Recent Developments in Environmental Law in Indiana

In this article, we explore recent developments in Indiana law in the use of expert witnesses and consider in particular the use of experts in environmental cases. The article also discusses developments in Indiana law regarding individual liability of corporate officials for environmental liabilities, as well as otherlegal developments.

Skepticism of expert witness testimony has a long history in our nation’s legal system. Nearly 150 years ago, the Supreme Court stated:

Experience has shown that opposite opinions of persons professing to be experts may be obtained to any amount; and it often occurs that not only many days, but even weeks, are consumed in cross-examinations, to test the skill or knowledge of such witnesses and the correctness of their opinions, wasting the time and wearying the patience of both court and jury, and perplexing, instead of elucidating, the questions involved in the issue.

Winans v. N.Y. & Erie R.R. Co., 62 U.S. 88, 101 (1858). Courts have struggled for a long time on how to manage expert testimony at trial, and in perhaps no other legal area do controversies over expert witnesses emerge more forcefully than in environmental law. Virtually all environmental law disputes involve contests between experts on geology, hydrology, contaminant migration modeling, human health and other areas.

This article surveys developments concerning the admissibility of expert witness testimony in Indiana in the wake of the U.S. Supreme Court’s 1993 Daubert v. Merrell Dow decision. The article concludes with a discussion of a recent Indiana Supreme Court decision, Sears Roebuck v. Manuilov, which calls for relaxation in the level of scrutiny of proffered expert witness testimony in Indiana.

Let’s begin with a recap of the decision that ignited a controversy across the United States concerning the admissibility of expert opinion testimony: Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579, 113 S.Ct. 2786 (1993). The case involved the claim that the drug Benedictin caused birth defects. The U.S. Supreme Court, in a decision by Justice Blackmun, rejected the prevailing test under Frye v. United States, 293 F. 1013 (D.C. Cir. 1923) concerning the admissibility of scientific evidence. Under Frye, which concerned the admissibility of polygraph evidence, the judge was to inquire whether proposed expert testimony or the methodology underlying the testimony was "sufficiently established to have gained acceptance in the particular field in which it belongs." 293 F. at 1014. The Frye test in this respect was conservative, designed to help keep "junk science" out of the courtroom. Daubert held that Rule 702 of the Federal Rules of Evidence had superseded the "general acceptance" test and instead required the judge to inquire into whether the proposed expert testimony is scientifically reliable. Thus, Daubert requires an independent judicial examination of reliability. The ruling was intended to eliminate the "battle of the experts" that prevails in a great deal of litigation.

There is no definitive checklist of factors that a judge must assess in determining whether scientific or technical evidence is reliable and therefore admissible, but among factors identified by the Supreme Court and lower federal courts and commentators are the following:

• Has the scientific theory or technique been empirically tested?
• Has the scientific theory or technique been subjected to peer review and publication?
• What is the known or potential error rate?
• What is the expert’s qualifications and stature in the relevant scientific community?
• Can the technique be explained with sufficient clarity and simplicity so that the judge and the jury can understand it?

Daubert thus offers a list of flexible factors to be used as appropriate for various types of expert testimony in determining the reliability of proffered testimony. The "overarching" objective is on "the scientific validity – and thus the evidentiary relevance and reliability – of the principles that underlie a proposed submission. The focus, of course, must be solely on principles and methodology, not on the conclusions they generate." 113 S.Ct. at 2796.

Since the Daubert decision, the U.S. Supreme Court has produced several important follow-up rulings elaborating upon Daubert including:

• General Electric Co. v. Joiner, 522 U.S. 136, 118 S.Ct. 512 (1997): Holds that federal appellate courts are to apply an abuse of discretion standard in reviewing a trial judge’s decision applying Daubert.
• Kumho Tire v. Carmichael, 526 U.S. 137, 119 S.Ct. 1167 (1999): Holds that the basic gatekeeping obligation of Daubert applies to all specialized "expert" testimony, not just scientific testimony. In Kumho, the trial judge had excluded testimony from plaintiff’s liability expert in an automobile tire failure case. The judge had not questioned the expert’s qualifications but did question his conclusions. The 11^th Circuit Court of Appeals reversed, holding that Daubert did not apply to cases other than those involving scientific principles. The Supreme Court reversed and affirmed the trial judge. Federal Rule 702 controls the admissibility of testimony from witnesses with "scientific, technical or other specialized knowledge" and was not confined to science experts. The Supreme Court explained that the essence of the Daubert inquiry 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."
• Weisgram v. Marley, 528 U.S. 440, 120 S.Ct. 1011 (2000): Holds that where a federal appellate court reverses the trial judge’s erroneous admission of expert evidence under Daubert, the appellate court also may mandate entry of judgment in favor of the defendant under F.R.Civ.P. 50. The plaintiff argued that in fairness to a verdict winner who may have relied on erroneously admitted expert witness evidence, the remedy on appeal should be a remand to the trial court rather than a mandated judgment for the defendant. But the Supreme Court stated that "[s]ince Daubert...parties relying on expert evidence have had notice of the exacting standards of reliability such evidence must meet." 120 S.Ct. 1021. The opinion thus leaves little doubt that in the Supreme Court’s view, Daubert operates to further restrict, rather than relax, the scope of admissible expert witness testimony.

Rule 702 of the Indiana Rules of Evidence provides:

(a) If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise.

(b) Expert scientific testimony is admissible only if the court is satisfied that the scientific principles upon which the expert testimony rests are reliable.

Ind. Evidence Rule 703 provides:

The facts or data in the particular case upon which an expert bases an opinion or inference may be those perceived by or made known to the expert at or before the hearing. Experts may testify to opinions based on inadmissible evidence, provided that it is of the type reasonably relied upon by experts in the field.

These provisions read collectively require that expert opinions in Indiana must be:

(1) helpful to the trier of fact,

(2) offered by a witness who is qualified through education, training or experience as an expert,

(3) based upon evidence that experts in the same field would reasonably rely upon, and

(4) in the case of scientific evidence, based upon principles that the court determines are reliable.

The Indiana Supreme Court has held that Daubert and its progeny are helpful but not controlling in applying Ind. Evidence Rule 702. See Steward v. State, 652 N.E.2d 490, 498 (Ind. 1995) (evidence of child sexual abuse syndrome would not be admissible to prove that child abuse had occurred). Rule 702 assigns to the trial court a gatekeeping function of ensuring that an expert’s testimony rests both on a reliable foundation and is relevant to the task at hand. When faced with a proffer of expert scientific testimony, the court must make a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and whether that reasoning or methodology properly can be applied to the facts in issue. Hottinger v. Trugreen Corporation, 665 N.E.2d 593 (Ind. Ct. App. 1996), citing Porter v. Whitehall Laboratories, Inc., 9 F.3d 607, 613 (7^th Cir. 1993). The trial court’s determination regarding the admissibility of expert testimony under Rule 702 is a matter within its broad discretion which will not be disturbed unless the trial court’s application of the Daubert framework is manifestly erroneous. Cook v. State, 734 N.E.2d 563, 570 (Ind. 2000); McGrew v. State, 682 N.E.2d 1289, 1292 (Ind. 1997).

About half the states, including Indiana and Kentucky, have accepted or generally approved of Daubert. The Frye test remains the rule in many states, including Illinois and Michigan. A few states, including Wisconsin and Minnesota, have fashioned their own admissibility tests, which have nothing to do with the reliability of the science underlying the expert’s opinion. For example, in Wisconsin the court determines first whether the evidence at issue is relevant; then the court decides whether the witness qualifies as an expert; and finally the court determines if the evidence will be helpful to the trier of fact. State v. Peters, 534 N.W.2d 867 (Wis. Ct. App. 1995).

Among the states that have approved of Daubert, it is less clear whether the law is evolving into a more exacting or a more relaxed assessment of expert witness testimony. Some courts insist that Daubert is intended to be friendly toward evidence based on novel scientific theories versus Frye’s rigid "general acceptance" test. Other courts (including the U.S. Supreme Court – see, e.g., dictum in Weisgram v. Marley, 528 U.S. 440, 120 S.Ct. 1011 (2000) that Daubert imposes "exacting standards of reliability" on scientific evidence) view Daubert as having significantly raised the evidentiary bar on the admissibility of scientific evidence. The tension between these interpretations of Daubert demonstrate that Daubert is a two-sided coin:

On the one side, it is expansive, rejecting the exclusivity of the "general acceptance" requirement; on the other side, it is restrictive, with a focus on the trial judge’s responsibility as a gatekeeper on reliability. Relevance takes on an added qualitative dimension, one that involves the trial judge deeper into fact finding as to the threshold decision on the admission of evidence. Courts are not just to let the opinion of the credentialed expert into evidence for what it is worth and leave its evaluation to the jury. No longer was exclusion to be limited to the off-the-wall ramblings of itinerant medicine men who earn their living by testifying. Daubert is clearly a further effort, and a deeper one, to curb speculation by imposing legal guideposts in an attempt to require a reasonable quantity of expert opinion under standards used in the expert community. But Daubert was also designed to escape the consensus threshold of Frye and give full range to respectable expert opinion.

Minner v. American Mortgage & Guaranty Company, 2000 Del. Super. LEXIS 99, *30 (2000).

Although Daubert seemed to clear the way for admission of novel scientific testimony, in fact the opposite has occurred, particularly in the lower federal courts. Many judges have used Daubert as a tool for second-guessing the credibility of experts and excluding witnesses whose testimony almost assuredly would have been admissible under Frye. Critics of the Daubert decision point out that Daubert’s "shift in perspective is subtle yet profound": whereas Frye required judges to survey the pertinent field to assess the validity of the proffered scientific evidence, Daubert calls upon judges to assess the merits of the scientific research supporting an expert's opinion. See 1 David L. Faigman, David H. Kaye, Michael J. Saks, & Joseph Sanders, Modern Scientific Evidence: the Law and Science of Expert Testimony, §13-1.5, at 534 (1997). For a particularly scathing critique, see 29 Charles Alan Wright & Victor J. Gold, Federal Practice and Procedure (Supp. 1998):

Additionally, the Daubert opinion offers no convincing rationale for a special test for the admissibility of expert scientific testimony. Many writers have thought that it was enough to abolish Frye and leave the supposed problems of "junk science" to the normal rules of relevance. While the Court's opinion does suggest that the adversary system is better than exclusion as a method of dealing with neo-phrenologists, the opinion also suggests that motions for summary judgment or directed verdicts may be employed by judges who don't trust jurors to treat anticorporate science with the appropriate disdain. Since those remedies are only effective against those who bear the burden of proof, this suggests that the Court supposes that the persons most deserving of special protection from spurious expertise are corporations and other wealthy defendants--the very parties most capable of manufacturing or purchasing questionable scientific opinions.

Finally, the Daubert opinion appears politically naive about the "methods and procedures" of both science and evidentiary admissibility. As to the first, students of science have commented on the fact that peer review and other techniques of scientific validation suffer from a lack of political sophistication. This is a serious flaw in relying on those methods to determine evidentiary admissibility because this politicized science is prevalent in litigation. The Daubert case is itself a good example. Whether or not Benedictin is capable of causing cancer may be a scientific question but it is one of a different order from whether birds are descended from dinosaurs or the Big Bang theory is "true." Broad questions, such as whether AIDS is caused by the HIV virus, are likely to benefit from the scientific "adversary system"; narrower questions, such as the efficacy of the Dalkon shield, are of less general interest and thus escape more rigorous scientific scrutiny.

Similarly, the Daubert opinion seems naive about the politics of procedure. Multi-factored, "flexible" tests of the sort announced in Daubert are more likely to produce arbitrary results than they are to produce nuanced treatment of complex questions of admissibility. All the Court would have had to do to appreciate this was to look at the history of Evidence Rule 403. Similarly, the Court's suggestion that questions of the validity of scientific evidence be handled by motions for summary judgment or directed verdicts may be read as an invitation to kill off disfavored causes of action in comparative secrecy rather than assassinate them by evidentiary rulings in open court.

22 Wright & Miller, §5168.1, at 86-87.

Criticism of Daubert and its progeny goes beyond differences of opinion over sound public policy. In Indiana, our state Bill of Rights guarantees the right of trial by jury (Indiana Constitution, Art. 1, §§19 and 20). In criminal cases the right to have a jury determine the facts is explicitly protected. Judge Riley of the Indiana Court of Appeals alluded to the constitutional aspect of the Daubert case in her dissent in Sears Roebuck and Co. v. Manuilov, 715 N.E.2d 968 (Ind. Ct. App. 1999), in which she stated that the majority’s reliance upon Daubert and Ind. Evidence Rule 702 to order the exclusion of plaintiff’s medical experts in a personal injury case amounted to "rewriting the causation element of tort" and was "troubling in light of our constitutional guarantee of trial by jury." 715 N.E.2d at 993.

Thus, rules of evidence that confer upon the judge and remove from the jury the power to pass upon questions of fact and determine the credibility of witnesses and the weight of conflicting evidence raise serious constitutional concerns. It seems apparent that the framers did not contemplate giving judges the power to determine the reliability and credibility of a qualified expert as a prerequisite to submission of the expert's conclusions to a jury for its determination of the weight to be given to the testimony.

Having said that, it is useful to recall (as pointed out at the beginning of this article) that courts historically have been skeptical of purported expert witnesses. Justice Pettit of the Indiana Supreme Court wrote in 1871: "We are not enamored with expert testimony, however procured or presented." Rush v. Megee, 36 Ind. 69 (1871). Similarly, the Supreme Court of Michigan stated just after the Civil War that expert testimony was not desirable in any case where the jury could get along without it, and expert testimony would only be admitted from necessity or where it would be of some value. People v. Morrigan, 29 Mich. 4 (1874). One commentator condemned expert witnesses on account of bias arising from the fact that experts are paid by advocates – a recurring criticism today:

Perhaps the testimony which least deserves credit with a jury is that of the skilled witness. It is often surprising to see what facility and to what an extent their views can be made to correspond with the wishes or the interests of the parties who call them. They do not, indeed, willfully misrepresent what they think, but their judgment becomes so warped by regarding the subject in one point of view that even when conscientiously disposed, they are incapable of expressing a candid opinion.... They are selected on account of their ability to express a favorable opinion, which, there is great reason to believe, is in many instances the result alone of employment and the bias growing out of it.

Professor Charles F. Himes, in the Journal of the Franklin Institute, Vol. 135, p. 409, as quoted in William L. Foster’s article, "Expert Testimony -- Prevalent Complaints and Proposed Remedies," 11 Harv. L. Rev. 169 (1897). See the excellent survey of the history of judicial treatment of expert witness testimony contained in Judge Quillen’s opinion in Minner v. American Mortgage & Guaranty Company, 2000 Del. Super. LEXIS 99 (April 17, 2000).

One does not have to look far to find recent decisions by the Indiana Court of Appeals rejecting scientific evidence as unreliable under Daubert and Ind. Evidence Rule 702, as the following examples demonstrate:

• Porter v. Whitehall Laboratories, Inc., 791 F.Supp. 1335 (S.D. Ind. 1992), aff’d. 9 F.3d 607 (7^th Cir. 1993): this is actually a pre-Daubert decision that remarkably prophesied the analysis subsequently adopted by the U.S. Supreme Court. Here, Judge Tinder excluded plaintiff’s expert’s testimony that plaintiff’s acute renal failure had been caused by ibuprofen. This decision is must reading because it was so prescient in anticipating U.S. Supreme Court’s treatment of expert witness testimony in Daubert.
• Lytle v. Ford Motor Co., 696 N.E.2d 465 (Ind. Ct. App. 1998), rehearing denied 1998 Ind. App. LEXIS 2395 (Dec. 14, 1998), trans. denied 726 N.E.2d 297 (Ind. 1999): relying on Daubert and Rule 702, the court affirms the exclusion of plaintiff’s seatbelt experts.
• Indiana Michigan Power Company v. Runge, 717 N.E.2d 216 (Ind. Ct. App. 1999): affirms use of Daubert and Rule 702 to exclude plaintiff’s expert on electrical and magnetic fields.
• Wallace v. Meadow Acres Manufactured Housing Inc., 730 N.E.2d 809 (Ind. Ct. App. 2000), trans. denied, (Ind. Feb. 5, 2001): relying on Daubert and Rule 702, court affirms exclusion of plaintiff’s expert regarding the concentration of formaldehyde in the plaintiff’s mobile home.
• Ollis v. Underwood, 751 N.E.2d 825 (Ind. Ct. App. 2001): affirming exclusion of economist’s testimony in wrongful death action on the valuation of the economic loss resulting from decedent’s death.

Collectively, these decisions illustrate a judicial skepticism, if not hostility, toward scientific evidence – even from well-credentialed experts – that has become common in the post-Daubert era. For example, in Wallace v. Meadow Acres, supra, the issue concerned the admissibility of testimony from plaintiff’s expert regarding the likely concentration of formaldehyde that plaintiffs had been exposed to in their new mobile home at the time of purchase some years prior to trial. Plaintiffs’ expert, a Ball State professor who had studied formaldehyde for 20 years, sampled formaldehyde in the air inside the mobile home shortly before trial, then used "the Berge equation" and a special extrapolation method to demonstrate that the formaldehyde concentrations formerly were much higher and that plaintiffs had been exposed to dangerous levels. The trial court allowed the expert to testify only regarding the levels he actually found at the time of his sampling but would not permit him to extrapolate back in time. The trial court found that the special equation was an unreliable method and that the extrapolation method was based on a speculative decay rate not supported by scientific methods. Because the appellants could not show causation without the disallowed testimony, the trial court granted summary judgement to the appellees.

In an even more striking example, see Ramsey v. Consolidated Rail Corporation, 111 F.Supp.2d 1030 (N.D. Ind. 2000), in which plaintiffs alleged that chlorinated hydrocarbon (TCE and carbon tetrachloride) contamination emanating from Conrail’s rail yard in Elkhart had affected their well water and caused liver damage to one of the plaintiffs. The plaintiffs’ home from 1983 to 1998 was in a residential neighborhood located downgradient from Conrail. Groundwater collected from several residential properties in the neighborhood had shown elevated levels of TCE and CCl₄ but tests conducted on two samples collected from the plaintiffs’ property (one in 1988, another in 1993) had not indicated either chemical. Moreover, testing of water collected from wells of the two houses south of the plaintiffs (closer to the contamination plume as understood by EPA) had shown no contamination. The plaintiffs’ causation case rested on the groundwater migration model developed by Dr. Hendrick Haitjema of the Indiana University School of Public and Environmental Affairs in Bloomington. Dr. Haitjema holds a Master’s Degree in civil engineering from the Deft University of Technology in the Netherlands and a Ph.D. in civil engineering from the University of Minnesota. He has taught courses at IU and elsewhere in the fields of geology and civil engineering and groundwater and is widely regarded as among the foremost experts in Indiana on groundwater flow and modeling. Dr. Haitjema testified, based on soil conditions and groundwater levels and velocity and other factors, that a highly variable groundwater contamination plume had extended generally from the Conrail property to the plaintiffs’ well and surrounding neighborhood. He testified that it was very probable that the plaintiffs had been exposed to Conrail’s contamination because (1) their well tapped into groundwater at the same depth as a nearby contaminated well; (2) the highest residential TCE contamination was found just south of plaintiffs’ home (that residence showed high concentrations in the late 1980s, then nondetect in 1992, and again high concentrations in 1994 – this variability in contaminant measurement supported Dr. Haitjema’s opinion that the groundwater plume was highly variable and that evidence of contamination could be missed by groundwater sampling based upon where and when the sampling occurred); (3) the absence of contamination in the water samples from plaintiffs’ property reflected the high degree of variability in the groundwater contamination plume. Dr. Haitjema testified that his groundwater modeling was well accepted in the scientific community and that other groundwater modeling studies (including one done for Conrail) supported his conclusions about general directions of groundwater movement.

Judge Miller held that most of Dr. Haitjema’s methodology satisfied Daubert but that Haitjema had not adequately explained the nondetect measurements of water from the plaintiffs’ well and from wells of two homes to south of plaintiffs’ residence. Judge Miller stated that even if he accepted Dr. Haitjema’s groundwater modeling as an accurate predictor of the general direction of contaminant flow, and even if he accepted his reasoning as to why the nondetect measurements did not prove that Conrail’s contamination had not made it to plaintiffs’ property, there still was no scientifically valid evidence showing the converse – that plaintiffs’ well had been affected by Conrail’s contamination. "That water was tested, as was water from the wells to the south of her well – 12 tests in all, over the course of eight years – and none of those tests detected such substances." Judge Miller stated that "...it seems that reliable methodology would...involve further examination after some number of tests revealed no VOCs," and that there was no basis in the record for discounting the 12 non-detect samples.

Many cases decided under Daubert have excluded opinion testimony from experts who ignored facts or considerations that must be considered under methods based on reliable principles. Dr. Haitjema didn’t ignore the non-detect tests. He explained why those tests didn’t prove that TCE never reached the Ramsey well. But the record contains no explanation as to how any scientific principles support the contrary opinion in the face of eight years of non-detect results in and immediately around the Ramsey well.

Ramsey v. Consolidated Rail Corporation, 111 F.Supp.2d at 1037-38 (citations omitted). After striking Dr. Haitjema’s testimony as scientifically unreliable, Judge Miller granted summary judgment to the defendants on the ground that the only evidence causally linking Conrail to the plaintiff’s injury was the stricken Haitjema testimony.

It is difficult to reconcile Judge Miller’s exclusion of Dr. Haitjema’s groundwater modeling testimony with criminal law cases finding that testimony by experts for the prosecution satisfy Daubert. To illustrate, see United States v. Havvard, 260 F.3d 597 (7^th Cir. 2001), which affirmed the admissibility of the government’s fingerprint comparison expert. In a criminal trial in Indianapolis, defendant argued to Judge Hamilton that the fingerprint analysis relied on by the government for charging defendant with illegal possession of a firearm was unscientific and unreliable and therefore inadmissible. The government’s expert testified that defendant’s fingerprints matched a latent fingerprint found in defendant’s grandmother’s residence. The defendant pointed out that the basic premise in fingerprint analysis – that all fingerprints are unique – remains unproven, and that there are no objective standards for defining how much of a latent print is required to conduct a comparison. Nor are there objective standards for evaluating an individual examiner’s comparison. Judge Hamilton acknowledged that fingerprint analysis as a field lacks unified objective standards for determining when a latent print is sufficient to allow comparison, and he acknowledged that fingerprint analysis has not been the subject of many scholarly peer-reviewed journal articles over the years. However, he observed that peer-reviewed fingerprint comparisons had been used in criminal cases for roughly 100 years, which provided a greater assurance of reliability than could be obtained from the mere publication of an article. Judge Hamilton concluded that fingerprint analysis is sufficiently reliable to satisfy Daubert. The Seventh Circuit affirmed notwithstanding that the National Institute of Justice in March 2000 sought proposals for fingerprint research studies to provide greater scientific foundation for forensic fingerprint identification. The defendant cited this fact as an admission by the government that more research needed to be done in the area of fingerprint analysis. The defendant, however, evidently had not raised the NIJ’s solicitation at the Daubert hearing conducted before Judge Hamilton or otherwise included the document in the record and so the Seventh Circuit refused to consider the NIJ "admission" on appeal.

Moreover, it is difficult to reconcile Daubert, Joiner and Kumho with the Supreme Court's earlier decisions in criminal cases upholding the admissibility of scientific evidence for the prosecution. As a general matter, courts in criminal cases have not subjected expert opinion testimony to a preliminary gatekeeping test of reliability. It is unclear why different rules should apply in civil cases. See, for example, Barefoot v. Estelle, 463 U.S. 880, 103 S.Ct. 3383 (1983), a capital case in which the prosecution presented psychiatric opinion evidence predicting the possibility of the defendant's future dangerousness if not sentenced to death. Rejecting the position of the American Psychiatric Association that psychiatrists "are incompetent to predict [such future behavior] with any acceptable degree of reliability," the Court said:

In the second place, the rules of evidence generally extant at the federal and state levels anticipate that relevant, unprivileged evidence should be admitted and its weight left to the fact finder, who would have the benefit of cross-examination and contrary evidence by the opposing party. Psychiatric testimony predicting dangerousness may be countered not only as erroneous in a particular case but also as generally so unreliable that it should be ignored. If the jury may make up its mind about future dangerousness unaided by psychiatric testimony, jurors should not be barred from hearing the views of the State's psychiatrists along with opposing views of the defendant's doctors.

Id. at 898, 103 S. Ct. at 3397. The Court was confident "that the fact finder and the adversary system" would be "competent to uncover, recognize and take due account of [the] shortcomings" of possibly unreliable expert opinion. Id. at 899, 103 S. Ct. at 3398. This same confidence in the adversary system appears to have dissipated in the modern Supreme Court’s consideration of standards applicable to expert testimony in civil cases.

In a potentially significant ruling this year by Justice Dickson, the Indiana Supreme Court signaled a relaxation in the rigor with which judges in Indiana are expected to apply Rule 702 in assessing the reliability of scientific expert witness opinions. Sears Roebuck and Co. v. Manuilov, 742 N.E.2d 453 (Ind. 2001). The court vacated a lengthy decision by the Court of Appeals that followed closely the Daubert line of appellate decisions and affirmed the trial judge’s decision to admit causation testimony by plaintiff’s treating physicians.

It is too early to tell whether Manuilov shows the approach judges should take only with respect to medical evidence in personal injury cases, or whether it is intended to apply to all kinds of cases. In any event, Manuilov offers helpful insight into Supreme Court’s views on the proper application of Ind. Evidence Rule 702.

The case concerned a high wire circus performer who fell and hit his head while shopping at a Sears store in Richmond. Defendant challenged the admissibility of opinions by plaintiff’s two medical experts that plaintiff had sustained "post-concussion syndrome" that interfered with his ability to resume work as a high wire artist. The trial court admitted the testimony but the Court of Appeals, following classic Daubert analysis, reversed in a 2-1 decision after scrutinizing each physician’s testimony and concluding that there simply was no medical basis (other than a temporal connection, which the court felt was scientifically insufficient) for connecting the plaintiff’s head injury with his complaints of recurring headaches, dizziness and other problems. Quoting Judge Tinder’s opinion in Porter v. Whitehall Laboratories, 791 F.Supp. 1335, 1345 (S.D. Ind. 1992), the Court of Appeals expressed deep suspicion that a jury could find the truth in such a technical case and that there was risk that the jury "would make an irrational finding of causation based upon the siren-like allure of opinions stated by highly qualified experts." 715 N.E.2d at 989. The Court of Appeals criticized the trial judge for permitting the doctors to testify about plaintiff’s "post-concussion syndrome" because medical science was unable to explain how plaintiff’s slip and fall was causally connected to the plaintiff’s medical problems:

Although a medical opinion that a patient suffers from the syndrome may provide a valid explanation of her symptoms for purposes of medical treatment, it does nothing to prove the cause-in-fact of a plaintiff’s legal injuries. Consequently, an otherwise qualified medical expert who is allowed to offer her opinion that a plaintiff suffers from post-concussion syndrome would be doing nothing more than providing the jury with clinically sound but legally speculative and potentially misleading testimony as to the cause-in-fact of the plaintiff’s injuries. Manuilov’s argument that cross-examination, presentation of contrary evidence, and proper jury instructions would somehow assist a jury in weighing the validity of post-concussion syndrome evidence fails to consider the "gatekeeping" purpose of Evid. R. 702 with respect to ensuring the reliability of the scientific principles that support a witness’s opinion and the legal axiom that evidence of causation may not consist solely of speculation or conjecture.

715 N.E.2d at 989.

The Supreme Court reversed in a 3-2 decision. The court stated that in adopting Rule 702, it had not intended to impose an unnecessarily burdensome procedure upon trial courts but simply wanted trial courts to satisfy themselves that expert opinions will assist the fact-finder and that the underlying scientific principles were reliable:

Although [Rule 702] authorizes the exclusion of purported scientific evidence when the trial court finds that it is based on unreliable principles, the adoption of Rule 702 reflected an intent to liberalize, rather than to constrict, the admission of reliable scientific evidence. Before Rule 702(b), Indiana courts applied the Frye test which determined the admissibility of novel scientific evidence based upon its general acceptance in the scientific community. Rule 702(b) is broader than the Frye test in that it permits trial courts to consider factors other than general acceptance and thus may permit expert testimony in new, innovative areas even though general acceptance may not yet have been achieved but which are otherwise found to be based on reliable scientific principles.

742 N.E.2d at 460 (citations and footnotes omitted). The Court did not rely on Daubert as the Court of Appeals had but stated that its approach to Ind. Evidence Rule 702 was "analogous to the liberalizing of the Frye rule achieved by the United States Supreme Court" in Daubert. The Court added:

Given that the thrust of our Rule 702(b) was to liberalize admissibility of reliable scientific evidence, "it is most improbable that a generally accepted scientific principle would be too unreliable to be admitted into evidence....

If applied to separately evaluate every subsidiary point made during the testimony of a qualified expert regarding matters based on reliable science, Rule 702(b) can become excessively burdensome to the fair and efficient administration of justice. It directs the trial court to consider the underlying reliability of the general principles involved in the subject matter of the testimony, but it does not require the trial court to re-evaluate and micromanage each subsidiary element of an expert’s testimony within the subject. Once the trial court is satisfied that the expert’s testimony will assist the trier of fact and that the expert’s general methodology is based on reliable scientific principles, presentation of contrary evidence, argument of counsel, and resolution by the trier of fact.

742 N.E.2d at 461.

The Indiana Supreme Court’s analysis is a dramatic departure from the approach taken in many recent decisions by the Court of Appeals in evaluating scientific evidence. Manuilov may prove to be confined to the admissibility of medical evidence, especially evidence from the plaintiff’s own treating physicians -- or it may signal a broader departure from the rigorous inspection and second-guessing of expert opinion testimony that has developed in the post-Daubert era.

Although certain Indiana courts have recommended convening pre-trial hearings to evaluate challenges to expert evidence, a recent federal court decision suggests that such hearings may not be absolutely necessary.

In Eve v. Sandoz Pharmaceuticals Corp., (S.D. Ind. 2001), Judge Young upheld the admissibility of disputed medical evidence for the plaintiff notwithstanding the absence of any human epidemiological evidence connecting the drug Parlodel to vasoconstriction resulting in stroke. The plaintiff’s two experts were medical doctors who had relied on a combination of animal studies, published reports, inferences based on other drugs in the same class as Parlodel, FDA findings about the drug’s safety, and internal documents from the defendant to support their conclusion that the plaintiff’s stroke had been caused by taking Parlodel. Judge Young acknowledged that human epidemiological evidence is the best way of linking up drug exposure to a particular disease or condition – but science is able to draw conclusions from other kinds of evidence when epidemiological studies are not available. Moreover, the plaintiff cannot be expected to conduct her own epidemiological study of the association between Parlodel and postpartum stroke in human beings, nor would it be ethical to insist on experimentation on human beings just to satisfy an evidentiary standard.

An important aspect of Judge Young’s decision concerns the requirement of a formal "Daubert hearing." Although it is now common practice for courts to convene pretrial evidentiary hearings to resolve Daubert challenges, Judge Young said no such hearing was required in the case of certain of plaintiff’s experts based on the fact that they already had given prior testimony in other Palodrel cases and had been subjected to cross-examination by other defense attorneys.

The Indiana Supreme Court ruled this past September that the "responsible corporate officer" doctrine permitted imposing environmental liability on an individual corporate official even though there was no basis for piercing the corporate veil. In Commissioner, Indiana Department of Environmental Management v. RLG, Inc., 755 N.E.2d 556 (Ind. 2001), the Court approved the following formula for determining when an individual may not avoid liability by hiding behind the shield of corporate separateness in environmental cases:

(1) the individual must be in a position of responsibility which allows the person to influence corporate policies or activities; (2) there must be a nexus between the individual’s position and the violation in question such that the individual could have influenced the corporate actions which constituted the violation; and (3) the individual’s actions or inactions facilitated the violations.

IDEM v. RLG, 755 N.E.2d at 561, quoting Matter of Dougherty, 482 N.W.2d 485, 490 (Minn. Ct. App. 1992). The Supreme Court sketched the origins of the "responsible corporate officer" doctrine in criminal law cases and noted that the doctrine also had been applied in federal and state civil cases under CERCLA, RCRA and state environmental statutes. 755 N.E.2d at 560. In this case, the defendant, Lawrence Roseman, was the sole officer, director and shareholder of the corporate owner of the Spring Valley Landfill in Wabash. When the company became insolvent and thereby unable to respond to IDEM’s demand for $3.175 million in civil penalties, IDEM sought payment from Roseman. The trial court ruled for Roseman, finding that there was "no evidence" he ever acted "in an individual capacity personally with respect to the activities which surrounded the management and operation of RLG, Inc," or "in activities surrounding the environmental regulations." The Court of Appeals affirmed, holding that the importance of the corporate structure and a lack of evidence of Roseman’s individual involvement in the environmental violations precluded personal liability for RLG’s acts.

The Supreme Court agreed that Roseman’s role as sole shareholder, officer and director by themselves did not trigger the responsible corporate officer doctrine. Rather, the Supreme Court found, contrary to the trial judge’s findings, that the evidence showed (following the factors itemized above) that (1) Roseman influenced – in fact, "dominated" – the company; (2) his position put him in direct charge of compliance with IDEM’s solid waste rules; and (3) he facilitated landfill violations by, among other things, personally ordering the placement of garbage outside the landfill’s permitted boundaries and by taking no action to correct violations once they were brought to his attention. The Supreme Court stated that it was adhering to what seemed like a highly deferential standard of review ("This Court considers the evidence in the light most favorable to the appellee and will reverse the judgment only if the evidence leads to but one conclusion and the trial court reached an opposite conclusion") yet found that the trial judge and Court of Appeals essentially had ignored important evidence on Roseman’s function in the corporation. The Supreme Court did not remand to the trial judge for further fact-finding but ordered the entry of judgment against Roseman for $3.175 million.

In an important decision last year, the United States Supreme Court cut back the jurisdiction of the EPA and the Army Corps of Engineers to regulate development activities in isolated wetland areas under the Clean Water Act, 33 U.S.C. §1251 et seq. In a 5-4 ruling, the Court held in Solid Waste Agencies of Northern Cook County v. United States Army Corps of Engineers, 531 U.S. 159, 121 S.Ct. 675 (2001) that EPA’s and the Army Corps’ jurisdiction does not extend to nonnavigable waters and adjacent wetland areas, which constituted the bulk of wetland areas previously considered to be subject to Clean Water Act permitting. What regulations would apply to development in these areas? An open question after SWANCC was whether state governments would assert authority to regulate development in intrastate wetland areas. In a recent decision by a trial judge in Indianapolis, however, IDEM was blocked from asserting jurisdiction over construction activities in wetlands that are beyond federal jurisdiction. The effect of SWANCC and the follow-up ruling in Indianapolis is to allow construction activities in isolated wetlands and intrastate private ponds to proceed without any regulation whatsoever.

Here is some background:

Twin Eagle LLC, an Allen County residential subdivision developer, sought to alter about 20 acres of private ponds and wetlands that were unconnected to any water other than the ponds. Until the SWANCC ruling, a developer of isolated, wholly wetlands would have been expected to seek prior approval from the Army Corps of Engineers under the Corps’ authority under Section 404 of the Clean Water Act. SWANCC eliminated the need to seek such a permit, and Twin Eagle confirmed with the Army Corps that the 20-acre parcel was not subject to any federal Clean Water Act regulation. IDEM argued that notwithstanding the SWANCC decision, Indiana retained jurisdiction over private ponds and isolated wetlands under an "interim regulatory process" announced last year, which required developers to apply for and obtain a permit for construction activities under Indiana’s National Pollutant Discharge Elimination System program.

Twin Eagle filed suit to challenge IDEM’s "interim regulatory process," contending that the only lawful way for IDEM to extend its regulatory authority was not through unilateral issuance of memoranda or announcements in the Indiana Register but through duly promulgated rules, following all the public notice and comment procedures spelled out by statute. On February 11, 2002, Judge Michael Keele ruled that IDEM’s "interim regulatory process" was illegal and void because it was not promulgated as a rule required by Indiana statutes. Judge Keele also ruled that even if IDEM had followed proper procedures, it still could not regulate areas that are not "waters of the United States" under IDEM’s existing NPDES program, which typically regulates discharges of pollutants into lakes and streams. Judge Keele also held that IDEM lacked authority to regulate private ponds or isolated wetlands under any of its other regulatory programs.

The Twin Eagle decision is being appealed by IDEM and Judge Keele has stayed his decision pending the appeal. If affirmed, the Twin Eagle decision would mean that Indiana does not currently have any statutory authority, federal or state, over wetlands or other areas that are not already subject to federal jurisdiction under the Clean Water Act.

On December 20, 2001, Congress passed the Small Business Liability Relief and Brownfields Act, which President Bush signed into law on January 11, 2002. The Brownfields portion of the legislation protects from liability innocent parties such as adjacent property owners, prospective site purchasers, and landowners who did not contribute to the contamination of their property. The small business liability relief portion of the legislation provides a small business liability exemption to CERCLA.

Brownfields funding: This portion of the new law establishes grants for local governments and states to make loans to developers or nonprofit organizations for assessing or cleaning up sites. Money can also be used to conduct medical monitoring around contaminated sites or to monitor institutional controls at sites. The legislation increases funding for the EPA’s Brownfields program from $92 million to $250 million annually, thus facilitating cleanups by either the state or federal government in those situations where a responsible party cannot be found.

Liability exemption: Under this portion, small businesses (under 100 employees) would be shielded from the cost of cleanup if they did not contribute a significant amount of non-hazardous wastes to the site and did not add any hazardous wastes. If a PRP disposed of fewer than 110 gallons of liquids or 200 pounds of solids, and if all disposal occurred before April 2001, then the PRP would no longer be liable under CERCLA. Liability is also removed for disposal of municipal solid waste if that waste came from residences, small businesses or tax exempt organizations. The liability exemptions do not apply to existing settlements.

At its mid-year meeting February 5, 2002 in Philadelphia, the ABA House of Delegates adopted several changes to the Model Rules of Professional Conduct, at least one of which could significantly affect environmental attorneys. The change to Rule 1.6(b) would authorize permissive disclosure of confidential client information to prevent reasonably certain death or substantial bodily harm even if the client would not be committing a crime and even if the harm would not be imminent but only reasonably certain, including after a period of latency. Here is the redlined text of new Rule 1.6(b):

A lawyer may reveal such information relating to the representation of a client to the extent the lawyer reasonably believes necessary:

New Comment 6 to Rule 1.6 provides as follows:

Although the public interest is usually best served by a strict rule requiring lawyers to preserve the confidentiality of information relating to the representation of their clients, the confidentiality rule is subject to limited exceptions. Paragraph (b)(1) recognizes the overriding value of life and physical integrity and permits disclosure reasonably necessary to prevent reasonably certain death or substantial bodily harm. Such harm is reasonably certain to occur if it will be suffered imminently or if there is a present and substantial threat that a person will suffer such harm at a later date if the lawyer fails to take action necessary to eliminate the threat. Thus, a lawyer who knows that a client has accidentally discharged toxic waste into a town's water supply may reveal this information to the authorities if there is a present and substantial risk that a person who drinks the water will contract a life-threatening or debilitating disease and the lawyer's disclosure is necessary to eliminate the threat or reduce the number of victims.

(Emphasis added.) Many environmental attorneys have adopted positions in litigation that there the only safe concentration of certain chemicals is zero. Even lawful discharges may present a risk. Under Comment 6, disclosure of the release of a dangerous substance would not constitute a violation of an attorney’s core obligation to protect client secrets and confidences.

The House of Delegates approved the change to Rule 1.6(b) at its February meeting over objections that the relaxation of an attorney’s confidentiality obligations would impair the attorney-client relationship. The Indiana Rules of Professional Conduct, which are patterned after the ABA model rules, do not contain the most recent changes adopted by the ABA House of Delegates. The model rules are persuasive, however. Many states may consider revisions to bring their codes into line with the new model rules.