Scenario: An expert forensic accountant is hired by the plaintiff’s counsel to determine economic damages in a financial dispute. The expert meets with the attorneys and the clients to discuss the key elements of the case. They talk about what is expected, as well as the expert’s background, credentials and any potential conflicts of interest. Information about the case is provided, along with documents, time frames and other administrative requirements.
Financial expert witnesses comply with ethical principles established by various professional organizations. For example, members of the American Academy of Economic and Financial Experts pledge to follow a number of tenets, including “to operate from a position of neutrality with respect to their calculations and analyses.” The Academy goes on to say that it doesn’t matter if the expert is retained by the plaintiff or the defense because “the approach, methodology and conclusions should be essentially the same.”
Members of the National Association of Forensic Economics pledge to adhere to principles that include:
Engagement. Members should decline involvement in any litigation when they are asked to assume invalid representations of fact or alter their methodologies without foundation or compelling analytical reason.
Compensation. Members shouldn’t accept contingency fee arrangements, or fee amounts associated with the size of a court award or out-of-court settlement.
Diligence. Members should employ generally accepted and/or theoretically sound economic methodologies based on reliable economic data. They should attempt to provide accurate, fair and reasonable expert opinions, recognizing that it is not their responsibility to verify the accuracy or completeness of the case-specific information that has been provided.
Disclosure. Members should stand ready to provide sufficient detail to allow replication of all numerical calculations, with reasonable effort, by other competent forensic economics experts, and be prepared to provide sufficient disclosure of sources of information and assumptions underpinning their opinions to make them understandable to others.
Consistency. While it’s recognized that members may be given a different assignment when engaged on behalf of the plaintiff than when engaged on behalf of the defense, for any given assignment, the basic assumptions, sources, and methods should not change regardless of the party who engages the expert. There should be no change in methodology for purposes of favoring any party’s claim. This requirement is not meant to preclude methodological changes as new knowledge evolves, nor is it meant to preclude performing requested calculations based upon a hypothetical — as long as its hypothetical nature is clearly disclosed in the expert’s report and testimony.
Knowledge. Members should strive to maintain a current knowledge base of their discipline.
In the above scenario, it is important that the team (attorneys/clients/expert) communicate in an open forum on key positions, facts, damage theories, etc. All viewpoints should be respected and evaluated. By doing so early on, the expert is better able to maintain a sense of independent objectivity. This leads to more effective testimony and less vulnerability to attack from the opposing counsel, who will likely try to impeach the objectivity and independence of the expert.
Here are some frequently asked questions about the importance of an expert witness maintaining neutrality:
Q. What’s the difference between being an advocate and being neutral?
A. Advocacy is defined as the act of pleading for, supporting, or recommending.
So, if an expert testifies about the credibility of the damage claims put forth by the plaintiff, is the expert an advocate? Ideally, the expert should reach a professional comfort level after pretrial sessions of discussion and debate as well as his or her independent analysis of data.
Neutrality means not being aligned with or supporting any side or position in a controversy. This can be challenging when an expert is hired by one party in a dispute. Obviously, it is more easily accomplished when the expert is appointed by a court or jointly retained by all parties in a dispute to evaluate the data and reach conclusions. In these cases, experts present both sides in order to foster a settlement or to help a judge in rendering decisions.
However, in litigation, neutrality shouldn’t depend on which party retained the expert — it should be more of a mindset. It involves the expert maintaining a professional distance from the emotional aspects of the client’s case and the desire of counsel to win. Of course, this does not mean the expert becomes belligerent or difficult, but he or she should insist on airing out alternate views to uncover provable facts and irrefutable documentary evidence. In this capacity, the expert provides an invaluable service by thinking through the complex details. Attorneys and clients are best served when an expert is passionate about his or her testimony and written reports and does not feel pressured.
Q. When are the lines of advocacy and neutrality blurred?
A. The expert in litigation is often asked to assist counsel in preparing for a deposition of a witness on the other side. In this role, the expert reviews the case information and composes draft questions. This work can lead to a planning meeting with the attorney and perhaps the client. At the meeting, the expert becomes exposed to the thoughts and strategies of the attorneys and the concerns of the client. At this point, it is incumbent on the expert to point out any flaws in the logic surrounding these views. An open exchange should be encouraged at this critical juncture, when the role of the expert becomes evident.
Q. What happens if the expert disagrees with the counsel or the client?
A. Sometimes, disagreements arise between members of the litigation team. They can stem from disputes over strategy or the completeness of data.
For example, an expert may not feel that the evidence overwhelmingly supports the client’s position. It is essential that the expert explain the basis for his or her position and allow time for discussion and debate. Perhaps more documentation can be located to buttress an argument.
However, after a period of time, if the expert still disagrees with the client’s position, the attorney may decide not to call the individual as a witness. In some cases, this can mean that the client’s case is weak or based on circumstantial evidence.
The unwillingness of an expert to testify can be a signal to counsel that settlement is in the best interest of the client.
Independence and Objectivity
An expert witness has a unique independence within the legal system. Unlike lawyers, experts owe no specific allegiance to clients. “While a lawyer is an advocate for his client, an expert witness is supposed to be a source of knowledge and opinions that will aid the Trier of fact,” according to an article in the Missouri Law Review.
Therefore, slanted opinions that are not based on empirical data and sound theory are subject to vicious attack on cross-examination and, potentially, dismissal of the expert by the court. Sometimes an expert is rejected prior to trial through a Daubert challenge. In such a challenge, the specific background of the individual in every intended area of testimony becomes subject to argument — making it much more difficult to proffer experts.
Testimony and written reports offer opinions and projections that should be as free of bias as possible. Soundly written reports should include references to published materials from authoritative sources. Novel opinions are difficult to introduce unless the expert possesses such lofty credentials that he or she is recognized as an undisputed authority. Even then, it’s essential to explain why more traditional theories are not as good as the novel argument. Since both sides may retain their own experts, a battle could take place during trial.
The posture of an expert witness should be one of professionalism and balance. Experts who testify as a predominant part of their practices can be cast as “hired guns.” The jury may dislike medical doctors, for example, who no longer practice medicine, but spend all of their time testifying in legal cases. Of course, this creates a challenge for skilled experts. They want to build their reputations within the legal community for being experts in certain fields to garner more business, but if they testify too many times, there can be a challenge that they were “bought.” For this reason, experts must guard their personal reputations for independence and objectivity, even if it means walking away from some cases.