Accounting Expert Witness’ Calculations of Lost Profits and Plow-Down Costs Survives Daubert Challenge
Posted on March 10, 2025 by Expert Witness Profiler
Polypack sued Nestlé for breach of contract and breach of implied covenant of good faith, claiming Nestlé failed to make final payments for equipment and service fees. Nestlé counterclaimed, alleging defective equipment and failure to meet performance requirements, resulting in significant financial losses, including lost profits, additional labor costs, and storage fees.
Nestlé retained David R. Tantlinger, Jr., a Certified Public Accountant (CPA), to provide expert testimony on the damages incurred due to Polypack’s alleged equipment failures. Polypack challenged Tantlinger’s qualifications, the reliability of his methodologies, and the relevance of his opinions, seeking to exclude his testimony.
Accounting Expert Witness
David R. Tantlinger, Jr. has been a CPA for 39 years and is “experienced in performing accounting services, including forensic accounting services and the computation of damages to commercial and other enterprises.”
He has experience in accounting, taxation, finance and business management with a variety of industries.
Discussion by the Court
Qualification
Polypack argued that Nestlé failed to adequately define Tantlinger’s specific field of expertise. They claimed this lack of clarity made it impossible to properly assess his qualifications, suggesting Nestlé was trying to pass off company information as expert opinion.
Nestlé asserted that they clearly identified Tantlinger as an expert on damages. They emphasized his long-standing experience as a CPA and his specific experience in forensic accounting and damages calculations. They also pointed out that Polypack had the opportunity to question Tantlinger’s qualifications during his deposition.
The Court found Tantlinger qualified, noting his 39 years as a CPA and experience in forensic accounting and damages computation. The Court also noted that Polypack had opportunity to question the expert at deposition, and failed to do so.
Reliability
Polypack’s Objection
Polypack attacked the reliability of Tantlinger’s methodologies. They alleged he:
- Failed to identify or apply established methodologies for calculating lost profits.
- Did not conduct independent research or analysis.
- Ignored other potential causation factors that could have contributed to Nestlé’s losses.
Nestlé’s Opposition:
- Providing detailed explanations of his calculations, demonstrating that they were not arbitrary.
- Stating that damages experts are allowed to rely on information provided by the client.
- Arguing that questions about other potential causes of losses go to the weight of the evidence, not its admissibility.
Court Observation:
The Court rejected Polypack’s arguments, emphasizing that Tantlinger explained his calculations and that a damages expert can rely on client-provided data. The Court stated that questioning the causation factors goes to the weight of the evidence, not its admissibility.
Relevancy:
Polypack argued that many of Tantlinger’s calculations were simple mathematical operations that required no specialized expertise. They contended that his testimony would not “assist the trier of fact” because it was within the understanding of a layperson.
Nestlé acknowledged that some calculations were mathematical but emphasized that Tantlinger’s work involved extensive data analysis, document review, and the application of accounting principles. They argued that this level of analysis went beyond the capabilities of a layperson and would assist the jury.
Tantlinger calculated Nestlé’s total damages—including lost profits and plow-down costs resulting from production delays allegedly caused by the equipment, which are clearly beyond simple arithmetic. While acknowledging that simple math is not typically considered expert testimony, the Court found that Tantlinger’s analysis of extensive data and complex calculations, including lost profits, made his testimony helpful to the jury. Tantlinger compiled and analyzed a large amount of data to perform the challenged calculations.
Held
The Court denied the Plaintiff Polypack, Inc.’s motion to exclude Nestlé USA, Inc.’s expert witness David R. Tantlinger, Jr.
Key Takeaway:
This case serves as a valuable example of the challenges involved in admitting expert testimony. The Court’s meticulous application of the Daubert standard and Rule 702 highlights the importance of thorough preparation and clear articulation of expert opinions. This case also shows the importance of proper deposition preparation, and how those depositions can be used in motions to exclude expert witnesses.
Case Details:
| Case Caption: | Polypack, Inc. V. Nestle USA, Inc. |
| Docket Number: | 8:23cv318 |
| Court: | United States District Court, Florida Middle |
| Order Date: | March 7, 2025 |
