Mickey Chandler's SpamSuite

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

e360 INSIGHT, LLC, an Illinois Limited
Liability Company, and DAVID LINHARDT,
an individual,
Plaintiffs,

v.

THE SPAMHAUS PROJECT, a company
limited by guarantee and organized under the
laws of England, a/k/a THE SPAMHAUS
PROJECT, LTD.,
Defendant.

THE SPAMHAUS PROJECT’S MOTION IN LIMINE TO EXCLUDE DAMAGES OPINION TESTIMONY OF DAVID LINHARDT

Defendant The Spamhaus Project (“Spamhaus”), pursuant to Federal Rules of Evidence 402 and 702, respectfully moves this Court for entry of an order excluding all opinion testimony of David Linhardt regarding the amount of damages or the method of calculating that amount, including without limitation Linhardt’s original $11.7 million damages calculation and revised $136 million damages calculation. In support of this Motion, Spamhaus states:

1. The sole issue on remand is the amount of damages Plaintiffs e360 Insight LLC (“e360”) and David Linhardt (“Linhardt”) incurred. Plaintiffs do not claim any actually incurred, out-of-pocket liquidated damages. To meet their burder of showing their damages to a “reasonable certainty,” e360 Insight v. The Spamhaus Project, 500 F.3d 594, 602 (7th Cir. 2007), Plainiffs have proffered Linhardt (individual plaintiff and CEO of corporate plaintiff e360) as their sole expert witness in support of their lost projected revenue and lost enterprise value claims in connection with this litigation.

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2. Linhardt has offered an opinion that Plaintiffs incurred total damages of $11.7 million due to Spamhaus’ alleged misconduct. A subsequent opinion that Plaintiffs instead actually incurred approximately $136 million in damages was excluded by this Court’s October 15, 2008 Order due to Plaintiffs’ repeated defaults on their discovery obligations. (Doc. 173.) The Court should exclude all of Linhardt’s testimony regarding the amount of damages, and methodology for calculating damages, for three reasons.

3. First, Linhardt admitted under oath in his deposition that he is not an expert in corporate valuations or in calculating damages for litigation; has no experience calculating damages prior to this case; and has no understanding of the legal standards for calculating damages. (Linhardt Dep., Ex. 1 at 85, 305-08). Linhardt does not “have sufficient specialized knowledge to assist the jurors in deciding the particular issues of the case” under Fed. R. Evid. 702, and is therefore unqualified to offer an opinion as an expert on these subjects. Goodwin v. MTD Products, Inc., 232 F.3d 600 (7th Cir. 2000); Ammons v. Aramark Unif. Servs., 368 F.3d 809 (7th Cir. 2004); Ancho v. Pentek Corp., 157 F.3d 512, 519 (7th Cir. 1998).

4. Second, Linhardt’s $11.7 million damages estimate cannot be admitted because he admitted that it is not reliable under Rule 702. Linhardt testified during his depositions that his $11.7 million calculation is not “accurate.” (Linhardt Dep., Ex. 1 at 258-59). Moreover, all of his calculations are based on financial results from e360’s non-party parent company Maverick Direct Marketing Solutions, Inc. (“Maverick”), and thus included revenue not only from e360 by also from non-party Bargain Depot Enterprises (“Bargain Depot”) and several other non-party entities owned by Maverick. (Linhardt Dep., Ex. 1 at 8-11, 99-100). And Linhardt was also unable to say what methodology was used to arrive at his $11.7 million damages calculation, and could produce no workpapers to explain his methodology. (Linhardt
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Dep., Ex. 1 at 286-89). Linhardt’s $11.7 million calculation is thus not “the product of reliable principles and methods . . . applied . . . reliably to the facts of the case,” and is therefore inadmissible under Fed. R. Evid. 702. General Electric Co. v. Joiner, 522 U.S. 136, 146 (1997); Fuesting v. Zimmer, 421 F.3d 528, 535 (7th Cir. 2005); Kempner Mobile Electronics, Inc. v. Southwestern Bell Mobile Systems, 428 F.3d 706 (7th Cir. 2005).

5. Third, while the Court’s October 15, 2008 Order struck Linhardt’s opinion and analysis for reaching his $136 million damages estimate (Doc. 173), Linhardt’s $136 million opinion would be inadmissible under Fed. R. Evid. 702 even if it had not been stricken. Linhardt admitted that he lacks the expertise to testify regarding corporate valuation or lost revenue damages; Linhardt’s $136 million damages calculation is also based on financial data from nonparty Maverick; and Linhardt’s testimony reveals that his putative methodology is flawed on its face. (Linhardt Dep., Ex. 1 at 8-11, 85, 99-100, 113-62, 258-59, 286-89, 305-08). These failures in Linhardt’s methodology make his testimony inadmissible as unreliable under Fed. R. Evid. 702.

6. In further support of this motion, Spamhaus submits the accompanying memorandum of law and exhibits thereto.

Respectfully submitted,

THE SPAMHAUS PROJECT
By: s/ David Jiménez-Ekman

Craig C. Martin
David Jiménez-Ekman
Chad Emerson Bell
JENNER & BLOCK LLP
330 North Wabash Avenue
Chicago, IL 60611
Telephone: (312) 222-9350
Facsimile: (312) 527-0484

Dated: December 9, 2008

Attachment	Date	Size
MotLimineExclLinhardtTestimony.pdf	12/10/08 5:06 pm	20.37 KB