Case o' The Week: Bad Forbidden, Good Forbidden - Lloyd, Lay Witnesses, and Expert Witness Disclosure
Bad films make good law.
United States v. Lloyd, 2015 WL 7873401 (9th Cir. Dec. 4, 2015), decision available here.
Players: Decision by visiting S.D. Texas DJ Lee Rosenthal, joined by Judges Berzon and Clifton. Hard-fought battle by CD Cal AFPD Kathryn Young, former CD Cal FPD Sean Kennedy, and others.
Facts: Lloyd and his co-D’s ran telemarketing “boiler rooms,” using false promises to solicit investments in movie productions (Like the classic “From Mexico with Love” and the fan favorite “Forbidden Warrior.”) Id. at *1.
During the fraud trial, the government called witness “Agler;” a man who had worked in boiler rooms. Id. at *18. Agler opined about the information and knowledge that telemarketers have when they cold-call investors. Id. Although Agler’s opinions smacked of FRE 702 “expert” testimony, the government failed to provide the defense with pretrial expert notice. Id. (citing Fed. R. Crim. P. 16(a)(1)(G)).
Issue(s): “[Appellants] argue that Agler's testimony impermissibly opined on what the telemarketers who solicited and closed investments, including themselves, knew about what they were selling and about what the investors were doing and thinking. They argue that to the extent Agler expressed a lay opinion, he relied on speculation and hearsay, and to the extent he expressed an expert opinion based on specialized knowledge gained from working in boiler rooms, the government failed to give the notice required under Rule 702 of the Federal Rules of Evidence and Rule 16 of the Federal Rules of Criminal Procedure.” Id. at *20.
Held: “Under [FRE] 701, a lay witness may testify ‘in the form of an opinion’ if it is ‘(a) rationally based on the perception of the witness; (b) helpful to a clear understanding of the witness’ testimony or the determination of a fact in issue; and (c) not based on scientific, technical, or other specialized knowledge.’ . . . . Rule 701(a) contains a personal knowledge requirement. . . . In presenting lay opinions, the personal knowledge requirement may be met if the witness can demonstrate firsthand knowledge or observation. A lay witness's opinion testimony necessarily draws on the witness's own understanding, including a wealth of personal information, experience, and education, that cannot be placed before the jury. . . But a lay opinion witness ‘may not testify based on speculation, rely on hearsay or interpret unambiguous, clear statements . . . .” Id. at *20.
“Agler had extensive personal experience working as a telemarketer in boiler rooms soliciting and closing investments . . . . But his testimony that investors did not understand the risks, that all telemarketers knew of and took advantage of this ignorance, and that telemarketers knew that investors never made any money, was largely based on statements he heard from unidentified telemarketers and investors, well beyond his own personal experience with investors. Our cases make clear that Rule 701 prohibits opinions based on such a foundation. . . Id. at *20
"Agler's testimony was not admissible as lay opinion testimony under Rule 701.” Id. (quotations and citations omitted).
Of Note: The government first gives plain error a shot (unsuccessfully, thankfully). Id. at *19. The paragraph starting at *19 is worth a close read, as a reminder for the defense to object early and often. The Ninth finds the defense objections were preserved here – but a little more specificity would have helped.
How to Use: “But,” the government sputtered, “any error is harmless. Agler would have qualified as a FRE 702 expert.” Id. at *1.
"Nyet" notes the Ninth, “No notice!” Id. at *21 (“The record does not present a basis to excuse the failure to provide the defense timely notice of Agler's Rule 702 expert testimony by holding it admissible as lay opinion testimony under Rule 701.”)
Lloyd adds welcome bite to our arguments that the government can’t use experts that were not properly disclosed.
For Further Reading: The ND Ill. has a nice, sharp and clear district rule for civil expert disclosures. See rule here.
Wouldn’t it be nice if district courts were equally persnickety about expert disclosures in criminal cases? It’s the same FRE 702, after all.
Maybe Santa will bring us criminal district-wide expert disclosure rules in 2016?
"Forbidden Warrior” Movie poster from https://upload.wikimedia.org/wikipedia/en/6/69/Forbidden_Warrior.jpg
“Santa Clause Barrister" from http://www.reasonstobelieve.com/Merchant2/merchant.mvc?Screen=PROD&Product_Code=kac7317&Category_Code=fabriche
Steven Kalar, Federal Public Defender N.D. Cal. Website at www.ndcalfpd.org