Preview
DATE FILED: May 19, 2023 3:01 PM
FILING ID: C6A22FBC9251D
DISTRICT COURT, ARAPAHOE COUNTY CASE NUMBER: 2021CV31019
STATE OF COLORADO
Arapahoe County Justice Center
7325 S. Potomac Street
Centennial, CO 80112
Plaintiffs(s): XUANZHI BAI, an individual and
JUNCHEN DAI, an individual
v.
Defendant(s): SHOYU DENVER LLC, a Colorado
Limited Liability Company, ZUOQUAN LIN, an
individual, and NENGBAO LIN, an individual COURT USE ONLY
ROBINSON & HENRY, P.C. Case Number: 2021CV031019
Joseph J. Novak, #41904
Christopher B. Davlin, #39257 Div.: 15 Ctrm:
7555 East Hampden Avenue, Suite 600
Denver, Colorado 80231
Telephone (303) 688-0944
joe@robinsonandhenry.com
kit@robinsonandhenry.com
Attorneys for Plaintiffs/Counterclaim Defendants
PLAINTIFFS’ MOTION TO EXCLUDE DEEFENDANT’S RETAINED
EXPERT JEREMY S. WYSOCKI
Plaintiffs X. Bai and J. Dai through undersigned counsel, Robinson & Henry, P.C., hereby
submit the following Motion to Exclude Defendants Z. Lin and Shoyu Denver, LLC’s Retained
Expert Jeremy S. Wysocki and, in support thereof, state as follows:
Certificate of Conferral Pursuant to C.R.C.P. 121, §1-15(8)
Counsel for the Plaintiffs conferred with Counsel for Defendants Z. Z. Lin and Shoyu
Denver, LLC. The Motion is opposed.
1
INTRODUCTION
This case alleges the creation of a partnership between the parties, and the subsequent acts
of Defendants to illicitly deny the benefits of that partnership to the Plaintiffs. The Amended
Complaint laid out nine separate causes of action, 1) Breach of Contract, alleging that Plaintiffs
entered into an oral contract with Defendants in which Plaintiffs would make capital contributions
and expense payments for the benefit of Shoyu, and in exchange, Plaintiffs would receive a
collective forty percent (40%) membership interest in Shoyu Denver, LLC, and a collective 40%
of the profits of the Shoyu restaurant; 2) Promissory Estoppel, alleging that Defendant Z. Lin and
Defendant N. Lin made an oral promise to Plaintiffs that Plaintiffs would receive a collective forty
percent (40%) membership interest in Shoyu Denver, 4 LLC, and a collective 40% of the profits
of the Shoyu restaurant in exchange for capital contributions by Plaintiffs to fund Shoyu and pay
for Shoyu expenses; 3) Unjust enrichment, alleging that upon promises made by Defendant Z. Lin
and Defendant N. Lin that Plaintiffs would receive a collective forty percent (40%) membership
interest in Shoyu Denver, LLC, and a collective 40% of the profits of the Shoyu restaurant,
Plaintiffs contributed at least $123,260.48 in capital contributions and expenses for Shoyu, and
that Defendants Shoyu, Z. Lin and N. Lin have thereby been unjustly enriched; 4) Civil
Conspiracy, alleging that Defendant Z. Lin and Defendant N. Lin agreed by conduct to accomplish
the unlawful goal of defrauding Plaintiffs of money and not providing any membership interest in
Shoyu Denver, LLC; 5) Civil Theft, alleging that Defendants Shoyu, Z. Lin and N. Lin have
knowingly and deceptively obtained, retained, and exercised control over the unpaid profits
belonging to Plaintiffs; 6) Fraudulent Concealment, alleging that Defendants Z. Lin and N. Lin
fraudulently concealed the material existing fact that Plaintiffs were not given membership interest
2
in Shoyu’s operating agreement; 7) Piercing the Corporate Veil, alleging that Defendants Shoyu,
Z. Lin and N. Lin exerted control over the restaurant and LLC in such a manner that the businesses
were mere extensions of the individuals, and that liability for the obligations of the corporation
should lie upon the individual defendants; 8) Accounting, alleging that Defendants Shoyu, Z. Lin
and N. Lin have controlled the bookkeeping of the business, and that actual amounts due Plaintiffs
cannot be ascertained without an accounting; and 9) Breach of Fiduciary Duty, alleging that
Defendants Z. Lin and N. Lin were partners of Plaintiffs and owed them a fiduciary duty, which
they have breached by continuing to exclude Plaintiffs from membership in Shoyu Denver, LLC
and by failing to make profit payments to Plaintiffs.
On May 2, 2022, Defendants provided the Expert Witness Report of Mr. Wysocki, attached
as Exhibit 1 to this motion. Plaintiffs seek to strike or limit the report and testimony of Mr.
Wysocki under C.R.E. 702 and C.R.E. 403. More specifically, Plaintiffs seek to strike the report
because 1) Mr. Wysocki’s opinions are not appropriate pursuant to C.R.E. 702 since scientific,
technical or other specialized knowledge is unnecessary to assist the jury to understand the
opinions or to determine a fact in issue; 2) Mr. Wysocki’s opinions constitute inadmissible legal
opinions and conclusions concerning the legal duties applicable to the parties and and how those
duties were allegedly breached; and 3) Mr. Wysocki’s opinions regarding the contributions of
Plaintiffs, refusal of Defendants to admit Plaintiffs to the LLC, and subsequent tax and accounting
of the business will not be helpful to the trier of fact since facts contrary to those upon which his
opinion are based have been admitted under oath by Defendants, and are subject to an adverse
instruction to the jury. Simply put, Mr. Wysocki’s report is an inadmissible attempt by Defendants
to state a factual narrative that is contrary to their own sworn testimony, interpret the evidence in
3
a manner favorable to Defendants despite their sanctioned failure to provide bookkeeping
documents, and make determinations that are ultimately reserved for the Court and the jury.
As of the date of this filing, Exhibit 1 is the only report generated by Mr. Wysocki. The
report was issued in May of 2022. The report relies upon the Articles of Organization, meeting
minutes, operating agreement, May 2, 2022 affidavit of Defendant Z. Lin, and IRS tax filings of
the company. See Ex. 1, p. 7. Based solely upon these documents, Mr. Wysocki proffered the
following opinions:
A. MEMBERS OF THE COMPANY. It is my opinion that Mr. Zuoquan and Mr. Nengbao
have constituted members of the Company since July 18, 2019.
It is my opinion that Plaintiffs nor Defendants treated Plaintiffs as members of the
Company since July 18, 2019.
It is my opinion that it is customary for a prospective investor in a business substantially
similar to the Company to conduct due diligence on such business, including, without
limitation, obtaining a copy of any organizational documents and/or limited liability
company agreement of such business.
It is my opinion that it is customary for an investor in a business substantially similar
to the Company to enter into a written Membership Interest Purchase Agreement,
Subscription Agreement and/or Joinder Agreement to an Operating Agreement with
such business in connection with any investment in the business.
It is my opinion that the Operating Agreement requires Mr. Zuoquan’s and/or Mr.
Nengbao’s written consent in order for Mr. Zuoquan and/or Mr. Nengbao, respectively,
to transfer all or a portion of their ownership interest in the Company.
It is my opinion that the Operating Agreement requires Mr. Zuoquan’s and/or Mr.
Nengbao’s written consent to add new members of the Company.
B. MANAGEMENT OF THE COMPANY. It is my opinion that the Company’s business
and affairs are managed by the Company’s members, Mr. Zuoquan and Mr. Nengbao.
It is my opinion that Mr. Zuoquan is the Company’s registered agent.
C. PLAINTIFFS’ FUNDING. It is my opinion that Plaintiffs and Defendants have treated
Plaintiffs’ Funding as unsecured loan(s) by Plaintiffs to the Company and/or Mr.
Zuoquan.
D. PLAINTIFFS’ PAYMENTS. It is my opinion that Plaintiffs’ Payments weren’t treated
by Plaintiffs nor Defendants as distributions of the profits of the Company to Plaintiffs
as members of the Company.
It is my opinion that Plaintiffs and Defendants treated Plaintiffs’ Payments as a return
by the Company of a portion of the principal amount of loan(s) by Plaintiffs to the
Company.
4
After Mr. Wysocki’s report was issued, Defendant Z. Lin, in both his personal and
professional capacity as designated 30(b)6 witness for Defendant Shoyu Denver, LLC, testified
repeatedly (and contrary to the opinions proffered in the report) that Plaintiffs were actually
partners in the business (Z. Lin Dep. 42:19-43:3, 71:11-74:17, attached as Exhibit 3 to Plaintiff’s
Motion for Partial Summary Judgment); that the contributions of the Plaintiffs were not loans but
rather investments (Z. Lin Dep. 2, 149:7-18) ; that the Plaintiffs were owed and were paid profits
of the company (Z. Lin Dep. 35:4-24) ;that evidence of the contributions would have been kept in
the unproduced ledger (Z. Lin Dep., 110:6-12); that the Plaintiffs were not consulted with or
advised of the operating agreement before Defendants signed them without Plaintiffs (Z. Lin Dep.
82:1-8 ); and that even after the signing of the operating agreement, Defendants told Plaintiffs that
they were members and shareholders of the company (N. Lin Dep. 42:24-42:6 attached as Exhibit
5 to Plaintiff’s Motion for Partial Summary Judgment ).
In preparing his report, Mr. Wysocki did not review the unproduced accounting ledger,
which this Court has ruled “would have contained evidence related to the Plaintiffs’ contributions
to the business, payments made by the Plaintiffs for the benefit of the business, and cash payments
made by Defendants.” Order Granting Spoliation Sanctions, January 30, 2023. Mr. Wysocki also
did not review the sworn deposition testimony of Defendants Z. Lin and Shoyu Denver, LLC
which directly contradict the opinions proffered by Mr. Wysocki. Mr. Wysocki’s opinions and
report are of questionable merit, but, more importantly, are unhelpful to the jury. Any probative
value of the proffered opinions are outweighed by the danger of unfair prejudice and will tend to
confuse the issues as they are in direct opposition to the testimony of Defendants and can only
serve to mislead the jury.
5
LEGAL AUTHORITY
Trial courts have an obligation to serve as gatekeepers regarding the propriety of expert
testimony. Lawrence v. People, 486 P.3d 269, 278 (Colo. 2021) Kumho Tire Co. v. Carmichael,
526 U.S. 137, 147-49, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999)(clarifying that the court’s gatekeeper
function applies to all expert testimony, not just testimony based in science). It is in this Court’s
discretion whether to admit purported “expert testimony.” People v. Martinez, 74 P.3d 316, 322
(Colo.2003). C.R.E. 702 governs a trial court’s determination as to the admissibility of scientific
or other expert testimony. People v. Shreck, 22 P.3d 68, 72 (Colo. 2011). C.R.E. 702 provides that
“[i]f 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.” In
determining the admissibility of expert testimony, the Court must employ a Shreck analysis,
determining (1) whether the scientific principles underlying the testimony are reasonably reliable;
(2) whether the expert is qualified to offer opinions on such matters; (3) whether the expert
testimony will be helpful to the jury; and (4) whether the proffered evidence satisfies C.R.E. 403.
Shreck, 22 P.3d at 72. Otherwise stated, Rulle 702 requires that expert testimony be both reliable
and relevant. Estate of Ford v. Eicher, 250 P.3d 262, 266 (Colo. 2011)(citing People v. Shreck, 22
P.3d 68, 77 (Colo. 2001).
When an expert’s opinions are based not on scientific principles, but rather specialized
knowledge derived from experience, the opinions are still subject to an inquiry regarding validity
and reliability. Brooks v. People, 975 P.2d 1105, 1114 (Colo. 1999). “A trial court’s reliability
inquiry under C.R.E. 702 should be broad in nature and consider the totality of the circumstance
6
of each case.” Shreck, 22 P.3d at 78. A trial court should consider the following in determining
reliability and relevancy of expert testimony: (1) whether the method used by the witness is
reasonably reliable; (2) whether the witness is qualified to express an opinion on such matters; and
(3) whether the witness’s testimony would be useful to the jury.” Estate of Ford v. Eicher, 220
P.3d 939, 943 (Colo .App. 2008).
Expert testimony is helpful if it “will assist the trier of fact to understand the evidence or
determine a fact in issue.” People v. Lesslie, 939 P.2d 443, 450 (Colo. App. 1996). “Expert opinion
that relies on bare assertions, subjective belief, or unsupported speculation will not satisfy [C.R.E.
702’s] reliability requirement.” Estate of Ford v. Eicher, 250 P.3d 262, 267 (Colo. 2011).
“Speculative testimony that would be unreliable and therefore inadmissible under C.R.E. 702 is
opinion testimony that has no relatively sound basis.” United States v. Crabbe, 556 F.Supp.2d
1217, 1222-1223 (D. Colo. 2008). A court may reject expert testimony that is connected to existing
data only by a bare assertion resting on the authority of the expert. Ramirez, 155 P.3d at 378 (citing
Gen. Elec. Co. v. Joiner, 522 U.S. 136, 146 (1997)). The policy considerations behind this principle
are well documented: the dangers of opinion testimony without a scientific basis is that what
appears to be scientific testimony, but really is not, may carry more weight with the jury than it
deserves. Id.
For this reason, expert testimony which may be permissible under C.R.E. 702 must also be
screened under C.R.E. 403 to ensure that the probative value of the scientific or other evidence is
not substantially outweighed by unfair prejudice, confusion of the issues, undue delay, waste of
time, or needless presentation of cumulative evidence. Shreck, 22 P.3d at 78-79. “In conducting
this analysis, a court must issue specific findings of its consideration under C.R.E. 403 as to
7
whether the probative value of the evidence is substantially outweighed by its prejudicial effect.”
Id., at 78. This consideration contemplates an analysis of such factors as the importance of the fact
of consequence for which the evidence is offered, the strength and length of the chain of inferences
necessary to establish the fact of consequence, the availability of alternative means of proof,
whether the fact of consequence for which the evidence is offered is being disputed, and, if
appropriate, the potential effectiveness of a limiting instruction in the event of admission.
Vialpando v. People, 727 P.2d 1090, 1096 (Colo. 1986).
Importantly, trial courts have drawn a distinction between permissible opinion testimony
that embraces an ultimate issue of fact under C.R.E. 704, and impermissible opinion testimony
regarding the applicable law or legal standard. A “trial judge ought to insist that a proffered expert
bring to the jury more than the lawyers can offer in argument.” People v. Williams, 790 P2d 796,
798 (Colo. 1990) (quoting In re Air Crash Disaster at New Orleans, Louisiana, 795 F.2d 1230,
1233 (5th Cir 1986)). To that end, Colorado case law establishes that an expert may not express
an opinion on the applicable law or legal standards or tell the jury what result to reach. People v.
Pahl, 169 P.3d 169, 182 (Colo. 2006); People v. Lesslie, 939 P.2d 443 (Colo. App. 1996)(holding
that an expert may not usurp the function of the court by expressing an opinion of the applicable
law or legal standards.); Specht v. Jensen, 853 F.2d 805, 810 (10th Cir 1988)(“[W]hen the purpose
of [expert] testimony is to direct the jury’s understanding of the legal standards upon which their
verdict must be based, the testimony cannot be allowed.”); People v. Gaffney, 769 P.2d 1081
(Colo. 1989); Hartman v. Cmty. Responsibility Ctr., Inc., 87 P.3d 202, 206 (Colo. App. 2003)
(concluding that proffered expert witness testimony should be excluded because it contemplated
the reasonableness of Plaintiff’s conduct, which was a matter of law.). Simply put, an expert
8
witness may not provide testimony opining that one party did nor did not breach its legal duties to
another party.
A trial court is vested with the discretion to decide whether an evidentiary hearing would
aid in its Shreck analysis and is not required to conduct an evidentiary hearing under Shreck
provided the parties have submitted sufficient for the court to make specific findings under C.R.E.
702 and C.R.E. 403. People v. Rector, 248 P.3d 1196, 1201 (Colo. 2011).
LEGAL ARGUMENT
A. Mr. Wysocki’s opinions are inadmissible pursuant to C.R.E. 702.
a. Mr. Wysocki takes it upon himself to analyze and interpret the Operating
Agreement and the existence of legal duties, thereby invading the province of the
Court and the jury.
One of the issues for the jury to resolve in this case is the whether the Plaintiffs were
partners in the business Prior to the filing of the Operating Agreement. Defendants have testified
that they were, but Mr. Wysocki merely recites the provisions of the operating agreement. This is
a transparent effort to tell this Court and the jury what result should be reached on a critical issue
for the jury’s resolution. This is inappropriate and inadmissible at trial.
While expert testimony can be used to assist the jury in determining a fact in issue, it may
not be used to usurp the Court’s function of instructing the jury as to the law by expressing a legal
opinion as to the nature and scope of the legal duties of the parties to one another. See e.g.,
Hartman, 87 P.3d at 205-206 (affirming trial court order granting motion in limine barring expert
opinion testimony as to the nature and scope of legal duties owed by a fiduciary); Grogan v. Taylor,
877 P.2d 1374, 1384 (Colo. App. 1994)(reversing trial court decision to allow an expert witness
to interpret the statute of limitations for the jury). The Colorado Court of Appeals has previously
9
found that a jury was able to make fact determinations as to whether a contract was breached
without the aid of expert testimony since there was sufficient evidence before the jury to allow it
to interpret the contract. See Town of Breckenridge v. Golforce, Inc., 851 P.2d 214, 216 (Colo.
App. 1992)(stating that “[w]hether there has been a breach of a contract is an issue for the fact
finder” and finding that“ there was sufficient evidence before the jury to allow it to interpret the
contract and determine whether the terms thereof were breached.”).
These opinions are unnecessary, unsubstantiated, lack foundation and invade the province
of the Court and jury by making the ultimate legal conclusions that Plaintiffs did not invest in the
company and partner with the Defendants. More specifically, Mr. Wysocki is attempting to
substitute his judgment for that of the jury by improperly providing a factual narrative advanced
by Defendants in pursuit of their claims and defenses – a narrative that was later belied by the
testimony of Defendants. Defendants did not provide Mr. Wysocki with the unproduced financial
ledger. Mr. Wysocki does not have all of the factual information necessary for him to accurately
formulate his opinions based on the evidence summarized in his report.
What’s more, the jury is capable of determining for itself what the evidence means,
including the duties and obligations of the partners. Opinions and/or arguments as to how the jury
should view and interpret the facts is properly reserved to counsel – not Mr. Wysocki. Accordingly,
these opinions exceed the permissible scope of C.R.E. 702 and are likely to confuse and mislead
the jury under C.R.E. 403. As a result, Plaintiffs are entitled to an order striking those portions of
the report and excluding any such legal opinion testimony from Mr. Wysocki at trial.
b. Mr. Wysocki must not be permitted to offer expert testimony about whether it is
“customary” for investors in a business to enter into an Operating Agreement, or to
conduct due diligence because no complete opinions or the basis for the opinions
has been disclosed.
10
Despite the obligation to disclose both the complete opinions of an expert and the bases and
reasons for those opinions, there has been no such disclosure with respect to the following opinions:
1. It is my opinion that it is customary for a prospective investor in a business
substantially similar to the Company to conduct due diligence on such business,
including, without limitation, obtaining a copy of any organizational documents
and/or limited liability company agreement of such business.
2. It is my opinion that it is customary for an investor in a business substantially
similar to the Company to enter into a written Membership Interest Purchase
Agreement, Subscription Agreement and/or Joinder Agreement to an Operating
Agreement with such business in connection with any investment in the business.
C.R.C.P. 26(a)(2)(B)(I) and (II) require disclosure of “a complete description of all
opinions to be expressed and the basis and reasons therefor,” as well as “a list of the data or other
information considered by the witness in forming the opinions[.]” As noted by the Tenth Circuit in
Smith v. Ford Motor Company, 626 F. 2d 784 (10th Cir. 1980):
Effective cross-examination of an expert witness requires advance preparation. The
lawyer even with the help of his own experts frequently cannot anticipate the
particular approach his adversary’s expert will take or the data on which he will
base his judgment on the stand.
626 F. 2d at 793 (quoting from Advisory Committee Notes, Rule 26, F.R.C.P., 28 U.S.C.A). Among
the purposes of pre-trial discovery are the elimination of surprise at trial, discovery of all relevant
evidence, and the simplification of issues. Samms v. District Court, 908 P.2d 520, 525 (Colo. 1995).
Defendants’ disclosure of Mr. Wysocki’s testimony on these matters is deficient in that the bases
underlying the opinions are not identified in the report. Ex.1. Mr. Wysocki fails to identify what
11
information was relied upon when reaching the conclusion that what was “customary”. Since
Woellner has not provided a complete opinion, his opinion will not be helpful to the trier of fact and
therefore must be excluded pursuant to C.R.E. 403 and 702.
c. Mr. Wysocki’s legal opinions should be excluded pursuant to C.R.E. 403.
C.R.E. 403 permits courts to exclude otherwise relevant evidence if its probative value is
substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading
the jury. Mr. Wysocki’s testimony is of limited probative value on the central facts of this case
because it constitutes unsupported opinions and legal conclusions that fall within the exclusive
purview of the trier of fact. He only reviewed, and repeats, the language of the operating
agreement. He did not review or articulate any basis for reconciling the contrary testimony of the
Defendants. It is clear, based on the listing of information considered when preparing the report,
that Mr. Wysocki did not have access to all available facts and documents. It is also entirely
possible that Mr. Wysocki chose to review only certain exhibits attached to the complaint or
counterclaims provided to him by Defendants. As a result, Mr. Wysocki’s testimony will be
confusing to a jury and is unlikely to “assist the trier of fact to understand the evidence or determine
a fact in issue.” C.R.E. 702. The danger of unfair prejudice is especially manifest here as the
Defendants have testified repeatedly under oath to facts that are in direct opposition to the opinions
proffered by Mr. Wysocki that he based, in part, on Defendants sworn affidavit. These “opinions”
are likely to mislead or confuse the jury. There is a substantial likelihood that the jury to put undue
weight on Mr. Wysocki’s testimony instead of reaching its own conclusion. Accordingly, for the
foregoing reasons, the proffered expert testimony by Plaintiff should be precluded by this court.
WHEREFORE, Plaintiffs respectfully requests that the Court grant their Motion to Exclude
12
Mr. Wysocki’s Expert Report Pursuant to C.R.E. 702 and C.R.E 403 and preclude his appearance
as an Expert Witness, and any such further relief the Court deems appropriate.
Respectfully submitted this 19th day of May, 2023.
ROBINSON & HENRY, P.C.
By: /s/ Christopher Barr Davlin
Joseph J. Novak, #41904
Christopher Barr Davlin, #39257
Attorneys for Plaintiffs Xuanzhi Bai and Junchen Dai
CERTIFICATE OF SERVICE
I hereby certify that on this 19th day of May, 2023 a true and correct copy of the foregoing
PLAINTIFFS’ MOTION TO EXCLUDE DEEFENDANT’S RETAINED EXPERT
JEREMY S. WYSOCKI was electronically filed and served via the Colorado Courts E-Filing
System to all counsel of record as follows:
Charles S. McIntyre IV, Esq.
AQMN Law
155 Cook Street, Suite 451
Denver, Colorado 80206
Attorney for Defendant Shoyu Denver, LLC and Defendant Zuoquan Lin
Christopher W. Carr
Dill Dill Carr Stonebreaker & Hutchings, P.C.
455 Sherman Street, Suite 300
Denver, Colorado 80203
Attorney for Defendant Nengbao Lin
ROBINSON & HENRY, P.C.
By: /s/ Christopher Barr Davlin
13
Pursuant to C.R.C.P. 121 § 1-26(7) a true and correct copy of the foregoing with original
or scanned signatures is maintained at the offices of Robinson & Henry, P.C. and will be made
available for inspection or review upon request.
14
Preview
DATE FILED: May 19, 2023 3:01 PM FILING ID: C6A22FBC9251D DISTRICT COURT, ARAPAHOE COUNTY CASE NUMBER: 2021CV31019 STATE OF COLORADO Arapahoe County Justice Center 7325 S. Potomac Street Centennial, CO 80112 Plaintiffs(s): XUANZHI BAI, an individual and JUNCHEN DAI, an individual v. Defendant(s): SHOYU DENVER LLC, a Colorado Limited Liability Company, ZUOQUAN LIN, an individual, and NENGBAO LIN, an individual COURT USE ONLY ROBINSON & HENRY, P.C. Case Number: 2021CV031019 Joseph J. Novak, #41904 Christopher B. Davlin, #39257 Div.: 15 Ctrm: 7555 East Hampden Avenue, Suite 600 Denver, Colorado 80231 Telephone (303) 688-0944 joe@robinsonandhenry.com kit@robinsonandhenry.com Attorneys for Plaintiffs/Counterclaim Defendants PLAINTIFFS’ MOTION TO EXCLUDE DEEFENDANT’S RETAINED EXPERT JEREMY S. WYSOCKI Plaintiffs X. Bai and J. Dai through undersigned counsel, Robinson & Henry, P.C., hereby submit the following Motion to Exclude Defendants Z. Lin and Shoyu Denver, LLC’s Retained Expert Jeremy S. Wysocki and, in support thereof, state as follows: Certificate of Conferral Pursuant to C.R.C.P. 121, §1-15(8) Counsel for the Plaintiffs conferred with Counsel for Defendants Z. Z. Lin and Shoyu Denver, LLC. The Motion is opposed. 1 INTRODUCTION This case alleges the creation of a partnership between the parties, and the subsequent acts of Defendants to illicitly deny the benefits of that partnership to the Plaintiffs. The Amended Complaint laid out nine separate causes of action, 1) Breach of Contract, alleging that Plaintiffs entered into an oral contract with Defendants in which Plaintiffs would make capital contributions and expense payments for the benefit of Shoyu, and in exchange, Plaintiffs would receive a collective forty percent (40%) membership interest in Shoyu Denver, LLC, and a collective 40% of the profits of the Shoyu restaurant; 2) Promissory Estoppel, alleging that Defendant Z. Lin and Defendant N. Lin made an oral promise to Plaintiffs that Plaintiffs would receive a collective forty percent (40%) membership interest in Shoyu Denver, 4 LLC, and a collective 40% of the profits of the Shoyu restaurant in exchange for capital contributions by Plaintiffs to fund Shoyu and pay for Shoyu expenses; 3) Unjust enrichment, alleging that upon promises made by Defendant Z. Lin and Defendant N. Lin that Plaintiffs would receive a collective forty percent (40%) membership interest in Shoyu Denver, LLC, and a collective 40% of the profits of the Shoyu restaurant, Plaintiffs contributed at least $123,260.48 in capital contributions and expenses for Shoyu, and that Defendants Shoyu, Z. Lin and N. Lin have thereby been unjustly enriched; 4) Civil Conspiracy, alleging that Defendant Z. Lin and Defendant N. Lin agreed by conduct to accomplish the unlawful goal of defrauding Plaintiffs of money and not providing any membership interest in Shoyu Denver, LLC; 5) Civil Theft, alleging that Defendants Shoyu, Z. Lin and N. Lin have knowingly and deceptively obtained, retained, and exercised control over the unpaid profits belonging to Plaintiffs; 6) Fraudulent Concealment, alleging that Defendants Z. Lin and N. Lin fraudulently concealed the material existing fact that Plaintiffs were not given membership interest 2 in Shoyu’s operating agreement; 7) Piercing the Corporate Veil, alleging that Defendants Shoyu, Z. Lin and N. Lin exerted control over the restaurant and LLC in such a manner that the businesses were mere extensions of the individuals, and that liability for the obligations of the corporation should lie upon the individual defendants; 8) Accounting, alleging that Defendants Shoyu, Z. Lin and N. Lin have controlled the bookkeeping of the business, and that actual amounts due Plaintiffs cannot be ascertained without an accounting; and 9) Breach of Fiduciary Duty, alleging that Defendants Z. Lin and N. Lin were partners of Plaintiffs and owed them a fiduciary duty, which they have breached by continuing to exclude Plaintiffs from membership in Shoyu Denver, LLC and by failing to make profit payments to Plaintiffs. On May 2, 2022, Defendants provided the Expert Witness Report of Mr. Wysocki, attached as Exhibit 1 to this motion. Plaintiffs seek to strike or limit the report and testimony of Mr. Wysocki under C.R.E. 702 and C.R.E. 403. More specifically, Plaintiffs seek to strike the report because 1) Mr. Wysocki’s opinions are not appropriate pursuant to C.R.E. 702 since scientific, technical or other specialized knowledge is unnecessary to assist the jury to understand the opinions or to determine a fact in issue; 2) Mr. Wysocki’s opinions constitute inadmissible legal opinions and conclusions concerning the legal duties applicable to the parties and and how those duties were allegedly breached; and 3) Mr. Wysocki’s opinions regarding the contributions of Plaintiffs, refusal of Defendants to admit Plaintiffs to the LLC, and subsequent tax and accounting of the business will not be helpful to the trier of fact since facts contrary to those upon which his opinion are based have been admitted under oath by Defendants, and are subject to an adverse instruction to the jury. Simply put, Mr. Wysocki’s report is an inadmissible attempt by Defendants to state a factual narrative that is contrary to their own sworn testimony, interpret the evidence in 3 a manner favorable to Defendants despite their sanctioned failure to provide bookkeeping documents, and make determinations that are ultimately reserved for the Court and the jury. As of the date of this filing, Exhibit 1 is the only report generated by Mr. Wysocki. The report was issued in May of 2022. The report relies upon the Articles of Organization, meeting minutes, operating agreement, May 2, 2022 affidavit of Defendant Z. Lin, and IRS tax filings of the company. See Ex. 1, p. 7. Based solely upon these documents, Mr. Wysocki proffered the following opinions: A. MEMBERS OF THE COMPANY. It is my opinion that Mr. Zuoquan and Mr. Nengbao have constituted members of the Company since July 18, 2019. It is my opinion that Plaintiffs nor Defendants treated Plaintiffs as members of the Company since July 18, 2019. It is my opinion that it is customary for a prospective investor in a business substantially similar to the Company to conduct due diligence on such business, including, without limitation, obtaining a copy of any organizational documents and/or limited liability company agreement of such business. It is my opinion that it is customary for an investor in a business substantially similar to the Company to enter into a written Membership Interest Purchase Agreement, Subscription Agreement and/or Joinder Agreement to an Operating Agreement with such business in connection with any investment in the business. It is my opinion that the Operating Agreement requires Mr. Zuoquan’s and/or Mr. Nengbao’s written consent in order for Mr. Zuoquan and/or Mr. Nengbao, respectively, to transfer all or a portion of their ownership interest in the Company. It is my opinion that the Operating Agreement requires Mr. Zuoquan’s and/or Mr. Nengbao’s written consent to add new members of the Company. B. MANAGEMENT OF THE COMPANY. It is my opinion that the Company’s business and affairs are managed by the Company’s members, Mr. Zuoquan and Mr. Nengbao. It is my opinion that Mr. Zuoquan is the Company’s registered agent. C. PLAINTIFFS’ FUNDING. It is my opinion that Plaintiffs and Defendants have treated Plaintiffs’ Funding as unsecured loan(s) by Plaintiffs to the Company and/or Mr. Zuoquan. D. PLAINTIFFS’ PAYMENTS. It is my opinion that Plaintiffs’ Payments weren’t treated by Plaintiffs nor Defendants as distributions of the profits of the Company to Plaintiffs as members of the Company. It is my opinion that Plaintiffs and Defendants treated Plaintiffs’ Payments as a return by the Company of a portion of the principal amount of loan(s) by Plaintiffs to the Company. 4 After Mr. Wysocki’s report was issued, Defendant Z. Lin, in both his personal and professional capacity as designated 30(b)6 witness for Defendant Shoyu Denver, LLC, testified repeatedly (and contrary to the opinions proffered in the report) that Plaintiffs were actually partners in the business (Z. Lin Dep. 42:19-43:3, 71:11-74:17, attached as Exhibit 3 to Plaintiff’s Motion for Partial Summary Judgment); that the contributions of the Plaintiffs were not loans but rather investments (Z. Lin Dep. 2, 149:7-18) ; that the Plaintiffs were owed and were paid profits of the company (Z. Lin Dep. 35:4-24) ;that evidence of the contributions would have been kept in the unproduced ledger (Z. Lin Dep., 110:6-12); that the Plaintiffs were not consulted with or advised of the operating agreement before Defendants signed them without Plaintiffs (Z. Lin Dep. 82:1-8 ); and that even after the signing of the operating agreement, Defendants told Plaintiffs that they were members and shareholders of the company (N. Lin Dep. 42:24-42:6 attached as Exhibit 5 to Plaintiff’s Motion for Partial Summary Judgment ). In preparing his report, Mr. Wysocki did not review the unproduced accounting ledger, which this Court has ruled “would have contained evidence related to the Plaintiffs’ contributions to the business, payments made by the Plaintiffs for the benefit of the business, and cash payments made by Defendants.” Order Granting Spoliation Sanctions, January 30, 2023. Mr. Wysocki also did not review the sworn deposition testimony of Defendants Z. Lin and Shoyu Denver, LLC which directly contradict the opinions proffered by Mr. Wysocki. Mr. Wysocki’s opinions and report are of questionable merit, but, more importantly, are unhelpful to the jury. Any probative value of the proffered opinions are outweighed by the danger of unfair prejudice and will tend to confuse the issues as they are in direct opposition to the testimony of Defendants and can only serve to mislead the jury. 5 LEGAL AUTHORITY Trial courts have an obligation to serve as gatekeepers regarding the propriety of expert testimony. Lawrence v. People, 486 P.3d 269, 278 (Colo. 2021) Kumho Tire Co. v. Carmichael, 526 U.S. 137, 147-49, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999)(clarifying that the court’s gatekeeper function applies to all expert testimony, not just testimony based in science). It is in this Court’s discretion whether to admit purported “expert testimony.” People v. Martinez, 74 P.3d 316, 322 (Colo.2003). C.R.E. 702 governs a trial court’s determination as to the admissibility of scientific or other expert testimony. People v. Shreck, 22 P.3d 68, 72 (Colo. 2011). C.R.E. 702 provides that “[i]f 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.” In determining the admissibility of expert testimony, the Court must employ a Shreck analysis, determining (1) whether the scientific principles underlying the testimony are reasonably reliable; (2) whether the expert is qualified to offer opinions on such matters; (3) whether the expert testimony will be helpful to the jury; and (4) whether the proffered evidence satisfies C.R.E. 403. Shreck, 22 P.3d at 72. Otherwise stated, Rulle 702 requires that expert testimony be both reliable and relevant. Estate of Ford v. Eicher, 250 P.3d 262, 266 (Colo. 2011)(citing People v. Shreck, 22 P.3d 68, 77 (Colo. 2001). When an expert’s opinions are based not on scientific principles, but rather specialized knowledge derived from experience, the opinions are still subject to an inquiry regarding validity and reliability. Brooks v. People, 975 P.2d 1105, 1114 (Colo. 1999). “A trial court’s reliability inquiry under C.R.E. 702 should be broad in nature and consider the totality of the circumstance 6 of each case.” Shreck, 22 P.3d at 78. A trial court should consider the following in determining reliability and relevancy of expert testimony: (1) whether the method used by the witness is reasonably reliable; (2) whether the witness is qualified to express an opinion on such matters; and (3) whether the witness’s testimony would be useful to the jury.” Estate of Ford v. Eicher, 220 P.3d 939, 943 (Colo .App. 2008). Expert testimony is helpful if it “will assist the trier of fact to understand the evidence or determine a fact in issue.” People v. Lesslie, 939 P.2d 443, 450 (Colo. App. 1996). “Expert opinion that relies on bare assertions, subjective belief, or unsupported speculation will not satisfy [C.R.E. 702’s] reliability requirement.” Estate of Ford v. Eicher, 250 P.3d 262, 267 (Colo. 2011). “Speculative testimony that would be unreliable and therefore inadmissible under C.R.E. 702 is opinion testimony that has no relatively sound basis.” United States v. Crabbe, 556 F.Supp.2d 1217, 1222-1223 (D. Colo. 2008). A court may reject expert testimony that is connected to existing data only by a bare assertion resting on the authority of the expert. Ramirez, 155 P.3d at 378 (citing Gen. Elec. Co. v. Joiner, 522 U.S. 136, 146 (1997)). The policy considerations behind this principle are well documented: the dangers of opinion testimony without a scientific basis is that what appears to be scientific testimony, but really is not, may carry more weight with the jury than it deserves. Id. For this reason, expert testimony which may be permissible under C.R.E. 702 must also be screened under C.R.E. 403 to ensure that the probative value of the scientific or other evidence is not substantially outweighed by unfair prejudice, confusion of the issues, undue delay, waste of time, or needless presentation of cumulative evidence. Shreck, 22 P.3d at 78-79. “In conducting this analysis, a court must issue specific findings of its consideration under C.R.E. 403 as to 7 whether the probative value of the evidence is substantially outweighed by its prejudicial effect.” Id., at 78. This consideration contemplates an analysis of such factors as the importance of the fact of consequence for which the evidence is offered, the strength and length of the chain of inferences necessary to establish the fact of consequence, the availability of alternative means of proof, whether the fact of consequence for which the evidence is offered is being disputed, and, if appropriate, the potential effectiveness of a limiting instruction in the event of admission. Vialpando v. People, 727 P.2d 1090, 1096 (Colo. 1986). Importantly, trial courts have drawn a distinction between permissible opinion testimony that embraces an ultimate issue of fact under C.R.E. 704, and impermissible opinion testimony regarding the applicable law or legal standard. A “trial judge ought to insist that a proffered expert bring to the jury more than the lawyers can offer in argument.” People v. Williams, 790 P2d 796, 798 (Colo. 1990) (quoting In re Air Crash Disaster at New Orleans, Louisiana, 795 F.2d 1230, 1233 (5th Cir 1986)). To that end, Colorado case law establishes that an expert may not express an opinion on the applicable law or legal standards or tell the jury what result to reach. People v. Pahl, 169 P.3d 169, 182 (Colo. 2006); People v. Lesslie, 939 P.2d 443 (Colo. App. 1996)(holding that an expert may not usurp the function of the court by expressing an opinion of the applicable law or legal standards.); Specht v. Jensen, 853 F.2d 805, 810 (10th Cir 1988)(“[W]hen the purpose of [expert] testimony is to direct the jury’s understanding of the legal standards upon which their verdict must be based, the testimony cannot be allowed.”); People v. Gaffney, 769 P.2d 1081 (Colo. 1989); Hartman v. Cmty. Responsibility Ctr., Inc., 87 P.3d 202, 206 (Colo. App. 2003) (concluding that proffered expert witness testimony should be excluded because it contemplated the reasonableness of Plaintiff’s conduct, which was a matter of law.). Simply put, an expert 8 witness may not provide testimony opining that one party did nor did not breach its legal duties to another party. A trial court is vested with the discretion to decide whether an evidentiary hearing would aid in its Shreck analysis and is not required to conduct an evidentiary hearing under Shreck provided the parties have submitted sufficient for the court to make specific findings under C.R.E. 702 and C.R.E. 403. People v. Rector, 248 P.3d 1196, 1201 (Colo. 2011). LEGAL ARGUMENT A. Mr. Wysocki’s opinions are inadmissible pursuant to C.R.E. 702. a. Mr. Wysocki takes it upon himself to analyze and interpret the Operating Agreement and the existence of legal duties, thereby invading the province of the Court and the jury. One of the issues for the jury to resolve in this case is the whether the Plaintiffs were partners in the business Prior to the filing of the Operating Agreement. Defendants have testified that they were, but Mr. Wysocki merely recites the provisions of the operating agreement. This is a transparent effort to tell this Court and the jury what result should be reached on a critical issue for the jury’s resolution. This is inappropriate and inadmissible at trial. While expert testimony can be used to assist the jury in determining a fact in issue, it may not be used to usurp the Court’s function of instructing the jury as to the law by expressing a legal opinion as to the nature and scope of the legal duties of the parties to one another. See e.g., Hartman, 87 P.3d at 205-206 (affirming trial court order granting motion in limine barring expert opinion testimony as to the nature and scope of legal duties owed by a fiduciary); Grogan v. Taylor, 877 P.2d 1374, 1384 (Colo. App. 1994)(reversing trial court decision to allow an expert witness to interpret the statute of limitations for the jury). The Colorado Court of Appeals has previously 9 found that a jury was able to make fact determinations as to whether a contract was breached without the aid of expert testimony since there was sufficient evidence before the jury to allow it to interpret the contract. See Town of Breckenridge v. Golforce, Inc., 851 P.2d 214, 216 (Colo. App. 1992)(stating that “[w]hether there has been a breach of a contract is an issue for the fact finder” and finding that“ there was sufficient evidence before the jury to allow it to interpret the contract and determine whether the terms thereof were breached.”). These opinions are unnecessary, unsubstantiated, lack foundation and invade the province of the Court and jury by making the ultimate legal conclusions that Plaintiffs did not invest in the company and partner with the Defendants. More specifically, Mr. Wysocki is attempting to substitute his judgment for that of the jury by improperly providing a factual narrative advanced by Defendants in pursuit of their claims and defenses – a narrative that was later belied by the testimony of Defendants. Defendants did not provide Mr. Wysocki with the unproduced financial ledger. Mr. Wysocki does not have all of the factual information necessary for him to accurately formulate his opinions based on the evidence summarized in his report. What’s more, the jury is capable of determining for itself what the evidence means, including the duties and obligations of the partners. Opinions and/or arguments as to how the jury should view and interpret the facts is properly reserved to counsel – not Mr. Wysocki. Accordingly, these opinions exceed the permissible scope of C.R.E. 702 and are likely to confuse and mislead the jury under C.R.E. 403. As a result, Plaintiffs are entitled to an order striking those portions of the report and excluding any such legal opinion testimony from Mr. Wysocki at trial. b. Mr. Wysocki must not be permitted to offer expert testimony about whether it is “customary” for investors in a business to enter into an Operating Agreement, or to conduct due diligence because no complete opinions or the basis for the opinions has been disclosed. 10 Despite the obligation to disclose both the complete opinions of an expert and the bases and reasons for those opinions, there has been no such disclosure with respect to the following opinions: 1. It is my opinion that it is customary for a prospective investor in a business substantially similar to the Company to conduct due diligence on such business, including, without limitation, obtaining a copy of any organizational documents and/or limited liability company agreement of such business. 2. It is my opinion that it is customary for an investor in a business substantially similar to the Company to enter into a written Membership Interest Purchase Agreement, Subscription Agreement and/or Joinder Agreement to an Operating Agreement with such business in connection with any investment in the business. C.R.C.P. 26(a)(2)(B)(I) and (II) require disclosure of “a complete description of all opinions to be expressed and the basis and reasons therefor,” as well as “a list of the data or other information considered by the witness in forming the opinions[.]” As noted by the Tenth Circuit in Smith v. Ford Motor Company, 626 F. 2d 784 (10th Cir. 1980): Effective cross-examination of an expert witness requires advance preparation. The lawyer even with the help of his own experts frequently cannot anticipate the particular approach his adversary’s expert will take or the data on which he will base his judgment on the stand. 626 F. 2d at 793 (quoting from Advisory Committee Notes, Rule 26, F.R.C.P., 28 U.S.C.A). Among the purposes of pre-trial discovery are the elimination of surprise at trial, discovery of all relevant evidence, and the simplification of issues. Samms v. District Court, 908 P.2d 520, 525 (Colo. 1995). Defendants’ disclosure of Mr. Wysocki’s testimony on these matters is deficient in that the bases underlying the opinions are not identified in the report. Ex.1. Mr. Wysocki fails to identify what 11 information was relied upon when reaching the conclusion that what was “customary”. Since Woellner has not provided a complete opinion, his opinion will not be helpful to the trier of fact and therefore must be excluded pursuant to C.R.E. 403 and 702. c. Mr. Wysocki’s legal opinions should be excluded pursuant to C.R.E. 403. C.R.E. 403 permits courts to exclude otherwise relevant evidence if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury. Mr. Wysocki’s testimony is of limited probative value on the central facts of this case because it constitutes unsupported opinions and legal conclusions that fall within the exclusive purview of the trier of fact. He only reviewed, and repeats, the language of the operating agreement. He did not review or articulate any basis for reconciling the contrary testimony of the Defendants. It is clear, based on the listing of information considered when preparing the report, that Mr. Wysocki did not have access to all available facts and documents. It is also entirely possible that Mr. Wysocki chose to review only certain exhibits attached to the complaint or counterclaims provided to him by Defendants. As a result, Mr. Wysocki’s testimony will be confusing to a jury and is unlikely to “assist the trier of fact to understand the evidence or determine a fact in issue.” C.R.E. 702. The danger of unfair prejudice is especially manifest here as the Defendants have testified repeatedly under oath to facts that are in direct opposition to the opinions proffered by Mr. Wysocki that he based, in part, on Defendants sworn affidavit. These “opinions” are likely to mislead or confuse the jury. There is a substantial likelihood that the jury to put undue weight on Mr. Wysocki’s testimony instead of reaching its own conclusion. Accordingly, for the foregoing reasons, the proffered expert testimony by Plaintiff should be precluded by this court. WHEREFORE, Plaintiffs respectfully requests that the Court grant their Motion to Exclude 12 Mr. Wysocki’s Expert Report Pursuant to C.R.E. 702 and C.R.E 403 and preclude his appearance as an Expert Witness, and any such further relief the Court deems appropriate. Respectfully submitted this 19th day of May, 2023. ROBINSON & HENRY, P.C. By: /s/ Christopher Barr Davlin Joseph J. Novak, #41904 Christopher Barr Davlin, #39257 Attorneys for Plaintiffs Xuanzhi Bai and Junchen Dai CERTIFICATE OF SERVICE I hereby certify that on this 19th day of May, 2023 a true and correct copy of the foregoing PLAINTIFFS’ MOTION TO EXCLUDE DEEFENDANT’S RETAINED EXPERT JEREMY S. WYSOCKI was electronically filed and served via the Colorado Courts E-Filing System to all counsel of record as follows: Charles S. McIntyre IV, Esq. AQMN Law 155 Cook Street, Suite 451 Denver, Colorado 80206 Attorney for Defendant Shoyu Denver, LLC and Defendant Zuoquan Lin Christopher W. Carr Dill Dill Carr Stonebreaker & Hutchings, P.C. 455 Sherman Street, Suite 300 Denver, Colorado 80203 Attorney for Defendant Nengbao Lin ROBINSON & HENRY, P.C. By: /s/ Christopher Barr Davlin 13 Pursuant to C.R.C.P. 121 § 1-26(7) a true and correct copy of the foregoing with original or scanned signatures is maintained at the offices of Robinson & Henry, P.C. and will be made available for inspection or review upon request. 14