In The Court of Appeals Seventh District of Texas at Amarillo ________________________
No. 07-11-00403-CV ________________________
CHESAPEAKE OPERATING, INC., NOMAC DRILLING CORPORATION, ROBERT RUSSELL/ROBERT M. CONSULTING, LLC, APPELLANTS
V.
KEVIN PAUL HOPEL, APPELLEE
On Appeal from the 18th District Court Johnson County, Texas Trial Court No. C2009-00303; Honorable John E. Neill, Presiding
October 24, 2013
MEMORANDUM OPINION Before QUINN, C.J., and CAMPBELL and PIRTLE, JJ.
This appeal presents the question of whether expert testimony based upon
speculative assumptions is sufficient to support an award of future loss of earning
capacity and the dilemma of determining whether such assumptions are reasonable just
because “an expert says it is so.” Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 712 (Tex. 1997), cert. denied, 523 U.S. 1119, 118 S.Ct. 1799, 140 L.Ed.2d 939
(1998) (citing Viterbo v. Dow Chem. Co., 826 F.2d 420, 421 (5th Cir. 1987)).
Presenting two issues, Appellants, Chesapeake Operating, Inc., Nomac Drilling
Corporation and Robert Russell/Robert M. Consulting LLC, challenge an award of
damages to Appellee, Kevin Paul Hopel, in his personal injury suit against them.
Appellants maintain by their first issue that the trial court erred in awarding past and
future lost earning capacity damages based on inadmissible expert testimony. By issue
two, they allege the trial court committed reversible error when it allowed Appellee to
introduce irrelevant evidence of unadjusted “gross medical bills” in direct contradiction
of section 41.0105 of the Texas Civil Practice and Remedies Code and Haygood v. De
Escabedo, 356 S.W.3d 390, 399 (Tex. 2011), which limits such evidence to medical bills
actually paid or incurred. We sustain issue one, pretermit issue two, reverse the
judgment of the trial court and, in the interests of justice, remand for further
proceedings. See TEX. R. APP. P. 43.3(b).
BACKGROUND
Chesapeake Operating, Inc. contracted with Crescent Directional Drilling to
provide directional drilling services on a well being drilled by Nomac Drilling Corporation
in Johnson County. Robert Russell/Robert M. Consulting, Inc., was a third party
contractor who supervised the well site. Appellee was hired by Crescent as a Measure-
While-Drilling (MWD) trainee. According to Appellee, in April of 2007, he was hired as a
trainee for four to five months before becoming an MWD engineer.
2 On December 19, 2007, after being on the job for approximately eight months,
Appellee was instructed by his supervisor, Cameron Stevens, to assist him in carrying
and placing a tool, approximately twenty-five to thirty feet long and weighing 250 to 300
pounds, on a metal catwalk. After they put down the tool, but while still on the catwalk,
a Nomac derrickman operating a forklift struck a monel collar, a pipe weighing
approximately 3,000 pounds, which slid towards a pipe stop that failed causing drill pipe
to jump over the pipe stop and careen in Appellee and Stevens’s direction. When they
realized the drill pipe was careening in their direction, Appellee and Stevens ran in the
opposite direction and jumped to the ground four feet below the catwalk to avoid being
struck by the drill pipe. Appellee landed with his left leg in a straight position and felt it
snap.1
Appellee suffered a severe fracture and was transported by ambulance to a
hospital in Fort Worth where he underwent surgery. Dr. Owen C. DeWitt, an orthopedic
surgeon, performed surgery for a tibia plateau fracture. After Appellee was discharged,
he returned home to New Orleans to convalesce. In March 2008, while still
experiencing pain and weakness in his knee, Appellee sought treatment from Dr. Terry
Habig, another orthopedic surgeon. After months of therapy and some improvement,
Appellee continued to have pain and Dr. Habig ordered an MRI. Test results showed a
torn medial meniscus and a second surgery was performed in August 2008.
Several years after his accident, Appellee filed suit against Appellants alleging
negligence and seeking monetary damages. Dr. Habig testified over objection that
1 At the time of the accident, Appellee was thirty years old and had a wife and young son living in New Orleans.
3 Appellee’s second surgery was related to his fall at work. He testified Appellee
continued therapy for months and, in October 2008, concluded Appellee had reached
maximum medical improvement. Dr. Habig recommended Appellee undergo a
functional capacities evaluation to determine his limitations. In December 2008,
Appellee was released to return to sedentary light duty work with weight lifting
maximums.
Dr. DeWitt testified Appellee’s disability rating was four to nine percent whole
body and nine to twenty-two percent lower body. He also testified Appellee could no
longer play golf, run, ski or enjoy sports with his son. Although Appellee had made
significant progress with full weight bearing and showed increased muscular endurance,
Dr. DeWitt testified that his light duty work restriction would keep him from working in
the oil fields.
Appellee testified Crescent offered him a job in its New Orleans office suitable to
his restrictions and he accepted it, but was later laid off in March 2009. For months, he
filed applications with businesses to no avail and eventually began a courier service
delivering various legal documents for lawyers and closing documents to title
companies. He was only able to keep the business afloat for about six months and was
ultimately unable to recoup his original investment. Eventually, with the help of a friend,
in August 2010, he found employment suitable to his physical restrictions with Harvey
Gulf International Marine, a tug boat company, at a starting salary of $85,000 plus
benefits. Although grateful for the job, Appellee testified that sitting behind a desk was
not what he had planned for the rest of his life.
4 Dr. Cornelius Gorman, a vocational rehabilitation counselor, and Dr. Roy
Douglas Womack, an economist, both testified as experts for Appellee. After a jury trial
and verdict in his favor, Appellee was awarded, among other damages, $170,000 for
past loss of earning capacity and $480,000 for future loss of earning capacity. Post-
verdict, the trial court reduced the award for past medical care expenses from
$92,817.18 to $38,661.48.2 The jury found Appellee thirty percent negligent which
resulted in an award of $587,945.19.
By their first issue, Appellants challenge the trial court’s admission of and refusal
to limit the testimony of experts Gorman and Womack. They characterize portions of
Gorman’s opinion as speculative and unreliable with no factual basis other than
Appellee’s hope of being promoted to one of the top-paying positions in the oil field
industry, that of a directional driller. We conclude the trial court erred in admitting that
expert testimony.
ISSUE ONE EXPERT TESTIMONY – RELEVANCE AND RELIABILITY
Rule 702 of the Texas Rules of Evidence provides that an expert may testify if
scientific, technical or other specialized knowledge will assist the trier of fact to
understand the evidence or to determine a fact in issue. The expert’s opinion is,
however, inadmissible if the trial court determines that the underlying facts or data do
not provide a sufficient basis for the opinion. TEX. R. EVID. 705(c).
2 This case was tried in March 2011, and Haygood v. De Escabedo, 356 S.W.3d 390 (Tex. 2011), was issued on July 11, 2011.
5 To be admissible, an expert’s opinion must be both relevant and reliable. See
E.I. du Pont de Nemours & Co. v. Robinson, 923 S.W.2d 549, 556-58 (Tex. 1995). See
also Daubert v. Merrell Dow Pharms., 509 U.S. 579, 597, 113 S.Ct. 2786, 125 L.Ed.2d
469 (1993). The requirement that expert testimony be relevant incorporates traditional
relevancy analysis under Rules 401 and 402 of the Texas Rules of Evidence, and in
order to be relevant the proposed testimony must be “sufficiently tied to the facts of the
case that it will aid the jury in resolving a factual dispute.” Robinson, 923 S.W.2d at 556
(quoting Daubert, 113 S.Ct. at 2796). In addition, in order to be reliable the expert must
explain how the facts of the case support his conclusion. See Volkswagen of Am., Inc.
v. Ramirez, 159 S.W.3d 897, 905-06 (Tex. 2004). Without a substantial basis in fact, an
expert’s bare opinion will not suffice. Id. Accordingly, an expert’s opinion that is based
on assumed facts that vary from the actual facts is “incompetent evidence,” without
probative value, and such conclusory testimony cannot support a judgment. See
Coastal Transp. Co. v. Crown Cent. Petroleum Corp., 136 S.W.3d 227, 232 (Tex. 2004).
See also Burroughs Wellcome Co. v. Crye, 907 S.W.2d 497, 500 (Tex. 1995).
Although the trial court serves as an evidentiary gatekeeper by screening out
irrelevant and unreliable expert evidence, it still has broad discretion to determine the
admissibility of evidence. See Exxon Pipeline Co., v. Zwahr, 88 S.W.3d 623, 629 (Tex.
2002). Accordingly, we review the trial court’s decision to admit such testimony under
an abuse of discretion standard. Id.
6 STANDARD OF REVIEW3
It is not the role of the trial court to determine the truth or falsity of an expert’s
opinion. See Robinson, 923 S.W.2d at 558. Rather, the trial court’s role regarding
expert testimony is to serve as an evidentiary gatekeeper, making the initial
determination whether the expert’s opinion is relevant and whether the methods and
research upon which it is based are reliable. Id. The burden is on the proponent of the
evidence to demonstrate the expert’s opinion is both relevant and reliable. Id. at 557. If
the expert’s opinion is not relevant or reliable, it is not evidence.4 Havner, 953 S.W.2d
at 713. An expert witness may be very believable, but his conclusions may be based on
irrelevant assumptions or unreliable methodology. Robinson, 923 S.W.2d at 558. Just
because a person has a degree and is designated an “expert” doesn’t mean he should
be “allowed to testify that the world is flat, that the moon is made of green cheese, or
that the Earth is the center of the solar system.” Id.
A trial court must act as an evidentiary gatekeeper by screening out irrelevant
and unreliable expert testimony. Enbridge Pipelines (E. Tex.) L.P. v. Avinger Timber,
LLC, 386 S.W.3d 256, 262 (Tex. 2012). Abuse of discretion is the proper standard by
which to review a trial court’s decision to admit or exclude expert testimony. See
General Electric Co. v. Joiner, 522 U.S. 136, 146, 139 L.Ed.2d 508, 118 S.Ct. 512 3 Appellants complain in their first issue of the trial court’s decision to admit Gorman’s and Womack’s expert opinions regarding Appellee’s loss of earning capacity. They challenge the trial court’s admission of “speculative and unreliable testimony about a hypothetical promotion to support Appellee’s lost earning capacity awards” and rely on legal authorities pertinent to the admissibility of expert testimony. We disagree with Appellee’s conclusion in his brief that Appellants “stepped away from any abuse of discretion analysis . . . by assigning no error” to the trial court’s ruling. 4 If the trial court concludes that the scintilla of evidence presented supporting a position is insufficient to allow a reasonable juror to conclude that the position more likely than not is true, the court remains free to direct a judgment . . . and likewise grant summary judgment. Daubert, 509 U.S. at 596.
7 (1997). See also Cooper Tire & Rubber Co. v. Mendez, 204 S.W.3d 797, 800 (Tex.
2006); Zwahr, 88 S.W.3d at 629. A trial court abuses its discretion if its decision is
arbitrary and unreasonable without reference to any guiding rules or principles.
Robinson, 923 S.W.2d at 558 (citing Downer v. Aquamarine Operators, Inc. 701 S.W.2d
238, 241-42 (Tex. 1985), cert. denied, 476 U.S. 1159, 106 S.Ct. 2279, 90 L.Ed.2d 721
(1986)).
LOSS OF EARNING CAPACITY
The proper measure of damages for loss of earning capacity is a plaintiff’s
diminished ability to earn a living. Big Bird Tree Serv. v. Gallegos, 365 S.W.3d 173, 178
(Tex.App.—Dallas 2012, pet. denied); Bituminous Cas. Corp. v. Cleveland, 223 S.W.3d
485, 491 (Tex.App.—Amarillo 2006, no pet.). It entails consideration of what a plaintiff’s
capacity to earn a livelihood actually was and assesses the extent to which it has been
impaired. Cleveland, 223 S.W.3d at 491. It is not measured by what a person actually
earned before the injury. See Pilgrim’s Pride Corp. v. Cernat, 205 S.W.3d 110, 120
(Tex.App.—Texarkana 2006, pet. denied). However, where a plaintiff seeks damages
for loss of earning capacity in a particular field, the amount of earnings must be shown
with reasonable certainty and be based on more than mere conjecture. See McIver v.
Gloria, 140 Tex. 566, 169 S.W.2d 710, 712 (1943).
Loss of future earning capacity is a plaintiff’s ability to earn a living after trial. Id.
Because future earning capacity is always uncertain, the jury has considerable
discretion in determining the amount. However, the award for loss of future earning
8 capacity must be supported by sufficient evidence to allow the jury to reasonably
measure earning capacity in monetary terms. Id.
ANALYSIS
Before Appellee’s experts testified, the trial court conducted a Daubert5 hearing
to determine whether to limit the testimony of Gorman and Womack on Appellee’s loss
of earning capacity. Appellants argued that permitting Gorman to speculate on
Appellee being promoted to lead MWD engineer and then being further promoted to the
position of a directional driller at a salary of $200,000 per year was speculative.
Appellee’s counsel argued that the oil drilling industry was booming, jobs were plentiful,
and with Appellee’s experience, he would have been promoted to directional driller.
After taking the motion under advisement, the trial court ruled that both Gorman and
Womack would be permitted to testify without limitations and the jury could judge their
credibility.
Before the jury, Appellee testified that as an MWD engineer, he was making
$2,200 per month in salary, plus $200 per day if on a rig, $850 car allowance, .40 per
mile travel, and $35 per diem. He estimated his annual compensation to be between
$110,000 and $118,000 at the time of his injury. According to Appellee’s testimony, an
MWD lead engineer, depending on years of experience, could earn between $125,000
and $150,000, and a directional driller could earn approximately $200,000 per year. For
the purpose of determining loss of past earning capacity, Appellee was injured on
5 Daubert, 509 U.S. at 597.
9 December 19, 2007, and trial commenced on March 21, 2011, although he was not
unemployed the entire time.
Gorman testified he met with Appellee to determine his literacy, intellect and prior
work history. He also evaluated his medical records in preparation for his testimony.
His methodology was to compare Appellee’s characteristics and medical history to
determine alternative employment. Gorman testified Appellee’s limited education was
irrelevant in the oil drilling industry. Gorman compared his findings with federal
standards and statistics while drawing on his past experiences working with other oil
companies. He determined Appellee would have difficulty with extended driving, sitting,
standing and walking but that he was highly motivated and interested in oil exploration
and drilling.
Gorman’s prediction for Appellee in 2008 was that with successful vocational
rehabilitation, he could earn $40,000 to $50,000 annually. He opined that but for the
injury, Appellee “probably” would have become an MWD lead engineer or a directional
driller based on his determination and work history, and because he met all federal
criteria. When asked if Appellee “would have more likely than not been employed at the
level of a lead hand or directional driller for the rest of his life,” Gorman answered “yes.”
Gorman also testified that given his experience in the industry, Appellee “more probably
than not” was in line for a promotion. Gorman further testified Appellee had six years of
experience in the oil industry which is twice the time and training necessary for
advancement. He also testified the oil industry was booming.
10 Womack, an economist, crunched the numbers given to him by Gorman in
calculating Appellee’s loss of past and future earning capacity. Womack testified he
took the numbers provided to him and made calculations based on key assumptions.
Using Appellee’s pre-injury earning capacity and offsetting it with a post-injury earning
capacity of $40,000 per year, Womack concluded Appellee’s loss of future earning
capacity would be $2,088,424 if employed at $125,000. On the high end of the pay
scale of $200,000, Appellee’s loss of future earning capacity would be $4,194,736.6
Womack acknowledged his calculations would be inaccurate if his key assumptions
based on Gorman’s information were unreliable.
We believe Appellee’s experience in oil drilling, as testified to by Gorman, was
inaccurate and exaggerated. Appellee's work history showed he moved from job to job
often and in varying industries. After obtaining his GED, Appellee worked in a feed
store for one year and then became employed by Nowska where he serviced offshore
equipment and worked as a coil tubing operator for one and one-half years. That
company was bought out and the office he worked in was closed. He found
employment with Superior Well Service and performed numerous tasks but was laid off
after two years due to the economy. His next job was with Coca-Cola as a
merchandiser. He testified his employment with Coca-Cola lasted two years. He then
gained employment with a shortline railroad for about four and one-half years first as a
switchman and then as an engineer. In 2005, after Hurricane Katrina hit the Gulf coast,
6 Womack adjusted his figures to reflect Appellee’s post-injury employment at a salary of $85,000 per year instead of an estimated post-injury earning potential of $40,000 per year estimated by Gorman. With the adjustment, Appellee’s loss of future earning capacity ranged from $1.3 million to $3.2 million.
11 Appellee’s cousin got him a job as a contractor with the Corp of Engineers to do quality
assurance work.
While under contract with the Corp of Engineers, a friend of Appellee’s called to
advise him that Crescent Directional Drilling was hiring MWDs. By the time Appellee
completed his contract with the Corp of Engineers, the MWD positions had all been
filled. He then took a job on a movie set in New Orleans as a laborer hoping an MWD
position at Crescent would later become available.7 In April 2007, he was hired as an
MWD trainee by Crescent but was injured on the job eight months later.
During cross-examination, Appellee acknowledged that most of his work history
did not involve drilling experience in the oil and gas industry. In fact, he admitted he did
not work in drilling until he went to work for Crescent which gave him approximately
eight months drilling experience as opposed to the six years testified to by Gorman.
When asked if he had any aspirations to become a direction driller, Appellee
testified it was his “goal.” He wanted to “get to the top of the MWD” and then “cross
train to directional drilling.” He knew from his friend who was a directional driller at
Crescent that the job paid approximately $200,000 per year.
Gorman’s credentials and speculative opinion that Appellee would “probably”
have been promoted to the top career in the oil and gas drilling industry were not
sufficient to support an award for lost earning capacity. No one from Crescent testified
Appellee, or for that matter anyone with his experience and qualifications, was
reasonably likely to be advanced or promoted. Without credible proof of an expectation
7 Gorman did not reference this job during his testimony about Appellee’s work history.
12 of a promotion and the consequent increase in salary, Gorman’s testimony was purely
speculative.
Additionally, Gorman’s opinion that Appellee would most likely be promoted to
the top position in the drilling industry did not take into account the cyclic nature of the
industry. Appellee himself testified he was laid off while employed with Superior Well
Service in the 1990s when the “offshore side of [the drilling industry] took a hit due” to
the economy. Furthermore, following his injury and transfer to an office job for
Crescent, Appellee was also laid off due to the economy.
During the defense’s case, a directional driller employed by Crescent testified
that in 2008 and 2009, the industry “slowed down quite a bit” and several employees,
including him, took a pay cut to keep their jobs. He approximated that forty employees
were laid off during that time. When asked if Appellee had ever expressed any interest
in becoming a directional driller during the months they worked together, the witness
answered, “[n]ot with me.” Neither did Appellee make any inquiries to him about
directional drilling.
We do not discount Gorman’s historical data nor his testimony regarding his
methodology and the reliability of statistics and range of salaries used in his evaluation.
We agree that anything is possible. See Richmond & D.R. Co. v. Elliott, 149 U.S. 266,
267-69 (1893). “[T]here are possibilities and probabilities before every person,
particularly a young man, and a jury in estimating the damages sustained will doubtless
always give weight to those general probabilities . . . .” Id. However, in evaluating loss
of earning capacity, the possibility of a plaintiff’s promotion or desire to work in a
13 particular profession must be supported by evidential foundation. See id. at 267-69. Cf.
McGrath v. Erie L. R. Co., 460 F.2d 1312, 1315 (3rd Cir. 1972) (finding testimony
regarding promotion not overly speculative where witness was responsible for
decedent’s promotion and testified there was a 100% certainty decedent would have
been promoted). Ambition, motivation or perseverance without more is insufficient to
support damages for loss of future earning capacity. See Rodriguez v. United States,
823 F.2d 735, 749 (3rd Cir. 1987) (finding the trial court’s calculation of decedent’s
future earnings based on the probability that he would have obtained employment as a
commercial pilot because decedent’s wife testified it was his ambition to become a pilot
was speculative). Additionally, Gorman’s exaggeration of Appellee’s drilling experience
is refuted by Appellee’s own testimony that his actual drilling experience was the eight
months he spent working for Crescent prior to his injuries.
The data underlying Gorman’s opinion was of such little weight that the jury
should not have received his expert opinion on Appellee’s lost earning capacity.
Resultantly, Womack’s testimony based on Gorman’s data was likewise of little
assistance to the jury and should have been excluded. The trial court did not exercise
its gatekeeper function when it opened the door to possibilities and speculation. We
conclude the trial court abused its discretion in permitting Gorman to speculate on
Appellee’s loss of future earning capacity. The trial court likewise abused its discretion
in allowing Womack to “crunch the numbers” before the jury based on conjecture.
14 HARM ANALYSIS
An expert witness can have an extremely prejudicial impact on a jury. Robinson,
923 S.W.2d at 553. To the jury an expert witness is an authority figure who is more
believable than a lay witness. Id. Consequently, a jury more readily accepts an
expert’s opinion simply because of the witness’s designation as an expert. Id. Trial
judges have a heightened responsibility to ensure that expert testimony show some
indicia of reliability. Id. When, as here, a trial judge erroneously admits expert
testimony, we are required to conduct a harm analysis.
Erroneous admission of evidence requires reversal only if the error probably
(though not necessarily) caused the rendition of an improper judgment. See TEX. R.
APP. P. 44.1(a)(1); Nissan Motor Co. v. Armstrong, 145 S.W.3d 131, 144 (Tex. 2004).
The Supreme Court has recognized “the impossibility of prescribing a specific test” for
harmless error review. Reliance Steel & Aluminum Co. v. Sevcik, 267 S.W.3d 867, 871
(Tex. 2008) (quoting McCraw v. Maris, 828 S.W.2d 756, 757 (Tex. 1992)). The
standard “is more a matter of judgment than precise measurement.” Armstrong, 145
S.W.3d at 144.
Erroneously admitted expert testimony that is crucial to a key issue is likely
harmful. State v. Cent. Expressway Sign Assocs., 302 S.W.3d 866, 870 (Tex. 2009)
(op. on reh’g). In our harm analysis, we examine the entire record and consider
whether the erroneously admitted evidence was emphasized and whether it was
calculated or inadvertent. Interstate Northborough P’ship v. State, 66 S.W.3d 213, 220
(Tex. 2001) (op. on reh’g); Serv. Corp. Int’l v. Guerra, 348 S.W.3d 221, 236 (Tex. 2001).
15 Appellee’s lost earning capacity was an integral part of the underlying case.
Gorman was allowed numerous times, over objection, to testify that Appellee “probably”
would have become an MWD lead engineer or a directional driller. This invited the jury
to consider a hypothetical promotion in awarding damages for loss of future earning
capacity. During Womack’s testimony, the jury was allowed to hear about millions of
dollars in lost earning capacity. Uncertainty cannot be made the basis of a legal claim
for damages. Elliott, 149 U.S. at 269. Accordingly, we find the trial court’s erroneous
admission of expert testimony of loss of earning capacity harmed Appellants. Issue one
is sustained.
ISSUE TWO MEDICAL BILLS – PAID OR INCURRED
Our resolution of issue one suspends consideration of issue two concerning the
admissibility of unadjusted gross medical bills, for to do so would constitute an advisory
opinion. See Valley Baptist Med. Ctr. v. Gonzalez, 33 S.W.3d 821, 822 (Tex. 2000).
See also Petro Pro, Ltd. v. Upland Res., Inc., 279 S.W.3d 743, 745 n.1 (Tex.App.—
Amarillo 2007, pet. denied). When this case was originally tried the trial court did not
have the benefit of the Supreme Court’s decision in Haygood v. De Escabedo.
Notwithstanding our decision to not address issue two, upon remand the trial court
should consider the implications of Haygood on the admissibility of such evidence.
CONCLUSION
When a trial court has erroneously admitted the only evidence on a contested
issue, we ordinarily render the judgment that would have been appropriate had the
erroneously admitted evidence been properly excluded. Guevara v. Ferrer, 247 S.W.3d
16 662, 670 (Tex. 2007). However, when, as here, there is some evidence to support a
loss of earnings capacity damages, but not enough to support the full amount awarded,
it is inappropriate for us to render judgment. See id. See also Akin, Gump, Strauss,
Hauer & Feld, L.L.P. v. Nat’l Dev. & Research Corp., 299 S.W.3d 106, 124 (Tex. 2009).
In the interests of justice, we believe the proper course in this instance is to reverse the
trial court’s judgment and remand the case for a new trial. See Estrada v. Dillon, 44
S.W.3d 558, 560 (Tex. 2001) (concluding that Rule 44.1(b) of the Texas Rules of
Appellate Procedure requires a remand of both liability and damages issues when
defendants have contested liability in the trial court).
Patrick A. Pirtle Justice