United States District Court, D. Colorado
MARY E. SPENDRUP, individually and on behalf of Quentin O. Spendrup, Plaintiff,
AMERICAN FAMILY MUTUAL INSURANCE COMPANY, a Wisconsin corporation, Defendant.
KRISTEN L. MIX, Magistrate Judge.
This matter is before the Court on Defendant's Rule 702 Motion to Preclude Jeffrey Opp From Offering Opinions Regarding Legal Issues [#53] (the "Motion"). On January 31, 2014, Plaintiff filed a Response [#56]. On February 7, 2014, Defendant filed a Reply [#57]. The Court has reviewed the Motion, the Response, the Reply, the entire docket, and the applicable law, and is sufficiently advised in the premises. For the reasons set forth below, the Motion [#53] is GRANTED in part, as explained below.
This dispute stems from a March 5, 2009 automobile accident involving Plaintiff's husband, Quentin O. Spendrup ("Mr. Spendrup") and a third party, which resulted in the death of Mr. Spendrup. Am. Compl [#49] at ¶¶ 41-42; Answer [#13] ¶ 2. Plaintiff accepted an offer of settlement for the third party driver's liability. Am. Compl [#49] at ¶¶ 49-50; Answer [#13] ¶ 2. Through this lawsuit, Plaintiff seeks payment of underinsured motorist benefits from Defendant for various insurance policies issued by Defendant to Plaintiff, Mr. Spendrup, and their son, Zedadiah O. Spendrup. Am. Compl [#49] at ¶¶ 12, 15-20, 25-28, 51, 53; Answer [#13] ¶ 2. Plaintiff seeks a variety of damages including "financial losses, " which she alleges "are the same as the financial benefit [she] might reasonably have expected to receive from" Mr. Spendrup. Am. Compl. [#49] at ¶ 120.
Notably, prior to Mr. Spendrup's death, Plaintiff and Mr. Spendrup each owned 50% of SMJ, Inc. ("SMJ") and each was paid a salary from SMJ. Motion for Determination of Question of Law [#39] at 2; Response to Motion for Determination of Question of Law [#45] at 2. Each "shared equally in the profits of SMJ." Motion for Determination of Question of Law [#39] at 2. According to Plaintiff, SMJ was an 1120S corporation. Response to Motion for Determination of Question of Law [#45] at 2. An "S" corporation is a small business that must meet certain criteria set by the Internal Revenue Service. See 26 U.S.C. § 1361(a)-(b)(2). Income and losses for an "S" corporation are passed through to the shareholders of the corporation. See 26 U.S.C. § 1366(a)(c). In her Response to the Motion for Determination of Question of Law, Plaintiff states that after Mr. Spendrup's death SMJ lost money and was eventually sold. Response to Motion for Determination of Question of Law [#45] at 2. Plaintiff claims that this was a result of Mr. Spendrup's death because "SMJ customers wanted [Mr. Spendrup's] expertise, knowledge, and experience. [He] could not be replaced." Id.
On January 15, 2014, the Court denied Defendant's Motion for Determination of Question of Law. See generally Order [#54]. The Court stated:
Absent clear law limiting Plaintiff's net pecuniary loss in a wrongful death action to exclude future business profits, the Court will not limit the factual information available to the jury to reach a "fair and just" dollar value of that loss. Hence, the parties may present the facts supporting their contentions regarding Plaintiff's entitlement to SMJ's lost profits and make their arguments in that regard. The jury will decide the proper amount of damages, if any.
Id. at 5.
In the instant Motion, Defendant asks the Court to "preclude Plaintiff's economic expert, Jeffrey Opp, from offering opinions regarding legal issues." Motion [#53] at 1. Defendant maintains that "based on the disclosed opinions of Mr. Opp, coupled with the representations made in Plaintiff's Response to Motion for Determination of Question of Law, the Defendant has very real concerns that the Plaintiff will offer Mr. Opp's legal opinions in her case in chief." Id. at 3 (emphasis in original). In support of this position, Defendant offers an October 20, 2013 letter from Mr. Opp to Andrew J. Peter [#53-1] (the "Opp Letter"). In the Opp Letter, Mr. Opp offers his opinions regarding certain issues raised by Defendant. Among other things, Mr. Opp states:
The computation of loss in a wrongful death action is based upon those amounts that would have inured to the benefit of the decedents' [sic] survivors had the death not occurred. Clearly the amount generated by SMJ prior to Mr. Spendrup's death (be it claimed as wages to Mr. Spendrup or net income of the company) have [sic] been lost by his survivors.
Opp Letter [#53-1] at 2. Defendant argues that any testimony provided by Mr. Opp that attempts to instruct the jury regarding what damages a plaintiff in a wrongful death case is entitled to recover is inadmissible pursuant to Fed.R.Evid. 702 and applicable case law. Motion [#53] at 3-4.
Plaintiff opposes the Motion. In her Response, she states:
At trial on this matter, Plaintiff anticipates that the Court will instruct the jury on C.R.S. § 13-21-202 and CJI-Civ. 4th 10:3 Damages For Wrongful Death. In accordance with this Court's ruling of January 15, 2014 denying Defendant's Motion for Determination of Question of Law, Plaintiff will elicit testimony from Jeffrey Opp supporting his expert belief that Mary Spendrup in entitled to SMJ's lost profits. Mr. Opp's opinion will be based on economic, financial, and tax principles as outlined in his reports provided in discovery. Plaintiff will ask Mr. Opp to testify as to the ultimate issue of why Mrs. Spendrup is entitled to 100% of the lost profits from SMJ Inc.
Response [#56] at 2. Plaintiff concludes by stating that she "does not intend to ask Mr. Opp his legal opinion regarding Colorado Law" but that she "does intend to elicit testimony from Jeffrey Opp supporting his expert belief that ...