Market Research Expert Was Allowed to Opine on the Primary Market Area for the Project

This case is about a proposed affordable housing development in Georgetown County, known as Porter's Landing (hereinafter, the "Project"), put forward by FourSix Development, LLC ("FourSix") and We Do Good Work, LLC ("WDGW") (collectively referred to as "Developer Plaintiffs"), and Defendants' denial of a zoning application to include multi-family housing among the permitted uses on the land where the Project was to be built.

Defendants sought to exclude the testimony of Developer Plaintiffs' expert, Rebecca Tippett, while Developer Plaintiffs sought to exclude the testimony of Defendants' expert, Steven Shaw, under Daubert and Rule 702 in response.

Demography Expert Witness

Rebecca Tippett has authored more than 200 articles and reports about the impact of demographic and social trends in North Carolina and is frequently sought after for her expertise and ability to communicate demographic information. She has delivered over 100 presentations on topics ranging from census reapportionment to school enrollment projections and regularly appears in state and national media such as The Charlotte Observer, The Wall Street Journal, and National Public Radio.

She earned her BA in Sociology and Political Science from The Ohio State University and her MA and PhD in Sociology from Duke University.

Get the full story on challenges to Rebecca Tippett’s expert opinions and testimony with an in-depth Challenge Study.

Market Research Expert Witness

Steven R. Shaw is exclusively in the business of performing market studies required by state housing authorities to determine if projects are eligible to be awarded LIHTCs. He has experience in performing such studies in South Carolina for 20-25 years.

Want to know more about the challenges Steven Shaw has faced? Get the full details with our Challenge Study report.

Discussion by the Court

Developer Plaintiffs point to the Tippett Report as establishing that the denial of the zoning application "results in a disparate impact on housing opportunities for Black households relative to White households in three ways." The Tippett Report also assesses whether the denial of the zoning application perpetuates segregation in Georgetown County.

Defendants proffered Steven Shaw as an expert in the primary market area for a Low-Income Housing Tax Credit ("LIHTC") analysis. Shaw prepared an expert report, wherein he provides his professional determination of the Primary Market Area ("PMA") for the Project as it pertains to guidelines and regulations for the LIHTC program, the South Carolina State Housing Finance and Development Authority ("SC Housing Authority"), and other industry organizations. Notably, unlike Tippett, Shaw did not include the entirety of Georgetown County. Rather, he excluded the high-income areas on the coast that also are separate geographically using the SC Housing Authority's criteria for determining market area for an LIHTC project.

Defendants contended that Shaw's opinion demonstrates that Tippett used an incorrect market area for her statistical calculations, thereby making "all of her disparate impact conclusions . . . suspect."

Developer Plaintiffs contended that:

• Shaw is unqualified because "he does not have the training or domain expertise typically possessed by experts who analyze whether policies have a disparate impact or perpetuate segregation or whether a LIHTC project would be approved;

• Shaw's Report and testimony are irrelevant — he "says nothing at all about the conclusions that Plaintiffs' expert reaches or her analysis"; and

• Shaw's Report and testimony are "not based on valid methodology" because "they do not reliably apply key facts in his analysis of the correct [PMA] for the Porter's Landing development; excluding areas that would be more favorable to Plaintiffs without sufficient explanation."

Analysis

The Court is not persuaded by the parties' arguments in support of exclusion and, therefore, denied both motions. The Court found no reason to exclude any of the data compiled by Tippett, as the data is both relevant and reliable.

Defendants have set forth certain critiques of Tippett's Report (e.g., finding fault with the market area, census data, and demographic data relating to the Project), which they are free to raise by cross-examination and the introduction of rebuttal evidence, i.e., Shaw's Report and testimony. Cross-examination and the presentation of contrary evidence should be sufficient to demonstrate any purported flaws in Tippett's analysis and conclusions.

As to Shaw, the Court found Defendants' points well taken. Shaw is clearly a rebuttal expert witness who will provide limited testimony at trial on the appropriate PMA for the Project, and the Court finds him well-qualified in this regard and that his testimony is both relevant and reliable. Contrary to Developer Plaintiffs' assertion, the Court found that Shaw's testimony does say something about the conclusions made by Tippett, as conclusions based on flawed data and/or analysis are also flawed or, at a minimum, should be scrutinized.

Held

The Court denied Developer Plaintiffs' motion in limine to exclude the testimony of Defendants' expert, Steven Shaw, as well as Defendants' motion in limine to exclude the testimony of Developer Plaintiffs' expert, Rebecca Tippett.

Key Takeaway

The compilation and presentation of statistical evidence by an expert witness in a comprehensive and coherent manner will "assist the trier of fact to understand the evidence."

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