In CITGO the Seventh Circuit advised that district courts not only retain discretion when applying the Daubert factors to asserted expert testimony, but they also retain discretion in determining the manner in which the Daubert issue may be presented to the court. CITGO involved a personal injury action alleging exposure to hydrogen sulfide gas while working at CITGO. The plaintiffs sought to establish injury causation through expert testimony from treating physicians. CITGO did not challenge the testimony by a traditional motion to bar or Daubert hearing. Instead, CITGO brought a motion for summary judgment challenging plaintiff’s ability to establish causation because the experts were not qualified based on a lack of training or experience in toxicology or epidemiology. Other challenges were also asserted, such as faulty methodology and failure to consider alternative causes. Plaintiffs argued that this was an improper approach by which to challenge the experts’ testimony. The district court disagreed and entered summary judgment in favor of CITGO. The Seventh Circuit affirmed noting that the law grants the district court great discretion regarding the manner in which it conducts Daubert evaluations. Sua sponte consideration of the admissibility of expert testimony by a district court was also held to be proper.

The Northern District of Illinois provides a detailed analysis of the Daubert requirements and expert testimony with respect to lost future profits in the Euro Holdings case. Euro Holdings sought to recover from Harris Trust based on a tortious interference with contract claim. Harris Trust had allegedly caused the failure of a transaction resulting in Euro Holdings’ loss of a 90% equity stake in LFG. To attempt to put forward evidence of significant lost future profits, Euro Holdings relied an expert witness. The retained expert determined actual past performance of LFG and then modified that performance to reflect Euro Holdings’ intention to modify the structure of LFG’s business after the sale. The expert then made projections regarding LFG’s likely future performance based on certain assumptions. The district court found the expert’s methodology as to past losses to be sufficient for purposes of denying a motion in limine. However, the district court granted defendants’ motion in limine regarding future profit testimony because the modifications to the structure of the purchased company hadn’t occurred and thus the “new company” was never actually in existence. The damage calculation was held to be too speculative, and the court found that the claim itself likely was barred by the “New Business Rule” (recovery for lost profits of a new business generally is not allowed because such a loss is “too uncertain, specific and remote to permit recovery.”) In Solomonic fashion, the court split the baby.