On November 1st, I spoke at the 17th Annual MNCPA Business Valuation Conference in the Minneapolis area. My first topic was “The QMDM and the Myth of the Minority Discount.” I addressed the QMDM and its 20th anniversary in a recent post.
My God! I’m Guilty!
My other topic was titled “Confessions of a Reluctant Expert Witness.” I started that session with the story of my first experience as an expert witness, which I have also told on this blog. The punch line was that as I bumbled through that first swearing-in prior to testifying, the thought went through my mind that:
My God! I’m Guilty!
I did get through that first testimony, and the court concluded that my original appraisal was the appropriate fair value for a going private transaction involving a small, publicly-held nursing home company. Over the last 35 years or so, I’ve testified, at deposition or trial, about 200 times.
And so, I confess.
My “confessions” do not reveal any startling secrets, but they do provide insight into how one (reluctant) expert views the job of expert witnessing after many years in the trenches.
- Nervous. I was nervous before my first testimony in 1981, and have been nervous before every deposition or trial appearance since. The point is that it’s natural to be nervous. What matters is what one does with that nervous energy, and preparation is the key.
- Love or Hate. I have said on many occasions that I’m not sure whether I love to hate litigation or whether I hate to love it. It depends on the day and nature of any case(s) I might be working on that day.
- Karma. My friend, Brian Brinig, an expert with many years of experience practicing primarily in the San Diego area, told me about the litigation version of karma. He said that it really doesn’t matter how good you are, or how good looking you are. It doesn’t matter how hard you worked, or that your report is better than any before the court. It doesn’t matter how well you are prepared for your testimony. In fact, a lot of things don’t matter when the judge doesn’t like your client…
- Mistakes/Errors. I hate mistakes and errors, and we go to great lengths to avoid them. But if an error is pointed out in your report, there is only one thing to do, and that is to acknowledge it and deal with it as best you can under the circumstances.
- Over-Zealous Experts. I love having over-zealous experts on the other side in litigation. They can’t help themselves. Advocacy bleeds through in many corners of their reports and their testimonies. They make easy targets for objective and dispassionate analysis.
- Who to Work for. Over the years, I’ve developed a client selection process that has worked well for me. I will work for the first side in a matter who calls me IF:
a. my first impression is that we have the capacity to take on the engagement
b. after talking with counsel and the client, I believe that I will be able to render an independent opinion in the matter
c. we can work out an engagement letter where we reasonably believe we will be compensated timely for our efforts
d. and, as I’ve gotten older, I only want to work for clients and attorneys that I like and that will treat us with respect
This client selection “equation” has led to a mix of clients that is pretty close to 50% economic plaintiffs and 50% economic defendants over more than 35 years of working as an expert witness.
- Positions to Take in Litigation. I recognized early on that some experts took different positions on key valuation issues when working on one side or the other in litigations. I began writing and speaking in the latter 1980s, and from the start, began to take positions on key issues based on valuation theory as I understood it. I recognized that I could not take different positions based on the side I was working on, but only on the basis of my understanding of our craft. Those positions that I have written and spoken about over the years have become a part of who I am as an expert.
- What We Will or Will Not Do. I field a lot of calls from attorneys in litigated matters. The first call on any matter is critical. Some requests are in our wheelhouse and some are not. If not, then we have to pass or refer to others. Some requests are goal-seeking in their intent, and the lawyers are looking, not for an independent expert, but for a specific result which may or may not be reasonable (to me). If unreasonable conclusions are being sought, we have to pass. See #6 above. Some requests might not be unreasonable per se, but they call for me taking a position contrary to one of my published positions. We have to pass. See #7.
- I Hate Redirect (Mostly). Direct went fine, which of course, it should. Cross-examination went pretty well, but the opposing counsel got in a lick or two, but no real damage. We are done. But, nope! Counsel has to stand up for re-direct. Invariably, this attempt to “rehabilitate” offers opposing counsel further opportunities to re-cross and to repeat the original licks and to get in another lick or two. Ouch! Exception. When counsel and I anticipate cross-examination and determine, in advance, if certain things happen, then certain redirect questions will be asked.
- Answer Yes or No, Only…Some attorneys like to create a line of questions with pre-determined “yes” or “no” answers that lead testimony in a direction they desire. I believe that an expert should have the right to answer “yes” or “no” and then, to explain her answer. Often, it would be misleading to the court to give a one-word answer without explanation. But sometimes courts preclude the explanation part. Lawyers make the rules. So in those situations, if there is anything wrong with a question that would make answering “yes” (most often the preferred response), then I consider answering “no.” Either you will get another question that you can answer “yes” to, or you will get an opportunity to explain in the discussion that follows.
So there we have it — 10 “confessions” of a reluctant expert witness. Hope you found this post interesting. Feel free to comment below!
Until next time, be well,
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