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Helton v. American General Life Insurance Co.

United States District Court, Sixth Circuit

June 4, 2013

WARREN C. HELTON, individually and on behalf of THE WARREN C. HELTON IRREVOCABLE TRUST, et al., Plaintiff,


JOSEPH H. McKINLEY, Jr., District Judge.

This matter is before the Court on Defendant Lawrence Rasche's motion to exclude the opinions and testimony of Plaintiffs' expert, Emily Will [DN 277] and Defendant American General's motion to exclude expert testimony of Richard M. Weber, Burke A. Christensen and Emily J. Will. [DN 284]. Fully briefed, these matters are ripe for decision.


This case stems from the sale of financed premium life insurance plans by Defendants American General Life Insurance Company ("American General") and its agent Lawrence Rasch ("Rasch"). Under these plans the insurance premiums are financed through bank loans. Each insured creates an irrevocable trust, naming a close relative or spouse as Trustee and owner of the policy. Ideally, at the time of the insured's death, the death benefits would be sufficient to repay all borrowed premiums plus interest and still provide substantial insurance proceeds to the beneficiaries.

Five causes of action remain in this case against American General Life Insurance Company ("American General"); and Lawrence A. Rasche. Count Two alleges Rasche violated KRS ยง 304.12-010 which provides that no person shall engage in Kentucky in any practice which is an unfair method of competition or any unfair or deceptive act or practice in the business of insurance; Count Four alleges that Rasche negligently misrepresented the premium financing scheme; Count Five alleges that Rasche was negligent; Count Six alleges American General was negligent in its supervision of Rasche; and Count Seven alleges that American General is vicariously liable for Rasche's actions and liabilities under the doctrine of respondeat superior. (Second Am. Compl., [DN 83].)


The Defendants argue that the testimony of Plaintiffs' experts must be excluded under Daubert v. Merrell Dow Pharm., Inc. , 509 U.S. 579 (1993) and its progeny.

Fed. R. Evid. 702. Rule 702 provides:

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.

Under Rule 702, the trial judge acts as a gatekeeper to ensure that expert testimony is both reliable and relevant. Mike's Train House, Inc. v. Lionel, L.L.C. , 472 F.3d 398, 407 (6th Cir. 2006) (citing Kumho Tire Co. v. Carmichael , 526 U.S. 137 (1999)). In determining whether certain testimony is reliable, the "inquiry envisioned by Rule 702 is... a flexible one. Its overarching subject is the scientific validity and thus the evidentiary relevance and reliability of the principles that underlie a proposed submission. The focus, of course, must be solely on principles and methodology, not on the conclusions that they generate." Daubert , 509 U.S. at 594-95. In Daubert, the Supreme Court identified a non-exhaustive list of factors that may assist the Court in assessing the reliability of a proposed expert's opinion including: (1) whether a theory or technique can be or has been tested;

(2) whether the theory has been subjected to peer review and publication; (3) whether the technique has a known or potential rate of error; and (4) whether the theory or technique enjoys "general acceptance" within a "relevant scientific community." Id. at 592-94. This gatekeeping role is not limited only to expert testimony based upon scientific knowledge, but extends to "all scientific, ' technical, ' or other specialized' matters within" the scope of Rule 702. Kumho Tire , 526 U.S. at 147-48.

Whether the Court applies the Daubert factors to assess the reliability of the testimony of an expert witness "depend[s] on the nature of the issue, the expert's particular expertise, and the subject of his testimony." Id. at 150 (quotation omitted). Again, Daubert is a flexible test and no single factor, even testing, is dispositive. See Kumho Tire , 526 U.S. at 151-52; Smith v. Ford Motor Co. , 215 F.3d 713, 719 (7th Cir. 2000). However, "[n]othing in either Daubert or the Federal Rules of Evidence requires a district court to admit opinion evidence that is connected to existing data only by the ipse dixit of the expert. A court may conclude that there is simply too great an analytical gap between the data and opinion proffered." General Elec. Co. v. Joiner , 522 U.S. 136, 146 (1997). In addition to the Daubert factors, trial courts also may "take judicial notice of methods and techniques which already have been recognized by existing case law as reaching the status of scientific reliability." Goodyear Tire and Rubber Co. v. Thompson , 11 S.W.3d 575, 579 (Ky. 2000) (citing Johnson v. Commonwealth , 12 S.W.3d 258, 262 (Ky. 1999)).


Both Defendant Rasche and Defendant American General have filed motions to exclude Emily Will, Plaintiffs' handwriting expert. Defendant American General has also moved the Court to exclude Plaintiffs' experts Richard Weber, a life insurance salesman and consultant, and Burke Christensen, who has an extensive background in insurance sales. Plaintiffs have stated that Mr. Weber and Mr. Christensen are to testify as expert witnesses regarding ...

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