Materials Engineering Expert Allowed to Opine on the Hot Spot

With respect to Attala Steel Industries, LLC's claim that The Travelers Indemnity Company of America wrongfully denied insurance coverage for damage to its steel galvanizing kettle and furnace, Travelers sought to preclude certain opinion testimony from Attala's expert witnesses, Shane Kennett and Jared Kaufman, under Federal Rule of Evidence 702 and, alternatively, to preclude Kaufman's testimony under Federal Rule of Evidence 403.

On April 29, 2023, a hole formed in the wall of Attala’s steel galvanizing kettle at its 2200 Attala Road location, causing molten zinc to leak out of the kettle. On May 12, Travelers denied Attala’s insurance claim for the resulting losses sustained to the kettle and furnace. After being contacted by Attala, Western Technologies, Inc. (“Westech”), the designer and manufacturer of the furnace, inspected the kettle on May 22. Westech concluded that the “primary cause” of the kettle failure was “incorrect re-assembly of the furnace and insulating systems” because “when the insulating ‘dross protection boards’ are correctly fitted and installed, there should be minimal heat transfer and thus no chance of a hot spot forming, leading to a hole.’” On July 11, Travelers informed Attala that it denied coverage under policy exclusions for faulty workmanship and wear and tear based on the findings of Lucas Brown of Engineering Design & Testing Corp. (“EDT”).

In response to additional information from Attala, Brown performed a follow-up investigation, concluding that “dross protection insulation had been present in the bottom of the furnace;” “dissolution of the kettle wall is normal wear and a normal part of the kettle’s life cycle;” “the wall thickness in the locality of the hole in the kettle wall had deteriorated to the equivalence of a few sheets of paper, or less;” and “a kettle wall that has been thinned down to this level is at an imminent point of experiencing a leak without any additional influence.”

Based on this investigation, Travelers again denied coverage on December 08, concluding that “the kettle leak occurred due to normal wear and tear and corrosion/deterioration which occurs during a kettle’s life cycle.”

Materials Engineering Expert Witness

Shane Christopher Kennett is a Professional Engineer, Mechanical Engineer, Metallurgical Engineer, and Certified Welding Inspector. He has a Bachelor’s Degree in Mechanical Engineering and a PhD in Metallurgical and Materials Engineering. His work includes the investigation of metallic component failures in mechanical systems and equipment at industrial facilities.

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

Mechanical Engineering Expert Witness

Jared Kaufman is a licensed Professional Engineer with a Bachelor’s and Master’s Degree in Mechanical Engineering. Kaufman has direct knowledge and experience designing, manufacturing, inspecting, troubleshooting, and servicing the type of steel galvanizing kettle and furnace at issue in this matter.

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

Discussion by the Court

Shane Kennett

Kennett prepared his report after visiting Attala’s facility and inspecting the remnants of the kettle corners. He concludes that because “there has been no evidence to date of issues with the heat dissipation into the molten zinc bath[,] … the temperature was higher due to conditions on the external side of the kettle wall in the furnace gallery as opposed to dross build-up on the inside of the kettle.”

a. Relevance & Reliability

Here, Travelers denied Attala’s claim because it found the damage was not covered, basing its conclusion on several policy exclusions. Travelers has the burden to show that the cause of the hot spot falls under one of the policy exclusions.

If Attala sought to prove that any one factor caused the hot spot and the hole in the kettle, Kennett’s opinion would certainly not be helpful to the factfinder, as Kennett himself admits that he could not determine which factor caused the hot spot. However, Kennett’s testimony is intended to demonstrate that alternative causes besides the causes identified by Travelers’ experts could have caused the hot spot. In this context, his opinion, though it deals only in possibilities, is relevant because it could help the factfinder determine whether Travelers has established that the damage was excluded under the policy.

As to reliability, it is evident from Kennett’s deposition testimony that he conducted no testing and did not otherwise attempt to determine which factor or combination of factors was most likely the cause of the hot spot. If Kennett intended to testify that the hot spot was caused by any specific factor, his testimony would be unreliable, as he himself testified that it was not possible, through testing or any other means, to determine which factor or combination of factors caused the hot spot.

Kennett formed his opinion based on information he obtained through inspecting the kettle and furnace, reviewing the reports of Westech and Brown, having discussions with Attala employees, and consulting with technical advisor Jared Kaufman. He then deduced possible explanations for the hot spot based on such information. The Court finds all this to be a reliable basis to testify about possible causes.

Jared Kaufman

Kaufman is expected to testify about “the standard installation, operation, maintenance, and lifespan of the galvanizing kettle and furnace, the dross removal process, and the root cause of the failure and hole that developed in Attala’s steel galvanizing kettle;” and “the inaccurate causation findings asserted by Travelers’ engineering experts.”

A. Rule 702

Travelers argued that “Kaufman has not submitted a stand-alone report in this litigation, nor has he performed his own analysis, nor did he author any portion of the Kennett Report;” “the Kennett Report does not identify any division of labor between Kennett and Kaufman, nor does it identify any opinions or accompanying analyses belonging to Kaufman;” and “Attala’s failure of disclosure prevents the Court from performing its gate-keeping function to ensure that Kaufman’s proffered testimony is relevant, helpful to the trier of fact, and reliable.”

Attala responded that Travelers “filed its motion to strike [Kaufman’s disclosure for the same reasons] after the expiration of the time period” allowed by the Local Rules, and “Travelers may not circumvent the waiver provision of Local Rule 26(a)(3) on this motion.” Attala further argued that “the Joint Report qualifies as a written report for purposes of expert witness disclosure;” and “Kaufman qualifies as a hybrid witness for which no separate written report is required.”

Travelers further argued that “Attala intended and attempted to disclose Kaufman as a retained and specially employed expert witness under Fed. R. Civ. P. 26(a)(2)(B), and not [a hybrid fact/expert witness] under Fed. R. Civ. P. 26(a)(2)(C);” and “even if the Court were to permit Attala’s eleventh-hour attempt to redesignate Kaufman under Rule 26(a)(2)(C), it still should preclude his testimony” because “the subject matter of his supposed opinions does not draw upon any work Kaufman did … before being specially retained by [Attala]’s counsel.”

Local Rule 26(a)(3) provides that “challenges as to inadequate disclosure of expert witnesses must be made no later than 30 days before the discovery deadline or will be deemed waived.” As mentioned above, the Court overruled Travelers’ objection to the magistrate judge’s order denying Travelers’ motion to strike Kaufman’s disclosure as untimely under Local Rule 26(a)(3).

Since Travelers’ Daubert challenge relies on its argument that the Kaufman disclosure is inadequate, the Court held that Travelers’ motion to preclude Kaufman’s testimony will not be granted based on Rule 702 and Daubert.

Because the Court concludes that Travelers has waived its challenge to the adequacy of the Kaufman disclosure, it need not address Attala’s arguments that the report authored by Kennett meets the requirement of a written report under Federal Rule of Civil Procedure 26(a)(2)(B) and that Kaufman is a hybrid witness who is not required to provide a written report. However, the Court briefly addressed both arguments. Here, even if Kennett’s proposed testimony regarding his visit to Attala’s facility before he was retained to provide expert testimony was not subject to the written report requirement, the portion of his testimony related to the contents of the report prepared after being retained as an expert, at least, is subject to Rule 26(a)(2)(B).

B. Rule 403

Travelers contended that “permitting Kaufman to offer any expert testimony would be unnecessarily cumulative” because “Kaufman is not going to offer any testimony that Kennett cannot also offer;” and “having two experts with identical overlapping opinions violates the limitations set forth in Federal Rule of Evidence 403 concerning duplicative or cumulative evidence.”

The “Subject Matter of Expert Testimony” and “Summary of Facts and Opinions” sections of the Kennett and Kaufman disclosures are nearly identical, and the disclosures specify that both experts will testify in conformity with the same expert report.

Travelers asked that the Court “preclude Kaufman from giving expert testimony in this action, whether by affidavit, at hearing, at trial, or otherwise.” Based on the information available to the Court at this stage, it is certainly possible that if this case ultimately goes to trial, Kaufman’s testimony at such trial would be needlessly cumulative of Kennett’s testimony. However, it also appears that Kaufman and Kennett have different areas of expertise and had different roles in preparing the expert report; in that sense, it is possible that Kaufman’s testimony would not be needlessly cumulative.

Ultimately, at this point in the litigation, it would be premature to exclude Kaufman’s testimony as needlessly cumulative when there are no hearings presently set in this case; it is uncertain whether this case will ultimately proceed to trial, and it is not yet known exactly what Kennett’s testimony and Kaufman’s testimony would be at trial.

C. Cause of Hot Spot

Travelers argued that “ the opinions in the Kennett Report as to the cause of a hot spot in the southeast corner of the Kettle are impermissibly speculative and unsupported by a reliable scientific methodology.”

As discussed above, for the same reasons that the motion to preclude Kennett’s testimony regarding the cause of the hot spot will not be granted, Kaufman also will not be precluded from testifying about the cause of the hot spot.

Held

The Court denied Travelers' motions to preclude expert testimony by Shane Kennett and Jared Kaufman.

Key Takeaway

To be reliable, expert testimony must be grounded in the methods and procedures of science and be more than unsupported speculation or subjective belief. However, Kennett's failure to perform any testing, calculations, or other procedures to confirm the cause of the hot spot does not render his opinion unreliable that any of the four factors possibly caused the hot spot.

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