Opinion
No. X07 CV 07 5010699 S
July 2, 2010
MEMORANDUM OF DECISION
I
In a memorandum of decision, dated October 27, 2009, this court granted in part and denied in part the parties' cross motions for summary judgment. On November 2, 2009, the defendant, PricewaterhouseCoopers, LLP, filed a motion in limine (#236.00) pursuant to Practice Book § 15-3 to preclude the plaintiff. Vigilant Insurance Company, from offering the testimony of its expert, James Kern, about the defendant's audit work relating to Rule 17a-5 of the Securities Exchange Act of 1934 (SEC Rule 17a-5). The defendant argues that Kern did not identify any breach of SEC Rule 17a-5 in either his expert report, dated April 6, 2009, or at his deposition.
Section 15-3 provides: "The judicial authority to whom a case has been assigned for trial may in its discretion entertain a motion in limine made by any party regarding the admission or exclusion of anticipated evidence. If a case has not yet been assigned for trial, a judicial authority may, for good cause shown, entertain the motion. Such motion shall be in writing and shall describe the anticipated evidence and the prejudice which may result therefrom. All interested parties shall be afforded an opportunity to be heard regarding the motion and the relief requested. The judicial authority may grant the relief sought in the motion or such other relief as it may deem appropriate, may deny the motion with or without prejudice to its later renewal, or may reserve decision thereon until a later time in the proceeding."
On November 10, 2009, the plaintiff filed an objection to the motion in limine (#277.00) that referenced a supplemental report issued by Kern, dated November 10, 2009, in which Kern stated for the first time that the defendant breached its obligations under SEC Rule 17a-5. The plaintiff argues that if the defendant had asked Kern about SEC Rule 17a-5 during his deposition that he would have discussed it. On November 18, 2009, the trial, which was to commence on November 24, 2009, was continued to January of 2012.
This report is attached to the plaintiff's "supplemental disclosure of expert" (#280.00), dated November 10, 2009.
On March 19, 2010, the defendant filed an additional motion (#326.00) to preclude the plaintiff from relying on Kern's new opinions about the defendant's alleged breach of SEC Rule 17a-5. The defendant argues that it is prejudiced by Kern's supplemental report in that it essentially seeks a "do over" of the past few years of litigation. In the plaintiff's April 9, 2010 response (#336.00), it claims that Kern's November 10, 2009 supplemental report is a clarification of his earlier report, and, more importantly, filed in response to questions asked at his deposition; in response to a request from attorneys in the companion matter, Vigilant Ins. Co. v. Deloitte Touche, LLP, Superior Court, complex litigation at Hartford, Docket No. CV 07 5012262; and, finally, in response to documents that were belatedly produced. The plaintiff also argues that the defendant is not prejudiced because it could have asked questions about SEC Rule 17a-5 at Kern's deposition and because the defendant has not attempted to depose Kern on this new report. This court heard oral argument on June 4, 2010.
This action was withdrawn on February 2, 2010.
II
"Practice Book § 220(D) [now § 13-4] provides that `any plaintiff expecting to call an expert witness at trial shall disclose the name of that expert, the subject matter on which the expert is expected to testify, the substance of the facts and opinions to which the expert is expected to testify, and a summary of the grounds for each opinion, to all other parties within a reasonable time prior to trial . . . If disclosure of the name of any expert expected to testify at trial is not made in accordance with this subsection . . . such expert shall not testify if, upon motion to preclude such testimony, the court determines that the late disclosure (I) will cause undue prejudice to the moving party; or (ii) will cause undue interference with the orderly progress of trial in the case; or (iii) involved bad faith delay of disclosure by the disclosing party . . .'
"Practice Book § 220(D) is intended to furnish a defendant with the details of a plaintiff's reliance on expert testimony in order to assist him with the preparation of his case. The rules of discovery are designed to make a trial less of a game of blindman's [buff] and more of a fair contest with the basic issues and facts disclosed to the fullest extent possible . . . A trial court may, in the exercise of its discretion, impose sanctions on a party for failure to comply with the rules of disclosure. These sanctions include the exclusion of expert testimony at trial." (Citation omitted; internal quotation marks omitted.) Ciarlelli v. Romeo, 46 Conn.App. 277, 280, 699 A.2d 217 (finding that plaintiff failed to demonstrate that trial court abused discretion by limiting expert's testimony to that disclosed), cert. denied, 243 Conn. 929, 701 A.2d 657 (1997).
Additionally, Practice Book § 13-5, in relevant part, provides: "Upon motion by a party from whom discovery is sought, and for good cause shown, the judicial authority may make any order which justice requires to protect a party from . . . oppression, or undue burden or expense, including one or more of the following . . . (4) that certain matters not be inquired into, or that the scope of the discovery be limited to certain matters . . ."
III CT Page 13870
The court has reviewed the parties' extensive memoranda on the defendant's motions. Although the plaintiff's complaint alleges a violation of SEC Rule 17a-5, Kern's April 6, 2009 report made no mention of a SEC Rule 17a-5 violation. Kern could have rendered such an opinion in his report or at his deposition in June and September of 2009. Indeed, Kern identified all breaches of the defendant's engagement letters at his deposition and affirmatively stated that there were no other breaches.
In the defendant's June 9, 2009 memorandum in support of its motion for summary judgment, it noted on page thirteen, footnote 14, that "Vigilant's expert has not opined that PwC breached the standard of care in preparing the Rule 17a-5 report or that any breach with respect to the Rule 17a-5 report resulted in damage to Vigilant." In the plaintiff's memorandum in opposition to the defendant's motion, the plaintiff did not respond to this argument. At the July 6, 2009 oral argument before this court, the plaintiff did not dispute the defendant's statement that the plaintiff was no longer pursuing a claim based upon a violation of SEC Rule 17a-5. Thus, the plaintiff had multiple opportunities to present Kern's opinion that there was a SEC Rule 17a-5 violation and to deny or correct the defendant's assertion that the SEC Rule 17a-5 allegations were no longer part of the case, but it remained silent.
It is noted, however, that the plaintiff reiterated the allegation of the complaint that involved the alleged violation of SEC Rule 17a-5: "PwC . . . failed to conduct audits in accordance with . . . the applicable requirements of SEC Rule 17a-5."
Instead, Kern's November 10, 2009 supplemental report containing his opinion that there was a violation was produced well beyond the scheduling order deadline of April 2009 and just two weeks before trial was to commence. Given the timing, it is clear that the supplemental report was filed in direct response to this court's October 27, 2009 decision and the defendant's November 2, 2009 motion in limine.
The court is mindful of the extensive pleadings and argument by both sides and is not blind to the legal costs that the parties have incurred. Allowing this latest report would require another round of discovery and dispositive motions that would be costly and would presumably result in a "do over" scenario as argued by the defendant. The fact that the trial has been continued and that there might be sufficient time to repeat this process does not alleviate the prejudice to the defendant. Indeed, allowing the report may both negate the efforts of the prior exhaustive summary judgment process and require further summary judgment motions. See Fortin v. Hartford Underwriters Ins. Co., Superior Court, complex litigation at Hartford, Docket No. X04 CV 03 4034596 (May 6, 2009, Shapiro, J.) ("There is no legal justification for permitting the plaintiffs to turn back the clock and to start again in another effort to attempt to provide expert testimony which has a sufficient factual basis. If the court permitted that now, more than a year after the deadline for disclosing plaintiffs' experts, the dispositive motion process followed by the parties and the court would be rendered meaningless. Likewise, long-ago completed discovery would be reopened just before trial. Having fully litigated and prevailed on the motion to preclude and the motion for summary judgment, [the defendant] would be unduly prejudiced if the court were to ignore its own adjudications and afford the plaintiffs another opportunity to provide expert testimony.").
The defendant also claims that the late disclosure was made in bad faith. However, this court need not address this issue as a result of the above finding.
Consequently, the court finds that the timing and the substance of Kern's supplemental report are prejudicial, will cause undue expense and burden to the defendant and will cause undue interference with the progress of the case. See Ciarlelli v. Romeo, supra, 46 Conn.App. 280; see also Practice Book § 13-5. Accordingly, the court grants the defendant's motion in limine and motion to preclude; the plaintiff may not rely on Kern's supplemental report as to any SEC Rule 17a-5 violation nor may Kern testify about his opinions on the same subject. See Advanced Financial Services, Inc. v. Associated Appraisal Services, Inc., 79 Conn.App. 22, 44-45, 830 A.2d 240 (2003) (affirming trial court's decision to preclude expert witness testimony on subject not in disclosure); Somers Mill Associates, Inc. v. Fuss O'Neill, Inc., Superior Court, complex litigation at New Britain, Docket No. X03 CV 00 0503944 (February 27, 2002, Aurigemma, J.) (precluding expert from testifying at professional malpractice trial as he expressed no opinion of professional's conduct either in his report or at his deposition).