LOBSTER 207 LLC v. PETTEGROW et al

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE
LOBSTER 207, LLC, 	)
)
Plaintiff 	)
)
v. 	) 	No. 1:19-cv-00552-LEW
)
WARREN B. PETTEGROW, et al., 	)
)
Defendants. 	)
ORDER ON DEFENDANTS’ MOTION TO EXCLUDE OR
ALTERNATIVELY LIMIT THE TESTIMONY OF PLAINTIFF’S
DESIGNATED EXPERT, CLARE FREEMAN
This matter comes before the Court on Motion (ECF No. 336) of Defendants Warren
B. Pettegrow, Poseidon Charters, Inc., Anthony D. Pettegrow, Josette G. Pettegrow, and
Trenton 	Bridge 	Lobster 	Pound, 	Inc. 	(the 	“Pettegrow 	Defendants”) 	to 	exclude 	or
alternatively limit the testimony of Plaintiff Lobster 207’s designated expert, Clare
Freeman. The Motion is denied.
BACKGROUND
The reader’s familiarity with the nature and history of the case is assumed and the
background statement, therefore, focuses on matters material to the legal issues presented
in the motion.
On January 29, 2021, Lobster 207 designated Clare Freemen, C.F.E., as an expert
witness (ECF No. 336-3). Ms. Freeman has been the CFO of Lobster 207 since October
of 2020. 	In her capacity as CFO of Lobster 207, Ms. Freeman provides daily financial
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accounting services to Lobster 207 and has personal knowledge of Lobster 207’s financial
books and records, including books and records associated with Lobster 207’s transactions
with the Trenton Bridge Lobster Pound. 	Based on the knowledge gained from Lobster
207’s books, records and transaction history, Ms. Freeman is expected to testify concerning
Lobster 207’s financial records through the date of Warren Pettegrow’s termination as
Lobster 207’s CEO, including but not limited to Lobster 207’s internal accounting records,
bank account records, invoices, expenses, and disbursements.
In addition to her work as CFO, Ms. Freeman is a Certified Fraud Examiner and a
principal at Cox Litigation Support, where she provides corporate financial management,
forensic accounting, litigation support, and risk management services to clients. 	Ms.
Freeman has worked as a financial manager for over fifteen years. 	Ms. Freeman also has
past experience working for a Portland lobster wholesaler, where she provided services
similar to those she now provides for Lobster 207. Ms. Freeman has served as an expert
witness in several other cases.
STANDARD OF REVIEW
Federal Rule of Evidence 702 provides:
A witness who is qualified as an expert by knowledge, skill, experience,
training, or education may testify in the form of an opinion or otherwise if:
(a) the expert’s scientific, technical, or other specialized knowledge will help
the trier of fact to understand the evidence or to determine a fact in issue;
(b) the testimony is based on sufficient facts or data;
(c) the testimony is the product of reliable principles and methods; and
(d) the expert has reliably applied the principles and methods to the facts of
the case.
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Fed. R. Evid. 702. Although Rule 702 authorizes expert opinion testimony, it also places
conditions on the admissibility of expert opinions and requires district courts to act as
gatekeepers, ensuring that the expert’s proffered testimony “rests on a reliable foundation
and is relevant to the task at hand.” Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579,
594–97 (1993). However, “the trial court’s role as gatekeeper is not intended to serve as a
replacement for the adversary system.” Fed. R. Evid. 702 Advisory Committee Notes to
2000 Amendments (quoting United States v. 14.38 Acres of Land Situated in Leflore
County, Mississippi, 80 F.3d 1074, 1078 (5th Cir. 1996)). The rejection of expert testimony
is the exception rather than the rule. 	Id. 	“Vigorous cross-examination, presentation of
contrary evidence, and careful instruction on the burden of proof are the traditional and
appropriate means of attacking shaky but admissible evidence.” Daubert, 509 U.S. at 596.
Since the Rules’ adoption in 1972, it has been understood that the admissibility of
expert opinion testimony is primarily a question of utility. See Fed. R. Evid. 702 Advisory
Committee Note to 1972 proposed rules (“Whether the situation is a proper one for the use
of expert testimony is to be determined on the basis of assisting the trier.”).1 An expert’s
opinion may be useful to a finder of fact even when it is not generally accepted by experts
in the field, Daubert, 509 U.S. at 589, so long as the opinion has “a reliable basis in the
knowledge and experience of [the expert’s] discipline.” Id. at 592. 	Provided that an
1 “There is no more certain test for determining when experts may be used than the common sense inquiry
whether the untrained layman would be qualified to determine intelligently and to the best possible degree
the particular issue without enlightenment from those having a specialized understanding of the subject
involved in the dispute.” Fed. R. Evid. 702 Advisory Committee Notes (quoting Ladd, Expert Testimony,
5 Vand.L.Rev. 414, 418 (1952)).
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expert’s knowledge and experience (or skill, training, or education) are equal to the task,
the expert “need not have had first-hand dealings with the precise type of event that is as
issue” to be able to provide useful guidance to the fact finder. 	Microfinancial, Inc. v.
Premier Holidays Int’l, Inc., 385 F.3d 72, 80 (1st Cir. 2004). 	“Nothing in [Rule 702] is
intended to suggest that experience alone—or experience in conjunction with other
knowledge, skill, training or education—may not provide a sufficient foundation for expert
testimony.” 	Fed. R. Evid. 702 Advisory Committee Notes to 2000 Amendments.
Furthermore, weaknesses in the factual underpinnings of an opinion do not dictate
exclusion; issues of weight and credibility generally are matters for the fact finder’s
consideration, unless it is apparent that the opinion is tethered to the facts only by the say
so of the expert. Gen. Elec. Co. v. Joiner, 522 U.S. 136, 146 (1997).
DISCUSSION
Upon review of Ms. Freeman’s designation and supporting documentation, I find
that Ms. Freeman’s credentials and years of experience qualify her to testify as an expert
witness. Despite Defendants attempts to belittle Ms. Freeman’s experience, Ms. Freeman’s
work as CFO, her qualification as a CFE, and her work in litigation support provide a
reliable foundation for the discrete areas of testimony that she intends to give.
It is not required that Lobster 207 find an expert witness that has personally
witnessed 	and 	has 	experience 	with 	every 	issue 	that 	will 	be 	presented 	at 	trial.
Microfinancial, Inc., 385 F.3d at 80. Instead, under Rule 702, a testifying expert “should
have achieved a meaningful threshold of expertise” in the given area. 	Prado Alvarez v.
R.J. Reynolds Tobacco Co., Inc., 405 F.3d 36, 40 (1st Cir. 2005). Based on my review, it
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appears that Ms. Freeman has “specialized knowledge” that will prove useful to the finder
of fact and is specifically relevant to the questions surrounding this case. I do not think that
Defendants’ statement that it does not take an expert to perform “simple arithmetic”
(Motion at 2, 3, 9, 13) is representative of the situation. This litigation involves years of
financial records, allegations of financial schemes, and a unique industry. Ms. Freeman is
expected to assist the trier of fact in understanding years of this discrete data that a
layperson would likely have trouble parsing without assistance and explanation.
I appreciate Defendants’ apprehension that expert testimony can carry with it an
“unwarranted aura of special reliability and trust worthiness, and as such, courts must guard
against letting it intrude in areas that jurors, by dint of common experience, are uniquely
competent to judge without the aid of experts.” United States v. Soler-Montalvo, 44 F.4th
1, 16 (1st Cir. 2022) (cleaned up). However, Ms. Freeman’s review of the parties’ pricing
data, tax filings, external auditing reports, accounts-payable, accounts-receivable, bank
records and internal correspondence would surely aid an untrained layman to determine
intelligently the relationship between Lobster 207’s business records and its claims. Ms.
Freeman’s experience analyzing this documentation should make her a reliable guide with
relevant insights.
I also appreciate Defendants’ concern over the fact that Ms. Freeman has not
produced “workpapers” in support of her findings and that much of her proposed testimony
is factual in nature and might be provided by another witness. But her focus on the books
and accounts is apparent and she has relevant expertise surveying these kinds of business
records. She is an apt witness to describe the state of these records and identify perceived
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irregularities in the same. In any event, nothing in this ruling prevents the exclusion of a
particular opinion if Ms. Freeman wanders off course into speculative terrain or otherwise
journeys beyond the scope of her designation.
As for the particular topics challenged in Defendants’ Motion, the lobster-crate and
customer-list valuation issues are essentially mooted by a prior summary judgment ruling.
What remains concerns post-closing transactions, how they are reflected in the relevant
books, and what conclusions one might draw from the same. These are the kind of mixed
fact and opinion matters that fall within the ordinary observations and insights of someone
with Ms. Freeman’s experience and background.2 	Moreover, it is not improper for Ms.
Freeman to serve in part as a fact witness who lays a foundation for opinions offered by
others, such as Messrs. Barlow and Purvis.
While a trial court may hold a hearing to screen the proffer of expert testimony in
advance of trial, Samaan v. St. Joseph Hosp., 670 F.3d 21, 31 (1st Cir. 2012), a hearing is
unnecessary where the initial inquiry suggests that a hearing is unlikely to expose the kind
of unreliable opinion that deserves special attention above and beyond what the adversarial
process will provide at trial. Kumho Tire, 526 U.S. at 152. n.4. I find that the issues that
arise in this Motion present only garden-variety concerns of weight and do not categorically
undermine the reliability or utility of Ms. Freeman’s qualifications and methods. These
types of issues are meant to be resolved through cross-examination. I do not believe that
any new information or opinions would be gleaned from a Daubert hearing that would not
2 As Lobster 207 observes, some of Ms. Freeman’s opinion testimony may be susceptible to classification
under Rule 701. A given witness may be qualified to provide both lay and expert testimony. United States
v. Valdivia, 680 F.3d 33, 50 (1st Cir. 2012).
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have been presented in these briefings. For this reason, I deny Defendants’ request for a
Daubert hearing.
Although Defendant’s Motion will be denied, Ms. Freeman will be confined to
discuss the discrete topics that were identified, sans any issues that were disposed of in
prior orders. Additionally, Ms. Freeman cannot assert that a transaction was fraudulent,
wrongful, or otherwise assign causation; opine on any valuation issues; testify as an expert
in regard to contract interpretation; or provide testimony overlapping with other designated
experts.
CONCLUSION
For the foregoing reasons, Pettegrow Defendants’ Motion (ECF No. 336) is
DENIED and the jury will determine what weight to give Clare Freeman’s testimony.
S O ORDERED .
Dated this 6th day of January, 2023.
/S / Lance E. Walker
U NITED STATES D ISTRICT JUDGE
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