January 7, 2014

Smith v. City of Evanston, 260 Ill. App. 3d 925; 631 N.E.2d 1269 (Ill. App. 1994). In this decision, the Court of Appeals affirmed the trial court’s decision to grant a new trial on the issue of damages only and said:

To clarify instructions on the categories of damages, we direct the court on remand to eliminate “disability” and “aggravation of preexisting condition” as separate categories of damages and include instead  “loss of a normal life,” with other instructions consistent with this opinion. 

The Court of Appeals chose the “loss of normal life” language based on law review article by Michael Graham entitled Pattern Jury Instructions: The Prospect of Over or Undercompensation in Damage Awards for Personal Injuries, 28 DePaul L. Rev. 33 (1978). At issue was the possibility that a jury had double counted losses based on the jury instruction. No economist was mentioned in the decision. One economic expert has attempted to have hedonic damages testimony admitted in Illinois by changing the name of alleged damages from “loss of enjoyment of life” and/or “hedonic damages” to “loss of normal life,” but performed the same calculations that the expert would have used for “loss of enjoyment of life” and/or “hedonic damages.”

Knight v. Lord, 271 Ill. App. 3d 581; 648 N.E.2d 617 (Ill. App. 1995). The Court of Appeals affirmed the trial court’s decision not to grant a new trial. As part of the reasoning, the Court of Appeals held that the trial court was correct in not accepting Plaintiff’s proposed jury instructions, saying that: “Plaintiff's proposed jury instruction would have improperly allowed disability and loss of enjoyment of life to be included as separate elements of damages.” The Court of Appeals cited Smith v. City of Evanston, 260 Ill. App. 3d 925; 631 N.E.2d 1269 (Ill. App. 1994). In holding that the language “loss of normal life” was the preferred language to avoid jury confusion. 

January 8, 2014

Mallicoat v. Archer-Daniels-Midland Company, 2013 U.S. Dist. LEXIS 160971 (E.D. MO 2013). Testimony of economist Dr. Leroy Grossman was excluded as speculative based on his pre-injury and post-injury assumptions in a personal injury action under the Jones Act. Dr. Grossman had assumed that the plaintiff would have continued to be employed by the plaintiff even though the plaintiff was fired after his injury for having lied on his employment application. Dr. Grossman also assumed that the plaintiff would only be able to earn minimum wage after his injury based on having been requested to make that assumption by the plaintiff attorney. The fact that the plaintiff had lied on his employment application was discovered when the plaintiff filed for unemployment compensation following the injury.

January 9, 2014

Von Weigen v. Shelter Insurance Company, 2014 U.S. Dist. LEXIS 1932 (C.D.KY 2014).  This case involved a claim by the plaintiffs that Shelter Insurance did not meet its contractual obligations in an uninsured motorist claim. The plaintiff was an attorney who refused to provide information requested by an accountant for Shelter Insurance and hired Dr. William Baldwin, an economist, who prepared a lost earnings claim. The plaintiff moved to exclude the testimony of the defense expert on the grounds that the defense expert Calvin Cranfill, an accountant, stated in his deposition that he did not consider himself qualified to prepare a lost earnings analysis himself given the inadequate information he had available.  The defense expert offered opinions regarding the inadequacies of Baldwin’s report, particularly Baldwin’s acceptance of financial information from the plaintiff without backup documentation. The Court held that:

[T]he testimony of Mr. Cranfill will be helpful to the trier of fact in making its determination regarding Mr. von Wiegen's alleged lost profits. In addition, his opinion will assist the trier of fact determine     whether the plaintiffs' expert had enough data and documentation to determine Mr. von Wiegen's amount of lost damages.

CSC v. United States, 2013 U.S. Dist. LEXIS 178961 (S.D. IL 2013). This decision of U.S. District Judge John A. Ross is interesting because he compared several calculations by Charles Linke for the plaintiff and Thomas Ireland for the defense. Judge Ross clearly preferred the testimony of Charles Linke.  Judge Ross said:

Professor Charles Linke's analysis, during the plaintiffs' case, is based on the earnings for full-time year round average male workers in his analysis. On the other hand, Professor Thomas Ireland used all male workers, including part-time. Since approximately eighty percent of male college graduates work year round full-time, the Court finds Dr. Linke's analysis more valid. His upper bound present value projection is $3,874,604. Dr. Linke's lower bound is $2,559,050. The middle ground of both of those is $3,216,827. That number is a fair value for Sean's diminished earnings capacity.

Professor Linke's methodology included averaging each of the items from the Klosterman/Dietzen plan to calculate the present value. All of Dr. Linke's methodology was set forth in detail in his report. Professor Ireland concedes that Professor Linke's upper bound net discount rate would be appropriate for what Dr. Ireland refers to as "true" medical expenses. Professor Ireland offered no methodology for determining what constitutes "true" medical expenses, as opposed to "false" medical expenses. Indeed, when asked by the Court about physical therapy  costs, he testified that he assumed that they have not gone up and will not go up as much as "true" medical expenses. On the other hand, the medical care segment of the CPI published by the U.S. Bureau of Labor Statistics includes everything in the Klosterman/Dietzen life care plan as medical expenses. . . In particular, it includes "fees paid to individuals or agencies for the personal care of invalids, elderly or convalescence in the home including food preparation, bathing, light house cleaning, and other services." Professor Ireland conceded that if the Court determines that the components of the Klosterman/Dietzen life care plan to be medical expenses, then Dr. Linke's upper bound is the appropriate discount rate.

DeJana v. Marine Technology, 2013 U.S. Dist. LEXIS 178982 (E.D. MO 2013).  This order related to a case involving two deaths caused by a boating accident. The Plaintiff’s economist Lane Hudgins projected lost financial support for the wife of one of the decedents and lost accumulations to the estate of the decedent in the other. A motion in limine to exclude her testimony was denied in the order. The judge also ruled against the Defense position that lost accumulations to an estate are not allowed under the Missouri Wrongful Death Act. The judge held that such damages could be claimed if sufficient evidence was provided that survivors would have suffered such losses. The defense economic expert Thomas Ireland was excluded from testifying about the likelihood that the second decedent would have married or about whether lost accumulations to an estate were allowed in Missouri. The judge held that although Ireland could not testify about the likelihood that decedent would have married, that issue “may remain a question of fact for the jury.”

January 29, 2014

Estate of Barabin v. AstenJohnson, 2014 U.S. App. LEXIS 74 (9th Cir. En Banc 2014). In this decision, the 9th Circuit reversed the trial court decision because the trial court had failed to conduct a Daubert hearing into the relevance and reliability of a theory underpinning the plaintiff’s theory of causation of Plaintiff’s decedent’s mesothelioma. The Court held that this was error prejudicial to the defense and therefore warranted reversal. The Court avoided ruling on whether or not the theory used by Plaintiff’s experts was valid or invalid, but held that such a determination needed to be made before expert testimony relying on the theory was admitted.  Suggested by Dave Tucek. 

March 3, 2014

State v. McGrady, 753 S.E.2d 361 (N.C. App. 2014). The North Carolina Court of Appeals held that amendments to North Carolina’s Rule 702(a) by the North Carolina legislature had effectively adopted the Daubert standard enunciated in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), reversing earlier North Carolina decisions that had held that North Carolina had not adopted Daubert. The issue did not involve economic expertise. Suggested by David Tucek.

March 6, 2014

Giza v. BNSF Railway Company, 2014 Iowa Sup. LEXIS 19 (Iowa 2014). The Iowa Supreme Court reversed the trial court and held that: “[W]e do not believe federal law precludes the introduction of statistical evidence as to when railroad workers in the plaintiff’s position typically retire.” Based on that ruling, the decision of the trial court to exclude evidence about retirement patterns of railroad workers by Mark Erwin, the defense expert resulted in reversal of the trial court decision and remand to the trial court for a new trial. The Court agreed with Plaintiffs that evidence regarding available retirement benefits at age 60 for workers eligible for such benefits should not be permitted because retirement benefits are a collateral source. The court also ruled, however, that evidence about the fact that Erwin’s testimony that the average age of retirement of workers with 30 years of railroad service at age 60 was age 60.7, notwithstanding the fact that the railroad worker said he planned to retire at an older age.  John O. Ward, the plaintiff economist, had projected lost earnings to age 66.  

April 1, 2014

Luttrell v. Wood, 902 S.W.2d 817 (KY 1995). This Kentucky Supreme Court decision held that while household services of a decedent in a Kentucky Wrongful Death case were valuable to survivors, “ordinary and necessary services that come with day-to-day family like . . . are clearly not an element of damages for wrongful death.” In Kentucky, the measure of damages in a wrongful death action is the damage to the estate of the decedent’s “power to labor and earn money.”  The Luttrell Court held that the ability to provide household services for survivors is not part of a decedent’s “power to labor and earn money.” 

April 4, 2014

Mallicoat v. Archer-Daniels-Midland Company, 2013 U.S. Dist. LEXIS 160971 (E.D. MO 2013). U.S. Magistrate Judge Terry I. Adelman excluded the testimony of economic expert Dr. Leroy Grossman on the basis that Dr. Grossman’s assumption that the plaintiff was only able to earn minimum wage after his injury was not supported by the record in this case and because Dr. Grossman had not taken into account the fact that the Plaintiff had been dismissed from employment because of dishonesty. 

April 5, 2014

Barclay v. Cameron Charter Boats, Inc., 2011 U.S. Dist. LEXIS 87524 (W.D.LA 2011).  The Court granted defendant’s motion in limine to exclude the testimony of economist Dr. Douglas Womack based on Dr. Womack’s use of a minimum wage assumption for post-injury employment.  The court said:

Dr. Womack expert opinion on future earnings capacity (i.e., Mr. Barclay can only earn a minimum wage salary in the future) is predicated on two assumptions: first, that Mr. Barclay will be able to return to work, which could be supported by Dr. Williams' testimony, and second, that Mr. Barclay will earn no more than the federally mandated minimum wage, which is supported by nothing. Mr. Barclay contends that this latter assumption derives from his age and employment history. Essentially, he argues that he will be unable to make anything above the federally mandated minimum wage in a "light duty" job because he has never worked a "light duty" job. This argument is not supported by any facts or evidence and thus amounts to pure speculation. While this assumption may represent a possibility, possibility alone cannot serve as the basis for an expert's opinion. See Gideon v. Johns-Manville Sales Corp., 761 F.2d 1129, 1137 (5th Cir. 1985). Because there is no evidence to support Dr. Womack's minimum wage opinion, any expert testimony that includes these unsupported calculations of future earnings is inadmissible.

June 3, 2014

Maltonado v. Kiewit La. Co, 2014 La. App. LEXIS 1420 (LA App. 2014).  This wrongful death decision involved a number of elements of interest to forensic economist. The plaintiff economic expert was Dr. Gerald Cassanave of Vocational Economics. The defense economic expert was Dr. Kenneth Boudreaux. One difference between the experts was the appropriate five years to consider in arriving at a base income for future projections. Cassanave excluded two years while Boudreaux used the last five consecutive years. Cassanave ignored the undocumented states of the worker while Boudreaux provided alternative calculations based on American earnings and based on Mexican wage rates. Cassanave provided calculations for household services while Boudreaux argued that there was no evidence that survivors of the plaintiff had purchased any household services after the decedent’s death. Cassanave did not reduce his calculations for personal consumption, while Boudreaux subtracted 26%. Cassanave added 9.9% for lost job-related fringe benefits, while Boudreaux indicated that there was no evidence that the decedent had ever had any fringe benefits. This decision also dramatically reduced jury awards to the plaintiff’s family for pain and suffering and love, affection and society and “Bystander award” allowed in Louisiana law for having to observe a very painful death.

July 9, 2014

Kenney v. Liston, 2014 W. Va. LEXIS 633 (WV 2014).  The West Virginia Supreme Court addressed the issue of whether plaintiffs can claim past medical damages based on amounts originally billed by medical service providers or amounts ultimately paid in satisfaction of those medical bills, following an injury. The Court held that the collateral source rule requires that a plaintiff should be able to recover amounts originally billed, saying:

[T]he amount of the medical expenses that was discounted or written off can be considered both a benefit of the plaintiff’s bargain with his health insurance carrier, and a gratuitous benefit arising from the plaintiff’s bargain with the medical provider. “A creditor’s forgiveness of debt – that is what a write-down in the present context amounts to – is often considered equivalent to payment in other contexts, e.g., income tax, credit bids at foreclosure, etc.  In other words, a creditor’s partial forgiveness of a tort victim’s medical bills via a write-down is properly considered a third-party ‘payment,’ evidence of which is barred by the collateral source rule.” (Citing McConnell v. Wal-Mart Stores, Inc., 2014 U.S. Dist. LEXIS 14280 (D. Nev. 2014).

The majority cited a number of cases from other states that held that past medical damages should be based on amounts originally billed, while the dissent from Justice Loughry cited some of the cases from other states that have held that past medical damages should be based on amounts actually paid in satisfaction of amounts originally billed.

July 15, 2014

State Farm Fire and Casualty Company v. Bell, 2014 U.S. Dist. LEXIS 92067 (D.KS). This order of Judge Daniel D. Crabtree allowed the economic testimony of Anthony M. Gamboa, which was based on the assumption that the plaintiff has a mobility disability as defined by the U.S. Census Bureau’s American Community Survey. The order did not discuss whether Gamboa’s loss analysis was based on a shortened work-life expectancy. The plaintiff’s life care planning expert was Laura Lampton, whose testimony was allowed in part and limited in part.

Farring v. Hartford Fire Insurance Company, 2014 U.S. Dist. LEXIS 33488 (D. NV). This two page order of Judge James C. Mahan denied a defense motion limine to exclude the hedonic damages testimony of Stan V. Smith under the standards of Daubert and Kumho. No mention was made in this order of prior federal court decisions to exclude hedonic damages testimony. Judge Mahan stated that because the “willingness to pay” literature “determines conclusions through observations of large amounts of data, its reliability is not in doubt.” The judge also said that: “Dr. Smith’s work has been published in countless peer-reviewed academic journals, and that the particular theories he uses in this case are included in textbooks relied upon by numerous universities across the country. While some economists disagree with Dr. Smith’s conclusions, his methodology has a strong following in the field.”  This is the first federal court decision in a case reported by LEXIS that has allowed hedonic damages testimony under a Daubert standard.

Stokes v. John Deere Seeding Group, 2014 U.S. Dist. LEXIS 21725 (C.D. IL 2014). This decision of Judge Sara Darrow excluded the hedonic damages testimony of Stan Smith. Her decision extensively discussed the Value of Statistical Life (VSL) literature, the method used by Stan Smith to derive his hedonic measures from the VSL literature, and makes it clear that the judge does not consider Smith’s methodology to be reliable. She said: “There is no basis, scientific or otherwise, for asserting that the only components of life’s value are economic productivity and enjoyment.” She also cited Michael L. Brookshire, et al, “A 2009 Survey of Forensic Economists: Their Methods, Estimates, and Perspectives,” 21 J. Forensic Econ. 5 (2009) to indicate that the hedonic damage approach of Smith has not been shown to be “generally accepted within the scientific community,” indicating that 83.8% of 173 respondents would refuse to calculate loss of enjoyment of life in an injury case and 82.2% of 174 respondents would critique a calculation of hedonic damages. She pointed out that while the survey was voluntary,

[T]he overwhelming negative response must least raise strong doubts as to whether Dr. Smith’s methodology can be termed ‘generally accepted.’ For this reason and because Dr. Smith’s method relies on unfalsifiable and unsubstantiated inferences, as described, it is unreliable.

Judge Darrow went on to deny a request from the plaintiff that, should court exclude Dr. Smith’s testimony on the plaintiff’s personal hedonic damages calculations, Smith would still be permitted to “explain the concept” of hedonic damages. She said:

The only sufficient testimony Dr. Smith could provide covers matters already “obvious to the layperson” . . . A jury has no need for an expert to make the banal observation that the value of life exceeds a person’s economic productivity.

Palms Casino v. Rodriguez, 2014 Nev. LEXIS 55; 130 Nev. Adv. Rep. 46 (NV 2014).  The Nevada Supreme Court reversed the trial court decision of Judge Jessie Walsh on several grounds and granted Palm’s request to have the remanded case reassigned to a new judge. The Court went out of its way to point out that the testimony of economist Thomas Cargill had been improperly excluded on the basis that Cargill had not stated that he had testified to a reasonable degree of professional probability, saying that Cargill’s “testimony was sufficiently certain given its purpose and content.

Foradori v. Captain D’s, 2005 U.S. Dist. LEXIS 47843 (N.D. MS).  This decision of Judge Michael P. Mills excluded the hedonic damages testimony of G. Richard Thompson, saying:

Captain D's motion to strike the testimony of plaintiff's expert G. Richard Thompson, Phd, who has been called to testify regarding plaintiff's damages, will be granted, to the extent that he seeks to offer expert testimony regarding the pecuniary value of any hedonic damages suffered by Foradori. After reviewing Dr. Thompson's report and the methodologies used therein, the court views his hedonic damages testimony as quintessential "junk" science excluded by Daubert.. See, e.g. Davis v. ROCOR Intern., 226 F.Supp.2d 839 (S.D. Miss. 2002) (excluding hedonic damages expert testimony pursuant to Daubert). Indeed, the notion that Dr. Thompson is able to assign the precise value of $ 1,164,300 to plaintiff's loss of enjoyment of life borders on the absurd, and the specific methodologies used by Dr. Thompson in arriving at this figure strengthen this court's conclusion in this regard.

July 16, 2014

Corenbaum v. Lampkin, 215 Cal. App. 4th 1308 (CA App. 2013). This decision followed Howell v. Hamilton Meats & Provisions, Inc., 52 Cal. 4th 541; 257 P.3d 1130 (CA 2011). The Corenbaum Court limited expert opinion about future medical expenses of an injured plaintiff, as follows:

[F]or an expert to base an opinion as to the reasonable value of future medical services, in whole or in part, on the full amount billed for past medical services to a plaintiff would lead to the introduction of evidence concerning the circumstances under which a lower price was negotiated with that plaintiff’s health insurer, thus violating the evidentiary aspect of the collateral source rule. . . Thus, we conclude that the future medical services that Corenbaum and Carter are reasonably likely to require may not rely on the full amounts billed for plaintiff’s past medical expenses.

This means that any projection of the future costs of medical care must be based on amounts that will be paid in satisfaction of future medical bills, and not amounts originally billed.

Howell v. Hamilton Meats & Provisions, Inc. 52 Cal. 4th 541; 257 P.3d 1130 (CA 2011). The California Supreme Court reversed the California Court of Appeals on the issue of whether a plaintiff can recover amounts originally billed rather than amounts actually paid in satisfaction of bills for medical services following an injury. The Court aid with respect to the collateral source rule in California:

The rule has no bearing on amounts that were included in a provider's bill but for which the plaintiff never incurred liability because the provider, by prior agreement, accepted a lesser amount as full payment. Such sums are not damages the plaintiff would otherwise have collected from the defendant. They are neither paid to the providers on the plaintiff's behalf nor paid to the plaintiff in indemnity of his or her expenses. Because they do not represent an economic loss for the plaintiff, they are not recoverable in the first instance. The collateral source rule precludes certain deductions against otherwise recoverable damages, but does not expand the scope of economic damages to include expenses the plaintiff never incurred.

The Court also said:

We hold, therefore, that an injured plaintiff whose medical expenses are paid through private insurance may recover as economic damages no more than the amounts paid by the plaintiff or his or her insurer for the medical services received or still owing at the time of trial. In so holding, we in no way abrogate or modify the collateral source rule as it has been recognized in California; we merely conclude the negotiated rate differential--the discount medical providers offer the insurer--is not a benefit provided to the plaintiff in compensation for his or her injuries and therefore does not come within the rule.

Pooshs v. Phillip Morris USA, Inc., 2013 U.S. Dist. LEXIS 72769 (N.D. CA 2013). This decision followed California law in holding that past medical expenses must be stipulated by the parties as amounts paid in satisfaction amounts billed for medical services. The Court followed Corenbaum v. Lampkin, 215 Cal. App. 4th 1308 (CA App. 2013) in holding that past medical bills cannot be introduced as evidence of the reasonable value for future medical expenses of the plaintiff. 

Quintero v. United States, 2011 U.S. Dist. LEXIS 20489 (E.D. CA 2011).  In this FTCA case, the Court considered both California’s collateral source rule and the Federal Rules of Evidence in determining that:

Evidence of the actual amounts paid for Esteban's medical care was considered for the limited purpose of ascertaining the reasonable value of the medical services provided. As specifically noted in the findings of fact and conclusions of law, evidence regarding the amounts actually paid for Esteban's medical services was the only evidence of the value of such services submitted other than the billed amounts, which the court found were unduly inflated. In light of the limited evidence of damages offered by the parties, evidence of the amounts actually paid for all Esteban's medical services was substantially probative. There was no jury hearing Esteban's case. The risk of undue prejudice under Rule 403 resulting from the evidence was nonexistent. Contra Lund, 31 Cal. 4th at 8; ("because collateral source evidence is 'readily subject to misuse by a jury,' the likelihood of misuse 'clearly outweighs' the value of such evidence") (emphasis added); Eichel, 375 U.S. at 255 (same). The evidence of the amounts paid in full satisfaction of Esteban's medical debts was properly admitted under either the evidentiary prong of California's collateral source rule or under the Federal Rules of Evidence to show the value of the services and as bearing on the actual loss qua damages.

Valiavicharska v. Tinney, 2012 U.S. Dist. LEXIS 12800 (N.D. CA 2012). The Court said with respect to the issue of whether a plaintiff can recover amounts originally billed for medical services or amounts paid by third party payers in satisfaction of those bills:

The Court agrees with Howell and Quintero that the amount actually paid on behalf of Plaintiff by her insurers pursuant to prior agreements with her medical providers is the reasonable value of her medical care. Plaintiff has not cited any case law to the contrary, and this rule makes common sense. The dilemma, however is how to present such evidence to the jury without – perhaps unintentionally – inducing them to reduce the amount of medical damages by the amount paid by insurers in violation of the collateral source rule. The parties are therefore ordered to meet and confer to determine if they can reach an agreement on how to present such evidence.
Another potential solution is to follow the procedure that occurred in Howell, namely “where a trial jury has heard evidence of the amount accepted as full payment by the medical provider but has awarded a greater sum as damages for past medical expenses, the defendant may move for a new trial on grounds of excessive damages,” and the plaintiff may “choose between accepting reduced damages or undertaking a new trial.”

Schultz v. The Glidden Company, 2013 U.S. Dist LEXIS (E.D. WI 2013).  Judge Rudolph Randa said as part of his memorandum:

The parties agree that there is a conflict between Wisconsin and Florida law regarding the "collateral source" rule, which generally provides that a plaintiff's recovery of medical expenses will not be reduced by the fact that they were paid by some source collateral to the defendant, such as an insurance company. Leitinger v. Van Buren Mgmt., 2006 WI App 146, 295 Wis. 2d 372, 720 N.W.2d 152, 156 (Wis. Ct. App. 2006). Schultz accrued $762,173.54 in medical expenses for his cancer treatment. Medicare paid $202,323.31 towards this amount, and Schultz's medical providers are not attempting to recover the balance. Under Wisconsin law, Schultz would be entitled to recover the entire balance so long as that amount represents the "reasonable value of medical and nursing services reasonably required by the injury." Id. (citing Ellsworth v. Schelbrock, 2000 WI 63, 235 Wis. 2d 678, 611 N.W.2d 764, 769 (Wis. 2000)).  [*11] Under Florida law, Schultz would be limited to the amount paid out by Medicare. Cooperative Leasing v. Johnson, 872 So. 2d 956, 960 (Fla. Dist. Ct. App. 2004) ("the appropriate measure of compensatory damages for past medical expenses when a plaintiff has received Medicare benefits does not include the difference between the amount that the Medicare providers agreed to accept and the total amount of the plaintiff's medical bills"). Accordingly, the Court agrees with the parties that there is a conflict between Wisconsin and Florida law.

July 17, 2014

Melo v. Allstate Insurance Company, 800 F. Supp. 2d 596 (D. VT 2011).  The Court said:

The Vermont Supreme Court has not decided whether the collateral source rule applies to bar evidence of third party payment that is directed to proof of the value of medical services rendered rather than to proof of the amount of damages owed by a defendant. Vermont's trial courts have reached different conclusions, although the majority have ruled that evidence of collateral source payments is not admissible to prove the reasonable value of medical services rendered.

July 28, 2014

Lees v. Storefront Specialties and Glazing, WL 7808659 (N.M. Dist. 2012).  Judge C. Shannon Bacon held that:

[Thomas R.] Ireland may not provide testimony at trial that challenges the “hedonic damages” approach to a determination of the the loss of enjoyment of life, or that the use of the “values of statistical life” studies are not scientifically reliable or valid to use in the determination of the value of life. These conclusions are contrary to the law of New Mexico. Further, Mr. Ireland may not provide testimony that is his lay person intepretation of the law. This is an improper invasion of the Court’s exclusive role in instructing the Jury on the law.

August 9, 2014

Hance v. Norfolk Southern, 571 F.3d 511 (6th Cir. 2009).  This decision involved a ruling that a worker who was fired because of National Guard obligations was wrongfully terminated. The worker was reinstated and awarded back pay, raising questions regarding how past lost medical insurance and payroll taxes/pension rights should be treated.  The Court held that a terminated worker could be awarded out-of-pocket expenses for either medical expenses that would have been covered or cost of replacement insurance, but was not entitled to recover the market value of medical insurance the worker would have had if he had remained employed. The Court held that awarding the market value of past lost medical insurance would have made the worker “more than whole.” The Court also held that the Norfolk Southern would be required to pay Tier I and Tier II payroll taxes on back pay, but that the worker would receive credit for having worked during those time periods during which he had been dismissed so that he would not have lost any credit toward future pension. Thus, no amount would be owed in the form of back pay based on a claim of lost pension benefits.  

Mickey v. BNSF, 2014 Mo. LEXIS 189 (MO 2014).  The Missouri Supreme Court affirmed the Missouri Court of Appeals in holding that the BNSF had to pay Mickey the full amount of $345,000 awarded by the jury, without reduction for payroll taxes. The BNSF had argued that he was required by law to withhold $12,820.80 from the lost earnings awarded to Mickey to pay Mickey’s portion of payroll taxes to the Railroad Retirement Board. The BNSF had paid that amount sua sponte, believing it was obligated to do so under RRB tax requirements. The Court pointed out that BNSF could cite no basis in any prior court decision that it was required to make such payments to the RRB. 

August 10, 2014

Phillips v. Chicago Central & Pacific Railroad, 2014 Iowa Sup. LEXIS 77 (IA 2014).  The Iowa Supreme Court held that the Railroad Retirement Tax Act (RRTA) required that a railroad employer pay the employer portion of Tier I, Tier II and Medicare payroll taxes on amounts awarded for personal injury to a railroad worker under the FELA. The Court interpreted the RRTA to require that the entire amount of an award be treated as lost earnings subject to RRTA taxes if the loss amounts were not enumerated, as in the jury decision in this case. This amounts awarded based on fringe benefits or lost household services that would not otherwise have been subject to RRTA taxes were subject to Tier I, Tier II and Medicare payroll taxes.

Cowden v. BNSF, 2014 U.S. Dist. LEXIS 91454 (E.D. MO 2014). Judge Richard Webber held in this FELA case that there is no requirement under federal law for a railroad to pay railroad retirement board taxes on amounts awarded to injured railroad workers or to withhold payroll taxes from those amounts. Judge Webber closely examined requirements under the Railroad Retirement Act (RRA) and the Railroad Retirement Tax Act (RRTA) and arrived at his opinion that the RRTA does not require Tier I or Tier II or Medicare payroll taxes to be paid by a railroad employer or withheld from the earnings of an injured railroad worker. In doing so, he rejected decisions reached by the Nebraska Supreme Court in Heckman v. BNSF (2013), the Iowa Supreme Court in Phillips v. Chi. Cent. & Pac. Rr. Co. (2014) and another federal district court decision in Cheetham v. CSX Transportation, but consistent with a decision of the Missouri Supreme Court in Mickey v. BNSF a day after this decision.

Cheetham v. CSX Transportation, 2012 U.S. Dist. LEXIS 49659 (M.D. FL 2012). This decision was under the Family and Medical Leave Act (FMLA). CSX was ordered to pay $199,056 to the plaintiff based on an FMLA violation. CSX wanted to withhold applicable federal and state income taxes and payroll taxes on the $199,056 under federal withholding requirements. The magistate judge recommended that CSX be allowed to do so.

Tolan v. Levi Strauss & Co.,867 F.2d 467 (8th Cir. 1989). This decision provided a review of decisions prior to 1989 with respect to the question of whether a plaintiff could recover the market value of lost past medical and life insurance or medical expenses caused by the lack of insurance and/or costs of replacement insurance before ruling that the award for past lost insurance must be reduced to amounts actually paid by the plaintiff for replacement insurance. This decision was cited in Hance v. Norfolk Southern,571 F.3d 511 (6th Cir. 2009) as providing a review of decisions before 1989. 

August 11, 2014

McMillan v. Mass. Society for the Prevention of Cruelty to Animals, 140 F.3d 288 (1st Cir 1998). The plaintiff won an award based on being underpaid because of sexual discrimination. The trial court had added 21% to back pay to account for allegedly lose job-related fringe benefits. The 1st Circuit held that:

Lost benefits are recoverable only if the plaintiff has offered evidence of out-of-pocket expenses for the same benefits. See Kossman v. Calumet County, 800 F.2d 697, 703-04 (7th Cir. 1986) (holding that, to recover damages representing benefits, a plaintiff must show that she actually incurred insurance or medical care expenses); Taylor v. Central Pa. Drug & Alcohol Servs. Corp., 890 F. Supp. 360, 372 (M.D. Pa. 1995); Berndt v. Kaiser Aluminum & Chem. Sales, Inc., 604 F. Supp. 962, 965 (E.D. Pa. 1985). In this case, even if the budgeted value of benefits corresponding to plaintiff's salary had been less than the budgeted value of benefits corresponding to the salaries of the other department heads, plaintiff presented no evidence that she incurred insurance expenses. In addition, she presented no evidence that any employer-contributed retirement benefits were tied to the amount of her salary. Further, that benefits may have amounted to twenty-one percent of her supervisees' salaries does not mean that benefits constituted an equal percentage of higher salaries. Indeed, it would be logical to expect that employer insurance contributions at all salary levels were substantially the same and that, therefore, benefits were a considerably lower percentage of higher salaries. Because there was no competent evidence from which a  reasonable jury could conclude that Dr. McMillan suffered any loss in benefits as a result of her lower salary, Dr. McMillan's back pay award should be accordingly reduced by the amount of the lost benefits award.

Lubke v. City of Arlington, 455 F.3d 489 (5th Cir. 2006).  The 5th Circuit reversed a trial court decision allowing plaintiff subject to age discrimination to recover for the “value” of past lost insurance, and said:

Because the remedies available under the ADEA (Age Discrimination in Employment) and the FMLA (Family Medical Leave Act) both track the FLSA, cases interpreting remedies under the statutes should be consistent. Consequently,  we hold that the correct measure of damages for lost insurance benefits in FMLA cases is either actual replacement cost for the insurance, or expenses actually incurred that would have been covered under a former insurance plan. The lost "value" of benefits, absent actual costs to the plaintiff, is not recoverable. Here, because the jury awarded an undifferentiated sum for employee benefits without segregating insurance benefits, and the award was based on an incorrect understanding of FMLA remedies, we must  remand to the district court for redetermination of this damage element (parentheses added.). 

August 16, 2014

Parks v. Pine Bluff Sand & Gravel Co., 712 So. 2d 905 (LA App. 1998).  This decision involved a defense claim that the plaintiff economic expert Randolph Rice was in error because he should should have included employer paid Social Security and Medicare taxes as a lost fringe benefit, but was correct in not subtracting employee paid Social Security and Medicare taxes from lost earnings. The Court argued that cases cited by the defense were no longer good law and that Rice was correct not to subtract employee payroll taxes from lost earnings, but should also have added employer paid payroll taxes to lost earnings.

EEOC v. Wilson Metal Casket Co., 24 F.3d 836 (6th Cir. 1994).  The majority held in this decision that the winning plaintiff in a sex discrimination case was entitled to recover for medical expenses she claimed would have been covered if she had not been wrongfully terminated. A dissent claimed that no evidence had been provided indicating that her particular medical expenses (for chemical dependency) would have been covered by her employer provided insurance. No claim was made that she was entitled to recover for the employer cost of medical insurance. 

August 17, 2014

Kossman v. Calumet County, 800 F.2d 697 (7th Cir. 1986).  This decision addressed the question of whether and how past lost medical insurance of ADEA age discrimination claimants should be determined, as follows:

The primary goal of the backpay award is to make a victim of age discrimination whole. (Omitting citation.)  Including the cost of insurance coverage in a backpay award when the victim of discrimination fails to secure alternative coverage allows the victim to recover an unwarranted windfall unless he or she can demonstrate that they were unable to secure coverage and had a medical expense. As the preceding cases demonstrate, Kossman and Jodar must establish  that in fact they incurred expenses in securing alternative insurance coverage or incurred medical expenses that would have been covered under the County's insurance program had they not been terminated in order that they might recover the cost of the insurance benefits or be reimbursed for any proper medical expenses incurred. Thus, the trial court should consider whether Kossman and Jodar after their retirement purchased insurance coverage the County would have purchased for them. The court should include those expenditures in the backpay award that Jodar and Kossman incurred if in fact they did purchase alternative coverage or in lieu thereof incurred medical expenses ordinarily covered under the County's policy.

The court also held that:

Common sense dictates that Kossman and Jodar certainly had no need for deputy sheriff's uniforms during the period they were not employed as deputy sheriffs. The inclusion of the clothing allowance in the backpay award, therefore, would not be in accord with the underlying policy of the ADEA, to make the victim of age discrimination whole.

Galindo v. Stoody Co., 793 F.2d 1502 (9th Cir. 1986). The 9th Circuit held that:

Where an employee's fringe benefits include medical and life insurance, a plaintiff should be compensated for the loss of those benefits if the plaintiff has purchased substitute insurance coverage or has incurred, uninsured, out-of-pocket medical expenses for which he or she would have been reimbursed under the employer's insurance plan.

A footnote to this passage included references to three supporting decisions and two decisions in opposition the the 9th Circuit’s decision that had held that a worker could or “might” recover for the employer cost of providing medical insurance. Those decisions were Fariss v. Lynchburg Foundation, 769 F.2d 958, 965 (4th Cir. 1985) (indicating plaintiff in an ADEA case might recover the cost to employer of providing insurance even where no substitute insurance is purchased; Jacobson v. Pitman Moore, Inc., 582 F. Supp. 169, 179 (D. Minn. 1984) (award of lost insurance benefits in ADEA case not limited to actual expenses).

August 22, 2014

Jacobson v. Pitman Moore, Inc., 582 F. Supp. 169, 179 (D. Minn. 1984). The Court allowed plaintiff in an Age Discrimination in Employment Act (ADEA) case to recover for the “cost of replacing past lost insurance benefits instead of actual out-of-pocket costs as claimed by the defendant in this case.  The Court said:
Defendants also object to including as damages $7,882, which represents the cost of replacing insurance benefits defendants provided to plaintiff.  Instead, defendants argue that plaintiff should be awarded actual expenditures made by plaintiff in obtaining replacement insurance coverage, and if an uninsured loss is incurred, the actual loss to the extent it would have been covered by the employer's insurance programs.  The Court does not accept the defendants' proposed method of calculating plaintiff's damages. . . The insurance benefits plaintiff lost are not any less of a monetary benefit to her because she could not afford to replace her insurance benefits or because she did not become sick. . . . Accordingly, the Court finds that plaintiff is entitled to recover her lost insurance benefits.

August 23, 2014

Fariss v. Lynchburg Foundation, 769 F.2d 958, 965 (4th Cir. 1985). This was an appeal of a trial court decision in an Age Discrimination in Employment Act (ADEA) case. The ADEA plaintiff had subsequently died after his termination. On the issue of whether past lost insurance should be calculated on the basis of past out-of-pocket costs, market value of the insurance or the employer cost for providing the insurance, the 4th Circuit said:

Had Mr. Fariss not been terminated, he would have been covered by a life insurance policy with a $42,000 face value for the two years before his death. This insurance coverage, not the proceeds, is the benefit for which the employer must be held liable. Here the employer would in no event have been liable to the employee for the $42,000, but only for the continuing payment of premiums. The value of being insured for a given period is precisely the amount of the premiums paid. To require the employer to pay the face value of the policy would be to compel assumption of a risk not undertaken on behalf of any other employee.
Nor is it sufficient to respond that an employer who discriminates in violation of the ADEA deserves to bear such a sizable and unanticipated penalty, for in most instances, the employee can easily avoid the risk of being uninsured by purchasing  an individual policy of comparable value. Where the employee elects to obtain substitute insurance, the "make whole" concept underlying ADEA damages . . . would permit full recovery of any additional premiums for the comparable individual policy beyond what the employer would have paid for group insurance.

The 4th Circuit also held that the defendant was entitled to an offset against back pay and front pay for a lump sum for pension benefits that Mr. Fariss received at the time of his termination. Since that lump sum was larger than his lost earnings because of his subsequent death, there was no net loss of financial support from his lost earnings to his surviving wife.

August 28, 2014

Moore et al. v. The Health Care Authority et al., 2014 Wash. LEXIS 641 (WA 2014).  This decision considered alternative methods proposed by employees and the State of Washington to value past medical insurance lost by part time employees as part of a class action lawsuit. The State argued that the only damages that it should pay were out-of-pocket costs paid by class members for medical expenses or for substitute health insurance that class members purchased during time when they were denied health benefits. This was to be established through an individual claims process. Employees held that the State’s method was inaccurate, contrary to the evidence, and would lead to a windfall to the wrong doer.  Employees proposed three alternative methods for measuring damages resulting from the State’s failure to provide medical insurance to part time employees: (1) Treat the amount the State would have paid to provide health benefits as the loss; (2) Treat the amount the state unlawfully retained by failing to provide health benefits as the loss; and (3) Treat the amount the state would have paid in health care costs for the group if they had been covered as the loss. The trial court generally sided with the Employees, but had refused to grant summary judgment to either side because additional information was needed “on the likelihood that any members would have opted out of coverage because of availability from another source. The trial court had also held that long term consequences of failures to seek medical attention because of lack of medical insurance should be considered. The Washington Supreme Court agreed with the trial court with respect to summary judgment and the need for more information, but emphasized that its ruling should not be treated as a “one size fits all” ruling for all future cases. Suggested by William Brandt.

August 31, 2014

Windom v. Norfolk Southern Railway Company, 2012 U.S. Dist. LEXIS 173477 (M.D. GA). In this FELA personal injury case, the jury awarded $200,000 in damages, including $100,000 in “net lost wages and benefits reduced to present value,” but held that the Plaintiff’s contributory negligence resulted in a net award of $20,000 to be paid by the Norfolk Southern to the Plaintiff. The Norfolk Southern withheld $6,233.23 as payroll taxes allegedly owed by the Plaintiff on the $100,000 portion of the award that was for lost earnings, only $10,000 of which represented a recovery by the Plaintiff.  Thus, in effect, the Norfolk Southern was reducing the $10,000 paid by the Norfolk Southern for “time lost” by the plaintiff by 62.33% for payroll taxes. The Norfolk Southern asked the Court to rule that the judgment had been satisfied by $13,766.77 paid to the Plaintiff as a result of the award, with the $6,233.23 being withheld Tier I, Tier II and Medicare payroll taxes the Norfolk Southern was allegedly going to have to pay to the Railroad Retirement Board. The Court held that the Norfolk Southern must pay the $6,233.23 to the Plaintiff on the ground that the Norfolk Southern had not provided that the Norfolk Southern would have to pay the amounts withheld to the Railroad Retirement Board.

September 3, 2014

Cox v. Martin, 2012 U.S. Dist. LEXIS 113549 (W.D. MO 2012). The U. S. District Court interpreted that:

[Mo. Rev. Stat. § 490.715.5(1)] provides a non-exhaustive list of factual matters to consider in determining whether the presumption has been rebutted, including (1) the medical bills incurred, (2) the medical bills paid, and (3) the unpaid amount that the plaintiff will be "obligated to pay to any entity" in the event of a favorable verdict. Other factors recognized, or testimony accepted, by Missouri courts as rebutting the presumption include: whether the amounts charged are customary and reasonable, whether the health care provider typically attempts to recover the full amount of the bill, and the extent to which the amount accepted represents the value of the medical services.

September 4, 2014

Jacques v. Manton, 125 Ohio St. 3d 342; 928 N.E.2d 434 (OH 2010). This decision involved medical expenses following an automobile accident and the passage of and Ohio statute addressing the issue of the reasonable value of past medical expenses. The Ohio Supreme Court said:

Because R.C. 2315.20 does not prohibit evidence of write-offs, the admissibility of such evidence is determined under the Rules of Evidence. A plaintiff is entitled to recover the reasonable value of medical expenses incurred due to the defendant's conduct. . .The reasonable value may not be either the amount billed by medical providers or the amount accepted as full payment. . . "Instead, the reasonable value of medical services is a matter for the jury to determine from all relevant evidence. Both the original medical bill rendered and the amount accepted as full payment are admissible to prove the reasonableness and necessity of charges rendered for medical and hospital care."

Hana v. Chams, 2011 Ill. App. Unpub. LEXIS 1997 (Ill App. 2011). The Illinois Court of Appeals held in a medical malpractice case that:

As our supreme court has now made clear, Illinois follows a "reasonable-value approach" to the collateral source rule. Id. at 413. Under this approach, and as a substantive rule of damages, "[a]ll plaintiffs are entitled to seek to recover the full reasonable value of their medical expenses." . . . Furthermore, under this approach, "'collateral benefits do not reduce the defendant tort liability, even though they reduce the plaintiff's loss.'" Id. at 419, quoting Arthur, 216 Ill. 2d at 78. [ Arthur v. Catour, 216 Ill. 2d 72, 833 N.E.2d 847, 295 Ill. Dec. 641 (2005)] As such, a plaintiff may recover for the reasonable value of medical treatment even where that treatment is, in whole or in part, paid for by private insurance, by a governmental insurance program, or is provided gratuitously. Id. at 413, citing Restatement (Second) of Torts § 920A cmt. b, c (1979).

Swanson v. Brewster, 784 N. W.2d 264 (MN 2010). The Minnesota Supreme Court reversed a trial court decision in a motor vehicle accident in light of its interpretation of a recent Minnesota legislative act modifying the application of the Minnesota collateral source rule with respect to offsets for costs paid by third party providers. The issue in this case is the narrower question of whether the offset should only be for the amount actually paid by third party providers or for the amounts originally billed by third party providers. The Court said:

We conclude that  negotiated-discount amounts--amounts a plaintiff is billed by a medical provider but does not pay because the plaintiff's insurance provider negotiated a discount on the plaintiff's behalf--are "collateral sources" for purposes of the Minnesota collateral-source statute, Minn. Stat. § 548.251. We therefore hold that the district court erred in its collateral-source determination because it failed to classify the amount by which Swanson's medical providers discounted Swanson's medical bills as a collateral source. Because of Swanson's accident with Rebecca Brewster, Swanson's medical expenses totaled $ 62,259.30. After Swanson's copayments of $ 1,169.80, $61,089.50 in charges remained. Because the money HealthPartners delivered to the medical providers ($17,643.76) combined with the negotiated discount ($43,445.74) fully satisfied Swanson's remaining $ 61,089.50 obligation, the total amount of "collateral sources that have been paid for the benefit of [Swanson] or are otherwise available to [Swanson]" is $ 61,089.50 for purposes of Minn. Stat. § 548.251, subd. 2(1). As required by Minn. Stat. § 548.251, subd. 3, the district court on remand should also offset the collateral-source amount--$ 61,089.50--by $ 4,570.64, the total of Swanson's health insurance premium payments for the two-year period immediately before this action. Accordingly, the district court on remand should reduce Swanson's damage award by the amount of $ 56,518.86.

Brethren Mutual Insurance v. Suchoza, 212 Md. App. 43; 66 A.3d 1073 (MD App. 2013). The Court of Special Appeals of Maryland indicated that “reasonable value” was the standard in Maryland and that Brethren had not provided any expert testimony to the effect that amounts actually paid in satisfaction of Suchoza’s bills represented the reasonable value of the medical services provided to Suchoza. The Court added:

[T]he mere acceptance by a medical provider of the payment of a lesser amount on a bill is not probative of the reasonable value of the medical services reflected in that bill. There are many reasons (e.g., managed care contracts, Medicaid contracts, private insurance agreements, etc.) why medical providers would accept a lesser amount than the amount charged. Indeed, in his deposition testimony, Dr. Urban stated: "I think that the charges are what I should get paid for [the medical service provided]. We have horrible contracts with our companies and I think that we are actually right now redoing our contracts because we don't get paid enough for what we do." 

Scott v. Garfield, 454 Mass. 790; 912 N.E.2d 1000 (MA 2009). This case involved an injury caused by rental house for which the plaintiff sued the owners of the house for damages. The Massachusetts Supreme Court took up this case on its own initiative from the Appeals Court. One of the issues in the appeal was a claim by the defendants that the defense should have been about to present evidence about the amounts actually paid to satisfy the plaintiff’s medical bills. The court said:

The judge properly excluded from the jury's consideration the amounts paid to Scott's health care providers.  The collateral source rule required that the amounts actually paid to the health care providers by the health insurer be redacted on the medical bills admitted in evidence. In any event, there could be no abuse of discretion here. Despite the defendants' argument that the jury, in determining Scott's reasonable medical expenses, should have been allowed to consider, in addition to the amounts billed, the amounts actually accepted by the health care providers as full payment, the defendants made no evidentiary proffer, i.e., a showing that the health care providers had agreed to accept as full payment some amount less than the amount billed, that would have laid the foundation for such a challenge to the application of the collateral source rule.

The court went on to say that defendants could have challenged the reasonableness of original bills by summoning and cross examining the medical care providers.

September 9, 2014

Bratek v. BNSF, 2011 WL 1883042 (C.D. Ill. 2011).  Economic expert Thomas Ireland was excluded from testifying about the possible loss of household services of the plaintiff. In deposition Ireland had admitted that he did not “have enough information to calculate a specific dollar value that I think was professionally responsible” and that Ireland had not determined a specific wage rate for replacement household services in the Fort Madison, Iowa area. The court said:

Dr. Ireland's deposition testimony shows that he does not know the value of alleged household services loss. Dr. Ireland does not have enough information to draw any conclusions or assist the trier of fact in assessing the household service loss. His testimony does nothing other than invite the jury to speculate about the amount of the alleged household service loss.

September 21, 2014

Toyota Motor Manufacturing v. Williams, 122 S.Ct. 681 (2002). “It is insufficient for individuals attempting to prove disability status under this test to merely submit evidence of a medical diagnosis of impairment.” Disability must be analyzed in a “case by case manner” “in terms of their own experience,” in terms of “the effect of that impairment on the life of the individual.” Revised listing.

Hough-Scoma v. Wal-Mart Stores, Inc., WL 261857 W.D.N.Y.; 1999 U.S. Dist. LEXIS 7046. The decision in this case was reversed because the vocational expert, Dr. Allen Winship, had relied upon the Gamboa tables as the sole basis for projecting that the plaintiff’s work-life expectancy had been shortened.  The plaintiff had returned to work at her old job, though with modified duties, but at the same pay. The Court pointed out that the Gamboa tables had not been admitted into evidence, that there was no evidence in the record that the Gamboa tables had been accepted in the relevant scientific community, and that there was no medical evidence that the plaintiff’s condition would worse over time such that she would not continue to work as long as before her injury. Given the lack of evidence of a reduction in work-life expectancy, the Court concluded that Dr. Winship’s testimony should not have been admitted. This is a revised listing.

October 29, 2014

Villacorta v. Cemex Cement, Inc., 221 Cal. App. 45h 1415; 165 Cal Rptr. 3d 441 (Cal. App. 4th Dist., 2013). The jury awarded $198,000 for lost earnings in a discrimination case (Venezuelan employers discriminating against a Filipino employee). The plaintiff had taken alternative work at a slightly lower earnings rate after eight months of unemployment, but with a required two hour drive each way to get to and from work. The award was for three years of lost earnings without reduction for amounts earned in the second job. The jury felt that the job requiring the two hour drive each way with slightly lower earnings was not comparable employment and therefore that earnings in that replacement employment should not be treated as a mitigation offset to Villacorta’s losses. The Court of Appeals upheld the trail court verdict, based on Parker v. Twentieth Century-Fox Film Corp., 3 Cal.3d 176 (1970). In other words, earnings during the loss period that fall outside of the duty to mitigate do not constitute an offset to losses that can be taken by a defendant in a California wrongful termination case. Villacorta had been unable to find comparable employment during the three year period since his termination.

November 26, 2014

Nilavar v. Osborn, 137 Ohio App. 3d 469 (Ohio App. 2000).  This was a breach of contract case. The plaintiff’s economic expert, Alan Duvall, had relied upon the Gamboa tables in the preparations of his damages analysis. The defense challenged the admissibility of testimony based on the Gamboa tables as one point in its appeal. The Court concluded that Duvall’s testimony based on the Gamboa tables was admissible, as follows:

[W]e conclude that Duvall's testimony based upon the Gamboa study was relevant and could assist the trier of facts in understanding the evidence presented or in determining a fact in issue, to wit: the amount of damages suffered by Nilavar due to Osborn's breach of contract. Applying the factors set forth in Daubert, we note that while there was no evidence that the Gamboa study had been subjected to peer review or had been generally accepted by the scientific community, these factors are not prerequisites to admissibility under Daubert. . . . The Gamboa study was based on data from the Current Population Survey by the U.S. Department of Commerce, Bureau of Census. The Gamboa study had been published for at least nine years at the time of trial, and Duvall knew of other experts who relied on it. Duvall also testified that if he had based his damage calculations on the "Cieka Study," which Osborn's expert recognized as authoritative, his calculations would have been even higher. Duvall utilized the more conservative study.

The decision is unclear about which study by “Ciecka” was being referred to, but it appears that damages calculated based on the Gamboa tables by Duvall reduced the loss period that would have been found in whichever “Ciecka” study was being referred to.

Johnson v. CSX, 2008 Ill. App. LEXIS 1354 (Ill. App. 2008). This decision responded to a defense challenge to the trial court decision in a FELA action. One of the issues raised by the defense was the nature of jury instructions regarding Johnson’s future lost earnings. The court said:

Dr. Anthony Gamboa, PhD, also testified at trial. Dr. Gamboa  is a vocational economist who testified regarding Johnson's future wage loss claim based on his status as a disabled person. Dr. Gamboa utilized a definition of disability from the American Community Service (ACS) that is published by the Census Bureau. According to Dr. Gamboa, the ACS definition of disability provides that a physical disability is a limitation or problem with climbing, lifting, prolonged standing, sitting or walking. Dr. Gamboa performed a vocational assessment of Johnson that was based on Johnson's medical records, Johnson's employment and tax records and depositions given by Drs. Miz, Carobene and Gates. Dr. Gamboa also testified that he functions like an appraiser, who measures the impact of disability on a subject's earning potential. Dr. Gamboa testified that Johnson was 39 years old at the time of trial, had a high school education and a pre-injury work-life expectancy between 21.2 and 22.5 years and a pre-injury earning capacity of $ 63,177 per year. According to Dr. Gamboa, disability reduces earnings because it reduces the work-life expectancy. Dr. Gamboa also testified that it is probable that Johnson will have a post-injury reduction in his work-life expectancy  to between 16.4 and 19.4 years as a result of his injury and resulting disability. According to Dr. Gamboa, people with herniated discs have problems with heavy lifting, with bending and with pain and Johnson was halfway between a person with anon-severe work disability and no work disability at all. Dr. Gamboa also testified that Johnson's lifetime loss of earning capacity ranged from $ 195,909 to $ 299,137.

Cox and Tube City LLC v. Matthews, 901 N.E.2d 14 (Ind. App. 2009). In this appeal of the trial court decision, the defense questioned the legitimacy of Gamboa’s use of the Gamboa tables in preparing his calculations. The Court said:

Dr. Gamboa based his opinion on the medical findings of Dr. Fortson, who had previously testified. Therefore, we cannot conclude that the trial court abused its discretion in determining that the findings of a medical doctor were a sufficiently reliable basis for a specialist's opinion under Rule 702(b). . . Moreover, Dr. Charles Linke, an economist and Tube City's expert, used the same methodology as Dr. Gamboa, including the same percentage for fringe benefits, the same interest rate growth rate, and the same data from the Current Population Survey that is gathered by the U.S. Bureau of the Census. Therefore, Tube City cannot now complain that Dr. Gamboa's methodology is unreliable.

November 30, 2014

Shaheen v. Advantage Moving and Storage, 369 Ill. App. 3d 534 (Ill. App. 2006). One of the grounds for this defense appeal of the jury verdict in this personal injury case was that the trial court abused its discretion by allowing Dr. Anthony Gamboa to testify about his estimate of diminished earning capacity. Defendants did not challenge Gamboa’s use of data, but argued that Gamboa should have given more weight to the fact that the defendant earned more in 2001, the year after the plaintiff’s injury, than the plaintiff earned in the last year before the injury and that government statistics do not distinguish between nonsevere work disabilities and severe work disabilities. The Court held that Dr. Gamboa had “provided an adequate foundation for his opinion with his credentials and his use of data typically used by persons in his profession.” The court added:

We note that defendants used the gain in actual earnings effectively to impeach Dr. Gamboa. The jury found that the plaintiff showed that he would lose $200,000 in earnings, and that amount is less than one-fourth of Dr. Gamboa’s estimate of lost earnings. At plaintiff’s 2001 earnings of nearly $60,000 per year, 3.5 years of diminished work life will cost plaintiff about $200,000 in lost earnings. Even if the jury had completely rejected Dr. Gamboa’s testimony, the evidence supports the assessment of $200,000 in lost earnings.  See Stringham v. United Parcel Service, Inc., 181 Ill. App. 3d 312, 317, 536 N.E.2d 1292, 130 Ill. Dec. 81 (1989) (uses change in expected work life to estimate lost earnings).