City of Pomona v. Sqm North America Corp. ( 2017 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CITY OF POMONA, No. 15-56062
Plaintiff-Appellant,
D.C. No.
v. 2:11-cv-00167-
RGK-VBK
SQM NORTH AMERICA
CORPORATION,
Defendant-Appellee. OPINION
Appeal from the United States District Court
for the Central District of California
R. Gary Klausner, District Judge, Presiding
Argued and Submitted May 10, 2017
Pasadena, California
Filed August 7, 2017
Before: J. Clifford Wallace, Morgan Christen,
and Paul J. Watford, Circuit Judges.
Opinion by Judge Wallace
2 CITY OF POMONA V. SQM NORTH AMERICA
SUMMARY*
Expert Testimony
The panel vacated the district court’s judgment, which
found that SQM North America Corporation was not liable
for causing perchlorate contamination in the City of
Pomona’s water system, and held that the district court
abused its discretion by limiting the testimony of one of the
City’s experts and failing to make sufficient findings before
admitting the testimony of one of SQM’s experts.
Dr. Neil Sturchio developed a methodology for collecting
and analyzing perchlorate isotopes from groundwater, and he
concluded that most of the perchlorate in the City’s water had
come from the Atacama Desert in Chile. The City filed this
products-liability action, alleging that SQM’s importation of
perchlorate-containing fertilizer products from the Atacama
Desert caused the contamination in the City’s water supply.
First, the panel addressed the district court’s denial of the
City’s motion to update Dr. Sturchio’s report, which resulted
in the exclusion of any testimony regarding post-2011
developments in Dr. Sturchio’s research. The panel held that
in denying the City’s motion, the district court identified the
correct legal standard. The panel held, however, that the
district court applied the legal standard in an “illogical”
manner, and thus committed an abuse of discretion. The
panel further held that the district court’s exclusion of Dr.
Sturchio’s testimony was prejudicial.
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
CITY OF POMONA V. SQM NORTH AMERICA 3
Second, the panel considered the district court’s denial
of the City’s motion to exclude the testimony of SQM’s
alternative source expert, Dr. Richard Laton, who opined that
the perchlorate at issue might have flowed from hundreds of
potential alternative sources other than SQM’s fertilizer. The
panel held that the manner in which the district court denied
the City’s Daubert motion as to Dr. Laton constituted an
abuse of discretion. Specifically, the panel held that the
district court’s failure to make any findings regarding the
efficacy of Dr. Laton’s expert opinions constituted an
abdication of the district court’s gatekeeping role, and was
necessarily an abuse of discretion. The panel also held that
based on the circumstances presented by the case, the City
did enough to preserve its objection. Finally, the panel held
that the erroneous inclusion of Dr. Laton’s testimony,
combined with the erroneous partial exclusion of Dr.
Sturchio’s testimony, was prejudicial.
On remand, the panel directed the district court to allow
Dr. Sturchio to update his expert report, and testify to the
state of stable isotope research up to the present. The panel
also directed the district court to make findings regarding the
scientific reliability of Dr. Laton’s proposed opinions, and
hold a Daubert hearing if deemed necessary.
COUNSEL
Susannah Weaver (argued), Donahue & Goldberg LLP,
Washington, D.C.; Esther L. Klisura, Kathleen S. Kizer, SL
Environmental Law Group, San Francisco, California; Robert
S. Chapman, Sauer & Wagner, Los Angeles, California;
Andrew L. Jared, Assistant City Attorney; Arnold M.
Alvarez-Glasman, City Attorney; Office of the City Attorney
4 CITY OF POMONA V. SQM NORTH AMERICA
of the City of Pomona, Pomona, California; for Plaintiff-
Appellant.
R. Gaylord Smith (argued), Lann G. McIntyre, Michael K.
Johnson, and Malissa Hathaway McKeith, Lewis Brisbois
Bisgaard & Smith LLP, San Diego, California, for
Defendant-Appellee.
Anthony Z. Roisman, Weathersfield, Vermont; Ned
Miltenberg, National Legal Scholars Law Firm P.C.,
Washington, D.C.; Kevin J. Madonna, Kennedy & Madonna
LLP, Hurley, New York; for Amicus Curiae Law Professors
Stephen A. Saltzburg, Michael M. Martin, and Joëlle Anne
Moreno.
OPINION
WALLACE, Senior Circuit Judge:
After a seven-day trial, a jury found SQM North America
Corporation (SQM) not liable for causing perchlorate
contamination in the City of Pomona’s (Pomona) water
system. Pomona now appeals from that judgment. We have
jurisdiction pursuant to 28 U.S.C. § 1291. We hold that the
district court abused its discretion by limiting the testimony
of one of Pomona’s experts and failing to make sufficient
findings before admitting the testimony of one of SQM’s
experts. These errors, in combination, were prejudicial.
Accordingly, we vacate the district court’s judgment and
remand for a new trial.1
1
We resolve two other issues raised by Pomona in a concurrently
filed memorandum disposition.
CITY OF POMONA V. SQM NORTH AMERICA 5
I.
Pomona owns and operates a public water system to
provide its residents with clean drinking water. The State of
California regulates the quality of that water by imposing
maximum contaminant levels (MCL), which limit the amount
of a given chemical that can be present in the water. In 2007,
California established that the MCL for perchlorate, a
chemical that interferes with the ability of the thyroid gland
to produce hormones, would be six parts per billion. Shortly
thereafter, Pomona discovered that fourteen of its wells
possessed perchlorate levels in excess of the MCL. In
response, Pomona shut down non-compliant wells, purchased
water from other sources, and took other steps to remedy the
perchlorate contamination in its drinking water.
In 2010, Pomona filed this products-liability action
against SQM. SQM began importing fertilizer from the
Atacama Desert in Chile in 1927, and from 1931 to 1968
imported a substantial portion of the Chilean nitrate (a
component of that fertilizer) brought from Chile into the
United States. The theory of Pomona’s case is that SQM’s
importation of perchlorate-containing fertilizer products from
the Atacama Desert, which were used in areas around
Pomona’s wells, caused the contamination in Pomona’s water
supply. Thus, Pomona sought to recover over $32 million in
past and future costs associated with investigating and
remediating the perchlorate contamination.
The case progressed towards a January 2012 trial date.
Unsurprisingly, the case involved several scientific experts,
as the key dispute centered around whether the perchlorate
from SQM’s fertilizer had migrated into Pomona’s wells and
caused the contamination present in Pomona’s water system.
6 CITY OF POMONA V. SQM NORTH AMERICA
Five days before trial, the district court conducted a Daubert
hearing to consider whether the testimony of Pomona’s expert
witness, Dr. Neil Sturchio, should be excluded. Dr. Sturchio,
who was then the Head of the Department of Earth and
Environmental Sciences at the University of Illinois at
Chicago,2 had developed a peer-reviewed methodology for
collecting and analyzing perchlorate isotopes from
groundwater. Dr. Sturchio’s research concluded that
perchlorate from the Atacama Desert in Chile has a distinct
isotopic fingerprint. Thus, by analyzing the chlorine and
oxygen isotopes taken from Pomona’s wells, Dr. Sturchio
determined that roughly ninety percent of the perchlorate
present in Pomona’s groundwater matched the isotopic
fingerprint of perchlorate unique to the Atacama Desert. Put
simply, Dr. Sturchio concluded that most of the perchlorate
in Pomona’s water had come from the Atacama Desert.
Four days before trial was to begin, the district court
granted SQM’s motion to exclude Dr. Sturchio’s testimony.
In a one half-page minute order, the district court held that
Dr. Sturchio’s opinions had “not been generally accepted by
the scientific community,” had “not been tested by other
laboratories,” and that “Dr. Sturchio’s reference database
[was] too limited.” As Dr. Sturchio was one of Pomona’s key
witnesses, the parties stipulated to dismiss the case and
allowed Pomona to appeal the exclusion of his testimony.
We reversed the district court’s exclusion of Dr.
Sturchio’s expert testimony. City of Pomona v. SQM North
America Corp., 750 F.3d 1036 (9th Cir. 2014) (Pomona I).
We held that the “district court’s ruling [was] unpersuasive
2
Dr. Sturchio is now the Chair of the Department of Geological
Sciences at the University of Delaware.
CITY OF POMONA V. SQM NORTH AMERICA 7
because both grounds for exclusion [were] without adequate
support in the record.” Id. at 1047. Accordingly, we
remanded the case for trial. The mandate from our court
issued in December 2014.
Upon remand, the district court ordered a status
conference for January 12, 2015. At that conference, Pomona
requested to reopen fact and expert discovery to reflect
scientific developments that had been advanced during the
three years in which the case was on appeal. The district court
requested that Pomona file a written motion to reopen
discovery and set trial to begin June 2, 2015, less than five
months from the date of the first post-remand status
conference.
On February 9, 2015, Pomona filed its formal motion to
reopen discovery. As to Dr. Sturchio, Pomona requested
leave to supplement his expert report to reflect additional data
concerning isotopic analysis of perchlorate that had been
developed while the appeal had been pending. The motion
contained a sworn declaration from Dr. Sturchio, in which he
described the new developments in the science of isotopic
analysis of perchlorate. Dr. Sturchio and other scientists had
conducted new interlaboratory comparisons and the database
sizes for their research had increased, which buttressed Dr.
Sturchio’s conclusions and repelled the main criticisms of his
research. On March 26, 2015, the district court denied
Pomona’s motion to supplement Dr. Sturchio’s report. The
district court concluded that Pomona failed to demonstrate
that the information was material and determined that
updating Dr. Sturchio’s report would “create back-and-forth
discovery, which could delay trial.”
8 CITY OF POMONA V. SQM NORTH AMERICA
The case proceeded towards the June 2, 2015, trial date.
Still pending, however, were the parties’ motions in limine,
which had been filed in 2011, before the original trial date. At
that juncture, before the case made its first trip through our
court, the district court had issued tentative rulings on the
motions in limine. On May 29, 2015, four days before trial,
the district court issued new rulings on the parties’ motions in
limine. Relevant for our purposes is the district court’s ruling
on Pomona’s motion to exclude the testimony of SQM’s
expert, Dr. Richard Laton. Dr. Laton’s proffered testimony
contended that the perchlorate contamination present in
Pomona’s water system could have come from hundreds of
alternative sources other than SQM’s importation of fertilizer
from the Atacama Desert. For example, Dr. Laton opined that
the perchlorate in Pomona’s water system could have come
from “household bleach,” “swimming pools,” “septic tanks,”
“photographic flash powder,” or even “fireworks.” Pomona’s
motion asserted that Dr. Laton’s testimony was unreliable
under the standard set forth in Daubert v. Merrell Dow
Pharmaceuticals, Inc., 509 U.S. 579 (1993). Before the first
appeal, the district court denied Pomona’s Daubert motion as
to Dr. Laton, without explanation, in a ruling that was
explicitly labeled as tentative. The district court’s May 29,
2015, ruling on Pomona’s motion to exclude Dr. Laton did
not include any analysis.
At trial, Dr. Sturchio testified to the circumstances as they
existed in 2011. As the district court had denied Pomona’s
motion to update Dr. Sturchio’s expert report, he was
prohibited from testifying about the significant scientific
progress that had taken place while the case had been on
appeal. Furthermore, Dr. Laton testified that the perchlorate
contamination could have arisen from many potential sources.
After seven days of testimony and argument, the jury returned
CITY OF POMONA V. SQM NORTH AMERICA 9
its verdict, finding that SQM’s sodium nitrate fertilizer was
not a substantial factor in causing harm to Pomona—a
complete defense verdict in favor of SQM.
This appeal followed, in which Pomona challenges the
district court’s denial of its motion to update Dr. Sturchio’s
expert report, which resulted in the exclusion of testimony
regarding new scientific developments. Pomona also
challenges the district court’s denial of its motion to exclude
Dr. Laton’s testimony.
II.
“We review evidentiary rulings for abuse of discretion
and reverse if the exercise of discretion is both erroneous and
prejudicial.” Pomona I, 750 F.3d at 1043. Furthermore, “[t]he
district court is given broad discretion in supervising the
pretrial phase of litigation, and its decisions regarding the
preclusive effect of a pretrial order . . . will not be disturbed
unless they evidence a clear abuse of discretion.” Johnson v.
Mammoth Recreations, Inc., 975 F.2d 604, 607 (9th Cir.
1992) (second alteration in original) (citation and internal
quotation marks omitted).
“[T]he first step of our abuse of discretion test is to
determine de novo whether the trial court identified the
correct legal rule to apply to the relief requested.” United
States v. Hinkson, 585 F.3d 1247, 1261–62 (9th Cir. 2009)
(en banc). “[T]he second step of our abuse of discretion test
is to determine whether the trial court’s application of the
correct legal standard was (1) illogical, (2) implausible, or
(3) without support in inferences that may be drawn from the
facts in the record.” Id. at 1262 (citations and internal
quotation marks omitted).
10 CITY OF POMONA V. SQM NORTH AMERICA
III.
A.
First, we turn to the district court’s denial of Pomona’s
motion to update Dr. Sturchio’s report, which resulted in the
exclusion of any testimony regarding post-2011
developments in Dr. Sturchio’s research.
In his 2011 expert report, Dr. Sturchio concluded that a
substantial majority of the perchlorate in Pomona’s water
system had come from the Atacama Desert in Chile. The
strongest criticisms of Dr. Sturchio’s 2011 report were that
the reference database he used was too small, and, that when
the 2011 report was composed, Dr. Sturchio’s specific
method had not been tested widely and confirmed by other
laboratories. Thus, upon remand in 2015, Pomona moved to
update Dr. Sturchio’s expert report, so his testimony would
reflect the current state of knowledge in the scientific
community in these areas. Pomona’s motion included a sworn
declaration from Dr. Sturchio, in which he described the
developments that had taken place. Dr. Sturchio explained
that “a number of laboratories, other than [his] own, have
continued to engage in perchlorate isotopic analysis,”
resulting in “additional interlaboratory comparisons that fully
verify the methods used and the results obtained in [his]
previous research.” Moreover, by 2015, “the database for
natural perchlorate samples [had] become larger, and
[included] samples from other locations across the US and
around the world.”
Despite these relevant scientific developments, the district
court denied Pomona’s motion to reopen discovery and
update Dr. Sturchio’s expert report, thus limiting his trial
CITY OF POMONA V. SQM NORTH AMERICA 11
testimony to the scientific world as it existed in 2011. The
district court’s three-sentence analysis of the issue provided
two reasons for prohibiting Dr. Sturchio from updating his
report, and thus testifying at trial to the then-current state of
stable isotope research. First, the district court concluded that
allowing Dr. Sturchio to update his report might “create back-
and-forth discovery, which could delay trial.” Second, the
district court determined that the updates to Dr. Sturchio’s
report were not material.
When ruling on a motion to amend a Rule 16 scheduling
order to reopen discovery, we instruct district courts to
consider the following factors:
1) whether trial is imminent, 2) whether the
request is opposed, 3) whether the non-
moving party would be prejudiced, 4) whether
the moving party was diligent in obtaining
discovery within the guidelines established by
the court, 5) the foreseeability of the need for
additional discovery in light of the time
allowed for discovery by the district court,
and 6) the likelihood that the discovery will
lead to relevant evidence.
United States ex rel. Schumer v. Hughes Aircraft Co., 63 F.3d
1512, 1526 (9th Cir. 1995) (citation omitted), vacated on
other grounds, 520 U.S. 939 (1997).
In denying Pomona’s motion, the district court identified
the correct legal standard, which satisfies the first step of our
abuse of discretion test. Hinkson, 585 F.3d at 1261–62. We
hold, however, that the district court applied that legal
standard in an “illogical” manner, thus committing an abuse
12 CITY OF POMONA V. SQM NORTH AMERICA
of discretion. Id. at 1262. As to the first reason the district
court provided, any potential for the updated expert report to
delay trial was of the district court’s own making. Upon
remand, the district court set a June trial date at the initial
status conference, following which Pomona promptly filed its
motion to reopen discovery. By the time the district court
ruled on the motion, roughly two months before trial,
reopening discovery would likely have caused delay. Any
potential delay, however, was brought about by the
combination of an expeditious trial date and the amount of
time Pomona’s motion sat undecided. The problem was not
the result of a lack of diligence by Pomona.
The district court’s second proffered reason for denying
the motion, lack of materiality, was also illogical. SQM has
acknowledged that “Sturchio was Pomona’s key witness, and
much of the case involved his forensic methods.” As such, the
level of support for his conclusions was critical and it was
important that his proffered testimony be accurate and reflect
the current state of knowledge in the scientific community.
The main attack on Dr. Sturchio’s testimony (as it stood in
2011) was that it had not been reproduced by other
laboratories and that his reference database was too small.
The proffered updates to Dr. Sturchio’s report directly
combated those criticisms. Based on Dr. Sturchio’s sworn
declaration (which accompanied Pomona’s motion), and the
fact that the first appeal focused heavily on Dr. Sturchio’s
testimony, the district court should have been on notice that
the updates to Dr. Sturchio’s report were material.
In defense of the district court’s decision, SQM argues
that Pomona was not diligent. Primarily, SQM asserts that
Pomona should have updated Dr. Sturchio’s report, and
should have moved to do so, in May 2014, after we decided
CITY OF POMONA V. SQM NORTH AMERICA 13
Pomona I. Thus, by making its motion in February 2015,
Pomona waited too long. But in May 2014, the appeal was
still alive, a certiorari petition was pending, and the mandate
had not issued. Pomona moved promptly once the case
returned to the district court.
SQM also asserts that Pomona lacked diligence because
it did not provide SQM with Dr. Sturchio’s full updated
expert report until eleven days before trial. This argument is
irrelevant. By that time, the district court had already issued
a firm ruling denying Pomona’s motion to update Dr.
Sturchio’s report. Although the record would have been more
complete had Pomona included the updated report with its
February 2015 motion, Dr. Sturchio’s declaration, attached to
the motion, was sufficient to put the district court and SQM
on notice of what the updated expert report would say.
SQM’s attempt to shift the relevant date to eleven days before
trial, rather than when Pomona filed its motion four months
before trial, has not convinced us.
SQM further argues that the updates Pomona sought to
include in Dr. Sturchio’s expert report were immaterial. In
doing so, SQM asserts, as the district court did, that the
updates were cumulative, did not change Dr. Sturchio’s
conclusions, and merely buttressed his previously-expressed
opinion. We disagree. As expressed above, the parties knew
Dr. Sturchio’s causation analysis would be a key factor at
trial. Thus, the degree of support for his conclusions was
critical and the updates Pomona sought were material.
B.
Having determined that the district court’s exclusion of
Dr. Sturchio’s testimony regarding post-2011 developments
14 CITY OF POMONA V. SQM NORTH AMERICA
was erroneous, we now must resolve whether that error was
prejudicial. “[A] showing of prejudice is required for
reversal.” Ollier v. Sweetwater Union High Sch. Dist.,
768 F.3d 843, 859 (9th Cir. 2014). Here, we hold that the
exclusion of Dr. Sturchio’s testimony regarding post-2011
developments, combined with the erroneous inclusion of Dr.
Laton’s expert testimony (as discussed in Section IV), more
probably than not affected the verdict and was thus
prejudicial.
After presentation of the evidence at trial, but before the
jury had rendered its verdict, the district court described the
trial as “a battle of the experts.” In keeping with this theme,
SQM sought to discredit Dr. Sturchio, who it recognized
“was Pomona’s key witness.” For example, SQM elicited the
following testimony from its geochemical expert, Dr. Ramon
Aravena, regarding Dr. Sturchio’s conclusions:
[T]he two main criticism[s] that I have on Dr.
Sturchio[’s] research. One is that it’s the
failure to reproduce his method and result by
other laboratories. And second is – basically
is the failure to have basically a complete
database for interpretation of the data for the
sources of perchlorate.
* * *
Q: In your prior chart where you had the two
critiques of Dr. Sturchio’s method, the second
one was failure to assemble a complete
isotope database for sources of perchlorate.
Do you have an opinion as to whether Dr.
CITY OF POMONA V. SQM NORTH AMERICA 15
Sturchio’s interpretation of the isotopic data
that he has developed is reasonable?
A: I have an opinion.
Q: What is your opinion, sir?
A: My opinion is that the database is
incomplete.
Furthermore, during its closing argument to the jury, SQM
asserted the following, regarding the scientific support for Dr.
Sturchio’s conclusions:
[Dr. Sturchio] also admitted his is the one and
the only laboratory to do his technique. Now,
I saw a big false sign next to my statement in
my opening statement where I said that he
was the one and only lab. Well, I didn’t make
that up, folks. That comes from Dr. Sturchio.
* * *
Isotope ratios don’t give you a unique
fingerprint. What they give you is a range of
values, and those range of values are not
unique from one place to one place or even
within one place. It is so important to have a
complete comparison database, and that’s
where Sturchio has dragged his feet. He says
there’s only 16 samples from Chile. An area
of the Atacama desert, a vast area, 16 samples
doesn’t even tell us where those samples were
taken from in Chile. And not one independent
16 CITY OF POMONA V. SQM NORTH AMERICA
lab has analyzed the isotopic signature or
composition of those samples. You only have
four samples from all of California.
* * *
Because Pomona is presenting weaker
evidence when they had it in their power to
present stronger evidence, you should
disregard Dr. Sturchio.
These criticisms of Dr. Sturchio were accurate in 2011. By
2015, however, these characterizations of Dr. Sturchio’s
research were false, and counsel making them had to know
they were false, based on the evidence SQM successfully kept
from the jury. By the time of trial, Dr. Sturchio, along with
other scientists, had amassed 50 samples from the Atacama
Desert, 55 samples of naturally occurring perchlorate from
other locations, and 79 samples of synthetic perchlorate. Had
the district court allowed Dr. Sturchio to update his
testimony, Pomona could have easily rebutted much of
SQM’s criticism of his research during trial. Given that Dr.
Sturchio was Pomona’s “key witness,” that his credibility and
the level of support for his conclusions was paramount, and
that SQM attacked directly the level of support as it existed
in 2011, we conclude that the district court’s refusal to allow
Dr. Sturchio to testify to scientific developments occurring
between 2011 and 2015 was prejudicial.
In response, SQM’s main argument is that even if the
district court committed error, any such error was harmless.
Put simply, SQM asserts that even if the jury agreed with Dr.
Sturchio’s conclusions, it could still have reasonably found
that SQM did not cause the perchlorate contamination in
CITY OF POMONA V. SQM NORTH AMERICA 17
Pomona’s water system. The record shows that from 1931 to
1968, SQM imported a substantial portion of the sodium
nitrate brought from Chile to the United States. Other
companies, however, imported Chilean nitrate before 1931.
Accordingly, as Dr. Sturchio conceded that he could not age
date the perchlorate found in Pomona’s wells, the perchlorate,
even if it had come from Chile, could have been imported by
an entity other than SQM. This argument is buttressed, SQM
argues, by the fact that some of the well sites below the
historic orchards in the well capture zone tested non-detect
for perchlorate. Had SQM’s fertilizer (which was originally
used in the orchards) been the cause of contamination, those
sites should have tested positive for perchlorate
contamination.
But the jury did not need to find that all of the perchlorate
found in Pomona’s water system came from SQM. Rather,
the jury instructions asked whether SQM’s importation of
fertilizer was a “substantial factor in causing” the
contamination, which the jury instructions defined as “more
than a remote or trivial factor.” Dr. Sturchio’s ultimate
conclusion was that ninety percent of the perchlorate
contamination found in Pomona’s wells came from the
Atacama Desert in Chile. The record further shows that from
1931 to 1968, SQM imported substantially all of the Chilean
nitrate coming into the United States, and imported especially
large amounts during 1941 and 1942. Taking these facts into
account, along with the erroneous inclusion of Dr. Laton’s
testimony (described below), we conclude that the preclusion
of Dr. Sturchio’s updated report and testimony more probably
than not affected the verdict. Thus, the exclusion of Dr.
Sturchio’s testimony regarding post-2011 scientific
developments was prejudicial.
18 CITY OF POMONA V. SQM NORTH AMERICA
IV.
A.
Next, we turn to the district court’s denial of Pomona’s
motion to exclude the testimony of SQM’s alternative source
expert, Dr. Richard Laton. Dr. Laton opined that the
perchlorate at issue might have flowed from hundreds of
potential alternative sources other than SQM’s fertilizer.
Pomona first moved to exclude Dr. Laton’s testimony under
Daubert before the scheduled 2012 trial. The district court
denied this motion in what was explicitly a “tentative” one-
sentence ruling. On remand, Pomona again challenged Dr.
Laton under Daubert. Pomona argued that Dr. Laton’s
proffered testimony failed to show any scientifically valid
grounds for asserting that any of his alternative sources
contained the specific type of perchlorate actually found in
Pomona’s groundwater. In a one-word ruling on Pomona’s
2015 Daubert motion, the district court stated “DENY.” Dr.
Laton proceeded to testify at the 2015 trial.
The manner in which the district court denied the Daubert
motion as to Dr. Laton constituted an abuse of discretion. In
Estate of Barabin v. AstenJohnson, Inc., 740 F.3d 457 (9th
Cir. 2014) (en banc), we held the district court had abdicated
its gatekeeping authority, in denying a Daubert motion,
because “[a]bsent from the explanation is any indication that
the district court assessed, or made findings regarding, the
scientific validity or methodology of [the expert’s] proposed
testimony. Therefore, the district court failed to assume its
role as gatekeeper with respect to [the expert’s] testimony.”
Id. at 464. Furthermore, in Pyramid Technologies, Inc. v.
Hartford Casualty Insurance Co., 752 F.3d 807 (9th Cir.
2014), we held that a district court abuses its discretion when
CITY OF POMONA V. SQM NORTH AMERICA 19
it fails to provide any “analysis or explanation” for its
decision regarding expert testimony under Daubert. Id. at
814. In Pyramid, the district court abused its discretion by
denying a Daubert motion “[i]n two conclusory sentences and
without analysis or explanation.” Id.So too here. The district court denied Pomona’s Daubert
motion as to Dr. Laton with a one-word “DENY.” Under the
standard we set in Estate of Barabin and Pyramid, the failure
to make any findings regarding the efficacy of Dr. Laton’s
expert opinions constituted an abdication of the district
court’s gatekeeping role, and necessarily an abuse of
discretion.
SQM’s main argument in response is that Pomona waived
its right to appeal the denial of its Daubert motion. Under
Federal Rule of Evidence 103(b), “[o]nce the court rules
definitively on the record—either before or at trial—a party
need not renew an objection or offer of proof to preserve a
claim of error for appeal.” Here, SQM argues that by failing
to appeal the district court’s tentative ruling in 2011, which
denied the Daubert motion as to Dr. Laton, Pomona waived
any right to appeal the district court’s 2015 ruling. We
disagree. The district court’s 2011 ruling was explicitly
tentative, and thus not definitive within the meaning of Rule
103. During the 2011 pretrial conference, in which the district
court made oral rulings, the district court stressed several
times that its rulings were tentative. Furthermore, the minute
order expressing the motion in limine rulings stated the
rulings were all “tentative.” “[I]n order to appeal an issue on
which the district court ruled in limine, a party must first
receive a final ruling on the issue.” Adkins v. Mireles,
526 F.3d 531, 542 (9th Cir. 2008). Thus, Pomona could not
have appealed the original tentative ruling.
20 CITY OF POMONA V. SQM NORTH AMERICA
Next, SQM argues that Pomona waived its right to appeal
because it did not object to Dr. Laton’s testimony at the 2015
trial. Unlike the 2011 ruling, however, the district court’s
2015 “DENY” ruling did not contain the tentative label in the
minute order. Instead, the “tentative” heading on the district
court’s motion in limine rulings was conspicuously omitted.
On the first day of trial, the district court stated as follows
regarding its written rulings on the parties’ motions in limine:
As to motions in limine, I think they’re pretty
clearly stated on my findings that I sent
you. . . . [M]otions in limine almost always
deal with evidentiary issues, evidentiary
issues that come up during the trial. Any
ruling on a motion in limine may or may not
be revisited as the evidence comes in. It may
or may not change, but these are the rulings
until and unless the Court decides that it can
come in. Some evidence may come up that
may make something relevant that the Court
had determined that up until the time that that
comes in is not relevant. So all I’m telling you
is, is that they’re quasi tentative, depending on
how the evidence comes in.
Thus, SQM’s only relevant argument is that the district
court’s statement, that its in limine rulings were “quasi
tentative,” meant that Pomona was required to object to Dr.
Laton’s testimony during trial to preserve its right to appeal,
which Pomona did not do explicitly.
Pretrial motions, such as motions in limine, “are useful
tools to resolve issues which would otherwise clutter up the
trial.” Palmerin v. City of Riverside, 794 F.2d 1409, 1413 (9th
CITY OF POMONA V. SQM NORTH AMERICA 21
Cir. 1986) (internal quotation marks omitted). Furthermore,
“a ruling on a motion in limine is essentially a preliminary
opinion that falls entirely within the discretion of the district
court. The district court may change its ruling at trial because
testimony may bring facts to the district court’s attention that
it did not anticipate at the time of its initial ruling.” United
States v. Bensimon, 172 F.3d 1121, 1127 (9th Cir. 1999)
(emphasis added) (internal citation omitted). “Still, parties
expect a district court to adhere to its earlier ruling if no facts
or circumstances arise to warrant a reversal.” Id. When a
district court makes a pretrial ruling on a motion in limine
that is subject to limitations regarding how the evidence
actually comes in, and if the testimony “stay[s] within [those]
parameters,” then “no additional objection [is] necessary.”
Mukhtar v. Cal. State Univ., Hayward, 299 F.3d 1053, 1063
(9th Cir. 2002), overruled in part on other grounds by Estate
of Barabin, 740 F.3d at 467.
Our reading of the district court’s statement on the first
day of trial, quoted above, is that it was merely reiterating
what we said in Bensimon—that a district court may change
an in limine ruling at trial if facts or circumstances arise to
warrant the change. The district court had denied the Daubert
motion as to Dr. Laton in a written ruling without any
tentative heading. As trial progressed, before Dr. Laton’s
testimony, the district court had denied objections, making
clear that it was “not going to argue with you in front of the
jury” and later, that “we do not argue objections in front of
the jury.” By the time Dr. Laton rose to testify, no facts or
circumstances had arisen that would have warranted reversal
of the district court’s pretrial ruling. In fact, during Dr.
Laton’s testimony, Pomona’s counsel asked if it could briefly
voir dire the witness, which request was quickly denied. By
making this request, Pomona renewed its challenge to Dr.
22 CITY OF POMONA V. SQM NORTH AMERICA
Laton’s testimony concerning alternative sources to
perchlorate, giving the district court another opportunity to
rule on the issue. Additionally, Pomona’s counsel tried to
object to Dr. Laton’s “shotgun” testimony about potential
sources of perchlorate, but the district court overruled him
while he was midsentence.
Thus, we must decide whether Pomona preserved its
objection to Dr. Laton’s testimony. Without doubt, Pomona
could have simplified this issue by restating its Daubert
objection just before Dr. Laton testified, or by raising the
objection during a recess. Nevertheless, given the importance
of expert testimony in this case, the fact that the first appeal
focused on a Daubert issue, and the district court’s focus on
moving the trial along briskly, Pomona’s hesitation to object
once more, and risk further irritating the district court, was
understandable. Accordingly, based on the circumstances
presented here, we hold that Pomona did enough to preserve
its objection.
B.
Having determined that the district court abdicated its
gatekeeping role by failing to make any findings of reliability
as to Dr. Laton, we next must decide whether that error was
prejudicial. “We treat the erroneous admission of expert
testimony the same as all other evidentiary errors, by
subjecting it to harmless error review. We reverse only if the
error affect[ed] a substantial right of the party. In other
words, we require a finding of prejudice.” Estate of Barabin,
740 F.3d at 464 (internal citations and quotation marks
omitted). Furthermore, “[p]rejudice is at its apex when the
district court erroneously admits evidence that is critical to
the proponent’s case.” Id. at 465.
CITY OF POMONA V. SQM NORTH AMERICA 23
Here, there can be no doubt that Dr. Laton’s testimony
was critical to SQM’s case. Dr. Laton essentially testified
about all the ways in which the perchlorate contamination
could have manifested in Pomona’s water system that had
nothing to do with SQM. Dr. Laton’s testimony undercut
directly the testimony of Dr. Sturchio, Pomona’s “key
witness,” as well as Dr. Stephen Wheatcraft, Pomona’s
hydrology expert, who testified about the manner in which
the perchlorate flowed from the orchards into Pomona’s water
system. On direct examination, Dr. Laton testified as follows:
Q: Did you reach an opinion as to whether the
City’s experts, Dr. Sturchio, Dr. Wheatcraft,
conducted a complete environmental
investigation in Pomona?
A: No, they did not.
Q: And what do you base your opinion on?
A: The reports that I reviewed that were
submitted on behalf of the City.
Dr. Laton’s testimony went on with a further attack on Dr.
Sturchio’s and Dr. Wheatcraft’s conclusions.
Dr. Laton’s testimony, and that of Dr. Sturchio and Dr.
Wheatcraft, went to the crux of the case—whether SQM’s
importation of fertilizer was a substantial factor in causing the
perchlorate contamination in Pomona’s water system. Dr.
Laton was a key player in what the district court aptly
described as “a battle of the experts.” Therefore, the
erroneous inclusion of Dr. Laton’s testimony, combined with
24 CITY OF POMONA V. SQM NORTH AMERICA
the erroneous partial exclusion of Dr. Sturchio’s testimony,
was prejudicial.
We do not decide, one way or the other, whether Dr.
Laton’s proffered opinions satisfy the Daubert standard.
Rather, we merely hold that the record lacks “any indication
that the district court assessed, or made findings regarding,
the scientific validity or methodology of [Dr. Laton’s]
proposed testimony.” Estate of Barabin, 740 F.3d at 464.
V.
We are sympathetic with the district court’s desire to keep
this case on a fast track. A civil action may meander through
discovery far too slowly and our system benefits when district
judges keep the wheels of justice turning by employing
effective case management. But there are limits. The record
demonstrates that the science of stable isotope analysis
evolved significantly during this case’s first journey through
the appellate system. By constraining Dr. Sturchio to his 2011
report, the district court abused its discretion. Furthermore,
the district court’s failure to make any findings regarding the
reliability of Dr. Laton’s testimony, despite Pomona’s
Daubert motion, was an abuse of discretion. These errors, in
combination, were prejudicial.
Accordingly, the district court’s judgment is vacated and
this case is remanded for a new trial. On remand, the district
court shall allow Dr. Sturchio to update his expert report and
testify to the state of stable isotope research up to the present.
In addition, the district court shall make findings regarding
the scientific reliability of Dr. Laton’s proposed opinions, and
CITY OF POMONA V. SQM NORTH AMERICA 25
hold a Daubert hearing if the district court determines one is
necessary.
VACATED and REMANDED.