*403 OPINION
Dеfendant-Appellant Lionel, L.L.C., appeals a jury verdict finding it liable for misappropriation of trade secrets and unjust enrichment, and awarding Plaintiff-Appellee Mike’s Train House, Inc. (“MTH”) damages exceeding $40 million. After unsuccessfully moving the district court for a new trial and judgment as a matter of law, Lionel appeals the jury verdict, the district court’s evidentiary decisions, the specificity with which MTH identified its “trade secrets,” the imposition of joint and several liability, and the amount of the damage award. Lionel also appeals the district court’s order granting MTH’s request for an injunction. Because Lionel correctly argues that the district court erred in admitting expert testimony and in imposing joint-and-several liability, and because the jury award improperly “double counts” MTH’s damages, we REVERSE the district court’s order denying Lionel’s motion for а new trial and REMAND this case for further proceedings consistent with this opinion. Because the district court’s injunction is based entirely on the jury’s verdict, we REVERSE that order as well.
I. BACKGROUND
This case involves MTH’s claim that Lionel misappropriated MTH’s trade secrets and was unjustly enriched by that misappropriation. Before MTH brought this claim, the parties were involved in both criminal and civil litigation in South Korea, based on the same underlying events. After several individuals associated with Lionel were convicted of criminal charges, and Lionel and MTH settled the civil suit, MTH filed the instant complaint against Lionel in federal district court.
Lionel and MTH are both distributors of O-gauge model trains. The model trains they distribute are scale replicas of actual trains. Both Lionel and MTH contract with third parties for the manufacture of their trains and then release the trains fоr distribution under their own names. “Gauge” refers to the width of the track; collectors tend to collect trains of only one gauge (in this case “0 gauge”), so that all their trains can operate on the same track. The trains are manufactured by a process known as zinc die-casting, which is a precise method of construction in which molten metal is injected into pre-shaped molds. This method requires extensive design work for the construction of a single train; accordingly, designers produce “design drawings,” which contain all the information necessary to build a die-cast train. About 200 to 300 design drawings are required to produce each scale engine.
Lionel has been producing O-gauge model trains since the 1930s. In 1987, Lionel hired MTH, founded by Michael Wolf, to work with Samhongsa, a Korean supplier, to design and manufacture die-cast trains, for release under Lionel’s name. MTH and Samhongsa designed and produced several different die-cast trains for Lionel between 1987 and 1993. MTH’s relationship with Lionel ended in 1993. Between 1993 and 1998, Lionel used a number of die-cast manufacturers, but none produced high-quality trains at competitive prices. In 1994, Samhongsa began making O-gauge die-cast trains for resale under MTH’s name, a relationship that continued until 2002.
Soon-Gap Ahn, one of the leading designers at Samhongsa from 1997-98, assisted in designing trains for both Lionel and MTH during each company’s relationship with Samhongsa. Ahn testified that Samhongsa designers, subcontract designers, members of various departments at *404 Samhongsa, and other subcontractors had access to all Samhongsa designs and were allowed to make and retain copies of those designs. Ahn also testified that Korean designеrs use a common numbering system in their design drawings to refer to the same parts of the model train. For example, engine parts are numbered in the “1000 range” by Korean design companies.
During the time that Samhongsa worked for both Lionel and MTH, Samhongsa subcontracted with a company named Korea Brass (“KB”), a supplier of wax castings for model trains. KB had been formed in 1984 by Sung-Won Cho, a former Sam-hongsa employee. In 1998, KB expanded and became a direct supplier and manufacturer of model trains. After Cho and Yoo Chan Yang, KB’s sales agent in the United States, approached Lionel in April 1998, Lionel placed an order with KB to manufacture two die-east-model-train lines.
KB then hired Ahn to design trains that it intended to manufacture for Lionel. Before departing Samhongsa, Ahn copied design drawings for MTH trains onto computer disks; Ahn testifiеd that he took the drawings to work on them at home, and that the other designers acted similarly. While working for KB, Ahn hired Bok-Dong Chung, a Samhongsa subcontractor, to assist him with the drawings for an 0-gauge die-cast model train. Ahn testified that he instructed Chung to draw the designs differently from those produced by Samhongsa.
In 1999, Lionel distributed the two die-cast trains designed and manufactured by KB. After purchasing samples of each model in July of that year, Wolf immediately traveled to Korea because he was concerned that the trains had been designed and manufactured based on MTH’s design drawings. Wolf asked Samhongsa to conduct an internal investigation, during which Chung admitted to copying Sam-hongsa designs of MTH trains and giving them to Ahn. Korean law-enforcement authorities launched an investigation into whether crimes had been committed in connection with the use of these designs. As pаrt of that investigation, the police seized Ahn’s computer and the computers belonging to other former and current Samhongsa employees to determine whether they contained evidence of criminal activity.
The Korean authorities prosecuted Ahn, along with three other Samhongsa employees, for misappropriation of trade secrets, a criminal offense in Korea. As part of that case, Professor Kun-Woo Lee, a Korean engineering expert, compared 3307 pairs of Samhongsa and KB drawings and found substantial evidence of copying. A Korean court found Ahn and three Sam-hongsa employees guilty of the unlawful misappropriation of MTH’s trade secrets. Samhongsa then brought a civil suit in Korea against Ahn, Cho, KB, and the three Samhongsa employees. The Korean court found all of the defendants liable for misappropriation of MTH’s trade secrets. During the defendants’ preparation for an appeal of that judgment, the parties settled the civil litigation and the case was dismissed.
In 2000, MTH filed a complaint against Lionel, KB, and Yang in the United States District Court for the Eastern District of Michigan, alleging (1) misappropriation of trade secrets; (2) unfair competition by the misappropriation of products; (3) unfair competition in violation of the Lanham Act, 15 U.S.C. § 1125(a); (4) violations of Korea’s Prevention of Unfair Competition and Trade Secret Protection Law; and (5) unjust enrichment. The district court granted the defendants’ motion for summary judgment as to the count alleging a violation of Korea’s trade-secrets act, and *405 MTH withdrew its claims of unfair competition and violations of the Lanham Act. On May 12, 2004, a jury trial began on the remaining claims, i.e., misappropriation of trade secrets and unjust enrichment.
The jury returned a verdict in favor of MTH against all defendants on both claims. It awarded MTH $11,978,887 for lost profits and $13,794,518 for future lost profits. The jury also awarded an additional $12,834,820 against Lionel and $2,167,440 against KB and Yang for unjust enrichment. Further, the court granted MTH’s request for a permanent injunction, prohibiting Lionel from using the design drawings at issue. The court denied Lionel’s motion for a new trial and for judgment as a matter of law. Lionel now appeals, requesting that we reverse the district court’s order denying its motion to vacate the jury’s verdicts as to both liability and damages, and grant either its motion for a new trial or for judgment as a matter of law. Lionel also asks that we reverse the district court’s injunction.
II. STANDARD OF REVIEW
We review de novo a district court’s refusal to grant a party’s mоtion for judgment as a matter of law.
Greene v. B.F. Goodrich Avionics Sys., Inc.,
We review a district court’s refusal to grant a motion for a new trial under an abuse-of-discretion standard.
In re Brown,
*406 III. LIABILITY ISSUES
On appeal, Lionel argues that the district court committed three errors related to Lionel’s liability: (1) allowing MTH to offer improper expert testimony; (2) determining that MTH had sufficiently identified what actual trade secrets Lionel had allegedly misappropriated; and (3) admitting into evidence various documents from the Korean court proceedings under exceptions to the rule proscribing hearsay evidence. We address these issues in turn.
A. Expert Testimony
MTH offered the testimony of Dr. Jeffery L. Stein, a professor of mechanical engineering at the University of Michigan, to establish that Lionel’s design drawings had been copied from drawings Samhong-sa completed for MTH. Stein testified that he examined two sets of design drawings, one from Lionel/KB and one from MTH/Samhongsa, concerning ten different train models, for a total of 162 pairs of drawings. Stein testified that his evaluation was based on twenty-one self-selected criteria, including factors such as the drawing’s title and the part number assigned to the drawing. Stein calculated a score from zero to one based on these criteria; zero indicated no association between the drawings, and one indicated an extremely high association. Stein testified that approximately fifty-five percent of the KB drawings were copied from Samhongsa drawings. Stein further testified that designers working independently to develop similar design drawings of the same train would not develop identical or substantially similar drawings, because detailed dimensions cannot be gleaned from еxamining pictures of full-scale trains, and thus it was likely that designers would assign slightly different dimensions and measurements to their drawings of the same train part. Furthermore, he testified that “even if all of the numbers were exactly the same, the way that the information is represented in the drawing, there is a certain amount of creative input that the designer has in terms of how to represent this in the drawing.” Stein also testified that designers would calculate different tolerances, i.e., the acceptable degree to which the completed part could deviate from the design dimensions:
If you make something with a very high tolerance then it’s very expensive and time consuming to produce, so it’s always a big engineering decision about when you make a tolerance as to how much it’s going to be, what is the tradeoff going to be between cost and time and the quality of the final product.
Given the delicate decisions that must be made between expense and quality, Stein testified that a company’s engineering team generally decides what the tolerance values for a given product will be.
Stein testified that he reviewed the report Professor Lee prepared, which compared 3307 drawing pairs. Stein explained that he independently corroborated Lee’s work using a regression analysis to compare it to the 162 drawing pairs Stein reviewed. Stein testified that he found copying in sixty-nine percent of the drawings, whereas Lee found copying in sixty-one percent. Stem’s regression analysis indicated that his criteria would produce conclusions about copying that were consistent with Lee’s conclusions in ninety-one percent of the drawings.
Lionel argues that (1) the district court should have excluded Stein’s testimony under Federal Rule of Evidence 702 as unreliable, and (2) even if reliable, Stein’s testimony about Lee’s conclusions was improper under Rule 703. As discussed below, we agree on both points and conclude that the errors were not harmless.
*407 1. Rule 702
A district court must determine whether expert testimony is reliable before it can be admitted under Rule 702.
1
See Kumho Tire Co. v. Carmichael,
We conclude that the district court abandoned its gate-keeping function by failing to make any findings regarding the reliability of Stein’s testimony. The district court allowed Stein to testify as to his opinion of Lee’s report, but failed to make specific findings regarding the reliability of Stein’s own technique for comparing the design drawings as opposed to Stein’s technique of comparing his conclusions to those reached by Lee. Although the district court’s failure to make specific findings does not itself require that we vacate the jury’s verdict, a proper application of the Daubert factors in this case reveals that the district court abused its discretion in admitting Stein’s testimony.
First, Stein created the criteria with which he compared the design drawings; however, there is no evidence that his methodology had ever been tested, subjected to peer reviеw, possessed a known or potential rate of error, or enjoyed general acceptance. Although it is true that “in some instances well-grounded but innovative theories will not have been published,” and that “[s]ome propositions ... are too particular, too new, or of too limited interest to be published,”
Daubert,
The novelty of Stein’s theory is not the only reason that his testimony is unreliable. Our conclusion is also compelled by the clear evidence that Stein lacked a rudimentary understanding of the Korean model-train design industry, and was thus unable to identify those aspects of the design drawings that might be indicative of copying. For example, one factor that Stein relied upon in evaluating the similarity between two drawings was whether the part was assigned the same number. The record clearly establishes, however, that Korean manufacturers share a common numbering system for train parts. For example, all Korean design companies assign the number “2600” to the train’s boiler. Based on his criteria, however, Stein would consider the fact that both MTH’s and Lionel’s design drawings of boilers were labeled “2600” as evidence of copying. Similarly, Stein gave weight to the name each drawing bore. Thus, if MTH’s design drawing of a boiler and Lionel’s design drawing of a boiler bore the name “boiler,” Stein intеrpreted that naming as a sign of copying. In addition to the obvious flaw inherent in a methodology that identifies copying by looking at the names of discrete component parts, Stein’s methodology reveals a lack of insight into this industry by considering the numbers assigned to each train part as evidence of copying.
As indicative of the lack of reliability in his methodology, Stein testified that he “arbitrarily” determined how much significance each of the twenty-one criteria would have on his assessment of whether there was evidence of copying. Among the twenty-one criteria Stein evaluated to determine whether copying was evident in a pair of drawings were part number, part name, the drawings’ dimensions, when the drawing was made, the distance from the edges to the image, and the color index. Stein testified that whether drawings had a similаr part name and part number bore more heavily on his assessment than any other criterion. Even if Stein purposefully placed more significance on part name and number, as opposed to doing so “arbitrarily,” by discounting the significance of more relevant criteria, Stein’s methodology does not reflect the realities of the Korean design industry, and thus cannot be relied upon as an adequate test by which the similarities between MTH’s and Lionel’s design drawings can be evaluated.
Finally, the record indicates, and MTH concedes, that Stein not only created his report for the purposes of litigation, but that he created the precise methodology at issue for that purpose as well. We have been suspicious of methodologies created for the purpose of litigation, because “exрert witnesses are not necessarily always unbiased scientists.”
Turpin v. Merrell Dow Pharms., Inc.
*409 2. Rule 703
Lionel argues that even if Stein’s methodology were adequately reliable under Rule 702, the district court erred in allowing Stein to testify as to the conclusions drawn by Professor Lee. Rule 703 of the Federal Rules of Evidence allows an expert to rely on facts not admitted into evidence if those facts are “of a type reasоnably relied upon by experts in the particular field in forming opinions or inferences upon the subject.” Fed.R.Evid. 703. Although an expert may testify as to his or her opinion formed from facts not admitted into evidence, “[f]acts or data that are otherwise inadmissible shall not be disclosed to the jury by the proponent of the opinion or inference unless the court determines that their probative value in assisting the jury to evaluate the expert’s opinion substantially outweighs their prejudicial effect.” Id.
Although Stein testified about the conclusions he drew based on his examination of the 162 drawing pairs, he also testified extensively about the conclusions reached by Professor Lee and the degree to which Stein’s and Lee’s conclusions overlapped. MTH argues that Stein could properly testify about the similarity of his and Leе’s conclusions regarding copying within the drawing pairs, and that the methodology by which Stein compared his conclusions with Lee’s (a regression analysis) meets DaubeH’s standards of reliability. Lionel does not challenge the general use of regression analysis. Rather, Lionel correctly argues that, regardless of the methodology Stein used to compare his conclusions to those of Lee, Rule 703 simply does not allow Stein to testify as to the degree of similarity between Lee’s conclusions and his own.
Stein’s testimony as to Lee’s report and conclusions, which were not admitted into evidence, was based on hearsay.
See
Fed. R.Evid. 801(c) (“ ‘Hearsay’ is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.”). Other circuits have squarely rejected any argument that Rule 703 extends so far as to allow an expert to testify about the conclusions of other experts.
See United States v. Tran Trong Cuong,
3. Harmless Error
Under Rules 702 and 703, the district court abused its discretion in admitting Stein’s testimony regarding (1) his conclusions about the degree of copying between the design drawing pairs, and (2) the similarity between his conclusions and Lee’s. We may, however, overturn the jury’s verdict based on these evidentiary errors only if they were not harmless.
Smithers,
Stein’s testimony likely had a substantial effect on the verdict. Stein was the only expert to testify about the degree of copying between the drawing pairs. Without his testimony, the jury would not have learned of Lee’s conclusions, nor would they have heard testimony from any other expert witness regarding the degree of copying. Furthermore, as Lionel points out, of the 3307 drawing pairs, only eleven were presented to the jury. Because MTH relied on Stein’s testimony as its source of expertise and analysis regarding the degree of copying, it is impossible to conclude with any certainty that Stein’s testimony did not sway the jury’s verdict. We therefore remand for a new trial. And because there remains a genuine issue of material fact as to whether Lionel copied MTH’s design drawings, we also affirm the district court’s order denying Lionel’s motion for judgment as a matter of law.
B. Specificity of Trade Secrets
The first element a plaintiff alleging misappropriation of trade secrets must prove is that the information at issue actually constitutes a “trade secret.”
Stromback v. New Line Cinema,
Citing
A.H. Emery Co. v. Marcan Products,
In
3M v. Pribyl,
In order to be considered a trade secret, a pattern, technique, or process need not reach the level of invention necessary to warrant patent protection. A trаde secret can exist in a combination of characteristics and components, each of which, by itself, is in the public domain, but the unified process, design and operation of which, in unique combination, affords a *411 competitive advantage and is a protecta-ble secret.
Id.
at 595-96. The Seventh Circuit explicitly rejected the argument that Lionel advances before this Court: “[Defendants seem to suggest that if
SM
cannot point to specific items within its manuals that are not known by the industry, then
SM
cannot claim a trade secret in the combined product. We disagree.”
Id.
at 595. Several courts have followed the Seventh Circuit’s decision in
SM. See Catalyst & Chem. Servs., Inc. v. Global Ground Support,
As in SM, the design drawings here are properly considered trade secrets even though they contain a mixture of secret information (e.g., dimensions, tolerances, and data-reference points) and non-secret information. The Seventh Circuit’s reasoning is persuasive: When material such as design drawings or manuals are trade secrets based on a unique combination of both protected and unprotected material, a plaintiff should not be obligated to identify which components of the protected material is secret. Thus, the district court did not abuse its discretion in denying Lionel’s motion for a new trial on this ground.
C. Documentary Evidence
The district court admitted forty-five exhibits that are English translations of documents generated during the Korean investigation and judicial proceedings. These documents include judgments of the criminal convictions of Ahn and the three Samhongsa employees, a final civil judgment against KB, statements by various witnesses to Korean authorities, indictments to which Ahn and his colleagues pleaded guilty, seizure reports of allegedly misappropriated trade secrets, investigative reports, arrest notices, seizure orders for trains at issue in this suit, documents involving Cho’s travels to the United States, the civil complaint against Cho, the Korean trade-secrets statute, and an appraisal by the Korean special master. Although the district court acknowledged that the documents were hearsay, it determined that they were admissible under specific hearsay exceptions. Lionel appeals the district court’s decision to admit all forty-five exhibits. It divides the documents into two categories: the actual Korean judgments and those documents relating to the Korean proceedings.
Following
United States v. Garland,
Furthermore, the district court did not abuse its discretion in admitting the other documents. The notices of arrest, Korean complaint, and the investigative reports are generally admissible under the public-records exception, as set forth in Rule 803(8).
See
Fed.R.Evid. 803(8);
Blue Tree Hotels Inv. (Canada), Ltd. v. Starwood Hotels & Resorts Worldwide, Inc.,
IV. DAMAGES
The jury awarded MTH total damages of $40,775,665, allocated as follows: (1) $11,978,887 for past lost profits; (2) $13,794,518 for future lost profits; (3) $12,834,820 for Lionel’s unjust enrichment; and (4) $2,167,440 for KB and Yang’s unjust enrichment. The first two parts of the award (for past and future lost profits, totaling $25,773,405) were imposed jointly and severally against all three defendants. Lionel argues that this violates Michigan’s ban on joint-and-several liability in tort actions. Lionel also argues that the part of the total damages based on its unjust enrichment ($12,834,820) is improperly excessive because at least part of it duplicates the award for past lost profits. Our review of a jury’s damage award is extremely deferential, and we will not order a remittitur or new trial unless the award “is contrary to all reason.”
In re Lewis,
A. Joint-and-Several Liability
Based on the jury’s verdict, the district court awarded MTH $25,773,405 for past and future lost profits, to be imposed jointly and severally against Lionel, KB and Yang. The district court held that because this is a trade-secrets case, the Michigan Tort Reform Act (MTRA), M.C.L § 600.2956, which prohibits joint liability in tort actions, does not apply.
4
Because the Supreme Court of Michigan has not conclusively ruled whether the MTRA applies to the misappropriation of trade secrets, we must determine how that court would respond if confronted with the issue.
See Stratienko v. Cordis Corp.,
Michigan courts have repeatedly held that the misappropriation of trade secrets is a tort.
See Bliss Clearing Niagara, Inc. v. Midwest Brake Bond Co.,
Several Michigan Court of Appeals holdings espouse this broader reading.
See Holton v. A + Ins. Assoc., Inc.,
Alternatively, MTH argues that the Michigan Uniform Trade Secrets Act (“MUTSA”) sets forth its own method of allocating damages among defendants, and thus M.C.L. § 600.2956 should not apply in this case. MTH cites M.C.L. § 445.1904, which sets forth the recovery of damages for misappropriation.
5
Citing
John Hancock Financial Services v. Old Kent Bank,
B. Double Recovery
Lionel argues that the damage award is excessive because the amount calculated for Lionel’s unjust enrichment ($12,834,820) duplicates much of MTH’s lost past profits (totaling $11,978,887).
See American Anodco, Inc. v. Reynolds Metals Co.,
Lionel notes that MTH offered evidence that Lionel’s unjust enrichment was $16,043,525, and that the jury found MTH’s actual past profit losses were $11,978,887. Lionel argues that the portion of Lionel’s unjust enrichment not duplicating MTH’s lost past profits is at most the $4,064,638 difference between these amounts. Accordingly, Lionel asserts that because this $4,064,638 is the maximum amount of Lionel’s unjust enrichment that MTH may recover, the jury’s $12,834,820 award on this point must be reduced to $4,064,638. MTH responds that the jury was specifically instructed not to award duplicate damages, and that juries are presumed to follow such instructions.
Cf. SM,
Moreover, although Lionel compares the jury’s award for MTH’s lost past profits of $11,978,887 with MTH’s evidence that Lionel’s unjust enrichment was $16,043,525, the proper comparison — and one that would be in Lionel’s favor — would be with the jury’s actual award of $12,834,820 for that unjust enrichment. The maximum amount of Lionel’s unjust enrichment that MTH could have recovered as non-duplicative based on the jury’s findings regarding that unjust enrichment ($12,834,820) is only that portion of the unjust enrichment exceeding MTH’s past lost profits ($11,978,887), a net of $855,933 (not $4,064,638). On remand, any award for Lionel’s unjust enrichment may not exceed MTH’s actual past profit losses. 6
V. CONCLUSION
For the prеceding reasons, we AFFIRM the district court’s order denying Lionel’s motion for judgment as a matter of law; REVERSE the district court’s orders denying Lionel’s motion for a new trial and granting MTH’s request for an injunction; and REMAND this case to the district court for further proceedings consistent with this opinion.
Notes
. Rule 702 states as follows:
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, training, or education, may testify thereto in the form of an opinion or otherwise, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case.
. Rule 201 allows a court to take judicial notiсe of facts that are not subject to reasonable dispute and that are "either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources *412 whose accuracy cannot reasonably be questioned.” Fed.R.Evid. 201.
. To the extent these documents contain hearsay statements, those statements fall under hearsay exceptions described below.
. That statute provides as follows:
Except as provided in section 6304, in an action based on tort or another legal theory seeking damages for personal injury, properly damage, or wrongful death, the liability of each defendant for damages is several only and is not joint. However, this section does not abolish an employer's vicarious liability for an act or omission of the employer’s employee.
M.C.L. § 600.2956 (footnote omitted).
. M.C.L. § 445.1904 states as follows:
Except to the extent that a material and prejudicial change of position prior to acquiring knowledge or reason to know of misappropriation renders a monetary recovery inequitable, a complainant is entitled to recover damages for misappropriation. Damages can include both the actual loss caused by misappropriation and the unjust enrichment caused by misappropriation that is not taken into account in computing actual loss. In lieu of damages measured by any other methods, the damages caused by misappropriation may be measured by imposition of liability for a reasonable royalty for a misappropriator’s unauthorized disclosure or use of a trade secret.
. Because we vacate the jury's award on the grounds discussed, we decline to address Lionel’s additional arguments related to the award.