United States District Court, S.D. Mississippi, Southern Division
MEMORANDUM OPINION AND ORDER GRANTING IN PART AND DENYING IN PART SAXON MORTGAGE SERVICES, INC.'S MOTION TO STRIKE EXPERT WITNESS REPORT AND EXCLUDE OPINION TESTIMONY OF BERNARD JAY PATTERSON, AND EXCLUDING OPINION THAT SAXON VIOLATED THE DEED OF TRUST
HALIL SULEYMAN OZERDEN, District Judge.
BEFORE THE COURT is Defendant Saxon Mortgage Services, Inc.'s ("Saxon") Motion to Strike Expert Witness Report and Exclude Opinion Testimony of Bernard Jay Patterson . Plaintiffs Charles and Bonnie Neel have filed a Response in Opposition   and Saxon a Rebuttal . After considering the pleadings on file, the record, and relevant legal authority, the Court finds that Saxon's Motion should be granted in part and denied in part. Mr. Patterson will be permitted to testify at trial, but his Conclusion 10 [149-2] opining that Saxon's alleged misapplication of payments violated the Deed of Trust is inadmissible and will be excluded from evidence at trial.
This civil action arises from Plaintiffs' execution of a note secured by a Deed of Trust [149-4] covering their home. Second Am. Compl. 1-3 . Saxon serviced Plaintiffs' Loan from March 2010 through April 2012. Decl. of Annette Anderson ¶¶ 4-5 [205-1]. Plaintiffs assert that Saxon misapplied and/or reversed several payments Plaintiffs made on the Loan. See generally Second Am. Compl. . To support their claims, Plaintiffs retained the services of Mr. Bernard Jay Patterson, a "Certified Fraud Examiner." Expert Witness Report of Bernard Jay Patterson, CFE ("the Report") 1 [149-2]. In his Report, Mr. Patterson states that he analyzed documents produced by Saxon, Mortgage Electronic Registration Systems, Inc., Residential Credit Solutions, Inc., and Plaintiffs. Id. at 4. Based on his forensic analysis of the data contained in the documents, Mr. Patterson prepared a transaction history of the Loan and offered 15 conclusions or opinions. Id. at 14-15.
Saxon has moved to strike the Report and opinions of Mr. Patterson on grounds that Mr. Patterson is not qualified and his opinions are both unreliable and irrelevant under Rule 702 of the Federal Rules of Evidence as interpreted in Daubert v. Merrill Dow Pharmaceuticals, Inc., 509 U.S. 579, 588-598 (1993). Mem. in Supp. of Mot. to Strike Expert Witness Report and Exclude Op. Test. of Bernard Jay Patterson ("Mem. in Supp. of Mot. to Strike") 1-4 . Saxon argues that Mr. Patterson's opinions do not pass Daubert scrutiny because they are simply a "regurgitation" of Saxon's payment history and servicing notes and they do not qualify as scientific or technical. Id. at 5-6, 7-9. Saxon also asserts that Mr. Patterson's opinion that Saxon misapplied Plaintiffs' payments in violation of the terms of the Deed of Trust constitutes an inadmissible legal conclusion. Id. at 9-13.
Plaintiffs respond that Mr. Patterson qualifies as an expert under Rule 702 and Daubert. Mem. in Supp. of Pls.' Resp. in Opp'n to Saxon's Mot. to Strike Expert Witness Report and Exclude Op. Test. of Bernard Jay Patterson ("Pls.' Resp. in Opp'n") 3 . According to Plaintiffs, since Mr. Patterson is not relying on a scientific background but on his experience and training, the Daubert factors should have no bearing on whether he is qualified. Id. at 5-6. Plaintiffs reason that Mr. Patterson's opinions will be helpful to the trier of fact in understanding the documentation in this case. Id. at 9, 19. Plaintiffs maintain that Mr. Patterson's opinion that Saxon did not comply with the application of payments provision of the Deed of Trust is admissible under Rule 704 of the Federal Rules of Evidence. Id. at 10-11. Plaintiffs posit that Mr. Patterson's opinion that Saxon violated the application of payments provision of the Deed of Trust should not be excluded because it is "expert financial opinion[ ] and not a legal opinion." Id. at 15.
A. Legal Standard
Rule 702 provides:
A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if:
(a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;
(b) the testimony is based on sufficient facts or data;
(c) the testimony is the product of reliable principles and methods; and
(d) the expert has reliably applied the principles and methods to the ...