Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I LLLP

Opinion

COURT OF CHANCERY OF THE SAM GLASSCOCK III STATE OF DELAWARE COURT OF CHANCERY COURTHOUSE VICE CHANCELLOR 34 THE CIRCLE GEORGETOWN, DELAWARE 19947

Date Submitted: November 7, 2017 Date Decided: November 13, 2017

Gregory V. Varallo, Esquire William B. Chandler, III, Esquire Rudolf Koch, Esquire Ian R. Liston, Esquire Robert L. Burns, Esquire Wilson Sonsini Goodrich & Rosati, P.C. Richards, Layton & Finger, P.A. 222 Delaware Avenue, Suite 800 One Rodney Square Wilmington, DE 19801 920 North King Street Wilmington, DE 19801 Lewis H. Lazarus, Esquire Meghan A. Adams, Esquire Morris James LLP 500 Delaware Avenue, Suite 1500 Wilmington, DE 19801

David S. Eagle, Esquire Sean M. Brennecke, Esquire Klehr Harrison Harvey Branzburg LLP 919 Market Street, Suite 1000 Wilmington, DE 19801

Re: Great Hill Equity Partners IV, LP, et al. v. SIG Growth Equity Fund I, LLLP, et al., Civil Action No. 7906-VCG

Dear Counsel:

As discussed at the pretrial conference, this Letter Opinion will address the

Defendants’ Motion in Limine No. 1. For the reasons that follow, the Motion in

Limine is denied without prejudice to object at trial and to seek to exclude

consideration of evidence in post-trial briefing. Motion in Limine No. 1 seeks to exclude portions of proposed testimony from

the Plaintiffs’ industry expert, Dr. Thomas Layman. The Defendants’ Motion

focuses on two purported problems with Dr. Layman’s proposed testimony. First,

the Defendants point out that the body of Dr. Layman’s report contains a recitation

of facts upon which he relied in forming his opinion. The Defendants argue that this

recitation of facts is cherry-picked and self-serving, and expressed the concern that

it may improperly skew my view of the facts, which I must determine based on

testimony at trial, not second-hand evidence received via an expert’s report. I have

no doubt, however, that I will be able to separate the two. Dr. Layman is permitted

to set forth the facts as he understood them in formulating his opinion.1 The

Defendants, of course, are free to cross-examine Dr. Layman and point out the

deficiencies or inaccuracies of the purported facts upon which he bases his opinion.

But I see no need to exclude Dr. Layman’s testimony through a ruling in limine.2

Next, the Defendants argue that Dr. Layman should not be permitted to opine

on the subjective knowledge or intent of individuals in the guise of providing insight

1 See D.R.E. 702 (“If scientific, technical or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training or education may testify thereto in the form of an opinion or otherwise, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case.” (emphasis added)). 2 See Beard Research, Inc. v. Kates, 2009 WL 7409282, at *6 (Del. Ch. Mar. 31, 2009) (“[A]lthough it is critical in a jury trial for a court to exercise its gatekeeper function in advance of allowing an expert to testify, the importance of addressing issues raised under Daubert and Rule 702 before an expert testifies is more attenuated in a bench trial.”). 2 into the industry in which Plimus did business. The Plaintiffs have responded that

they are not anticipating any such testimony. The Defendants are free to object to

any question which they feel improperly solicits views outside Dr. Layman’s area of

expertise.3

For the foregoing reasons, the Defendants’ Motion in Limine No. 1 is denied

without prejudice, as described in the body of this Letter Opinion. To the extent that

the foregoing requires an order to take effect, IT IS SO ORDERED.

Sincerely,

/s/ Sam Glasscock III

Sam Glasscock III

3 See Hoechst Celanse Corp. v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa., 1994 WL 721624, at *1 (Del. Ch. Apr. 20, 1994) (holding that “subjective testimony regarding the plaintiffs’ subjective intent with respect to property damage is not admissible as expert testimony pursuant to Delaware Rule of Evidence 702.”). 3