United States District Court, S.D. New York
January 5, 2004.
WANTANABE REALTY CORP., et al., Plaintiffs, -against- THE CITY OF NEW YORK, et al., Defendants
The opinion of the court was delivered by: LEWIS KAPLAN, District Judge
In anticipation of the commencement of the damages portion of the
trial, defendants have challenged the admissibility of the proposed
testimony of five of plaintiff's proposed expert witnesses and plaintiff
has reciprocated by challenging that of one of defendants'. The Court
conducted a three day in limine hearing on December 15-17, 2003.
Having considered the evidence, the Court rules as follows:*fn1
Plaintiff proposes to offer opinions of George Laibe as to the costs of
rebuilding the Thunderbolt and repairing it on November 16, 2000 to
operating condition. Defendants challenge Mr. Laibe's expertise as well
as the relevancy of both of these opinions.
In order to evaluate Mr. Laibe's expertise, it is necessary first to
understand what he did. He and others obtained the original drawings of
the roller coaster, entered the information into
an AutoCAD program,*fn2 did a quantities take-off from the program,
reviewed photographs, and developed a list of the materials required to
replicate the roller coaster. On the basis of his prior experience, he
then estimated the number and cost of man hours necessary to construct a
new roller coaster and other costs. Hearing Tr. ("HT") 34-40, 90. He did
much the same thing in estimating the repair cost, but here he was
severely limited because the roller coaster had been destroyed before he
was engaged and he therefore had only a number of photographs, showing
only limited portions of the roller coaster, from which to work. Id.
Rule 702 permits testimony by a person "qualified as an expert by
knowledge, skill, experience, training, or education . . ." Mr. Laibe has
had no education or formal training in engineering, construction, or cost
estimating. He began as a construction laborer and has spent some years
working in the amusement industry, broadly defined. He later was employed
for approximately one and one-half to two years as vice president of
marketing and sales for Roller Coaster Corporation of America in which
capacity he had some involvement in developing budgets for construction
of wooden roller coasters.*fn3 Subsequently, he was involved in a firm
called The Coaster Works, which built two wooden roller coasters. He
prepared budgets and pricing for both based on "the quantities that were
given to [him] from the plan and profile by the design engineers." HT
The Court has no doubt that Mr. Laibe is qualified to take a bill of
materials generated by design engineers for a roller coaster construction
project and, using that starting point, to develop a cost estimate for the
materials needed for the construction as well, perhaps, as other costs.
It is not so clear that he is qualified to generate a bill of materials
from original construction drawings, with or without an Auto CAD
program. It is still less clear that he is qualified to give, from
fragmentary photographs, a helpful opinion as to the extent of the
repairs that were necessary to render the roller coaster operational.
Compare Thorp v. American Aviation and General Insurance Co., 212 F.2d 821,
826 (3d Cir. 1954) (building contractor familiar with destroyed structure
prior to its destruction who inspected and measured remains after fire
qualified to give opinion as to replacement cost). But defendants did not
fully develop these points during the hearing. Nevertheless, the Court is
not prepared at this juncture to exclude his testimony on this ground for
two reasons. First, "[t]he standard for qualifying expert witnesses is
liberal." 4 Weinstein's Federal Evidence § 702.04 [a], at 702-42
(2003). Second, in view of the fact that the cost of repairs must be
estimated from photographs in consequence of the City's tortious action,
some liberality in the proof of the amount of damages is warranted. See,
e.g., Cullen v. Nassau County Civil Service Comm., 52 N.Y.2d 492, 497,
442 N.Y.S.2d 470, 473 (1981). In consequence, the better course of action
is to decline in advance of the damages trial to exclude Mr. Laibe's
testimony on this ground but to deal with any issues at trial or,
perhaps, after verdict.
Defendants posit that the proper measure of damages is the lesser of
the cost of restoring the property to its former condition and the
diminution, if any, in the market value of the property by reason of the
trespass. Def. Mem. 1. As Mr. Laibe does not propose to testify directly
to either point, they argue, his testimony is irrelevant.
Assuming arguendo that the defendants are correct on the measure of
damages, they nevertheless overlook the significance of the proposed
testimony. It at least is arguable that the cost of restoring the roller
coaster to its former condition the dilapidated and inoperable
condition in which it stood immediately prior to demolition is
approximately equal to the difference between the cost of rebuilding it
from scratch and the cost of bringing the roller coaster, in its former
condition, up to operable condition.
Ms. Silber is a licensed real estate appraiser whom plaintiff offers to
give her opinions as to the value of the land on which the roller coaster
was situated and as to the appropriate method for valuing the roller
coaster. Defendants challenge her testimony on the ground that her
opinions are unreliable in that they are based upon incorrect legal and
factual assumptions, viz. that the roller coaster had been declared a
landmark and that it was "specialty property" as a matter of law.
As Ms. Silber admitted at the hearing, the roller coaster never was
"landmarked" and her report, to that extent, simply was wrong. HT 270.
She contended, however, that this error did not affect her opinion
because she appraised the land as if it were vacant. Id. 275. This then
is an issue going to the weight rather than the admissibility of her
As for the defendants' other argument, it is reasonably clear that Ms.
Silber has used language loosely in referring to special purpose property
(a real estate appraisal term) and specialty property (a legal term of
art). She will not be permitted to testify to legal conclusions or offer
opinions on the law. There is no reason, however, why she should not be
able to give her opinion that the roller coaster was special purpose
property to the extent, if any, that this is relevant to her opinion as
to the appropriate method for valuing that structure.
Tony M. Small
Plaintiff proposes to call Mr. Small, a mechanical engineer, to testify
that, in his opinion, it would be acceptable for one rebuilding the
roller coaster to have experienced steel workers inspect the existing
steel for corrosion and to replace any member that appeared questionable.
See HT 110, 114-19, 122. Defendants object on the ground that he
was identified too late and that they never had an opportunity to take
his deposition. Implicit in this is the failure of
plaintiff to serve an expert report with respect to this witness under
At this point, defendants have had the benefit of Mr. Small's testimony
at the in limine hearing. While this is not the equivalent of a
deposition, particularly in the absence of a Rule 26 report, it is better
than nothing. In all the circumstances, the Court will not exclude Mr.
Small's testimony as to his opinion, as a mechanical engineer, that it
would be appropriate for one rebuilding the roller coaster to have
experienced steel workers inspect the existing steel for corrosion and to
replace any member that appeared questionable as distinguished from using
an engineer or other methods to determine the reusability of existing
steel. His testimony, however, will be limited to that precise point and
will not be allowed to wander, as it did at the hearing, into his
opinions concerning such matters as the proportion of the steel in the
roller coaster that would have proved reusable had this method been
employed or as to how he would have done the job.
Plaintiff proposes to call Bruce Davidson to give his opinions
concerning (a) the cost to bring the Thunderbolt, as it existed prior to
the demolition, to working order (i.e., repair cost), (b) the cost of
rebuilding the Thunderbolt, (c) the value of the Thunderbolt as it stood
immediately prior to the demolition, (d) the "historic value" of the
Thunderbolt, (e) the value of the so-called Kensington Hotel, a derelict
wood structure with unrepaired fire damage, prior to its demolition, (f)
the cost to repair the Kensington Hotel, as it existed prior to the
demolition, to operable condition, (g) the cost of rebuilding the
Kensington Hotel, and (h) the "historic value" of the Kensington Hotel.
Defendants challenge Mr. Davidson as unqualified. They contend that his
prefferred testimony is neither reliable nor based on appropriate
Mr. Davidson holds an associate degree in business from the University
of Texas at Arlington and has worked in the amusement industry for
years, starting as a 16-year old ride operator. HT 131-32. He has no
training as a financial analyst. Id. 201. He has had significant
experience in the theme park business, especially as a safety
administrator and a supervisor of park rides, and has had a certain
amount of budgeting experience. He also has been involved in selling and
installing amusement park rides, including roller coasters, and has had
some experience with repair of rides. He worked with George Laibe in
assessing the extent to which materials in the Thunderbolt, as it stood
prior to demolition, could be used in the course of repairing it to
operating condition. Id. 158-59. The Court deals with the elements of the
proposed testimony seriatim.
1. As nearly as can be understood, Mr. Davidson claims that he
generated a "historic value" for the Thunderbolt of $1.5 million by
assuming that the roller coaster had been repaired, estimating the
ridership and operating performance of a "generic" roller coaster on the
site, adding to it the incremental ridership that would have been
generated by the fact that the ride was the "original" Thunderbolt,
assuming that additional revenue producing operations such as food
service would be built on the site, and constructing a business model
that projected seasonal earning of $3.4 million. HT 160-87; DX W; DX W-1.
This testimony is patently inadmissible. To begin with, the Court is
not satisfied that Mr. Davidson is qualified to offer opinions as to the
historical value of anything or to project the operating results of a
hypothetical business such as this, let alone the incremental ridership
that would have been generated by an "historic" as opposed to a "generic"
new roller coaster. While he had some experience running rides in
established theme parks, there is a considerable difference between
budgeting for such operations and forecasting the operations of an
amusement ride that has been out of business since 1982 or 1983, not to
mention the operations of ancillary businesses that never have operated.
In view of his lack of education in this area and the lack of reliance on
any data customarily relied upon by experts in such a field, there is no
basis for putting this sort of testimony in front of a jury. But there
are still more flaws. Mr. Davidson offered no connection between his
"historic value" of $1.5 million and the projected business model with
its supposed earnings of $3.4 million. Nor did he separate out what part
of the $3.4 million figure, whatever its merits, would have been realized
irrespective of whether there were a new roller coaster on the site or a
repaired Thunderbolt. Much more could be said, but no useful purpose
would be served by prolonging this order. Mr. Davidson will not be
permitted to testify to any "historic value" of the Thunderbolt. As far
as the Court can see, the "historic value" is a figure plucked from the
2. Mr. Davidson assisted Mr. Laibe in preparing the repair cost
estimate. The starting point was Mr. Laibe's "new coaster budget." HT
158. They evaluated the photographs and assigned percentages of what they
believed could be reused. Id. 159, 165-66, 188-89. Mr. Davidson testified
that in his opinion, it would have cost $5.1 million to repair the
Thunderbolt to operable condition in November 2000. Id. 166. What remains
unclear, notwithstanding the hearing, is whether Mr. Davidson
independently generated that estimate and, if so, by what means, as
opposed to taking Mr. Laibe's estimate of the cost of building a new
roller coaster to the Thunderbolt design, estimating the extent to which
components of the Thunderbolt could have been used, reducing the cost of
a new roller coaster by the cost of replacing the reusable components,
and then characterizing the difference between the cost of new
construction and the cost as new of the salvageable components as a
If Mr. Davidson independently generated the repair cost estimate, the
means by which he did and his qualifications for doing so remain obscure
and will have to be addressed at trial. If he is to be called simply to
say that he agrees with the salvageability estimates employed by Mr.
Laibe, with Mr. Laibe's methodology, and with his result, the Court sees
no present basis for excluding the testimony as to the repair cost
3. It is unclear from the hearing testimony whether Mr. Davidson had
any material role in generating the $8.4 million cost for rebuilding the
Thunderbolt that appears in DX W, although it appears that he probably
relied on Mr. Laibe for that figure. The Court therefore lacks a
sufficient basis for ruling now on the admissibility of any opinion by
Mr. Davidson on that point.
4. Mr. Davidson opined that the value of the Thunderbolt, as it stood
immediately prior to the demolition (a figure referred to in DW W as the
"appraised value"), was approximately $2.1 million (disregarding the
"historic value" figure discussed previously). E.g., HT
185. He derived this figure by subtracting from the cost of building a
new roller coaster to the Thunderbolt design (see ¶ 3) the cost to
repair it (see ¶ 2). See HT 192. The admissibility of this testimony
depends upon the extent to which Mr. Davidson's testimony concerning the
cost of building a new roller coaster and the repair cost is admissible.
For reasons discussed in paragraphs 2 and 3, that cannot now be
5. The Court ruled during the hearing that Mr. Davidson's proposed
testimony regarding the so-called Kensington Hotel is inadmissible,
essentially on the ground that the opinions expressed in his report are
not his, but those of a Mr. Procter, an independent consultant whom he
engaged to prepare these estimates. HT 213-14, 222-23, 230-31. While an
expert often may rely upon the expert opinion of another in formulating
his own opinion, the hearing made clear that Mr. Davidson has no
expertise in this area, little information upon which to base any
opinion, and no real understanding of the nature of the structure at
issue. Id. 212-23. The estimates in the report included, for example, the
cost of an HVAC system despite the fact that Mr. Davidson did not know
whether the demolished structure was so equipped, Id. 220, the cost of an
electrical system although he did not know if the building had been
electrified, Id., the cost of dry wall although he never had seen any
photographs of the interior, Id. 221, the cost of cabinets although he did
not know if there had been any cabinets in the building, Id., and so on.
Compare Thorp, 212 F.2d at 826 (upholding receipt in evidence of opinions
as to value of personal property destroyed in fire predicated on detailed
description of the destroyed property by one fully familiar therewith).
The Court adheres to its ruling at the close of the hearing with
respect to plaintiff's application to preclude the testimony of Mr.
Rosin. HT 403-04.