Expert Witness Case Study: Rethinking Expertise, Independence, and Testimony

Part III (of IV)

Expert Witness Case Study: Rethinking Expertise, Independence, and Testimony

In this third part of our series on financial expert witnesses, we delve into critical questions surrounding the qualifications, independence, and courtroom practices of experts. What constitutes true expertise? How independent can experts really be? And how can the process of presenting expert evidence be refined to better serve the interests of the court?

What Qualifies Someone as an Expert?

In our opinion a central issue in expert testimony is where is the threshold for being considered an expert? In financial litigation, for example, familiarity with industry practices, technical systems, or regulatory frameworks may qualify for expressing expert opinion. However, whilst a strong understanding of the subject matter is an obvious pre- requisite, knowledge gained via academia or senior management positions may not always be comparable to the long-term experience of a market practitioner.

Where ‘normal market practice’ is the central issue for the experts, the process of expert selection is key in order to identify the correct profile of an expert which matches as closely as possible the opinions that both the court and counsel are looking to attain.

Expertise is More Than Technical Knowledge

As we have experienced, being an effective expert witness requires more than technical acumen. Proficiency in presenting complex ideas clearly, handling cross-examination confidently, and adapting explanations to the court’s level of understanding are equally vital.

This distinction between expertise and practical witness proficiency should not be underestimated and an expert’s previous experience as a witness must also be considered. They should be familiar with the demands of legal proceedings and have a clear understanding of their responsibilities within the process. A seasoned expert is typically more adept at report writing, meeting court deadlines, and maintaining their composure under sometimes pressurised cross-examination.

The Challenge of Independence & The Influence of Expert Instructions

In the UK, independence is a fundamental pillar of credible expert testimony but in our opinion true neutrality can be challenging to achieve in practice. Even the most impartial experts may be influenced—consciously or subconsciously—by the party instructing them or the framing of their instructions.

The way an expert’s instructions are framed can significantly influence their opinion. Vague or overly directive instructions risk leading experts toward conclusions that favour the instructing party. This phenomenon underscores the importance of clear, impartial, and narrowly tailored mandates.

Courts and legal teams must be vigilant in ensuring that instructions do not unduly shape expert opinions. Transparency in the framing and delivery of these instructions can help preserve the integrity of the process. The simple fact that in the UK even the supposed independent experts are remunerated by either the Claimant(s) or Defendant(s) will always create a certain level of conflict of interest.

The Single Joint Expert Option

One solution which is gaining traction is the use of a Single Joint Expert (SJE), appointed by both parties or the court. While this approach has the potential to reduce costs and eliminate perceived bias, it also raises concerns:

  • Case for the SJE: A single expert eliminates “duelling experts” and simplifies proceedings. Their opinion may carry more weight due to their neutral appointment.
  • Case Against the SJE: A jointly appointed expert may face greater scrutiny from both sides, leading to overly cautious or watered-down opinions. Additionally, their selection process can be contentious, particularly in cases involving highly specialised fields.
  • Striking the right balance between independence and effectiveness remains a key challenge in utilising SJEs and in large trials it is more than likely that the task for one SJE would be insurmountable.Standardising the Timing of Expert Reports

    The timing of expert report submissions varies widely across jurisdictions and cases. Standardising this process could improve efficiency and reduce potential strategic manoeuvring between the experts. For instance, a uniform timeline would ensure that experts on both sides have matching submission deadlines in order to prevent one side from gaining any form of unfair advantage.

    The submission of the initial expert reports (and subsequent supplemental reports) is often staggered, allowing the later submissions to effectively rebut the opinions of the primary report. In our experience this can lead to over-elaboration on certain issues and experts straying into almost argumentative mode, structuring their reports in a responsive manner to that first submission.

    Without doubt this leads to a significant increase in the time and resource devoted to this ‘rebuttal’ process, whilst at the same time straying into subject matter that would normally be strictly reserved for the Judge to decide upon.

 

Hot-Tubbing: A Collaborative Approach

“Hot-tubbing,” or the simultaneous examination of multiple experts, is an increasingly popular alternative to traditional cross-examination. In this format, experts from both sides are questioned together, facilitating direct comparisons and clarifications.

Pros:

  • Encourages dialogue between experts, allowing them to address each other’s points directly.
  • Provides the court with a clearer picture of areas of agreement and disagreement.
  • Reduces the adversarial nature of cross-examination, potentially leading to more constructive insights. Cons:
  • Requires careful moderation to prevent discussions from becoming overly technical or contentious.
  • May disadvantage less confident experts who struggle to assert their views in a group setting.When implemented effectively, hot-tubbing can be a powerful tool for distilling complex issues and identifying the true points of contention. It could also provide a significant timesaving for the court, nullifying the need for several experts to be separately cross- examined on predominantly the same subject matter.

    Changing Opinions During Trial

    In long trials such as the LIBOR rigging case and the “Cum-Ex” dividend related tax reclaims, where factual evidence is presented over a multitude of trial days, it would not be unreasonable for an expert to revise their opinion as new evidence emerges or as they gain a deeper understanding of the case. This can often be viewed as a sign of integrity, as long as the expert must clearly explain the basis for any changes in order to maintain their credibility

    However, it can also be perceived as a weakness or inconsistency, particularly during cross-examination. Courts should recognise that evolving opinions, when supported by credible reasoning, are not only legitimate but often necessary in complex cases.

    Conclusion: Towards a More Effective Role for Experts

    As litigation grows more complex, the role of the expert witness must continue to evolve. Whether through more rigorous qualifications, enhanced independence, or innovative courtroom practices like hot-tubbing, the goal is to ensure that expert evidence remains a reliable and impartial source of assistance to the court.

By addressing the issues of scope, timing, and presentation, legal and financial professionals can better leverage the expertise of witnesses while upholding the principles of fairness and efficiency.

Ultimately, the effectiveness of expert testimony depends not only on the knowledge of the individual but also on the systems and practices that govern its use. In rethinking these processes, courts and litigators have an opportunity to enhance the quality of expert testimony in even the most challenging cases.

In Part IV, the final instalment of this series of posts, we conclude by showcasing the approach taken by our team at Objectivus, a firm uniquely positioned to address the complexities and challenges of expert testimony in financial and legal disputes.