Courts Deal With "Dual-Hat" Experts: Part II

August 11, 2021

Last week's Privilege Point addressed a court's careful sorting out of discovery issues implicated when a non-testifying consulting expert created documents arguably related to his later role as a testifying expert. About two weeks later, the Southern District of New York (Judge Caproni) dealt with other issues involving non-testifying experts.

In In re Commodity Exchange, Inc. Gold Futures & Options Trading Litig., Nos. 14-MD-2548 (VEC) & 14-MC-2548 (VEC), 2021 U.S. Dist. LEXIS 113760 (S.D.N.Y. June 17, 2021), plaintiffs alleged that defendants comspired to manipulate the London daily benchmark gold price. Defendants sought to depose plaintiffs' non-testifying consulting experts, but the court rejected defendants' motion. First, defendants argued that plaintiffs' non-testifying experts were "fact witnesses and not experts," because they were familiar with gold pricing issues from their previous work. Id. at *24. The court acknowledged that Fed. R. Civ. P 26(b)(4)'s Advisory Committee's Notes state that experts may be deposed about information they acquired as "an actor or viewer with respect to transactions or occurrences that are part of the subject matter of the lawsuit." Id. at *25. But the court concluded that plaintiffs' experts had not "traded gold or gold-based instruments or participated in any way in the Fixing process" – and that "[b]y Defendants' logic, most experts who analyze facts are fact witnesses who fall outside the ambit of Rule 26(b)(4)(D), swallowing any protections afforded by the Rule." Id. at *26-27. Second, the court found that plaintiffs' experts had waived certain work product protection – accurately noting that "[c]ourts are split as to whether [non-testifying consulting experts'] protections can be waived." Id. at *29. After concluding that the non-testifying consulting expert Rule did not protect plaintiffs' experts from depositions, the court nevertheless denied defendants' motion to depose them – concluding that "any additional information obtained from deposing [plaintiffs' non-testifying consulting experts] would be unreasonably cumulative or duplicative of the information Defendants should have already received via fact discovery." Id. at *37.

Litigants and their lawyers should always consider both non-testifying and testifying experts' source of information – especially if these experts move from one role to the other.

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