Catipovic v. Turley
2014 U.S. Dist. LEXIS 169889
| N.D. Iowa | 2014Background
- Plaintiff Branimir Catipovic alleges breach of contract and unjust enrichment arising from an aborted plan to build an ethanol plant in Osijek, Croatia, and claims defendants Mark Turley and Roland Fagen (and Fagen, Inc.) later developed a Dunaföldvár, Hungary ethanol facility without him.
- Trial originally set for April 2014 was continued to November 2014; parties filed overlapping motions in limine addressing admissibility of expert opinions, evidence about the Dunaföldvár facility, unpleaded claims, undisclosed damages, wealth, settlement negotiations, and an October 24, 2012 letter from Turley to nonparty Walt Wendland.
- Catipovic’s damages expert Michael Ott initially relied on U.S. data (Iowa/CARD) but later submitted an amended/supplemental March report incorporating Dunaföldvár data produced belatedly by defendants.
- Defendants moved to exclude Ott under Rule 702/Daubert, to exclude lost-profit evidence for a ‘‘new business’’ (Osijek) and to exclude evidence of Fagen’s construction profits as irrelevant to unjust enrichment claims.
- The court evaluated Daubert reliability, relevancy under Rules 401–403, discovery sanctions under Rules 26/37, hearsay and credibility limits, and admissibility of the October 24, 2012 letter as possible witness tampering.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of expert Michael Ott under Rule 702/Daubert | Ott has relevant renewable-energy valuation experience; March amended report cures earlier reliance on U.S. data; weight for jury | Ott lacks formal valuation credentials; original report used irrelevant U.S. data and was speculative; supplementation untimely | Denied as to Ott's amended/supplemented report: expert admissible; original February 2013 opinions excluded as too speculative |
| Evidence of future lost profits from Dunaföldvár and Osijek projects | Dunaföldvár has actual financial data making future-profits evidence admissible; Osijek profits are speculative | New-business rule bars lost-profit recovery; Osijek never built and is speculative; foreign markets differ | Testimony on Dunaföldvár lost profits admissible (actual performance data); Osijek future profits excluded under new-business rule |
| Evidence of Fagen, Inc. construction profits from Dunaföldvár (relevance to unjust enrichment) | Profits/contract award show Fagen benefited and may have received equity tied to profits | Construction profits are not the value of Catipovic’s promoter services and thus irrelevant and prejudicial | Excluded: Fagen’s construction profits irrelevant to unjust enrichment valuation and likely to confuse jury (Rule 403) |
| October 24, 2012 Turley letter to Wendland (alleged witness tampering) | Admissible to show attempt to influence/suppress Wendland and consciousness of weak case; relevant to credibility | Irrelevant, prejudicial, improper character evidence; Wendland not yet a witness; letter not a true threat | Admissible against Turley as evidence of attempted witness influence/consciousness of weakness; limiting instructions required; not admissible against parties not responsible |
Key Cases Cited
- Daubert v. Merrell Dow Pharm., 509 U.S. 579 (1993) (district court is gatekeeper evaluating relevance and reliability of expert testimony)
- Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999) (Daubert gatekeeping applies to all expert testimony)
- General Elec. Co. v. Joiner, 522 U.S. 136 (1997) (court may exclude expert opinion where connection between data and opinion is too speculative)
- Concord Boat Corp. v. Brunswick Corp., 207 F.3d 1039 (8th Cir. 2000) (expert testimony that is speculative contributes nothing and may be excluded)
- Wegener v. Johnson, 527 F.3d 687 (8th Cir. 2008) (Rule 37(c)(1) sanctions—exclusion of undisclosed evidence unless harmless or substantially justified)
- Great Am. Ins. Co. v. Horab, 309 F.2d 262 (8th Cir. 1962) (evidence of attempts to influence witnesses may be admissible to show consciousness of weakness, but exclusion can be within discretion)
- Dahlgren v. First Nat’l Bank of Holdrege, 533 F.3d 681 (8th Cir. 2008) (third-party settlement evidence is viewed skeptically under Rule 408; may be excluded for prejudice)
- State ex rel. Palmer v. Unisys Corp., 687 N.W.2d 142 (Iowa 2001) (elements of unjust enrichment under Iowa law)