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Great Western Air, LLC v. Cirrus Design Corp.

United States District Court, D. Nevada

December 4, 2019

GREAT WESTERN AIR, LLC doing business as CIRRUS AVIATION SERVICES, LLC, Plaintiff/Counter-Defendant,
v.
CIRRUS DESIGN CORPORATION, Defendant and Counter-Plaintiff.

          ORDER

          ELAYNA J. YOUCHAH UNITED STATES MAGISTRATE JUDGE

         Before the Court is Plaintiff Cirrus Aviation Services, LLC's (“Cirrus Aviation”) Motion to Strike Disclosure and Designation of Defendant/Counter-Claimant's Non-Retained Expert Witness Ben Kowalski (EFC No. 66); Cirrus Design Corporation's (“Cirrus Design”) Memorandum in Opposition to Plaintiff's Motion to Strike Disclosure and Designation of Defendant/Counterclaimant's Non-Retained Expert Witness Ben Kowlaski (ECF No. 78); Plaintiff/Counter-Defendant's Reply in Support of Motion to Strike Disclosure and Designation of Defendant/Counter-Claimant's Non-Retained Expert Witness Ben Kowalski (ECF No. 83); Counter-Plaintiff Cirrus Design Corporation's Motion to Strike the Expert Testimony of Reza Karamooz and Shai Cohen (ECF No. 67); Plaintiff's Opposition to Defendant Cirrus Design Corporation's Motion to Strike the Expert Testimony of Reza Karamooz and Shai Cohen (ECF N0. 79); and, Counterclaim Plaintiff Cirrus Design Corporation's Reply Memorandum of Law in Support of its Daubert Motion and Motion to Strike the Expert Testimony of Reza Karamooz and Shai Cohen (ECF No. 84).

         I. BACKGROUND

         The case before the Court involves a trademark dispute between Cirrus Aviation and Cirrus Design. ECF No. 1. Cirrus Aviation seeks “a declaratory judgment that it does not infringe trademark rights of … [Cirrus Design] in and to the term CIRRUS and that … [Cirrus Aviation's] concurrent use of the CIRRUS term in connection with unrelated services does not warrant a finding of unfair competition.” Id. Cirrus Aviation describes itself as “in the business of providing private airline charter flights and other related services in the aircraft charter industry.” Id. Cirrus Aviation says that it first used the trademark CIRRUS in May 2007. Id.

         Cirrus Design states it is “an innovator in the personal aircraft market” and has been since the “1980s.” ECF No. 27. Cirrus Design states that it “has spent a considerable amount of resources on marketing and advertising its products and services using the trademarks and service marks described” in its Answer and Counterclaim. Id. Cirrus Design also states: “In addition to manufacturing and selling personal aircraft and related products, Cirrus Design also provides numerous aircraft-related services, such as aircraft inspection and repair services, flight instruction and training, and aircraft insurance.” In September 2013, Cirrus Design applied for a U.S. service mark registration for the mark “CIRRUS” for various services such as aircraft crew scheduling services, providing employee leasing of aircraft flight crews, and business management services in the nature of private aircraft management services. Id. Cirrus Design has used the name “Cirrus” for “aircraft and structural parts thereof” since 1979. ECF No. 27 at 8, and Ex. C, p. 1.

         Cirrus Design filed a Motion to Dismiss, which was denied on March 27, 2018 (ECF No. 26). On June 1, 2018, the Court entered a discovery plan and scheduling order (EFC No. 32) that was subsequently extended four times with the last extension entered on August 2, 2019 (ECF No. 61). In each of the stipulations to extend discovery, dates for specific discovery related extensions were identified. ECF Nos. 34, 43, 52, and 60. The initial expert disclosure deadline was extended only once, from September 20, 2018 to December 19, 2018, through ECF No. 34 granted on September 13, 2018 (ECF No. 35). The rebuttal expert deadline was extended twice, the second time to January 25, 2019. ECF No. 45. The deadline to complete fact discovery was finally extended to July 2, 2019. ECF No. 53.

         a. Cirrus Aviation's Motion to Strike.

         Cirrus Aviation timely disclosed two experts on December 19, 2018. ECF No. 66 at 2:28. Cirrus Design did not disclose any experts on that date. Id. at 3:1. On January 25, 2019, Cirrus Design disclosed a single non-retained expert, Ben Kowalski (“Kowalski”), who is the Senior Vice President of Sales & Marketing for Cirrus Design. Id. at 3:4-6. Cirrus Aviation asserts that the disclosure of Kowalski was untimely as he is offered as an expert for Cirrus Design's Counterclaims in chief, as well as a rebuttal expert to Cirrus Aviation's initial experts. Id. at 3:4-7. Moreover, Cirrus Aviation states that Cirrus Design's disclosure does not meet the requirements of Fed.R.Civ.P. 26(a)(2)(c) regarding non-retained experts because Cirrus Design did not include “any summary of facts upon which Kowalski's opinions would be based.” Id. at 3:8-9. The disclosure made by Cirrus Design, referred to as Cirrus Aircraft in the below disclosure, states:

Cirrus Aircraft discloses that Ben Kowalski, Cirrus's Senior Vice President of Sales & Marketing, will or may provide evidence under Federal Rules of Evidence 702, 703, or 705, on the subjects of whether there is actual and/or likely confusion caused by plaintiff/counter-defendant Cirrus Aviation Services, LLC's use of trademarks and rights belonging to Cirrus Aircraft, and related issues.
A summary of the facts and opinions to which Mr. Kowalski is expected to testify is as follows: Based upon his experience in the aviation industry, his work for Cirrus Aircraft, and specific information relating to the respective activities of Plaintiff/Counter-Defendant Cirrus Aviation and Defendant/Counter-Claimant Cirrus Aircraft, Mr. Kowalski is expected to testify that in his opinion and based on factual evidence Cirrus Aviation's use of the Cirrus name and trademarks have caused actual confusion and is likely to cause additional confusion, and that that confusion is harmful to Cirrus Aircraft. Customers in the Las Vegas market have confused the two companies as a result of the similarity in names.
In addition, with respect to the expert witness reports disclosed by Plaintiff/Counter-Defendant Cirrus Aviation, Mr. Kowalski is expected to testify that Mr. Karamooz's opinion that Cirrus Aircraft's aircraft are “generally not suitable for use as charter aircraft” is incorrect and inconsistent with Cirrus Aircraft's future business plans. Mr. Kowalski is further expected to testify that Mr. Cohen's opinions regarding customers and that the “target market for charter services providers[s] like Cirrus Aviation is wholly different than the target market for a purchaser of a small Cirrus [] aircraft, ” are also incorrect.

ECF No. 78 at 4. Cirrus Aviation asks that Kowalski be struck as both an initial and rebuttal expert.

         In contrast to Cirrus Aviation's contentions, Cirrus Design contends that Kowalski “was disclosed as a fact witness at the outset of the case, ” was timely disclosed as an expert, the summary offered fairly describes Kowalski's “opinions and the basis for them, ” and the summary was provided almost six months before the close of fact discovery. ECF No. 78 at 2:6-23.

         b. Cirrus Design's Motion to Strike Reza Karamooz and Shai Cohen.

         On August 16, 2019, Cirrus Design filed its Motion to Strike experts Reza Karamooz (“Karamooz”) and Shai Cohen (“Cohen”) who were retained and timely disclosed by Cirrus Aviation. Cirrus Design claims that these individuals offer “expert” testimony in the subject matter of customer or consumer confusion, but that neither has the qualifications necessary to offer this testimony and, moreover, that these opinions are unreliable. ECF No. 67 at 5, 7, 8, and 10.

         Cirrus Aviation argues that “Mr. Cohen is presented as an expert from the perspective of a customer/user of Defendant's aircraft because he in fact is such a customer/user.” ECF No. 79 at 3. His expertise is said to arise from six years as a licensed pilot and “his experience as a private pilot with extensive time with Defendant's own product.” Id. at 3. Cohen states in his report that he has “flown approximately 160 hours in the SR22 [Cirrus Design] aircraft.” ECF No. 67-3 (Cohen Report) at 1. Cohen also states that he has flown “approximately 387 hours” in other aircraft, and that based on his time as a “private pilot and a businessman, ” he has “become quite knowledgeable about both aircraft and air travel.” Id.

         “Karamooz is presented as an expert from the perspective of the aircraft charter industry.” ECF No. 79 at 5. Karamooz's expertise is said to arise from the fact that he is an engineer, the CEO of LuckyJets since 2008, Chairman of the Nevada Department of Transportation's Aviation Technical Advisory Committee, and the founder and president of the Nevada Business Aviation Association. ECF No. 67-3 (Karamooz Report) at 1-2. Karamooz offers opinions regarding “the nature of the parties' offerings under their respective trademarks.” Id. at 4 and 4-6.

         II. DISCUSSION

         a. Fed. R. Civ. P. Rule 702 and Expert Testimony Requirements.

         Admissibility of expert testimony in a civil proceeding is governed by Fed.R.Evid. 702, which states:

A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if: (a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue; (b) the testimony is based on sufficient facts or data; (c) the testimony is the product of reliable principles and methods; and (d) the expert has reliably applied the principles and methods to the facts of the case.

         In Barabin v. AsentJohnson, Inc., 740 F.3d 457, 463 (9th Cir. 2014), the Ninth Circuit explained that “[w]e have interpreted Rule 702 to require that expert testimony … be both relevant and reliable.” (Internal citations and quote marks omitted.) Relevancy, as stated by the court, requires “the evidence … logically advance a material aspect of the party's case.” Id. (Citation omitted.) Reliability encompasses “whether an expert's testimony has a reliable basis in the knowledge and experience of the relevant discipline.” Id. citing Kumbo Tire Co. Ltd. v. Carmichael, 526 U.S. 137, 149 (1999). “[E]videntiary reliability is based upon scientific validity.” Id. citing Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 590 n.9 (1993).

         The Federal Rules of Evidence impose on trial courts a “gatekeeping” obligation to ensure the relevance and reliability requirements are met. United States v. Hankey, 203 F.3d 1160, 1167 (9th Cir. 2000). The objective of the “gatekeeping” requirement is to make certain that an expert, “whether basing testimony upon professional studies or personal experience, employs in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field.” Kumho Tire Co., Ltd., 526 U.S. at 152. The trial judge must make “some kind of” reliability determination to fulfill the “gatekeeping” function. Mukhtar v. Cal. State Univ., Hayward, 299 F.3d 1053, 1066 (9th Cir. 2002), amended by319 F.3d 1073, 1076 (9th Cir. 2003).

         Trial courts have broad discretion in performing its gatekeeping function. Barabin, 740 F.3d at 465 (citation omitted). The district court must “ensure that the proposed expert testimony is relevant and will serve to aid the trier of fact. . . . Expert testimony assists the trier of fact when it provides information beyond the common knowledge of the trier of fact.” United States v. Finley, 301 F.3d 1000, 1008 (9th Cir. 2002) (citing Daubert, 509 U.S. at 591-93).

         The role of the Court is not to determine the “correctness of the expert's conclusions but the soundness of his methodology.” Id. citing Primiano v. Cook, 598, F.3d 558, 564 (9th Cir. 2010). Nonetheless, “rejection of expert testimony is the exception rather than the rule.” Fed.R.Evid. 702 Advisory Committee Notes (2000). Where an expert satisfies the Rule 702 standards, cross-examination is the proper method of challenging the expert's opinions. See e.g. U.S. Fidelity and Guar. Co. v. Soco West, Inc., No. CV 04-29, 2006 WL 5230019, at *2 (D.Mont. April 21, 2006).

         The Ninth Circuit has found opinions based on an expert's experience to be properly admitted. “When evaluating specialized or technical expert opinion testimony, the relevant reliability concerns may focus upon personal knowledge or experience.” United States v. Sandoval- Mendoza, 472 F.3d 645, 655 (9th Cir.2006) (quoting Kumho Tire Co., 526 U.S. at 150 (internal quotations omitted)); PixArt Imaging, Inc. v. Avago Tech. Gen. IP (Singapore) Pte. Ltd., 2011 WL 5417090, at *8 (N.D.Cal. Oct. 27, 2011) (expert testimony grounded on the expert's personal knowledge and experience was admissible in light of his extensive background in the area); Toomey v. Nextel Commc'ns, Inc., 2004 WL 5512967, at *8 (N.D.Cal. Sept. 23, 2004).

         In Hangarter v. Provident Life & Accident Insurance Co., the court explained that when discussing non-scientific testimony “the ‘Daubert factors (peer review, publication, potential error rate, etc.) simply are not applicable to this kind of testimony, whose reliability depends heavily on the knowledge and experience of the expert, rather than the methodology behind it.'” 373 F.3d 998, 1017 (9th Cir. 2004) (quoting Hankey, 203 F.3d at 1169). “[T]he judge is supposed to screen the jury from unreliable nonsense opinions, but not exclude opinions merely because they are impeachable. The district court is not tasked with deciding whether the expert is right or wrong, just whether his testimony has substance such that it would be helpful to a jury.” Alaska Rent-A-Car, Inc. v. Avis Budget Grp., Inc., 738 F.3d 960, 969-70 (9th Cir. 2013). Nonetheless, subject beliefs and opinions are not proper expert testimony.[1]

         In addition to evaluating relevance and reliability, a trial court must determine whether an expert has “appropriate qualifications.” Hankey, 203 F.3d at 1168. A witness may testify to his special knowledge so long as he is qualified as an expert based on any combination of knowledge, skill, experience, training, or education. Wright v. United States,280 F.Supp.2d 472, 478 (M.D. N.C. 2003). “Rule 702 contemplates a broad conception of expert qualifications.” Hangarter, 373 F.3d at 1015 (citation omitted); Kopf v. Skyrm,993 F.2d 374, 377 (4th Cir. 1993) (“[w]here the expert's qualifications are challenged, the test for exclusion is a ...


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