United States District Court, S.D. Illinois
UNITED STATES OF AMERICA, et al. ex rel. JAMES GARBE, Plaintiffs,
KMART CORPORATION, Defendant.
MEMORANDUM AND ORDER
J. ROSENSTENGEL United States District Judge.
matter comes before the Court on the motions to exclude
expert testimony filed by Relator James Garbe and Defendant
Kmart Corporation. Defendant Kmart has moved to exclude the
expert opinion of Dr. Joel Hay, a pharmaceutical economist
hired by Relator to analyze Kmart's reimbursement data
and calculate the damages purportedly sustained by the
Government as a result of Kmart's alleged conduct (Doc.
323). Relator has moved to exclude the report and testimony
of Kmart's expert witness Dorothy DeAngelis, who was
retained by Kmart to rebut the damages theory proffered by
Relator in his pleadings, as well as to rebut the testimony
of Relator's experts (Doc. 322). After holding a hearing
on these motions, as well as a thorough review of the
parties' briefs and the record in this case, the Court
denies both motions.
district court's decision to exclude expert testimony is
governed by Federal Rules of Evidence 702 and 703, as
construed by the Supreme Court in Daubert v. Merrell Dow
Pharms., Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d
469 (1993).” Brown v. Burlington Northern Santa Fe
Ry. Co., 765 F.3d 765, 771 (7th Cir. 2014); see also
Lewis v. Citgo Petroleum Corp., 561 F.3d 698,
705 (7th Cir. 2009). The Daubert standard applies to
all expert testimony, whether based on scientific competence
or other specialized or technical expertise. Smith v.
Ford Motor Co., 215 F.3d 713, 719 (7th Cir. 2000)
(citing Kumho Tire Co., Ltd. v. Carmichael, 526
U.S.137, 141 (1999)).
Rule of Evidence 702 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, or training or education may
testify thereto in the form of an opinion or otherwise.
short, the rule requires that the trial judge ensure that any
and all expert testimony or evidence admitted ‘is not
only relevant, but reliable.'” Manpower, Inc.
v. Ins. Co. of Pa., 732 F.3d 796, 806 (7th Cir. 2013)
(quoting Daubert, 509 U.S. at 589). In determining
whether expert testimony is both relevant and reliable,
courts in the Seventh Circuit perform a three-step analysis:
“the witness must be qualified ‘as an expert by
knowledge, skill, experience, training, or education, '
Fed.R.Evid. 702; the expert's reasoning or methodology
underlying the testimony must be scientifically reliable,
Daubert, 509 U.S. at 592-93, 113 S.Ct. 2786; and the
testimony must assist the trier of fact to understand the
evidence or to determine a fact in issue.” Ervin v.
Johnson & Johnson, Inc., 492 F.3d 901, 904 (7th Cir.
2007) (citing Fed.R.Evid. 702).
such testimony's factual basis, data, principles,
methods, or their application are called sufficiently into
question . . . the trial judge must determine whether the
testimony has ‘a reliable basis in the knowledge and
experience of [the relevant] discipline.'”
Kumho, 526 U.S. at 149 (quoting Daubert,
509 U.S. at 592). “A Daubert inquiry is not
designed to have the district judge take the place of the
jury to decide ultimate issues of credibility and
accuracy.” Lapsley v. Xtek, Inc., 689 F.3d
802, 805 (7th Cir. 2012). “If the proposed expert
testimony meets the Daubert threshold of relevance
and reliability, the accuracy of the actual evidence is to be
tested before the jury with the familiar tools of
‘vigorous cross-examination, presentation of contrary
evidence, and careful instruction on the burden of
proof.'” Id. (quoting Daubert,
509 U.S. at 596). The district court possesses “great
latitude in determining not only how to measure the
reliability of the proposed expert testimony but also whether
the testimony is, in fact, reliable.” United States
v. Pansier, 576 F.3d 726, 737 (7th Cir. 2009) (citing
Jenkins v. Bartlett, 487 F.3d 482, 489 (7th Cir.
Kmart's Motion to Exclude Relator's Expert Dr. Joel
submitted his expert report on July 14, 2014, and issued
revised reports on November 30, 2014 and July 11, 2017 (Docs.
324-1, 324-3, 422). Kmart argues Dr. Hay's opinions are
inadmissible because his damages calculation methodology is
unreliable and irrelevant, and thus it will not help the
trier of fact in reaching a verdict on the issues in this
case. Kmart also asserts Dr. Hay's methodology is fatally
flawed because it is based on an incorrect understanding of
Medicare Part D's payment structure. Kmart claims this
mistake is indicative of Dr. Hay's lack of expertise
regarding Medicare Part D, which renders him unqualified to
serve as an expert.
Dr. Hay's Qualifications
Daubert and the Federal Rules of Evidence, the Court
must determine whether Dr. Hay is qualified as an expert by
his knowledge, skill, education, or training.
Daubert, 509 U.S. at 596; Fed.R.Evid. 702.
“Whether a witness is qualified as an expert can only
be determined by comparing the area in which the witness has
superior knowledge, skill, experience, or education with the
subject matter of the witness's testimony.”
Gayton v. McCoy, 593 F.3d 610, 616 (7th Cir. 2010)
(quoting Carroll v. Otis Elevator Co., 896 F.2d 210,
212 (7th Cir. 1990)). “The question we must ask is not
whether an expert witness is qualified in general, but
whether his ‘qualifications provide a foundation for
[him] to answer a specific question.'” Id.
at 617 (quoting Berry v. City of Detroit, 25 F.3d
1342, 1351 (6th Cir. 1994)).
acknowledges Dr. Hay holds a Ph.D. in Economics from Yale
University and is a tenured Full Professor and Founding Chair
of Pharmaceutical Economics and Policy in the School of
Pharmacy at the University of Southern California. Yet, Kmart
contends, Dr. Hay's experience in the field of
pharmaceutical economics does not extend to data analysis and
submission of Medicare Part D claims. For example, he has not
published any articles on Medicare Part D and has done no
research regarding the program. While he once served as a
consultant for CMS, this experience was not related to
Medicare Part D. Furthermore, during his deposition, Dr. Hay
demonstrated only a cursory familiarity with the Medicare
Part D payment structure and appeared unfamiliar with ...