M.D. Claims Group, LLC v. Anchor Specialty Insurance Company
3:17-cv-00369
M.D. La.Jun 12, 2019Background
- Plaintiffs M.D. Claims Group, L.L.C., Darryn Melerine (majority owner), and Richard Broom (minority owner) were retained by Defendants Anchor Specialty Insurance Co. and Lozano Insurance Adjusters to provide claim-management services for Anchor’s Beaumont, TX claims operation.
- Plaintiffs allege the parties agreed to compensation by a fee schedule and that their duties expanded beyond the original scope at Anchor’s request.
- Plaintiffs claim Defendants failed to pay for the additional services and seek $486,062.37 for extracontractual work; Defendants contend the additional tasks fell within the original scope.
- Plaintiffs proffered Quin Netzel as an expert to (1) describe the customary duties of independent adjusters (to show whether Plaintiffs’ work was within the original scope) and (2) provide a valuation of the additional services.
- Defendants moved to exclude Netzel under Rule 702/Daubert, arguing he is unqualified and his damages valuation is unreliable.
- The court conditionally admitted Netzel to testify about the specialized meaning and customary duties of an "independent adjuster," but excluded his damages valuation opinions as not based on sufficient facts or reliable methodology.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Netzel is qualified to testify about the customary duties/scope of an "independent adjuster" | Netzel's 30 years of industry experience qualifies him to explain trade usage and typical adjuster duties | Netzel lacks specialized experience beyond defense fact witness and thus adds no value | Admitted: Netzel is qualified under Rule 702 to testify about the industry meaning and customary duties of an independent adjuster (conditionally) |
| Whether expert testimony interpreting contract scope is permissible | Trade usage can inform contract terms; Netzel can testify about specialized industry meaning | Interpretation of contract terms is a factual/legal issue improper for expert testimony | Admitted in part: Expert testimony on trade practice and specialized meaning is permissible; Netzel may testify if Plaintiffs show they were hired as independent adjusters |
| Whether Netzel's valuation of Plaintiffs' extracontractual services meets Rule 702(b) sufficiency and reliability requirements | Netzel relied on industry experience to estimate a $385,000–$490,000 value for extra services | Netzel failed to review source documents, time records, or specific tasks—valuation is speculative | Excluded: Netzel’s damages opinions are unreliable and not based on sufficient facts or methodology |
| Whether an expert may be excluded because a fact witness has similar qualifications | Plaintiffs: No rule bars admission due to overlap in qualifications | Defendants: Netzel is duplicative of defense witness Larson | Rejected: Court found no authority to exclude merely because qualifications overlap; argument unpersuasive |
Key Cases Cited
- Daubert v. Merrell Dow Pharm., 509 U.S. 579 (court must act as gatekeeper to ensure expert testimony is reliable and relevant)
- Owen v. Kerr-McGee Corp., 698 F.2d 236 (expert may not usurp judge’s or jury’s role or offer conclusions of law)
- Kona Tech. Corp. v. S. Pac. Transp. Co., 225 F.3d 595 (expert testimony can be admissible to interpret contract provisions with specialized industry meaning)