Latest / The Epstein Chronicles / The USVI And Their Motion To Exclude JP Morgan's Expert Witnesses (Part 4) (10/31/26)

Transcript

The USVI And Their Motion To Exclude JP Morgan's Expert Witnesses (Part 4) (10/31/26) · The Epstein Chronicles

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  Speaker 1: What's up, everyone, and welcome back to the Epstein Chronicles.
• 0:04
  Speaker 1: In this episode, we're getting right back to the USVI's
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  Speaker 1: attempt to bar expert testimony. See, Mr. Fonseca's opinions about
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  Speaker 1: what federal law enforcement would have done are not based
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  Speaker 1: on sufficient facts. To the extent that Mr. Fonseca relies
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  Speaker 1: upon his experience as a trafficking investigator not just to
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  Speaker 1: qualify himself as an expert, but also as a foundation
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  Speaker 1: for his opinions... This experience provides insufficient support for these opinions. Specifically, Mr.
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  Speaker 1: Fonseca provides opinions about redacted that law enforcement never sought
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  Speaker 1: additional records from JPMC indicates consistent with my experience investigating
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  Speaker 1: sex trafficking cases that law enforcement did not view these
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  Speaker 1: records as material evidence. Mr. Fonseca, however, expressly disavowed having
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  Speaker 1: prior knowledge not only of what SARS and CTRs were
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  Speaker 1: or what information they provided, but also of how any
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  Speaker 1: investigator other than himself conducted trafficking investigations. When counsel for
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  Speaker 1: the government questioned him about possible uses of SARS or
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  Speaker 1: other financial information in trafficking investigations, Mr. Fonseca's answers made
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  Speaker 1: clear that he was speaking and could speak only for himself.
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  Speaker 1: Question How about with a large sex trafficking operation? Do
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  Speaker 1: you think financial information would be useful in a large
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  Speaker 1: sex trafficking operation? Answer. If we follow the approach that
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  Speaker 1: we use to investigate sex trafficking cases, I would think not. Question.
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  Speaker 1: When you say the approach that we use, you're speaking
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  Speaker 1: from your experience, correct? Answer. Yes. Using our approach to
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  Speaker 1: interviewing our victims, and as the case develops, starting to...
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  Speaker 1: He gets interrupted. Question. you understand that there are other
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  Speaker 1: FBI agents who may have used a different approach in
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  Speaker 1: investigating sex trafficking operations. Is that fair? Answer. I have
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  Speaker 1: no idea. Question. And sitting here today, you don't know
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  Speaker 1: whether or not other agents in other field offices had
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  Speaker 1: successes in their investigations utilizing suspicious activity reports. Is that fair? Answer.
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  Speaker 1: I would not have much an idea on that. And
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  Speaker 1: I say not much because I didn't interact every day
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  Speaker 1: with other offices, so that would be fair. Indeed, even
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  Speaker 1: when questioned about federal prosecutors' use of financial records in
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  Speaker 1: obtaining the conviction of Ghislaine Maxwell as one of Epstein's co-conspirators, Mr.
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  Speaker 1: Fonseca retreated to his own investigations as a limit to
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  Speaker 1: the scope of his knowledge. Question, well, I'll give you
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  Speaker 1: an example here. The Maxwell case, they used the records
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  Speaker 1: to show that she was a co-conspirator, didn't they? Answer, again,
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  Speaker 1: they used the records, yes. not being part of that trial,
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  Speaker 1: I don't know what ended up proving, but they did
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  Speaker 1: use the records. Having disavowed knowledge of whether or how
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  Speaker 1: trafficking investigators other than himself may have used SARS, Mr.
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  Speaker 1: Fonseca lacks sufficient facts or data upon which to opine
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  Speaker 1: on redacted. Expert testimony should be excluded if it's speculative
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  Speaker 1: or conjectural, since the facts that Mr. Fonseca relies upon
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  Speaker 1: are those of his own investigations and no others, He
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  Speaker 1: lacks sufficient facts or data on which to opine unredacted,
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  Speaker 1: of which he had no understanding as an investigator in
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  Speaker 1: any event. For this additional reason, Mr. Fonseca's expert opinions
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  Speaker 1: should be excluded. 3. The court should exclude Carlin Irwin's
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  Speaker 1: opinions related to economic development commission benefits. J.P. Morgan offers
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  Speaker 1: Carlin Irwin a professional expert witness to, among other things,
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  Speaker 1: analyze and evaluate the tax incentives awarded by the EDC
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  Speaker 1: and to assess the work done by IDC-EDC in connection
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  Speaker 1: with evaluating, extending benefits to, and monitoring of Mr. Epstein's companies.
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  Speaker 1: Her opinions related to tax benefits awarded to Epstein's companies
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  Speaker 1: are irrelevant for the reasons described in the government summary
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  Speaker 1: judgment briefing. But even if they were relevant, Ms. Irwin
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  Speaker 1: is utterly unqualified to give them because, by her own admission,
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  Speaker 1: she is not an expert in the EDC personnel's jobs,
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  Speaker 1: she has no prior experience evaluating these or similar tax benefits,
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  Speaker 1: and she's not familiar with these types of tax benefits
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  Speaker 1: prior to assembling her opinion about this case. Ms. Irwin
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  Speaker 1: is an economist, but her opinions stray well into inadmissible
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  Speaker 1: territory in order to do counsel's bidding, criticizing the EDC's
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  Speaker 1: procedures and decisions. To the extent she performed any analysis,
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  Speaker 1: she refused to characterize it as my own independent analysis,
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  Speaker 1: but rather was merely replicating the EDC's own calculations of
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  Speaker 1: its cost-benefit ratios. Her report consists nearly entirely of reciting
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  Speaker 1: the cost-benefit ratios and then criticizing the EDC for its
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  Speaker 1: actions or inactions. Where, as here an expert purports to
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  Speaker 1: offer opinions beyond the scope of her expertise, court strike
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  Speaker 1: the extraneous testimony as the admission of an expert does
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  Speaker 1: not provide that individual with carte blanche to opine on
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  Speaker 1: every issue in the case. While the court need not
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  Speaker 1: exclude the entirety of Ms. Irwin's opinions, it should restrict
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  Speaker 1: her testimony solely to economic matters for which she may
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  Speaker 1: be qualified. To the extent testimony regarding EDC benefits is
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  Speaker 1: relevant and it is not, the court should not permit Ms.
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  Speaker 1: Irwin to offer opinions regarding the adequacy of EDC procedures
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  Speaker 1: or conduct. A. Ms. Irwin's EDC-related opinions are irrelevant. The
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  Speaker 1: parties have extensively briefed the relevance of evidence related to
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  Speaker 1: the tax benefits rewarded Epstein's companies, and the government does
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  Speaker 1: not seek to repeat that argument unnecessarily. The decision whether
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  Speaker 1: to collect taxes from third parties constitutes a protected policy
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  Speaker 1: choice as to whether and as to whom to take
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  Speaker 1: enforcement action. This sort of enforcement falls in the heartland
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  Speaker 1: of a state's broad discretion in the area of law
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  Speaker 1: enforcement decision-making. and these defenses are never cognizable as a
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  Speaker 1: matter of laws as to any claim. Notably, Ms. Irwin
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  Speaker 1: acknowledged in her deposition that the EDC applies discretion in
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  Speaker 1: her recommendations to either approve or deny tax incentives, and
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  Speaker 1: the Commission does exercise judgment in making its decisions. As
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  Speaker 1: pertains to expert testimony, the threshold question for the court
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  Speaker 1: is whether the proffered testimony is relevant. Irrelevant testimony offered
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  Speaker 1: by an expert fails the helpfulness prong of the Daubert
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  Speaker 1: prong and is therefore inadmissible. Because J.P. Morgan's affirmative defenses
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  Speaker 1: challenging the government's conduct are not cognizable, the proffered expert
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  Speaker 1: opinions related to that conduct are irrelevant and should be excluded. B. Ms.
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  Speaker 1: Irwin lacks sufficient qualifications to opine regarding EDC procedures. As
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  Speaker 1: argued above, when an expert is no longer applying her
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  Speaker 1: extensive experience and reliable methodology, Daubert teaches that the testimony
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  Speaker 1: should be excluded. That is precisely the case here. Ms.
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  Speaker 1: Irwin has a master's degree in accounting and finance and
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  Speaker 1: more than 25 years of litigation consulting and expert witness experience,
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  Speaker 1: but she has no experience with territorial tax benefits or
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  Speaker 1: the inner workings and procedures of governmental agencies. She summed
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  Speaker 1: it up best during her deposition, freely conceding that, with
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  Speaker 1: respect to the EDC, I'm not an expert in their jobs.
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  Speaker 1: Prior to beginning work on this case, Ms. Irwin admitted
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  Speaker 1: she was not familiar with the tax benefits that are
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  Speaker 1: addressed in her report. None of her prior expert work
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  Speaker 1: involved tax benefits awarded by the Virgin Islands or by
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  Speaker 1: any other U.S. territory, which differ from state tax benefits
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  Speaker 1: because they are federally authorized and, unlike state tax benefits,
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  Speaker 1: are memorialized in a contractual certificate that obliges the beneficiary
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  Speaker 1: to make certain contributions to the territory and satisfy certain
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  Speaker 1: conditions of employment of territorial residents. She has never been
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  Speaker 1: an employee of any governmental entity or agency. She's never
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  Speaker 1: worked for a tax authority, nor has she ever performed
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  Speaker 1: litigation consulting or work for such an authority. Indeed, during
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  Speaker 1: her deposition, Ms. Irwin acknowledged that she was not relying
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  Speaker 1: on her own experience or anyone else's experience in forming
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  Speaker 1: her opinions. Yet despite having no relevant work or professional experience, Ms.
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  Speaker 1: Irwin opines that the EDC ignored Financial Trust and Southern
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  Speaker 1: Trust's consistently unfavorable cost-benefit analysis and failed to ask questions
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  Speaker 1: or to gather information. She criticizes the EDC for failing
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  Speaker 1: to conduct compliance reviews and and she criticizes the EDC
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  Speaker 1: for failing to follow up with Southern Trust to test
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  Speaker 1: whether or not it was a legitimate company. None of
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  Speaker 1: these opinions are admissible. Ms. Irwin's credentials as an economist
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  Speaker 1: do not grant her license to opine regarding the propriety
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  Speaker 1: of a government agency's procedure or decision-making, nor do they
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  Speaker 1: authorize her to contend that the EDC board members should
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  Speaker 1: have asked different questions at public hearings. She identifies no
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  Speaker 1: methodology in her report that she used to arrive at
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  Speaker 1: these conclusions. Indeed, to the extent Ms. Irwin performed any
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  Speaker 1: computational analysis, aside from reviewing documents in the record, it
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  Speaker 1: was limited to recalculating the EDC's cost-benefit rations. And, she confirmed,
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  Speaker 1: I wouldn't characterize it as my own independent analysis. While
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  Speaker 1: an expert must of course rely on facts or data
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  Speaker 1: in formulating an expert opinion, an expert cannot be presented
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  Speaker 1: to the jury solely for the purpose of constructing a
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  Speaker 1: factual narrative based on record evidence. That is precisely what J.P.
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  Speaker 1: Morgan seeks to do here. Ms. Irwin's economic analysis was
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  Speaker 1: limited to recalculating the EDC's cost-benefit ratios based upon the
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  Speaker 1: data contained in the EDC's spreadsheets. She is not offering
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  Speaker 1: any opinion as to whether those formulas are on an
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  Speaker 1: appropriate measure of the economic benefit derived from the tax incentives. Ms.
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  Speaker 1: Irwin's opinions concerning what actions the EDC should have taken
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  Speaker 1: based upon those ratios, which in and of themselves represent
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  Speaker 1: an oversimplification of the EDC decision-making process, which recognizes economic
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  Speaker 1: benefits beyond job creation. are outside her area of expertise
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  Speaker 1: and they should be excluded. C. Ms. Irwin should not
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  Speaker 1: be permitted to testify regarding a potential improper motive. Compounding
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  Speaker 1: the errors reflected above, J.P. Morgan relies on Ms. Irwin
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  Speaker 1: to opine that ADC's conduct is consistent with the possibility
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  Speaker 1: of that these benefits were granted as part of an
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  Speaker 1: improper quid pro quo exchange between Mr. Epstein and the
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  Speaker 1: USVI officials. Not only is Ms. Irwin unqualified to offer
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  Speaker 1: this opinion for the reasons set forth above, but this
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  Speaker 1: opinion represents rank speculation regarding motive that no expert is
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  Speaker 1: qualified to give. Experts may not offer opinions regarding the
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  Speaker 1: intent or motive of parties as part of their analysis.
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  Speaker 1: As a general rule, inferences about the intent or motive
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  Speaker 1: of parties or others lie outside of the bounds of
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  Speaker 1: expert testimony. At least one court in this district has
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  Speaker 1: characterized an expert speculating as to a party's motive as
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  Speaker 1: improperly assuming the role of advocates because such testimony lacks
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  Speaker 1: basis and any relevant body of knowledge or expertise and
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  Speaker 1: would be inadmissible if offered by a lay witness. As
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  Speaker 1: another court explained, whatever expertise an expert may possess, no
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  Speaker 1: expert may supplant the role of counsel in making arguments
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  Speaker 1: at trial and the role of the jury in interpreting
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  Speaker 1: the evidence. Ostensibly aware of this precedent, J.P. Morgan seeks
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  Speaker 1: to protect Ms. Irwin's opinion by having her confirm that
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  Speaker 1: she is not actually opining as to the existence of
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  Speaker 1: an improper quid pro quo. She merely claims that such
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  Speaker 1: an arrangement was possible and concedes that she doesn't know
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  Speaker 1: the universe of potential factors that could have affected the
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  Speaker 1: EDC's decision to Although Ms. Irwin references payments that benefited
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  Speaker 1: politicians as one such factor, she doesn't know whether those
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  Speaker 1: payments actually affected any EDC decision. Indeed, even though Ms.
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  Speaker 1: Irwin is a certified fraud examiner, she offers this opinion
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  Speaker 1: when she didn't conduct a fraud investigation because this would
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  Speaker 1: require access, open access to underlying financial records, that she
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  Speaker 1: claimed she did not have in this case. None of
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  Speaker 1: this speculation is admissible. Highland Cat Management 379 F.SUPP 2D
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  Speaker 1: at 469. Inferences about the intent or motive of parties
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  Speaker 1: or others lie outside the bounds of expert testimony. Ms.
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  Speaker 1: Irwin may not avoid the well-established bar precluding experts from
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  Speaker 1: testifying as to the motives of parties by couching her
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  Speaker 1: opinions as identifying a possibility. If any expert testimony is
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  Speaker 1: permitted concerning EDC decisions, it should not seek to attribute
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  Speaker 1: or suggest motives for the EDC's conduct. To the extent
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  Speaker 1: the EDC's motives are relevant, which they are not, the
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  Speaker 1: subject matter constitutes lay matter that the fact finder can
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  Speaker 1: understand without the assistance of experts. Conclusion. For all the
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  Speaker 1: reasons set forth above, the court should exclude the expert
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  Speaker 1: opinions of Kimberly Melman Orozco, Joseph Fonseca, and Carlin Irwin.
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  Speaker 1: This document was signed by David Ackerman and it was
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  Speaker 1: dated August 18th of 2023. All right, folks, that's going
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  Speaker 1: to do it not only for this episode, but the
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  Speaker 1: document as a whole. All of the information that goes
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  Speaker 1: with this episode can be found in the description box.