CPA ExpertUnited States Bankruptcy Judge Sarah A. Hall of the Western District of Oklahoma recently ruled on a Bankruptcy Trustee’s Motion to Strike the affidavit of a company’s CPA expert.

The Scheduling Order timeline included a deadline to complete all disclosures required by Local Rule 7016-1(B) (requiring exchange of all known exhibits and all then known witnesses, with additional exhibits and witnesses to be “exchanged promptly once they become known”) and Federal Rule of Bankruptcy Procedure 7026 (requiring disclosure of the identity of any witnesses that may be used at trial to present expert evidence); and a deadline to file final witness and exhibit lists.

Both the Trustee and Defendant filed motions for summary judgment. Attached to Defendant’s motion was disclosure that it had engaged a CPA expert, as well as a certified fraud examiner and certified forensic accountant. The Trustee sought to strike the CPA Declaration, and Defendant objected.

Judge Hall wrote in her decision that at the summary judgment stage, the parties need not submit evidence in a form admissible at trial, but the content or the substance of the evidence must be admissible. When a movant utilizes an affidavit in support of summary judgment, such affidavit “must be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant or declarant is competent to testify on the matters stated.” Fed. R. Civ. P. 56(c)(4).

A movant may only offer an expert’s testimony via affidavit in support of summary judgment if the affiant previously has been designated an expert witness under Fed. R. Civ. P. 26(a)(2). “Otherwise, any non-expert testimony in the form of opinions or inferences must be ‘(a) rationally based on the perception of the witness, (b) helpful to a clear understanding of the witness’s testimony or the determination of the fact in issue, and (c) not based on scientific, technical, or other specialized knowledge.'”

Judge Hall plainly found that the CPA Declaration was the declaration of an expert witness. She noted that in similar circumstances, the Tenth Circuit has held that, in order to offer an expert’s testimony into evidence in support of summary judgment, such expert must have been previously designated as an expert witness under Rule 26(a)(2). As a result, the CPA Declaration must be excluded, the judge held, because Defendant didn’t disclose the inclusion of a CPA expert and comply with Rule 26(a)(2) prior to offering the Declaration in support of summary judgment. Defendant argued that the court should allow the CPA’s declaration because the expert disclosure deadline had yet to elapse. However, Judge Hall rejected this argument because she was unwilling to establish a rule where parties may” ambush their opponents with previously-undisclosed expert testimony so long as they file the summary judgment motion prior to the expert and/or final witness disclosure deadline(s).” Such a rule, Hall noted, would be unfair and illogical. Further, she reasoned that once parties adjusted to such a rule, “it would be the catalyst for the development of an unnecessarily extended summary judgment process in which, upon being ambushed with expert testimony by the movants, non-movants would seek delayed adjudication and time for discovery under Fed. R. Civ. P. 56(d),” and the court “would be obliged to assent.”

While Defendant was clear about when the expert CPA expert was hired—just a few weeks before it filed its motion for summary judgment and when the CPA created his Declaration—Defendant was silent as to when it determined that it should hire an expert to support its motion for summary judgment…or more broadly, when it determined that an expert might aid any of its efforts to obtain summary judgment.

It didn’t appear from the record that Defendant delayed retention of an expert in order to ambush the Trustee on summary judgment. However, Judge Hall said they did show how easily it could be done.

As a result, Judge Hall found that, irrespective of the non-expiration of the expert disclosure deadline, Defendant was precluded from offering expert testimony in the CPA Declaration on summary judgment because it did not previously disclose the inclusion of a CPA expert to the Trustee per Rule 26(a)(2) prior to filing its motion for summary judgment.

Accordingly, Judge Hall granted the motion to strike the CPA’s declaration.


In re Tomahawk Oil and Gas Marketing, No. 14-15055-SAH, 2016 Bankr. LEXIS 3071 (Bkr. W.D. Okla. August 19, 2016).