Securities and Exchange Commission V. Kopsky, 586 F. Supp. 2d 1077 (E.D. Mo. Nov. 18, 2008)
While polygraph evidence is not per se inadmissible, Eighth Circuit courts continue to closely scrutinize the circumstances of administration of polygraph tests. In SEC v. Kopsky, too many “red flags” doomed to exclusion an expert’s report and testimony regarding polygraph results.
In 2003, Ronald Davis, a corporate officer, was investigated for passing insider information to his broker, Matthew Kopsky. Davis’ counsel arranged for John Long, a retired FBI polygraph examiner, to test Davis on whether Davis knew the information he provided was nonpublic, material information that was being used by Kopsky. Long used the “control question” technique, most often used by polygraph examiners. According to Long’s report, Davis passed with flying colors, and a copy of the report was provided to the SEC.
Prior to trial, the SEC moved to exclude the report and Long’s testimony. The court ruled the evidence inadmissible as unreliable under FRE 702 and as more prejudicial than probative under FRE 403. In its ruling, the court first reviewed Supreme Court and Eighth Circuit precedent, concluding that polygraph evidence is generally “highly disfavored” but not “per se inadmissible.” Here, the court found the test and conclusions unreliable, agreeing with an SEC expert that: (1) two of the four questions Davis was asked were vague; (2) Long improperly marked the chart tracings; (3) Long used questions submitted by Davis’ counsel; and (4) Long failed to ask Davis about his last use of medications. (According to a letter from defense counsel to Long, Davis was taking six medications, including anti-anxiety drugs, at the time the polygraph was administered.)
In its FRE 403 analysis, the court expanded on its doubts about the reliability of the testing. The court was particularly concerned about the ex parte nature of the examination, citing concerns voiced by other courts that an examinee has no fear of failing such an examination because a failed test is unlikely to ever see the light of day. The court further noted that the time lapse of three years between the alleged insider trading and the examination was a factor, in that the questions were directed to Davis’ state of mind at the time of the alleged insider trading.
Brandis v. Farmers Alliance Mutual Ins. Co., No. CIV. 07-3007, 2009 WL 347409 (D. S. D. Feb. 10, 2009)
The fact that a proffered witness has never worked in the insurance industry does not necessarily preclude him from testifying as an expert on the ordinary practices of claims handling.
In Brandis, the plaintiff was involved in a motor vehicle accident in 2001 and settled with the insurer of the driver at fault for policy limits. The plaintiff then sued her own insurer, Farmers, for medical and disability benefits under underinsured provisions, as well as bad faith claims handling in denying her claim. The court ordered a bifurcated trial, in which the bad faith claim would be heard only if the plaintiff prevailed on the benefits claims. To support the bad faith claim, the plaintiff designated Gary Jensen, based on his “years of experience with insurance law,” as an expert to testify as to ordinary claims handling practices.
Farmers moved to exclude Jensen’s testimony, arguing that Jensen had never worked for an insurance company, and cited several South Dakota statutes as evidence in support of its argument. The court stated: “Counsel is reminded that in federal court, the Federal Rules of Evidence are controlling, not some state statutes.” The court went on to state that nothing in the federal rules requires employment “in the insurance industry in order to be considered an expert in insurance company practices.” With little discussion as to Jensen’s credentials, the court found his background sufficient to ensure the necessary reliability supporting his testimony. The court did caution, however, that Jensen’s testimony would not be without its limits: “Mr. Jensen will not be allowed to invade the province of the court in instructing the jury as to what the law is.”
Schmidt v. Magyari, 557 F.3d 564 (8th Cir. 2009)
The exclusion of a police lieutenant’s testimony concerning the reasonableness of police actions in a §1983 suit was affirmed where the proffered expert’s report went beyond the narrow issue of the case and was stated in conclusory terms.
In Schmidt, Jami Schmidt, age 20 at the time, was a passenger in a car stopped by the Bella Villa, Missouri police for traffic violations. The officer smelled alcohol and saw two empty beer cans in the car. He then asked the occupants of the car for identification information, and Schmidt provided a false name, date of birth and social security number. The officer ran the information provided through his computer, determined that Schmidt had given false information, and arrested only her, for false declaration and being a minor in possession of alcohol.
Schmidt did not contest the propriety of her arrest, but claimed that the officer violated her Fourth and Fourteenth Amendment rights and the Missouri strip search statute at the station. She alleged that upon being asked, she revealed that she had a butterfly tattoo low on her abdomen. She complied when the officer asked her to take a picture of it in a bathroom for identification purposes. However, she claimed, the officer was not satisfied with the photograph and required her to unbutton her jeans and lower them so he could take a better picture. The defendants, including the officer, were awarded summary judgment on the claims. On appeal, Schmidt argued that the exclusion of the testimony of Anthony Russo was error.
Russo, a St. Louis Police Lieutenant, was prepared to testify regarding police practices, including decisions to arrest, evidence collection procedures, strip-search procedures and general police policies. The district court had excluded a number of his proposed opinions as improper legal conclusions, which Schmidt conceded, and as generally lacking in standards and explanations.
Schmidt argued, however, that Russo’s testimony concerning the circumstances of the initial arrest should have been admissible, and was relevant as to the “totality of the circumstances” as to whether the officer’s conduct was reasonable. The court affirmed the decision to exclude this testimony, saying that only the circumstances surrounding the photographing of the tattoo were at issue because Schmidt did not challenge her initial arrest. The court further upheld the exclusion of Russo’s testimony regarding strip-search procedures, the officer’s motivations, and the psychological impact of custody. It agreed with the trial court that Russo’s experience as a traffic patrolman, a watch commander and security organizer was not a close enough fit with the subjects on which he proposed to testify (“there was no evidence that Russo had any experience with civil rights violations or with strip searches.” “Additionally, there was no evidence that Russo had any work experience pertinent to psychology.”). The court did agree with Schmidt that the district court abused its discretion in excluding Russo’s testimony regarding the existence of policy manuals, but stated that such error did not have a substantial influence on the outcome of the case.
John W. Rourke is an attorney and principal with the St. Louis, Missouri law firm of Niemann Rourke, LLC. Chris A. Michener is an attorney with the St. Louis, Missouri law firm of Reinert, Weishaar & Associates, P.C.
