conclude that Defendants were acting as brokers. ( Id .; see also ECF Nos. 114-2, 114-3.) Mr. Feigin's report also discusses the legal standards governing interpretation of the term "security", and interprets the "associated person of an issuer" rule governing exemption from registration as a broker. (ECF No. 114 at 12-13.)
To the extent these opinions reach ultimate conclusions regarding the essential elements of Plaintiffs' claim that Defendants acted as brokers, those opinions are properly excluded. See Specht, 853 F.2d at 808. Plaintiffs admit as much in their Response, explaining that the expert reports' discussions of legal issues were merely "background ...