UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
D’Pergo Custom Guitars, Inc.
v. Civil No. 17-cv-747-LM Opinion No. 2020 DNH 180 P Sweetwater Sound, Inc.
ORDER
D’Pergo Custom Guitars, Inc. (“D’Pergo”) brings this action against
Sweetwater Sound, Inc. (“Sweetwater”), asserting Sweetwater’s liability for
copyright infringement and violations of the New Hampshire Consumer Protection
Act, RSA ch. 358-A. D’Pergo alleges that Sweetwater used a copyrighted photograph
of D’Pergo’s trademarked custom guitar necks and headstock to promote and sell
Sweetwater products on its website.
Sweetwater designated a witness to serve as its damages expert. However,
the expert later became unavailable due to serious illness. Sweetwater therefore
designated a substitute expert and produced the new expert’s report to D’Pergo.
D’Pergo now moves to strike (doc. no. 152) from the substitute expert’s report each
paragraph that contains a statement of opinion or fact that did not appear, in some
form, in the original expert’s report. D’Pergo does not argue that Sweetwater lacked
substantial justification for its late designation of a substitute expert. Instead,
D’Pergo argues that meaningful differences between a late-disclosed substitute
expert’s report and a timely-disclosed original expert’s report are impermissible as a
matter of law. For the reasons discussed below, D’Pergo’s motion to strike is denied. STANDARD OF REVIEW
Under Federal Rule of Civil Procedure 26, a party must “disclose to the other
parties the identity of any witness it may use at trial to present evidence” in the
form of expert opinion. Fed. R. Civ. P. 26(a)(2)(A). The disclosure of the expert
witness’s identity must be accompanied by a report containing, among other things,
“a complete statement of all opinions the witness will express and the basis and
reasons for them,” and “the facts or data considered by the witness in forming”
those opinions. Fed. R. Civ. P. 26(a)(2)(B)(i)-(ii).
Where, as here, a district court has established a disclosure deadline, a party
must disclose the expert’s identity and report by the court-ordered deadline. See
Fed. R. Civ. P. 26(a)(2)(D). If a party’s expert disclosure is untimely under Rule
26(a), the party may not use the expert or the expert’s report “to supply evidence on
a motion, at a hearing, or at a trial, unless the failure was substantially justified or
is harmless.” Fed. R. Civ. P. 37(c)(1); see also Esposito v. Home Depot U.S.A., Inc.,
590 F.3d 72, 77 (1st Cir. 2009). “Rule 37(c)(1) ‘allows the court to admit belatedly
proffered expert evidence if the proponent's failure to reveal it was either
substantially justified or harmless.’” Poulis-Minott v. Smith, 388 F.3d 354, 358 (1st
Cir. 2004) (emphasis added) (quoting Lohnes v. Level 3 Commc’ns, Inc., 272 F.3d 49,
60 (1st Cir. 2001)).
An expert’s incapacity to serve due to illness or death constitutes substantial
justification for the untimely disclosure of a substitute expert, so long as the party
2 seeking substitution discloses the new expert within a reasonable time. See, e.g.,
Morel v. Daimler-Chrysler Corp., 259 F.R.D. 17, 21 (D.P.R. 2009) (citing Ferrara &
DiMercurio v. St. Paul Mercury Ins. Co., 240 F.3d 1, 8, 10 (1st Cir. 2001)). A late
disclosure that occurs well before trial, and with sufficient time to permit the
opposing party to adjust its litigation strategy to avoid prejudice, is harmless. See
Samos Imex Corp. v. Nextel Commc’ns, Inc., 194 F.3d 301, 305 (1st Cir. 1999).
The courts have broad discretion to determine whether to admit late-
disclosed evidence with or without sanctions. See Macaulay v. Anas, 321 F.3d 45, 51
(1st Cir. 2003). “Courts have looked with disfavor upon parties who claim surprise
and prejudice but who do not ask for a [continuance]so they may attempt to counter
the opponent's testimony.” Johnson v. H. K. Webster, Inc., 775 F.2d 1, 8 (1st Cir.
1985). Generally, courts will exclude late-disclosed expert testimony only where
there has been “some evasion or concealment, intentional or not, on the part of the
litigant offering the evidence.” Id.
BACKGROUND
As noted, this action arises out of Sweetwater’s use of a photograph belonging
to D’Pergo in an article appearing on Sweetwater’s website. Although the question
of Sweetwater’s liability for copyright infringement has already been decided in
D’Pergo’s favor, see doc. no. 139, the question of D’Pergo’s resulting damages has
not yet been resolved.
3 On May 1, 2019, D’Pergo timely disclosed its damages expert, Jeffery Sedlik,
and produced his report to Sweetwater. Sedlik’s report opined as to the hypothetical
fee D’Pergo could have charged in exchange for licensing its photograph to
Sweetwater.
On June 15, 2019, Sweetwater timely disclosed its own damages expert, Ellen
Boughn, and produced her report to D’Pergo. Boughn provided a response to
Sedlik’s report, and in addition produced her own “alternative fair market value . . .
for a hypothetical license to use a single, existing photograph.” Doc. no. 152-2, exh. 2
at 3. D’Pergo deposed Boughn on July 25, 2019. Discovery concluded in September
2019, and trial was set for November 2019.
It appears that, had trial taken place as originally scheduled in November
2019, Sweetwater would have gone to trial with Boughn serving as its damages
expert. However, to accommodate the serious medical needs of one of D’Pergo’s
attorneys, the trial date was postponed multiple times. On February 14, 2020, the
parties jointly proposed August 18, 2020 as the trial date, and on February 18,
2020, the court agreed to the parties’ proposal.
On April 23, 2020, Sweetwater informed D’Pergo that Boughn needed to
withdraw as Sweetwater’s expert due to serious health issues. After searching for
an appropriate substitute, Sweetwater disclosed its new damages expert, Gary
Elsner, and produced his report to D’Pergo on July 15, 2020. That same day,
Sweetwater moved, with D’Pergo’s assent, to continue trial a further sixty days.
Sweetwater’s stated reason for seeking to continue trial was to provide D’Pergo with
4 adequate time to depose Sweetwater’s substitute expert and, if necessary, to permit
D’Pergo’s expert to update his own report or to submit a rebuttal report. The court
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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
D’Pergo Custom Guitars, Inc.
v. Civil No. 17-cv-747-LM Opinion No. 2020 DNH 180 P Sweetwater Sound, Inc.
ORDER
D’Pergo Custom Guitars, Inc. (“D’Pergo”) brings this action against
Sweetwater Sound, Inc. (“Sweetwater”), asserting Sweetwater’s liability for
copyright infringement and violations of the New Hampshire Consumer Protection
Act, RSA ch. 358-A. D’Pergo alleges that Sweetwater used a copyrighted photograph
of D’Pergo’s trademarked custom guitar necks and headstock to promote and sell
Sweetwater products on its website.
Sweetwater designated a witness to serve as its damages expert. However,
the expert later became unavailable due to serious illness. Sweetwater therefore
designated a substitute expert and produced the new expert’s report to D’Pergo.
D’Pergo now moves to strike (doc. no. 152) from the substitute expert’s report each
paragraph that contains a statement of opinion or fact that did not appear, in some
form, in the original expert’s report. D’Pergo does not argue that Sweetwater lacked
substantial justification for its late designation of a substitute expert. Instead,
D’Pergo argues that meaningful differences between a late-disclosed substitute
expert’s report and a timely-disclosed original expert’s report are impermissible as a
matter of law. For the reasons discussed below, D’Pergo’s motion to strike is denied. STANDARD OF REVIEW
Under Federal Rule of Civil Procedure 26, a party must “disclose to the other
parties the identity of any witness it may use at trial to present evidence” in the
form of expert opinion. Fed. R. Civ. P. 26(a)(2)(A). The disclosure of the expert
witness’s identity must be accompanied by a report containing, among other things,
“a complete statement of all opinions the witness will express and the basis and
reasons for them,” and “the facts or data considered by the witness in forming”
those opinions. Fed. R. Civ. P. 26(a)(2)(B)(i)-(ii).
Where, as here, a district court has established a disclosure deadline, a party
must disclose the expert’s identity and report by the court-ordered deadline. See
Fed. R. Civ. P. 26(a)(2)(D). If a party’s expert disclosure is untimely under Rule
26(a), the party may not use the expert or the expert’s report “to supply evidence on
a motion, at a hearing, or at a trial, unless the failure was substantially justified or
is harmless.” Fed. R. Civ. P. 37(c)(1); see also Esposito v. Home Depot U.S.A., Inc.,
590 F.3d 72, 77 (1st Cir. 2009). “Rule 37(c)(1) ‘allows the court to admit belatedly
proffered expert evidence if the proponent's failure to reveal it was either
substantially justified or harmless.’” Poulis-Minott v. Smith, 388 F.3d 354, 358 (1st
Cir. 2004) (emphasis added) (quoting Lohnes v. Level 3 Commc’ns, Inc., 272 F.3d 49,
60 (1st Cir. 2001)).
An expert’s incapacity to serve due to illness or death constitutes substantial
justification for the untimely disclosure of a substitute expert, so long as the party
2 seeking substitution discloses the new expert within a reasonable time. See, e.g.,
Morel v. Daimler-Chrysler Corp., 259 F.R.D. 17, 21 (D.P.R. 2009) (citing Ferrara &
DiMercurio v. St. Paul Mercury Ins. Co., 240 F.3d 1, 8, 10 (1st Cir. 2001)). A late
disclosure that occurs well before trial, and with sufficient time to permit the
opposing party to adjust its litigation strategy to avoid prejudice, is harmless. See
Samos Imex Corp. v. Nextel Commc’ns, Inc., 194 F.3d 301, 305 (1st Cir. 1999).
The courts have broad discretion to determine whether to admit late-
disclosed evidence with or without sanctions. See Macaulay v. Anas, 321 F.3d 45, 51
(1st Cir. 2003). “Courts have looked with disfavor upon parties who claim surprise
and prejudice but who do not ask for a [continuance]so they may attempt to counter
the opponent's testimony.” Johnson v. H. K. Webster, Inc., 775 F.2d 1, 8 (1st Cir.
1985). Generally, courts will exclude late-disclosed expert testimony only where
there has been “some evasion or concealment, intentional or not, on the part of the
litigant offering the evidence.” Id.
BACKGROUND
As noted, this action arises out of Sweetwater’s use of a photograph belonging
to D’Pergo in an article appearing on Sweetwater’s website. Although the question
of Sweetwater’s liability for copyright infringement has already been decided in
D’Pergo’s favor, see doc. no. 139, the question of D’Pergo’s resulting damages has
not yet been resolved.
3 On May 1, 2019, D’Pergo timely disclosed its damages expert, Jeffery Sedlik,
and produced his report to Sweetwater. Sedlik’s report opined as to the hypothetical
fee D’Pergo could have charged in exchange for licensing its photograph to
Sweetwater.
On June 15, 2019, Sweetwater timely disclosed its own damages expert, Ellen
Boughn, and produced her report to D’Pergo. Boughn provided a response to
Sedlik’s report, and in addition produced her own “alternative fair market value . . .
for a hypothetical license to use a single, existing photograph.” Doc. no. 152-2, exh. 2
at 3. D’Pergo deposed Boughn on July 25, 2019. Discovery concluded in September
2019, and trial was set for November 2019.
It appears that, had trial taken place as originally scheduled in November
2019, Sweetwater would have gone to trial with Boughn serving as its damages
expert. However, to accommodate the serious medical needs of one of D’Pergo’s
attorneys, the trial date was postponed multiple times. On February 14, 2020, the
parties jointly proposed August 18, 2020 as the trial date, and on February 18,
2020, the court agreed to the parties’ proposal.
On April 23, 2020, Sweetwater informed D’Pergo that Boughn needed to
withdraw as Sweetwater’s expert due to serious health issues. After searching for
an appropriate substitute, Sweetwater disclosed its new damages expert, Gary
Elsner, and produced his report to D’Pergo on July 15, 2020. That same day,
Sweetwater moved, with D’Pergo’s assent, to continue trial a further sixty days.
Sweetwater’s stated reason for seeking to continue trial was to provide D’Pergo with
4 adequate time to depose Sweetwater’s substitute expert and, if necessary, to permit
D’Pergo’s expert to update his own report or to submit a rebuttal report. The court
granted the motion, and trial was reset to October 5, 2020. 1
Elsner’s report is substantially similar to Boughn’s original report in most
respects. However, Elsner’s report states facts about the stock photography industry
that do not appear in Boughn’s report. In addition, Elsner offers opinions on the
propriety of certain licensing fee “multipliers” discussed in Sedlik’s opinion, which
Boughn’s report did not discuss.
DISCUSSION
It is undisputed that Sweetwater disclosed Elsner after the court-appointed
deadline for disclosure of its experts. However, D’Pergo concedes that Elsner’s
belated designation was substantially justified in light of Boughn’s serious illness,
and the court agrees. See, e.g., Morel, 259 F.R.D. at 21. Under the plain language of
Rule 37(c)(1), Sweetwater may therefore rely on Elsner’s report at trial or in
connection with any motion or hearing. See Fed. R. Civ. P. 37(c)(1); see also Poulis-
Minott, 388 F.3d at 358.
D’Pergo nevertheless argues that portions of Elsner’s report should be
stricken to ensure that Elsner expresses no opinions beyond those expressed in
Boughn’s original report. D’Pergo argues that notwithstanding the adequate
1 On September 22, 2020, the court terminated pretrial deadlines in
connection with the October 5 trial setting. The parties will propose a new trial date at a status conference scheduled for October 15, 2020. 5 justification for Elsner’s untimely designation, Elsner cannot offer an opinion that
differs in any meaningful way from Boughn’s. In effect, D’Pergo argues that the
court must not allow Elsner’s untimely designation as an expert unless it first
ensures harmlessness by requiring Elsner to offer an opinion functionally identical
to the original expert’s opinion. The court disagrees.
First, both the plain language of Rule 37(c)(1) and First Circuit case law
make clear that a party may rely on belatedly disclosed expert opinion either if
there was substantial justification for the untimely disclosure or if the untimely
disclosure was harmless. See Fed. R. Civ. P. 37(c)(1); see also Poulis-Minott, 388
F.3d at 358; Lohnes, 272 F.3d at 60; Wilson v. Bradlees of New Eng., Inc., 250 F.3d
10 (1st Cir. 2001). Analysis of the merits of D’Pergo’s motion can therefore properly
end with a finding of substantial justification.
Second, the court finds that the substitution of Elsner for Boughn was in any
event harmless because D’Pergo has had ample time to adjust its litigation strategy
prior to trial. D’Pergo has been on notice of the need for a new expert since April 23,
2020, and received a copy of the new report on July 15, 2020. At the same time that
Sweetwater produced the new report, Sweetwater successfully moved for a 60-day
continuance to permit D’Pergo to conduct whatever further discovery it deemed
necessary to avoid prejudice. And since that time, the parties have agreed to further
continue the trial date. D’Pergo has had sufficient time to ensure the harmlessness
of the substitution. See Samos, 194 F.3d at 305; Morel , 259 F.R.D. at 21; Downeast
Ventures, Ltd. v. Washington Cty., 450 F. Supp. 2d 106, 112 (D. Me. 2006).
6 Third, D’Pergo seeks exclusion of portions of Elsner’s report, but does not
request additional time to respond to it. The suggestion that D’Pergo will suffer
harm absent such exclusion is unpersuasive given D’Pergo’s failure to seek any less
extreme remedy. See Johnson, 775 F.2d at 8.
Fourth, D’Pergo identifies no prejudice that it would suffer if Sweetwater
were permitted to rely on Elsner’s report in its entirety. While the two reports differ
in minor respects, D’Pergo has made no effort to show that the differences are likely
to thwart its litigation strategy. Absent a showing of actual prejudice, minor
differences between the two opinions provides no grounds for exclusion of any
portion of Elsner’s substitute opinion. See Macaulay, 321 F.3d at 51.
Fifth, and finally, there is no suggestion in the record that Sweetwater’s
designation of a new expert involved any evasion or concealment. To the contrary,
Sweetwater informed D’Pergo that it would require a new expert as soon as it
learned of Boughn’s need to withdraw. Absent evasion or concealment, courts
generally disfavor the exclusion sanction. See Johnson , 775 F.2d at 8.
In sum, the late designation of Sweetwater’s substitute damages expert was
both substantially justified and harmless, and D’Pergo has not shown that it will be
prejudiced if Sweetwater is permitted to rely on the late-produced expert report.
Thus, there are no grounds to strike any portion of Elsner’s report.
7 CONCLUSION
Because the court finds that Sweetwater’s late disclosure of its substitute
damages expert was both substantially justified and harmless, see Fed. R. Civ. P.
37(c)(1), the court denies D’Pergo’s motion to strike (doc. no. 152).
SO ORDERED.
__________________________ Landya McCafferty United States District Judge
October 14, 2020
cc: Counsel of Record