Opinion
Civ. No. 16-808 KG/SMV C/w Civ. No. 17-1268 KG/SMV
01-06-2020
MOSAIC POTASH CARLSBAD, INC., Plaintiff, v. INTREPID POTASH, INC., INTREPID POTASH-NEW MEXICO, LLC, and STEVE GAMBLE, Defendants.
MEMORANDUM OPINION AND ORDER
This matter comes before the Court upon "Mosaic Potash Carlsbad, Inc.'s Motion to Partially Exclude Intrepid Rule 26(a)(2)(C) Experts" (Motion to Partially Exclude), filed May 15, 2019. (Doc. 211). Defendants Intrepid Potash, Inc. and Intrepid Potash-New Mexico, LLC (collectively, Intrepid) filed a response on June 4, 2019. (Doc. 235). Plaintiff Mosaic Potash Carlsbad, Inc. (Mosaic) filed a response on June 16, 2019. (Doc. 265). Having considered the Motion to Partially Exclude, the accompanying briefing, the relevant evidence and the law, the Court grants the Motion to Partially Exclude, in part, as described herein. The Court notes that it filed this Memoranda Opinion and Order under seal. See (Doc. 62). Even so, the Court reserves judgment to determine at an appropriate time whether to unseal the Memorandum Opinion and Order. I. Background
Mosaic processes langbeinite (lang), a potash ore, to produce fertilizer. Mosaic alleges that its former employee, Defendant Steve Gamble, violated his confidentiality agreement with Mosaic by misappropriating Mosaic's trade secrets and confidential information when he went to work for Intrepid, Mosaic's competitor, on January 5, 2015. Mosaic contends that Intrepid hired Gamble for his knowledge of Mosaic's lang processing which allegedly resulted in an increase of "Intrepid's Lang production and recovery efficiency" and an improvement of Intrepid's "methods for granulation of Lang," i.e., lang pelletization. (Doc. 66) at ¶ 2. Intrepid and Gamble argue that they did not misappropriate any of Mosaic's trade secrets or confidential information.
A. Lang Processing
Processing raw lang ore begins with passing the ore through a crusher to grind the ore into smaller particles. (Doc. 241) at ¶ 8. The particles are then separated into coarse and fine particles, or "fines." (Doc. 240-1) at ¶ 24. The impurities in the coarse particles and fines are removed through leaching. Id. The fines are later mixed with a binder to build them into pellets or granules. Id. at ¶ 30. Prior to hiring Gamble, Intrepid operated a dual sylvite-lang plant. (Doc. 240-1) at ¶ 45. After hiring Gamble, Intrepid switched to a lang-only plant which required Intrepid to redesign its crushing circuit. (Doc. 241) at ¶ 14.
B. Intrepid's Non-Retained Experts' Opinions
On April 10, 2019, Intrepid disclosed four non-retained experts pursuant to Fed. R. Civ. P. 26(a)(2)(C): Steve Bytnar (vice president of research and quality at EnviroTech Services, Inc. (EnviroTech), an Intrepid consultant); Michael Morrison (former corporate process chemist at Intrepid); Chris Nyikos (a current Intrepid strategic engineer), and Brett Berg (a current Intrepid senior project engineer). (Doc. 212-1). Mosaic moves to exclude certain portions of the expected testimony of those non-retained experts.
1. Bytnar
a. Rule 26(a)(2)(C) Summary of Bytnar's Expected Testimony
Bytnar will testify about Intrepid's binder testing and binder selection. Bytnar and his company, EnviroTech, were "involved in the identification of CMC as a binder solution for Intrepid in 2014 and 2015." (Doc. 212-1) at 4. EnviroTech's 90 days of binder lab testing ended in early March 2015. Id. EnviroTech also did pilot testing at a company called FEECO, in Wisconsin. Id. In the process of scheduling the final production testing at Intrepid, Bytnar "heard the name Steve Gamble for the first time." Id. After that final production testing, "EnviroTech identified one CMC product as being superior to the others." Id.
Mosaic objects to the following expected testimony by Bytnar:
While Mosaic highlighted portions of the Rule 26(a)(2)(C) disclosures it objects to, the Court examines only those objections Mosaic specifically addresses in the Motion to Partially Exclude.
Gamble had no involvement in any of the testing that identified and confirmed the CMC binder as being the superior option. Gamble provided no information regarding, and had no influence on, the identification and selection of CMC as Intrepid's binder. In Mr. Bytnar's opinion, Intrepid's selection of CMC was the result of Envirotech's extensive scientific testing, and in no way was influenced by Steve Gamble.Id.
b. Bytnar's Deposition Testimony
Bytnar's personal involvement with the binder research at Intrepid effectively ended in April 2015. (Doc. 212-2) at 3-4. The CMC binder Bytnar recommended to Intrepid was produced by Ashland and known as "12M31XP." Id. at 5-6. Bytnar testified that Gamble had no influence on what happened in Bytnar's lab. Id. at 7. Bytnar, however, did not know whether Gamble had any influence "as to what happened in Intrepid's facility" or whether Gamble steered Intrepid away from an alternative binder and toward a CMC product. Id. at 7, 14. Bytnar also did not know whether Gamble was involved in Intrepid's subsequent selection of other CMC binders like Aqualon's CMC 12M31XT or CP Kelco's CMC FINNFIX HPB. Id. at 8-12.
In January 2016, Intrepid switched to Aqualon's CMC 12M31XT binder on a full-time basis. (Doc. 212-6) at 2; (Doc. 212-7) at 2. Then, in September 2016, Intrepid decided to begin testing CP Kelco's CMC FINNFIX HPB. (Doc. 212-7) at 2.
Bytnar testified that the first time he saw Gamble's name was in an email scheduling the final binder production testing at Intrepid. (Doc. 235-3) at 3, depo. at 51-52. When Bytnar attended the final binder production testing, he met Gamble for the first time. Id. at 3, depo. at 52. Bytnar observed Gamble asking Morrison and another individual for data reports on the CMC binder and how it compared to starch. Id. Bytnar presumed that "Gamble had some role in the production of the material in some sort of a supervisory role at the plant." Id.
2. Morrison
a. Rule 26(a)(2)(C) Summary of Morrison's Expected Testimony
Morrison will testify about lang "fines dissolution testing, and binder testing and selection." (Doc. 212-1) at 4. In the spring of 2014, prior to Gamble's employment at Intrepid, Morrison conducted "dissolution testing to determine the optimal leach time for langbeinite fines." Id. at 5.
Mosaic objects to the following expected testimony by Morrison:
In Mr. Morrison's opinion, the lab testing he did was a scientifically correct way to determine the optimal leach time to dissolve halite and other impurities from langbeinite.Id.
Mr. Morrison's lab testing determined that the optimal leach time for fine langbeinite is approximately one minute.
Morrison was also involved with EnviroTech's binder testing and selection of the CMC binder in the spring of 2015. Id. Mosaic further objects to the following expected testimony by Morrison:
Gamble had no involvement in any of the testing that identified and confirmed the CMC binder as being the superior option. Gamble provided no information regarding, and had no influence on, the identification and selection of CMC as Intrepid's binder. In Mr. Morrison's opinion, Intrepid's selection of CMC was the result of Envirotech's extensive scientific testing, and data generated by FEECO and within Intrepid's pellet plant during trial runs and in no way was influenced by Steve Gamble.Id. at 5-6.
b. Morrison's Deposition Testimony
Morrison explained at his deposition that an "optimal" leach time means "the shortest amount of time to essentially make grade." (Doc. 212-3) at 3-4. Morrison did not take into account lang dissolution losses in calculating the optimal leach time, but instead focused on the dissolution of impurities to reach an "optimal" leach time. See id. at 4. Nonetheless, at some point, Morrison calculated lang dissolution losses. (Doc. 235-4) at 3, depo. at 78-79.
Morrison further explained why his lab testing was the "scientifically correct way to determine the optimal leach time...." (Doc. 212-3) at 4-6. Morrison also clarified that he based the one-minute optimal leach time on testing that used pond brine, not fresh water. Id. at 7-8.
Morrison left Intrepid in May 2016. Id. at 9. Morrison testified that he does not know what the current fines leaching process is at Intrepid and so cannot opine as to that process. Id. at 11.
With respect to EnviroTech's selection of a superior CMC binder, Morrison only recalled that EnviroTech selected a CMC 12M31 series binder. Id. at 15. He also could not recall the manufacturer of the selected CMC binder. Id. at 16. Morrison did not know if EnviroTech shared its testing and test results with Gamble. Id. at 17. In addition, Morrison did not remember what binders underwent FEECO testing nor how many CMC binders EnviroTech scheduled for final production testing at Intrepid. Id. at 18-20. Morrison, however, testified that during that final production testing, Gamble, as an engineer, "helped in the plant test, but he did not help in the identification of a CMC binder." (Doc. 235-4) at 4, depo. at 103-04.
In November 2015, Morrison and Gamble conducted pilot testing of CMC 12M31XT at FEECO. (Doc. 212-8) at 2-11.
Morrison further testified that he was not personally involved in the selection of the CMC binder. (Doc. 212-3) at 22. In fact, Morrison could not say whether Gamble affected the Intrepid decision-makers' selection of a binder. Id. at 23. Morrison testified that he did not know whether Gamble influenced Intrepid's selection of a particular CMC binder. Id. at 24.
3. Nyikos
a. Rule 26(a)(2)(C) Summary of Nyikos' Expected Testimony
Nyikos will testify about processing lang "and other potash products." (Doc. 212-1) at 6. Nyikos is expected to testify that he
has some knowledge of some aspects of Mosaic's operation, for example the fact that Mosaic has a much greater ability to dispose of effluent water in the Laguna Grande. Because it can use more water in its processing of langbeinite, and because its ore is not the same as Intrepid's, and because Mosaic uses certain different types of equipment, the technical details of Mosaic's processing are necessarily going to be different from those of Intrepid's. Knowledge of those Mosaic processing details would not be helpful to Intrepid in improving Intrepid's operations.Id.
However, Mosaic objects to Nyikos' "opinion there are no legitimate trade secrets in this area, except for the formula of a pelletization binder." Id. at 7. Mosaic also objects to Nyikos' opinion that "the concept of leaching langbeinite fines is not and cannot be a trade secret" as well as his opinion that "Intrepid never received any new insights regarding leaching of lang fines from Steve Gamble." Id. at 7.
Intrepid notes that Nyikos will also testify that in his "opinion, it is well-known in the mineral processing industry that slowing the speed of a crusher will lead to larger sized particles in the crusher products," a strategy Intrepid knew about prior to Gamble's employment at Intrepid. Id. at 7. In fact, Intrepid had "been attempting to minimize the speed of its crusher since becoming a lang-only operation in April of 2016." Id.
Mosaic objects to the following expected testimony by Nyikos: "Steve Gamble provided no information that influenced the speed of the main crusher at Intrepid." Id. Mosaic also objects to the following expected testimony by Nyikos:
While Intrepid's langbeinite recovery rate improved dramatically in the 2014-2017 time period, the improvement is not attributable to having received Mosaic information from Steve Gamble. Rather, in Mr. Nyikos's opinion the improvement from 33.4% recovery to 68.5% recovery is attributable to the following factors that are independent of Gamble:
Id.• Change to CMI centrifuge from solid bowl debrining: 5.9%
• Change from mixed ore process to lang only: 13.5%
• Use of reflux classifier: 6.7%
• Addition of fine lang leach: 9%
b. Nyikos' Deposition Testimony
Nyikos testified that his job responsibilities do not include determining whether something is a trade secret. (Doc. 212-5) at 7. Nyikos admitted that he does not have an opinion as to whether the specific parameters of Mosaic's lang fines leaching constitute a trade secret. Id. at 8. Moreover, Nyikos testified that he was not "Gamble's day-to-day supervisor." Id. at 9.
Nyikos testified that he "was intimately involved in fines leaching from conception in 2014 to the latest commissioning of the leach system." Id. Morrison and Berg were also principals involved in developing the fines leaching process. Id. Nyikos conceded that he does not know whether Gamble provided insights on fines leaching to either Morrison or Berg. Id. at 10-11, 13.
In addition, Nyikos testified that Gamble provided Intrepid with information and recommendations about the primary crushing circuit, but Gamble did not influence the speed of the primary crusher. Id. at 16-17. Nyikos explained that Intrepid considered Gamble's information but then rejected information not related to crusher speed. Id. at 17-18. Intrepid, however, did not reject Gamble's "general concept of slowing down the crusher...." Id. at 18. In fact, Gamble "was involved in work slowing down that crusher." Id.
According to Nyikos, Intrepid's operations management team decided to slow the crusher speed based on Nyikos' recommendations. Id. at 19. Nyikos testified that Gamble's work slowing down the crusher speed did not influence the operations management team because Intrepid had been discussing slowing down the crusher speed since June or July 2014, prior to Gamble's employment at Intrepid. Id. Nonetheless, Nyikos admitted that Gamble's work could have validated Intrepid's idea of slowing the crusher speed. Id. at 19-20.
Next, Nyikos testified that he calculated Intrepid's improved lang recovery rate "[f]or the purposes of this case." Id. at 21.
4. Berg
a. Rule 26(a)(2)(C) Summary of Berg's Expected Testimony
Berg will testify about "potash processing and engineering design of potash processing facilities." (Doc. 212-1) at 8. In fact, Berg designed Intrepid's lang fines leach system. Id. In "Berg's opinion, the concept of using a pipeline leach to remove halite from langbeinite is commonly known in mineral processing, and was a concept will known to Intrepid prior to Steve Gamble's arrival." Id. Berg used a 550-foot pipeline for Intrepid's lang fines leach system because of the physical location of equipment, including "[t]he distance from the pump box to the cyclones...." Id.
Mosaic objects to Berg's expected testimony that "roughly 60 seconds [is] the optimal dissolution time" for lang fines leaching. Id. Mosaic further objects to Berg's expected testimony that he "received zero input from Steve Gamble on what the length of the pipeline should be, or any other aspect of his design of the fines leach." Id. at 8-9. Next, Mosaic objects to the following expected testimony by Berg: "In Mr. Berg's opinion, the leaching medium in Intrpid's fines leach is water." Id. at 9.
Berg will also opine that "the Tailings Brine Recovery (TBR) liquid is not the leaching medium in Intrepid's fines leach." Id. Berg will testify that Intrepid adds TBR to the crushed dry ore "in order to create a slurry to move the ore through the various unit operations." Id. Berg will further testify that "[i]f the TBR were a leaching medium, the leaching would start at that very early stage, which is certainly not what Intrepid intends." Id.
Finally, Mosaic objects to the following expected testimony by Berg: "In Mr. Berg's opinion, he and others at Intrepid are responsible for the design of Intrepid's fines leach system, which incorporates no information received from Steve Gamble and no information that originated at Mosaic." Id.
b. Berg's Deposition Testimony
Berg testified that his definition of an optimal leach time is "[t]he amount of time necessary to remove sufficient halite to reach product grade of the langbeinite," i.e., the optimal leach time is based on the dissolution of impurities. (Doc. 212-4) at 3. Berg had no opinion as to whether Gamble assisted Morrison in leaching tests, like tests to determine an optimal dissolution, or whether Gamble helped Morrison. Id. at 5. Furthermore, since neither Morrison nor Gamble reported directly to Berg, Berg admitted that he did not know what Morrison or Gamble did on a daily basis. Id. at 4-5.
Moreover, Berg explained that his expected testimony regarding a pipeline fines leach system restricted by the location of the pump box and cyclones referred to a pipeline leach system installed in 2018. Id. at 5. In addition, Berg agreed that is was "pure coincidence" that the 550-foot pipeline resulted in a 60-second optimal dissolution time. Id. at 8. According to Berg, it was also "pure coincidence" that Morrison also identified 60 seconds as an optimal leach time. Id.
Berg further testified that he had not researched whether TBR acts as a leaching medium. Id. at 9. II. Discussion
Mosaic makes four arguments in support of its Motion to Partially Exclude. First, Mosaic argues that all four non-retained experts lack sufficient information to opine that Gamble was not involved with Intrepid's lang process modifications that Mosaic claims implemented its trade secrets or confidential information. Second, Mosaic argues that Morrison and Berg's opinions regarding an optimal lang fines leach time of 60 seconds are misleading and confusing, and not based on the facts of this case. Third, Mosaic argues that Berg does not support his opinion that water is Intrepid's leaching medium with sufficient facts or data. Finally, Mosaic argues that Nyikos did not form his trade secrets opinions and his opinion concerning Intrepid's improved lang recovery rate in the course of his professional duties. Intrepid opposes the Motion to Partially Exclude in its entirety.
Rule 26(a)(2) provides for two different types of expert witnesses: (1) expert witnesses who are "retained or specially employed to provide expert testimony in the case or one whose duties as the party's employee regularly involve giving expert testimony," Rule 26(a)(2)(B), and (2) expert witnesses who are "not retained" or whose duties as the party's employee do not regularly involve giving expert testimony, Rule 26(a)(2)(C). A Rule 26(a)(2)(B) expert witness (referred hereinafter as a "retained expert") must provide a written report while a Rule 26(a)(2)(C) expert witness (referred hereinafter as a "non-retained expert") need only disclose the subject matter of the testimony and a summary of the facts and opinions to which the expert will testify.
A non-retained expert's "opinion is based on information the expert witness acquired through percipient observations" while a retained expert's "opinion is based on information provided by others or in a manner other than by being a percipient witness to the events in issue." United States v. Sierra Pac. Indus., 2011 WL 2119078, at *4 (E.D. Cal.); see also Skarda v. Johnson & Johnson, 2014 WL 12792345, at *3 (D.N.M.) (holding that physicians can testify as non-retained experts because their "testimony was derived from their 'personal knowledge and observations obtained during [their] course of care and treatment of Plaintiff'") (citation omitted). For example, non-retained experts may testify about any "professional analysis" of facts, or opinions, made during their involvement in a project that is later the subject of a lawsuit. Burgundy Dev., L.L.C. v. Lathan Co., 2012 WL 6674413, at *2 (E.D. La.). Moreover, non-retained experts can rebut other "experts' opinions with which they disagree, provided that their disagreement is factual in nature and arises from their experience on" the project at issue in the lawsuit "(as opposed to information they learned solely through the claim adjustment process or in litigation)." Indianapolis Airport Auth. v. Travelers Prop. Cas. Co. of Am., 849 F.3d 355, 371 (7th Cir. 2017). In other words, non-retained experts "may not offer opinions that were formed specifically in preparation for trial ... because they did not produce expert reports under Rule 26(a)(2)(B)." Burgundy Dev., L.L.C., 2012 WL 6674413 at *2; see also Goodman v. Staples The Office Superstore, LLC, 644 F.3d 817, 826 (9th Cir. 2011) (holding that treating physicians were retained experts because they reviewed information provided by "attorney that they hadn't reviewed during the course of treatment").
Federal Rule of Evidence 702 governs the admissibility of expert testimony, whether the expert is retained or not. Rule 702 imposes on courts a gatekeeper obligation to "ensure that any and all scientific testimony or evidence admitted is not only relevant, but reliable." Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 589 (1993). The proponent of the expert testimony bears the burden of proving the requirements of Rule 702 by a preponderance of the evidence. See Fed. R. Evid. 702 Advisory Committee's Note (2000) (stating that proponent of expert testimony "has the burden of establishing that the pertinent admissibility requirements are met by a preponderance of the evidence."). With these standards in mind, courts should liberally admit expert testimony. See United States v. Gomez, 67 F.3d 1515, 1526 (10th Cir. 1995) (describing Rule 702 as a "liberal standard").
Rule 702(b) provides that experts fulfill the reliability obligation when they base their testimony "on sufficient facts or data...." The need for experts to base their testimony "on sufficient facts or data" requires "a quantitative rather than a qualitative analysis." Duke Energy Field Servs., L.P. v. Gandy Corp., 2006 WL 5186540, at *3 (D.N.M.) (citation omitted). As this Court explained,
[t]he emphasis in Rule 702[(b)] on "sufficient facts or data" is "not intended to authorize a trial court to exclude an expert's testimony on the ground that the court believes one version of the facts and not the other." An expert's opinion must find some support in the record for the facts assumed, and weaknesses in the factual basis of an expert's opinion goes to the weight to be given to the evidence, not to its admissibility.Id. (citation omitted). In other words, an expert cannot base his or her testimony on "subjective belief or unaccepted speculation." Pioneer Centres Holding Co. Employee Stock Ownership Plan & Tr. v. Alerus Fin., N.A., 858 F.3d 1324, 1341-43 (10th Cir. 2017), cert. dismissed sub nom. Pioneer Centres Holding v. Alerus Fin., 139 S. Ct. 50 (2018) (citation omitted).
"Relevance is about whether the expert testimony 'will assist the trier of fact' or whether it instead falls 'within the juror's common knowledge and experience' and 'will usurp the juror's role of evaluating a witness's credibility.'" United States v. Wofford, 766 F. Appx. 576, 581 (10th Cir. 2019) (quoting United States v. Rodriguez-Felix, 450 F.3d 1117, 1123 (10th Cir. 2006)).
A. Whether All Four Non-Retained Experts Lack Sufficient Information to Opine that Gamble was not Involved with Intrepid's Lang Process Modifications that Mosaic Claims Implemented its Trade Secrets or Confidential Information
1. Bytnar and Morrison's Opinions that Gamble was not Involved in or Influenced Intrepid's Binder Selections
Mosaic contends that Bytnar and Morrison's opinions that Gamble had no involvement in the binder testing or no influence on Intrepid's selection of a CMC binder have no factual basis and that those "expert opinions" are mere fact testimony. Intrepid argues that "[t]here is sufficient factual basis to allow Bytnar's proffered and disclosed testimony that Intrepid's selection of CMC was the result of Envirotech's testing." (Doc. 235) at 6. Intrepid notes that although Gamble helped with the final production testing of CMC products, Morrison testified that Gamble did not identify Ashland's CMC 12M31XP as the superior binder. Intrepid concludes that Mosaic's arguments go to the weight and not to the admissibility of Bytnar and Morrison's opinions regarding Gamble's involvement in Intrepid's CMC binder selections.
Bytnar acknowledged in his deposition testimony that Gamble had some role or involvement in the final binder production testing when Gamble asked Morrison and another individual for data reports on the CMC binder and how it comparted to starch. Morrison also admitted that Gamble was involved in the final production testing of CMC 12M31XP. Other evidence shows that Gamble participated in the later pilot testing of CMC 12M31XT. Even though Bytnar testified that Gamble had no influence in his EnviroTech lab, Bytnar could not testify that he had knowledge that Gamble had no influence at Intrepid in determining a CMC binder. Like Bytnar, Morrison could not testify that he had knowledge that Gamble did not affect Intrepid's selection of a CMC binder. Considering the above deposition testimony, neither Bytnar nor Morrison knew facts to support their sweeping opinions that Gamble was not involved in Intrepid's CMC binder testing and did not influence Intrepid's selection of a CMC binder. Bytnar and Morrison opinions on Gamble's involvement and influence on Intrepid's CMC binder selection are speculative and, thus, unreliable.
Also, a jury can use its common knowledge and experience to determine the extent to which Gamble was involved in Intrepid's CMC binder testing and influenced Intrepid's CMC binder selections. As such, Bytnar and Morrison's opinions that Gamble was not involved in either testing CMC binders or influencing Intrepid's CMC binder selections will not assist the trier of fact. Accordingly, those opinions lack relevance. The Court, therefore, excludes Bytnar and Morrison's opinions about Gamble's lack of involvement in testing CMC binders and lack of influence on Intrepid's selection of CMC binders.
2. Nyikos and Berg's Opinions that Gamble was not Involved in Developing Intrepid's Fines Leach system
Mosaic objects to Nyikos's opinion that "Intrepid never received any new insights regarding leaching of lang fines from Steve Gamble." (Doc. 212-1) at 7. Mosaic further objects to Berg's opinion that Intrepid did not incorporate any information from Gamble in designing Intrepid's fines leach system, including any input on the length of the pipeline. Mosaic contends that both Nyikos and Berg have no personal knowledge or facts to support the assertion that Gamble was not involved in designing Intrepid's fines leach system.
Intrepid asserts that Nyikos' involvement in the design of the lang fines leach system provides the necessary personal knowledge and factual support for Nyikos' opinion that Gamble did not provide Intrepid with any "insights." Intrepid contends that "any weaknesses in Nyikos' factual basis goes to the weight of this evidence, and not to its admissibility." (Doc. 235) at 8. Intrepid also asserts that Berg's deposition testimony that he has no personal knowledge of whether Gamble assisted Morrison with leach dissolution testing is "of no import" to whether Berg has personal knowledge that Gamble did not provide Intrepid information to incorporate into the design of the fines leach system. Id. at 7.
In fact, Nyikos conceded in his deposition testimony that he did not know if Gamble provided insights on fines leaching to Morrison or Berg, who were both principals involved in developing the lang fines leaching process. Berg also had no opinion as to whether Gamble assisted Morrison in leaching tests, like one to determine an optimal dissolution time, or whether Gamble helped Morrison. Moreover, because neither Morrison nor Gamble reported directly to Berg, Berg admitted that he did not know what they did on a daily basis. The above deposition evidence indicates that Nyikos and Berg's testimony about Gamble's lack of involvement in the development of the lang fines leach system is at best speculative and unreliable.
Moreover, a jury can use its common knowledge and experience to determine the extent to which Gamble was involved in the development of Intrepid's fines leach system. Consequently, Nyikos and Berg's opinions regarding Gamble's involvement in the development of the Intrepid's fines leach system does not assist the trier of fact and, so, those opinions lack relevance as well. Accordingly, the Court excludes Nyikos and Berg's opinions concerning Gamble's lack of involvement in the development of Intrepid's fines leach system.
3. Nyikos' Opinion that Gamble did not Provide Information to Intrepid to Change the Crusher Speed
Mosaic objects to Nyikos' opinion that "Gamble provided no information that influenced the speed of the main crusher at Intrepid." (Doc. 212-1) at 7. Mosaic argues that Nyikos contradicts this opinion by testifying that Gamble provided Intrepid information regarding the crusher circuit and that Gamble's information regarding the speed of the crusher could validate Intrepid's previous idea about slowing the crusher speed. Intrepid contends that Nyikos' deposition testimony shows that although Gamble worked on the crusher he did not provide information that influenced Intrepid to change the crusher speed.
Nyikos actually testified that Gamble both recommended slowing the crusher speed and was involved in slowing down the crusher. However, Nyikos testified that Gamble's work did not influence Intrepid's operations management team because Intrepid had already considered slowing down the crusher beginning in June or July of 2014, well before Gamble began working at Intrepid. On the other hand, Nyikos admitted that Gamble's work slowing down the crusher could have validated Intrepid's prior consideration of a slower crusher speed. Nonetheless, Nyikos has provided some factual support for his opinion that Gamble's work on reducing the crusher speed did not influence Intrepid, i.e. that Intrepid previously considered a slower crusher speed. The Court finds that fact sufficient to support Nyikos' opinion that Gamble did not provide information to Intrepid that influenced its crusher speed. Any weakness in the factual basis for Nyikos' opinion goes to the weight of Nyikos' testimony, not its admissibility. Hence, disregarding any qualitative assessment of the opinion, the Court determines that the Nyikos' opinion is reliable.
Even though Nyikos' opinion that Gamble did not provide information to Intrepid that influenced its crusher speed is reliable, the Court questions whether the opinion is relevant. A jury does not need Nyikos' expertise as a strategic engineer to determine whether Gamble's work reducing the crusher speed actually influenced, by validation or some other means, Intrepid's decision to slow the crusher speed. A jury can use its common knowledge and experience to make that determination. Nyikos' opinion, thus, will not assist the trier of fact. Consequently, that opinion lacks relevance. For that reason, the Court excludes Nyikos' opinion that Gamble did not provide information to Intrepid that influenced its crusher speed.
B. Whether Morrison and Berg's Opinions on an Optimal Fines Leach Time is Misleading and Confusing, and not Based on the Facts in this Case
Mosaic objects to Morrison's opinions that his lab testing to determine an optimal fines leach time was "scientifically correct" by focusing on the dissolution of impurities from the lang and that the optimal fines leach time is approximately one minute. (Doc. 212-1) at 5. Mosaic also objects to Berg's opinion that "roughly 60 seconds" is the "optimal dissolution time." Id. at 8. Mosaic argues that in light of Morrison and Berg's deposition testimony these opinions are misleading and confusing because Mosaic's fines leaching trade secret parameters include an optimal fines leach time based on the time required to minimize lang dissolution, not on the time required to dissolve impurities. See (Doc. 210-4) at 7. Mosaic also argues that the Morrison and Berg's opinions do not relate to the facts of this case.
Intrepid asserts that Morrison based his leach time conclusions on facts developed in his lab testing. Moreover, Intrepid argues Morrison's testimony is not confusing because he considered lang dissolution losses in addition to the dissolution of impurities in his testing. Additionally, Intrepid argues that Berg's opinion is factually related to Intrepid's current leach system, which Berg assisted in designing.
Mosaic counters that Morrison's testimony that he considered lang dissolution losses concerned "different testing." (Doc. 265) at 7. Morrison apparently did other leach time testing in early 2015, but Mosaic does not provide any evidence that Morrison's testimony about lang dissolution losses referred only to Morrison's testing in early 2015 and not to his testing in the spring of 2014, prior to Gamble's employment at Intrepid. See (Doc. 264-2) at 3. Regardless of when Morrison conducted his testing, Mosaic asserts that, according to Berg, no testing occurred regarding the retention time in the leaching circuit because the location of pre-existing equipment dictated the length of the pipeline and produced, coincidentally, the corresponding optimal leach time to dissolve impurities.
Mosaic does not contest that Morrison conducted leach testing in the course of his employment at Intrepid. Mosaic also does not contest that Berg assisted in designing the fines leach system in the course of his employment at Intrepid nor does Mosaic contest Berg's explanation of why and how that system produced what Berg considers an optimal fines leach time. Notwithstanding whether Mosaic qualitatively challenges how Morrison conducted his leach testing or how Berg designed the fines leach system, Morrison's leach testing and Berg's leach system design furnish sufficient facts and data to support their optimal fines leach time opinions based on the dissolution of impurities. Those opinions, therefore, are reliable.
Instead, Morrison challenges the relevancy of those opinions considering that the alleged trade secret involves an optimal fines leach time based on the dissolution of lang, not on the dissolution of impurities. If Intrepid developed its optimal fines leach time based on the dissolution of impurities, as determined by Morrison's testing or the physical limitations of the leach system, that fact is relevant to whether Intrepid used Mosaic's optimal fines leach time premised on the dissolution of lang. If Intrepid, in fact, considered dissolution of lang, which Morrison's deposition testimony indicates occurred at some point (possibly after Gamble began his employment at Intrepid), that fact, likewise, is relevant to whether Intrepid used Mosaic's optimal fines leach time premised on the dissolution of lang. Moreover, contrary to Mosaic's characterization of Morrison and Berg's testimony as misleading and confusing, in view of the technical nature of this evidence, Morrison and Berg's testimony on those matters would assist a trier of fact. Bearing in mind the liberal application of Rule 702, the Court will not exclude Morrison and Berg's opinions and testimony regarding optimal fines leach time.
C. Whether Sufficient Facts or Data Support Berg's Opinion the Intrepid uses Water as a Leaching Medium
Mosaic objects to Berg's opinion that Intrepid's leaching medium is water because neither sufficient facts or data support that opinion. Mosaic contends that this opinion contradicts Intrepid's Fed. R. Civ. P. 30(b)(6) corporate witness' testimony that Intrepid uses both water and brine as the medium to leach fines. Moreover, Mosaic notes that Berg testified at his deposition that he had not researched whether brine or TBR has a leaching effect.
In addition to his expert deposition testimony, Nyikos gave deposition testimony as Intrepid's Rule 30(b)(6) corporate witness. In his capacity as the Rule 30(b)(6) corporate witness, Nyikos testified that the pipeline leach uses both water and brine or TBR. (Doc. 212-10) at 3. The Court treats that testimony as an evidentiary admission as opposed to a judicial admission. See Vehicle Mkt. Research, Inc. v. Mitchell Int'l, Inc., 839 F.3d 1251, 1259-61 (10th Cir. 2016) (agreeing "with our sister circuits that the testimony of a Rule 30(b)(6) witness is merely an evidentiary admission, rather than a judicial admission").
Intrepid concedes that it uses TBR to create a slurry to move the ore in the fines leaching process, but it does not use TBR as a leaching medium. So, in that sense, the pipeline leach utilizes both water and TBR as the Rule 30(b)(6) corporate witness testified. However, Berg's unqualified opinion that water is the leaching medium is belied by Berg's admission that he does not know if TBR also leaches fines because he has not done the research to make that determination. Without more information on TBR's leaching capabilities, Berg's opinion that "the leaching medium in Intrepid's fines leach is water" is speculative and not based on sufficient data. Consequently, Berg's opinion that Intrepid uses water as its leaching medium is not reliable and the Court excludes Berg's opinion for that reason.
D. Whether Nyikos Formed his Opinions on Trade Secrets and Intrepid's Improved Lang Recovery Rate in the Course of his Professional Duties
Mosaic objects to Nyikos' opinions that (1) "there are no legitimate trade secrets ... except for the formula of a pelletization binder;" (2) "the concept of leaching langbeinite fines is not and cannot be a trade secret;" and (3) Intrepid's dramatic lang recovery rate "is not attributable to" Intrepid's receipt of "Mosaic information from Steve Gamble," but is instead attributable to the use of a CMI centrifuge (5.9%), changing to lang only processing (13.5%), use of a reflux classifier (6.7%), and use of a fines lang leach (9%). (Doc. 212-1) at 7. Mosaic asserts that Rule 26(a)(2)(C) prohibits these non-retained expert opinions "because Nyikos did not arrive at any of these opinions in the course of his professional responsibilities, or prior to this lawsuit." (Doc. 211) at 16.
Intrepid argues that the Court should not exclude those opinions because Nyikos is an Intrepid employee and Nyikos formulated his opinions at the request of counsel to rebut Mosaic's experts, Carlos Perucca and William Chavez. In addition, Intrepid notes that its disclosure of Nyikos as a non-retained expert complies with Rule 26(a)(2)(C).
Notwithstanding whether Nyikos is a rebuttal witness, the Court agrees with Mosaic. Nyikos admitted at his deposition that his job responsibilities do not include determining whether something is a trade secret nor does he have an opinion as to whether specific parameters of Mosaic's fines leaching constitute a trade secret. Hence, Nyikos, as a non-retained expert, cannot testify on what constitutes a trade secret. See Burgundy Dev., L.L.C., 2012 WL 6674413 at *2 (explaining that non-retained expert can testify about "professional analysis" of facts and opinions made while working on project that is subject of lawsuit). Furthermore, Nyikos testified that he calculated the rate of Intrepid's lang recovery improvements "[f]or the purposes of this case." (Doc. 212-5) at 21. Nyikos made those calculations specifically in preparation for trial, so he cannot testify about Intrepid's improved rate of lang recovery as a non-retained expert. See Burgundy Dev., L.L.C., 2012 WL 6674413 at *2 (stating that non-retained expert "may not offer opinions that were formed specifically in preparation for trial ... because they did not produce expert reports under Rule 26(a)(2)(B)"); Indianapolis Airport Auth., 849 F.3d at 371 (holding that non-retained experts can rebut factual basis of other experts' opinions so long as rebuttal is based on non-retained expert's experiences acquired during course of employment). The Court further notes, as Mosaic does, that Intrepid's disclosure does not describe the methodology or data Nyikos relied upon to make his lang recovery rate calculations. Thus, reliability of those calculations is at issue. For the above reasons, the Court excludes Nyikos' trade secret opinions and his opinion that several factors "independent of Gamble" dramatically improved Intrepid's lang recovery rate. III. Conclusion
Intrepid, as the proponent of the above challenged non-retained expert testimony, has not proven by a preponderance of the evidence that the entirety of that challenged testimony meets the requirements of Rule 26(a)(2)(C) and Rule 702. Consequently, the Court, in fulfilling its gatekeeper obligation, grants the Motion to Partially Exclude, in part, for the reasons discussed, supra.
IT IS ORDERED that "Mosaic Potash Carlsbad, Inc.'s Motion to Partially Exclude Intrepid Rule 26(a)(2)(C) Experts" (Doc. 211) is granted, in part, in that the Court excludes the following testimony:
1. Steve Bytnar:
a. Gamble had no involvement in any of the testing that identified and confirmed the CMC binder as being the superior option.
b. Gamble provided no information regarding, and had no influence on, the identification and selection of CMC as Intrepid's binder.
c. In Bytnar's opinion, Intrepid's selection of CMC was the result of Envirotech's extensive scientific testing, and in no way was influenced by Gamble.
2. Michael Morrison:
a. Gamble had no involvement in any of the testing that identified and confirmed the CMC binder as being the superior option.
b. Gamble provided no information regarding, and had no influence on, the identification and selection of CMC as Intrepid's binder.
c. In Morrison's opinion, Intrepid's selection of CMC was the result of Envirotech's extensive scientific testing, and data generated by FEECO and within Intrepid's pellet plant during trial runs and in no way was influenced by Gamble.
3. Chris Nyikos:
a. In Nyikos' opinion, there are no legitimate trade secrets in this area, except for the formula of a pelletization binder.
b. In Nyikos's opinion, the concept of leaching lang fines is not and cannot be a trade secret.
c. Intrepid never received any new insights regarding leaching of lang fines from Gamble.
d. Gamble provided no information that influenced the speed of the main crusher at Intrepid.
e. The improvement in Intrepid's recovery rate in the 2014-2017 timeframe is not attributable to having received Mosaic information from Gamble. In Nyikos' opinion the improvement from 33.4% recovery to 68.5% recovery is attributable to the following factors that are independent of Gamble:
i. Change to CMI centrifuge from solid bowl debrining: 5.9%
ii. Change from mixed ore process to lang only: 13.5%
iii. Use of reflux classifier: 6.7%
iv. Addition of fine lang leach: 9%
4. Brett Berg:
a. In Berg's opinion, Intrepid did not incorporate any information from Gamble in designing Intrepid's lang fines leach system.
b. In Berg's opinion, the leaching medium in Intrepid's fines leach is water.
/s/_________
UNITED STATES DISTRICT JUDGE