Are Experts' Notes Protected from Disclosure?
One such issue is whether an expert's notes are protected from disclosure. The 2010 amendments narrowed Rule 26(a)(2)(B)(ii) "to provide that disclosure include all 'facts or data considered by the witness in forming' the opinions to be offered, rather than the 'data or other information' disclosure prescribed in 1993." 2010 amends., advisory committee's notes. Rule 26(b)(4)(B) was also amended to provide work-product protection for draft expert reports. Together, these amendments could fairly be read to protect an expert's notes. Like a draft report, notes arguably are in the nature of work product (albeit at a more elemental level than the draft report itself) and consist of more than the raw "facts or data considered by the witness."
At least one court has found an expert's notes to be protected under the new version of Rule 26. See D.G. ex rel. G. v. Henry, 08-CV-74-GKF-FHM, 2011 WL 1344200 (N.D. Okla. Apr. 8, 2011) ("The court finds that notations or highlights on the case files do not constitute facts or data and do not need to be provided under Fed. R. Civ. P. 26(a)(2)(B)(ii)."). However, at least two other courts have reached the opposite conclusion. Both rejected the argument that notes qualify as draft reports and relied instead on a statement in the advisory committee notes that, under the amended Rule 26(b)(4), "the expert's testing of material involved in litigation, and notes of any such testing, would not be exempted from discovery." 2010 amends., advisory committee's notes. See Dongguk Univ. v. Yale Univ., 3:08-CV-00441 TLM, 2011 WL 1935865 (D. Conn. May 19, 2011) ("As for Kim's hand-written notes, as a general matter, an expert's notes are not protected by 26(b)(4)(B) or (C), as they are neither drafts of an expert report nor communications between the party's attorney and the expert witness."); In re Asbestos Prods. Liab. Litig. (No. VI), MDL 875, 2011 WL 6181334 (E.D. Pa. Dec. 13, 2011) ("We note with respect to Dr. Anderson, that he has in his possession copies of his hand-written notes. These do not fall under the draft report provision of Rule 26(b)(4)(B). These notes were not 'draft reports,' but rather reflect his own interpretations of the B-read results he was retained to analyze for CVLO.").
Are Experts Who Do Not Write a Report Deprived of Protection?
Perhaps an even more interesting, and significant, issue arising from the 2010 amendments is the tension created between two of the amended provisions in the treatment of experts who do not write a formal report. On the one hand, the amendments clarify that many types of experts, including employees who do not typically provide expert testimony, are not required to provide written reports under Rule 26(a)(2)(B). On the other hand, the new protections for attorney-expert communications in Rule 26(b)(4)(C) appear to be limited to those experts who are in fact required to provide Rule 26(a)(2)(B) reports. Taken together, the two amendments are arguably a case of "one hand giveth, and the other taketh away."
Many Experts Need Not Prepare a Long-Form Report
As part of the 2010 amendments, section (a)(2)(C) was added to Rule 26 "to mandate summary disclosures of the opinions to be offered by expert witnesses who are not required to provide reports under Rule 26(a)(2)(B) and of the facts supporting those opinions." 2010 amends., advisory committee's notes. By its plain text, Rule 26(a)(2)(B) requires a report only from an expert "retained or specially employed to provide expert testimony in the case or one whose duties as the party's employee regularly involve giving expert testimony." However, many courts were uncomfortable with numerous categories of experts being wholly exempt from any reporting requirement, and the amendment, by requiring at least a short-form disclosure from all experts, "resolves a tension that has sometimes prompted courts to require reports under Rule 26(a)(2)(B) even from witnesses exempted from the report requirement." 2010 amends., advisory committee's notes.
By helping to clarify that courts should not require a long-form report from any type of expert except the two specifically described in section (a)(2)(B)—specially retained experts and employees who regularly give expert testimony—section (a)(2)(C) gives parties an incentive to look elsewhere for their expert opinions, including to their own employees who do not regularly give expert testimony. Allstate Insurance Co. v. Nassiri, 2:08-CV-00369-JCM, 2011 WL 2975461 (D. Nev. July 21, 2011), illustrates the implications of applying the amended rule as it apparently was intended to be. That case involved claims by an insurance company (Allstate) to recover the inflated portions of dozens of insurance claim settlements, arising from the defendant's allegedly improper and unnecessary medical services and billings. Allstate sought to introduce expert testimony on damages from an employee (Patterson), who reviewed the claim files and the underlying expert opinion of Allstate's retained medical expert and then calculated the reasonable settlement value of the claims, using a formula created by Allstate.
The court engaged in an extended discussion of two lines of authority that had developed prior to the 2010 amendments, addressing whether Rule 26 required a report from a party employee expert who had no percipient knowledge of the events in dispute but developed his opinions solely in preparation for trial. The court held that, while the amendment did not explicitly reject the prior majority interpretation that a report is required, the fact that the rule was not amended to adopt that position, but instead to require at least a short-form disclosure from all experts, supported the prior minority interpretation that no report is required. Accordingly, the court held that no long-form report was required from Patterson, notwithstanding the following findings: (1) "Patterson was not involved in evaluating and determining the settlement value of the underlying claims during the time that they were being adjusted or litigated;" (2) "[r]ather, he was assigned the task of reviewing the settlements and determining the amount of Allstate's alleged damages for purposes of testifying in this case;" and (3) "Patterson functioned exactly as an expert witness normally does, providing a technical evaluation of evidence he has reviewed in preparation for trial." Nassiri, 2011 WL 2975461, at *9.
Privilege and Work-Product Protections May Be Waived
While cases like Nassiri might give organizational parties a strong incentive to use their own employees as experts and thereby avoid preparing a long-form report, cases like United States v. Sierra Pacific Industries, CIV S-09-2445 KJM EF, 2011 WL 2119078 (E.D. Cal. May 26, 2011), illustrate the potential drawbacks of that approach. The case concerned damages caused by the Moonlight Fire in 2007, for which the government brought suit. Two government employees investigated the fire and prepared an Origin and Cause Report documenting their findings. The parties and the court agreed that these employees were non-retained, "non-reporting" expert witnesses subject only to the short-form disclosure requirements of Rule 26(a)(2)(C).
Based in large part on that finding, the court held that the witnesses' communications with the government's attorneys were not protected under Rule 26's newly added section (b)(4)(C), providing new work-product protections for attorney-expert communications (subject to certain enumerated subject-matter carve-outs). Because the new section limits its protections to attorney communications with "reporting experts" under Rule 26(a)(2)(B), by its terms it "does not itself protect communications between counsel and other expert witnesses, such as those for whom disclosure is required under Rule 26(a)(2)(C)." 2010 amends., advisory committee's notes.
The Sierra Pacific court acknowledged that "the advisory committee notes explain that the new rule does not provide protection for communications between non-reporting experts and counsel, but does not disturb any existing protections," such as privilege or independent development of the work-product doctrine. Sierra Pacific, 2011 WL 2119078, at *5 (emphasis added). Nonetheless, the court held that any existing protections were waived when the employees were designated as experts. The court discussed at length the state of the law on this issue as it existed in the Ninth Circuit prior to the 2010 amendments, as well as the advisory committee's deliberations. The court noted that the advisory committee had explicitly discussed this issue and, finding that there were certain circumstances under which broad discovery should be allowed into an attorney's communications with a non-reporting employee expert, had refused to protect such communications in all cases. Ultimately, the Sierra Pacific court declined to hold that designating an individual as a non-reporting expert waives privilege and work-product protections in all cases, or even in all cases involving non-reporting employee experts. Nonetheless, the court held that, in this particular case, the government had waived any otherwise applicable protections.
Although the Sierra Pacific court's holding was thus limited, it still demonstrates the risk parties run in designating their own employees as non-reporting experts. This risk is particularly acute where the employee is also a fact witness and has had otherwise privileged communications with counsel concerning percipient aspects of his or her testimony. Notably, the Sierra Pacific court ordered the disclosure of all of the witnesses' communications with counsel, even though it expressly acknowledged the witnesses' hybrid fact/expert role. The court reasoned as follows: "While it is desirable that any testifying expert's opinion be untainted by attorneys' opinions and theories, it is even more important that a witness who is testifying regarding his own personal knowledge of facts be unbiased. Therefore, at least in some cases, discovery should be permitted into such witnesses' communications with attorneys, in order to prevent, or at any rate expose, attorney-caused bias." Sierra Pacific, 2011 WL 2119078,*10. Thus, it was the witnesses' status as fact witnesses that caused the court to find a waiver, an illogical result. The testimony of all fact witnesses, not just hybrid fact/expert witnesses, can be tainted by attorney bias. However, allowing a client representative to testify as a fact witness does not generally waive the attorney-client privilege.
While the court's reasoning was suspect, it could nonetheless serve as a template for other courts. The holding thus gives organizational parties good cause to be wary of designating their own employees as non-reporting experts, even if the 2010 amendments clarify that such experts need not provide a long-form written report.
Keywords: litigation, commercial, business, Federal Rule of Civil Procedure 26, expert witnesses, work-product privilege, attorney-client privilege