How the Maryland Supreme Court's Decision in KatzAbosch
Opens the Door to Exclusion of Experts
BY TODD W. HESEL, ESQ.
The Supreme Court of Maryland’s watershed decision in Rochkind v. Stevenson, 471 Md. 1 (2020), overhauled the admissibility standard for expert testimony by dropping the Frye-Reed general-acceptance test in favor of the Daubert reliability test. The Court’s first civil case on the application of this new standard, Katz, Abosch, Windesheim, Gershman & Freedman, P.A. v. Parkway Neuroscience & Spine Inst., LLC, 485 Md. 335 (2023) (“Katz Abosch”), presented a choice between “two competing visions” for the treatment of an expert’s data selection. See id. at 369. One approach, which I’ll call the “hands on” approach, treats an expert’s data selection as part of the expert’s methodology and permits a trial court to closely scrutinize those choices and exclude the expert if it determines that the data selection is unsound. The other approach, which I’ll call the “hands off” approach, distinguishes data from methodology and treats the expert’s data selection as a credibility issue for the trier of fact, as opposed to a reliability issue for the court under Daubert The Court endorsed the “hands on” approach, and that decision has significant implications for any Maryland litigator who works with or against experts who make judgment calls in data selection.
The context for Katz Abosch was an expert’s lost profits analysis using the widely accepted “before-and-after” method, which determines the loss by comparing profits calculated from a “benchmark” period before a harmful event with profits from the period after the harmful event. The plaintiff’s expert used a single year, 2015, to benchmark a medical practice’s lost profits from 2016 through 2019. The expert gave a seemingly plausible rationale for her choice, explaining that 2015 was representative of future profits because the practice had “hit its stride” that year after a period of significant expenses. But the trial court was unconvinced and excluded her in part because it thought her choice of 2015 was “speculative.”
The Appellate Court applied the “hands off” approach and reversed. It reasoned that a trial court “acts outside of its [gatekeeping] role when it second guesses the expert’s choice of data to rely on when applying the indisputably legitimate choice of methodology,” in that case, the before-and-after method. 255 Md. App. 596, 626. The expert had given a reason for her choice, “and unless the data and assumptions she made were ‘so unrealistic and contradictory as to suggest bad faith,’” which they were not, her testimony should have been admitted.
The Supreme Court, however, took the opposite view and adopted the “hands on” approach. It saw the “hands off” approach as drawing an “overly rigid” line between data and methodology, and sided with courts that “reject this sharp line and acknowledge that problems with data and
data selection . . . can bear on admissibility before the judge and not just weight before the jury.” 485 Md. at 372. Thus, the trial court acted within its discretion by excluding the plaintiff’s lost profits expert based on a perceived error of judgment in selecting the benchmark period.
Many civil cases involve lost profits calculations, and those calculations almost invariably involve judgment calls by experts in selecting the data inputs. Katz Abosch thus opens a new door for defendants to attack and potentially exclude the opinions of these experts. Moreover, there is no reason why other types of experts would be immune from the scrutiny permitted by Katz Abosch Any expert who makes judgment calls in data selection is now potentially subject to a Daubert challenge for making the wrong choices.
To date, there are no reported civil cases applying Katz Abosch’s “hands on” approach to data selection, but this is an area for Maryland litigators to watch carefully.
For plaintiff’s attorneys used to the old Frye-Reed test, this new “hands on” version of Daubert is a major change and poses a serious risk. Simply having an expert follow an established, reliable methodology is not enough. Attorneys must ensure their experts’ data choices will withstand close scrutiny by the trial court. This means working with the expert from the beginning to ensure that any data choices are supported by a persuasive rationale that addresses why the chosen data produces a representative result.
To date, there are no reported civil cases applying Katz Abosch’s “hands on” approach to data selection, but this is an area for Maryland litigators to watch carefully. Though trial courts clearly have license to scrutinize data choices, the amount of leash they’ll be given to do so remains uncertain. A follow-on decision pulling in the reins could bring a sigh of relief for plaintiffs, while another decision like Katz Abosch could put more wind in the sails of defendants.
