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When you go to court and need a witness with specialized knowledge, the process of figuring out who fits the complex legal definition of an expert might leave you wondering, Who am I gonna call?
Knowing what qualifications to look for is key to finding a qualified "industry expert" whose evidence the courts will accept.
Looking at the legal history of such testimony, one can see that this is no easy task, for what constitutes an expert is an area where the standards have been evolving and are anything but clear-cut.
According to the most current definition in Websters dictionary, an expert is one who has acquired special skills in, or knowledge of, a particular subject. And, in 1923, in the Frye v. United States case, the U.S. Circuit Court for the District of Columbia established a standard for the admission of expert witness testimony in cases brought before the federal court. The Frye standard required that the data and methodology used by the expert in developing their opinion must be of the kind that is "generally accepted" by other practitioners in that specific discipline.
In 1975, Congress enacted Federal Rule of Evidence 702, which states: "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."
Rule of Evidence 702, however, did not directly address the legal standard for establishing the foundation of an experts conclusions. The "generally accepted" standard established in Frye continued to be used until 1993, when the U.S. Supreme Court issued its opinion in Daubert v. Merrill-Dow Pharmaceuticals. The high court found that Rule 702 abolished the Frye "generally accepted" standards and that the federal courts must now apply a new standard for the admission of expert testimony.
Under Daubert, a two-step analysis was established to be used by the federal district courts relating to scientific evidence and expert testimony–(1) the evidence is relevant, and (2) it is reliable.
The reliability is measured against a four-part test:
Can the theory or technique be tested?
Has it been subjected to peer review and publication?
Is there a known or potential rate of error?
Is there a level of general acceptance in that particular disciplines community?
While Daubert dealt specifically with scientific experts, many courts have held that the "gatekeeper" function of judges discussed in Daubert applies to all types of expert testimony under Rule 702, and the trial judge must find that expert witness testimony is both reliable and relevant.
In the Broders v. Heise case, the Texas Supreme Court held that: "What is required is that the offering party establish that the expert has knowledge, skill, experience, training or education regarding the specific issue before the court which would qualify the expert to give an opinion on that particular subject."
Since it appears that many courts accept the testimony of a qualified "industry expert," what qualifications should we seek? What "skill sets" would lend value to the defense or prosecution of the position?
It is well known that underwriters, marketers and claim adjusters seldom exchange ideas or discuss risks before new coverage is developed or a policy is written. It is, therefore, not unexpected that there will be losses presented that were not expected when the coverage was written. Disagreements will inevitably occur when there is a question as to whether a specific loss is covered.
While the underwriter establishes the underwriting intent, it is the claims department that interrupts the coverage and decides whether a specific loss is covered.
Further, with the ever-changing world of litigation, plaintiff attorneys are constantly developing new areas of pursuit in efforts to find coverage where it was not thought to be before. The insurance industry itself contributes to these areas of dispute by not having consistent and universal standards regarding policy language, underwriting practices and claims handling procedures.
As required by Daubert and previously by Frye, an expert must have experience that is "generally accepted" in the industry. But in an industry that does not have universally accepted standards, how does one determine what is generally accepted?
