1 2 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 3 4 Pacira Pharmaceuticals, Inc., Case No. 2:21-cv-02241-CDS-NJK
5 Plaintiff Order Resolving RDF’s Motion in Limine to Exclude Opinions and Testimony 6 v. of Brian P. Jenkins
7 Research Development Foundation, [ECF No. 222, 253]
8 Defendant
9 10 Plaintiff Pacira Pharmaceuticals, Inc. sues defendant Research Development Foundation 11 (“RDF”) in this declaratory-judgment action arising out of a long-standing assignment 12 agreements between the parties. RDF filed a motion in limine seeking to exclude parts of the 13 expert testimony of Pacira’s expert witness Brian P. Jenkins. RDF motion, ECF No. 222 (sealed); 14 ECF No. 253 (unsealed). Pacira opposes the motion. Opp’n, ECF No. 261. RDF filed a reply to 15 Pacira’s opposition. RDF Reply, ECF No. 284. For the reasons described herein, I grant in part 16 and deny in part RDF’s motion in limine to exclude the testimony of Dr. Jenkins. 17 I. Legal standard 18 The court incorporates the motion in limine standard set forth in the order resolving 19 Pacira’s motions in limine to exclude, ECF No. 307. 20 II. Discussion 21 As background, the issues that remain outstanding for trial are: (1) “whether Pacira’s 22 New Patents ‘relate to the Assigned Proprietary Property’ under Section 3.8 of the 1994 23 Agreement[,]” ECF No. 232 (citing ECF No. 178 at 6); ECF No. 264 at 4 (citing Summ. J. Order, 24 ECF No. 152 at 17–18), and (2) unenforceability of the assignment agreements on the grounds of 25 unconscionability and public policy, ECF No. 232 at 6. 26 1 In his expert report, Jenkins discusses RDF’s royalty revenues related to Pacira as a 2 percentage of RDF’s total royalty revenues; compensation paid to RDF representatives Thomas 3 J. Brorby, Dudley R. Dobie, and Brian W. Crozier by RDF and related organizations; and fees 4 incurred by the law firm of Brorby, Crozier & Dobie, P.C. for legal services provided to RDF and 5 related organizations. See Jenkins rep., ECF No. 253-2. RDF seeks exclusion of Jenkins’s report 6 and testimony arguing that his report does not assist the trier of fact and is irrelevant to the 7 remaining issues set for trial. ECF No. 253 at 7–19. 8 A. Whether Jenkins’s report assists the trier of fact1 9 RDF argues first that Jenkins’s report essentially boils down to three tables which 10 summarize information available to the factfinder and for which he conducts only basic addition 11 and division. Id. at 7. It contends that the conclusions he offers could be drawn by a layperson 12 and require no specialized skills. Id. at 13 (citing Ga. Operators Self-Insurers Fund v. PMA Mgmt. Corp., 13 143 F. Supp. 3d 1317, 1338 (N.D. Ga. 2015) and Isr. Travel Advisory Serv. v. Isr. Identity Tours, 1993 U.S. 14 Dist. LEXIS 13749, at *4–6 (N.D. Ill. Sep. 15, 1993)). In its response, Pacira argues that Jenkins’s 15 opinions are helpful because, even if the outputs require only simple addition and division, 16 Jenkins’s inputs were complicated and required significant experience and expertise. ECF No. 17 261 at 15–20. Pacira contends that, (1) for his royalty reports, Jenkins reviewed thousands of 18 pages of forms to put together a picture of RDF’s royalty revenue; (2) for his table analyzing 19 RDF payments to Brorby, Crozier, and Dobie, he was required to derive annual compensation 20 paid to each RDF Trustee for the period from 2001 through 2020; and (3) for his legal fees table, 21 he compiled and analyzed tax returns from five entities across nineteen years. Id. at 16–18. 22 “Whether the situation is a proper one for the use of expert testimony is to be 23 determined on the basis of assisting the trier” and “[t]here is no more certain test for 24 determining when experts may be used than the common sense inquiry whether the untrained 25 26 1 As the parties are aware, because this is a bench trial, I will be serving as the trier of fact. 1 layman would be qualified to determine intelligently and to the best possible degree the 2 particular issue without enlightenment from those having a specialized understanding of the 3 subject involved in the dispute.” Fed. R. Evid. 702 advisory committee’s note (citations omitted). 4 However, an expert report that relies on relatively simple calculations may nonetheless assist 5 the trier of fact where the basis for these calculations is “more involved[.]” Relevant Grp., LLC v. 6 Nourmand, 2022 WL 18356631, at *4 (C.D. Cal. Dec. 9, 2022); cf. SiteLock LLC v. GoDaddy.com LLC, 7 562 F. Supp. 3d 283, 331 (D. Ariz. 2022) (finding that even though an expert was only making a 8 “simple math calculation[,]” it could still be useful to the trier of fact). 9 I find that, even though Jenkins only conducts addition and division in his calculations, 10 his expertise as an accountant is essential in both reaching and evaluating those calculations; 11 especially calculations that involve calculations that span over the course of nineteen years. 12 Although a layperson could find an average, a layperson would not have been able to evaluate 13 the thousands of documents upon which Jenkins relied to synthesize the numbers he calculated. 14 Accounting experts, especially, are often asked to synthesize heavy evidentiary records and 15 excluding their reports and testimony as unhelpful because their ultimate calculations are 16 “simple” misunderstands the value of their expertise. Therefore, RDF’s motion to exclude 17 Jenkins’s testimony because it is unhelpful to the trier of fact is denied without prejudice. 18 B. Relevance of Jenkins’s report 19 RDF argues that all parts of Jenkins’s report are irrelevant. 20
21 RDF first argues that Jenkins’s Pacira royalty revenues opinions are irrelevant because 22 they do not serve to address the question of whether the ’495 patent and the ’572 or ’838 patents 23 are related, and are frivolous to any bias question because, although a fact witness could testify 24 that RDF receives royalties from Pacira, the amount in royalties is irrelevant. ECF No. 253 at 14– 25 15. It expresses concern that this bias testimony will lead to a “mini-trial on, or an attempt to 26 quantify, a party’s or its representative-witnesses’ inherent partiality.” Id. at 15 (citing Dent v. U.S. 1 Tennis Ass’n, 2010 U.S. Dist. LEXIS 31052, at *2–3 (E.D.N.Y. Mar. 30, 2010)). In response to this 2 contention, Pacira argues that Jenkins’s testimony is relevant because it demonstrates RDF’s 3 “significant financial stake in the outcome of this litigation[,]” which would not come to light 4 otherwise. ECF No. 261 at 21. Additionally, it argues that the royalty revenue opinions are 5 relevant to the substantive unconscionability question, “as it speaks to the ‘one sidedness’ of the 6 contract under RDF’s ‘harsh’ and ‘unreasonable’ interpretation.” Id. at 22. (citing D.R. Horton, Inc. 7 v. Green, 96 P.3d 1159, 1163–64 (2004) (“substantive unconscionability focuses on the one- 8 sidedness of the contract terms.”) (quoting Ting v. AT&T, 319 F.3d 1126, 1149 (9th Cir.), cert. denied, 9 540 U.S. 811 (2003))). 10 I agree that Jenkins’s opinions about the Pacira royalty revenue are relevant. Evidence of 11 potential bias, as well as the extent of that bias, may be relevant. See, e.g., Heath v. Cast, 813 F.2d 12 254, 259 (9th Cir. 1987) (finding that factfinder was “entitled to hear the evidence and decide 13 the extent of that bias”); see also United States v. Abel, 469 U.S. 45
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1 2 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 3 4 Pacira Pharmaceuticals, Inc., Case No. 2:21-cv-02241-CDS-NJK
5 Plaintiff Order Resolving RDF’s Motion in Limine to Exclude Opinions and Testimony 6 v. of Brian P. Jenkins
7 Research Development Foundation, [ECF No. 222, 253]
8 Defendant
9 10 Plaintiff Pacira Pharmaceuticals, Inc. sues defendant Research Development Foundation 11 (“RDF”) in this declaratory-judgment action arising out of a long-standing assignment 12 agreements between the parties. RDF filed a motion in limine seeking to exclude parts of the 13 expert testimony of Pacira’s expert witness Brian P. Jenkins. RDF motion, ECF No. 222 (sealed); 14 ECF No. 253 (unsealed). Pacira opposes the motion. Opp’n, ECF No. 261. RDF filed a reply to 15 Pacira’s opposition. RDF Reply, ECF No. 284. For the reasons described herein, I grant in part 16 and deny in part RDF’s motion in limine to exclude the testimony of Dr. Jenkins. 17 I. Legal standard 18 The court incorporates the motion in limine standard set forth in the order resolving 19 Pacira’s motions in limine to exclude, ECF No. 307. 20 II. Discussion 21 As background, the issues that remain outstanding for trial are: (1) “whether Pacira’s 22 New Patents ‘relate to the Assigned Proprietary Property’ under Section 3.8 of the 1994 23 Agreement[,]” ECF No. 232 (citing ECF No. 178 at 6); ECF No. 264 at 4 (citing Summ. J. Order, 24 ECF No. 152 at 17–18), and (2) unenforceability of the assignment agreements on the grounds of 25 unconscionability and public policy, ECF No. 232 at 6. 26 1 In his expert report, Jenkins discusses RDF’s royalty revenues related to Pacira as a 2 percentage of RDF’s total royalty revenues; compensation paid to RDF representatives Thomas 3 J. Brorby, Dudley R. Dobie, and Brian W. Crozier by RDF and related organizations; and fees 4 incurred by the law firm of Brorby, Crozier & Dobie, P.C. for legal services provided to RDF and 5 related organizations. See Jenkins rep., ECF No. 253-2. RDF seeks exclusion of Jenkins’s report 6 and testimony arguing that his report does not assist the trier of fact and is irrelevant to the 7 remaining issues set for trial. ECF No. 253 at 7–19. 8 A. Whether Jenkins’s report assists the trier of fact1 9 RDF argues first that Jenkins’s report essentially boils down to three tables which 10 summarize information available to the factfinder and for which he conducts only basic addition 11 and division. Id. at 7. It contends that the conclusions he offers could be drawn by a layperson 12 and require no specialized skills. Id. at 13 (citing Ga. Operators Self-Insurers Fund v. PMA Mgmt. Corp., 13 143 F. Supp. 3d 1317, 1338 (N.D. Ga. 2015) and Isr. Travel Advisory Serv. v. Isr. Identity Tours, 1993 U.S. 14 Dist. LEXIS 13749, at *4–6 (N.D. Ill. Sep. 15, 1993)). In its response, Pacira argues that Jenkins’s 15 opinions are helpful because, even if the outputs require only simple addition and division, 16 Jenkins’s inputs were complicated and required significant experience and expertise. ECF No. 17 261 at 15–20. Pacira contends that, (1) for his royalty reports, Jenkins reviewed thousands of 18 pages of forms to put together a picture of RDF’s royalty revenue; (2) for his table analyzing 19 RDF payments to Brorby, Crozier, and Dobie, he was required to derive annual compensation 20 paid to each RDF Trustee for the period from 2001 through 2020; and (3) for his legal fees table, 21 he compiled and analyzed tax returns from five entities across nineteen years. Id. at 16–18. 22 “Whether the situation is a proper one for the use of expert testimony is to be 23 determined on the basis of assisting the trier” and “[t]here is no more certain test for 24 determining when experts may be used than the common sense inquiry whether the untrained 25 26 1 As the parties are aware, because this is a bench trial, I will be serving as the trier of fact. 1 layman would be qualified to determine intelligently and to the best possible degree the 2 particular issue without enlightenment from those having a specialized understanding of the 3 subject involved in the dispute.” Fed. R. Evid. 702 advisory committee’s note (citations omitted). 4 However, an expert report that relies on relatively simple calculations may nonetheless assist 5 the trier of fact where the basis for these calculations is “more involved[.]” Relevant Grp., LLC v. 6 Nourmand, 2022 WL 18356631, at *4 (C.D. Cal. Dec. 9, 2022); cf. SiteLock LLC v. GoDaddy.com LLC, 7 562 F. Supp. 3d 283, 331 (D. Ariz. 2022) (finding that even though an expert was only making a 8 “simple math calculation[,]” it could still be useful to the trier of fact). 9 I find that, even though Jenkins only conducts addition and division in his calculations, 10 his expertise as an accountant is essential in both reaching and evaluating those calculations; 11 especially calculations that involve calculations that span over the course of nineteen years. 12 Although a layperson could find an average, a layperson would not have been able to evaluate 13 the thousands of documents upon which Jenkins relied to synthesize the numbers he calculated. 14 Accounting experts, especially, are often asked to synthesize heavy evidentiary records and 15 excluding their reports and testimony as unhelpful because their ultimate calculations are 16 “simple” misunderstands the value of their expertise. Therefore, RDF’s motion to exclude 17 Jenkins’s testimony because it is unhelpful to the trier of fact is denied without prejudice. 18 B. Relevance of Jenkins’s report 19 RDF argues that all parts of Jenkins’s report are irrelevant. 20
21 RDF first argues that Jenkins’s Pacira royalty revenues opinions are irrelevant because 22 they do not serve to address the question of whether the ’495 patent and the ’572 or ’838 patents 23 are related, and are frivolous to any bias question because, although a fact witness could testify 24 that RDF receives royalties from Pacira, the amount in royalties is irrelevant. ECF No. 253 at 14– 25 15. It expresses concern that this bias testimony will lead to a “mini-trial on, or an attempt to 26 quantify, a party’s or its representative-witnesses’ inherent partiality.” Id. at 15 (citing Dent v. U.S. 1 Tennis Ass’n, 2010 U.S. Dist. LEXIS 31052, at *2–3 (E.D.N.Y. Mar. 30, 2010)). In response to this 2 contention, Pacira argues that Jenkins’s testimony is relevant because it demonstrates RDF’s 3 “significant financial stake in the outcome of this litigation[,]” which would not come to light 4 otherwise. ECF No. 261 at 21. Additionally, it argues that the royalty revenue opinions are 5 relevant to the substantive unconscionability question, “as it speaks to the ‘one sidedness’ of the 6 contract under RDF’s ‘harsh’ and ‘unreasonable’ interpretation.” Id. at 22. (citing D.R. Horton, Inc. 7 v. Green, 96 P.3d 1159, 1163–64 (2004) (“substantive unconscionability focuses on the one- 8 sidedness of the contract terms.”) (quoting Ting v. AT&T, 319 F.3d 1126, 1149 (9th Cir.), cert. denied, 9 540 U.S. 811 (2003))). 10 I agree that Jenkins’s opinions about the Pacira royalty revenue are relevant. Evidence of 11 potential bias, as well as the extent of that bias, may be relevant. See, e.g., Heath v. Cast, 813 F.2d 12 254, 259 (9th Cir. 1987) (finding that factfinder was “entitled to hear the evidence and decide 13 the extent of that bias”); see also United States v. Abel, 469 U.S. 45, 52 (1984) (“Proof of bias is 14 almost always relevant because the jury, as finder of fact and weigher of credibility, has 15 historically been entitled to assess all evidence which might bear on the accuracy and truth of a 16 witness’ testimony.”). I see no reason to exclude this evidence just because Jenkins not only 17 opines about potential bias, but also supports his conclusions with data. As to the issue of 18 unenforceability based on unconscionability, I likewise find that Jenkins’s opinions about the 19 percentage of RDF’s royalty revenue derived from Pacira are relevant. His testimony does not 20 invite a “mini-trial” on the level of bias as RDF contends because RDF does not dispute Jenkins’s 21 methodology or his accuracy. Therefore, RDF’s motion to exclude Jenkins’s testimony about the 22 royalty revenues as irrelevant is denied without prejudice. 23 However, Pacira is reminded that this trial is about the triable issues—the “related to” 24 and unenforceability questions—and, as rulings on motions in limine are only preliminary, 25 should testimony about or issues of bias become all-encompassing, I will not hesitate to impose 26 limitations during trial. 1 2 3 RDF next argues that Jenkins’s testimony as to compensation of Brorby, Dobie, and 4 Crozier is irrelevant for demonstrating witness bias because, though the fact of compensation is 5 relevant, the amount of compensation is not. ECF No. 253 at 16. In response, Pacira argues that 6 amount of compensation is relevant to establish bias. ECF No. 261 at 22–23. It also argues that 7 “[s]imply knowing that Mr. Brorby and Mr. Crozier are trustees of RDF that receive 8 compensation is insufficient to establish the extent of their bias and credibility” because it fails 9 to capture the extent of their monetary relationship with RDF and their corresponding stake in 10 the case. Id. at 23–24. Pacira does not argue that Jenkins’s findings regarding Dobie should not 11 be excluded. See ECF No. 261 at 22–24. 12 The parties each point to case law addressing similar situations that supports their 13 respective arguments. Compare, e.g., Johnson v. Hewlett-Packard Co., 2010 U.S. Dist. LEXIS 122161, at 14 *6 (N.D. Cal. Nov. 1, 2010) (holding that discovery regarding amount of compensation was 15 irrelevant because “Slaby’s employment with HP already implies bias, and thus, exact 16 information as to amounts of compensation is unnecessary for such a purpose”), with Oracle USA, 17 Inc. v. Rimini St., Inc., 2015 WL 5089779, at *3 (D. Nev. Aug. 27, 2015) (denying motion to exclude 18 CEO’s “net worth in [defendant] stock” because it was “relevant to establish his bias. 19 [Defendant] has publicly stated that the outcome of this case may have a material impact on its 20 value. As such, defendant [CEO] has a direct financial stake in the outcome of this case and 21 [plaintiff] is entitled to examine any testimonial bias during trial.”). 22 I find the Oracle court’s reasoning more persuasive; amount of bias can be a relevant 23 inquiry. See Wyatt Tech. Corp. v. Malvern Instruments, Inc., 2010 WL 11505684, at *23–24 (C.D. Cal. 24 Jan. 25, 2010) (refusing to exclude salaries and dividends paid to witnesses because “income 25 flowing directly from [plaintiff] as a company” to the company executive witnesses “is relevant 26 to their possible bias as witnesses in this case[.]”). Although the fact of compensation serves as 1 the primary relevant fact to demonstrate a witness’s bias, how much the witness is being paid or 2 has been paid by a party can further fill in the picture of how much the witness stands to gain 3 should their side prevail at trial. Here, the amount of compensation Brorby and Crozier have 4 received from RDF and related organizations is relevant to the question of how significant their 5 stake in the outcome of this trial will be. Therefore, RDF’s motion to exclude Jenkins’s 6 testimony about the amount paid to Brorby and Crozier because it is irrelevant is denied 7 without prejudice. 8 Because Pacira’s response does not object to—or even mention—Jenkins’s findings as to 9 Dobie, I find that Pacira has waived the argument that Jenkins’s testimony regarding Dobie is 10 relevant. Stiffarm v. City of Pullman, 2007 WL 9717343, at *1 (E.D. Wash. Mar. 6, 2007) (finding 11 that a failure to address parts of a motion in limine amount to a concession). Accordingly, RDF’s 12 motion to exclude Jenkins’s testimony about the amount paid to Dobie because it is irrelevant is 13 granted. 14 15 16 RDF states that Jenkins’s opinions about the payment the law firm Brorby, Crozier & 17 Dobie, P.C. (at which Brorby, Crozier, an Dobie are all partners) received will be presumably 18 used to demonstrate that Brorby, Dobie, and Crozier were further compensated by RDF in this 19 litigation. ECF No. 253 at 17. It argues that the implication that the three were inappropriately 20 compensated is false and the only way to defend against this accusation will be for RDF to put 21 on a large collection of evidence to show that the partners appropriately billed for their time and 22 could separately encroach on attorney-client privilege. Id. It also suggests that this evidence 23 showing witness bias is cumulative. Id. at n.2. Pacira argues in response that evidence of the 24 longstanding relationship between Brorby, Crozier & Dobie, P.C. and RDF, and the millions of 25 dollars that have been paid to the firm in that time, is relevant in this case where at least Brorby 26 and Crozier are billing for their time as fact witnesses. ECF No. 261 at 24–25. Pacira asserts that lj it “is not suggesting that RDF is paying Brorby Crozier & Dobie P.C for work that it has not done” and therefore there is no need for a “sideshow” that would require RDF to put on proof of 3]| what its fact witnesses were billing for. Id. at 25 n.13. 4 For the same reasons I found that the evidence of RDF’s direct compensation to the 5]| witnesses was relevant, I find that evidence of payment to the witnesses’ law firm is, too. Seeing 6]| as the parties do not dispute that the payments were made for credible work, and this evidence 7|| serves only to further demonstrate the witnesses’ stake in the ultimate outcome of the litigation, 8|| there should be no need for RDF to produce evidence to defend its reputation and the reputation 9] of its witnesses. I also do not find that this evidence is cumulative, though the plaintiffs are cautioned that, should this evidence of bias become a significant sideshow at trial, I will not hesitate to place limitations on Jenkins’s testimony. Therefore, RDF’s motion to exclude 12|| Jenkins’s testimony about the amount paid to Brorby, Crozier & Dobie, P.C. for legal services provided to RDF and related organizations because it is irrelevant is denied without prejudice. = Conclusion 5 IT IS THEREFORE ORDERED that RDF’s motion in limine [ECF No. 222 (sealed); 16]| ECF No. 253 (unsealed)] is GRANTED in part and DENIED in part as set forth in this order. 17 Dated: September 19, 2024 / 18 LZ
50 Oe d States District Judge 21 22 23 24 25 26