IQ Holdings, Inc. v. Am. Comm. Lines, Inc., C.A. No. 6369-VCL (Del Ch. Aug. 30, 2012).

Short Overview:

This short letter ruling addressed the effort of the plaintiff in an appraisal proceeding to submit an updated expert report beyond the deadline for submitting such reports. The updated report also changed the substance of the same expert’s earlier report in a material manner. The Court of Chancery explained why the supplemental revised report, and any testimony regarding it, would not be admissible at trial.

Why this case is noteworthy:

This decision is useful for litigators to keep handy because is explains the importance (in the Delaware Court of Chancery) of adhering to the various deadlines in scheduling orders, and how unlikely it is for the Court of Chancery to agree to change those deadlines, or allow extensions of those deadlines, especially as trial becomes imminent.

The Court also provides copious citations to cases that support the public policy behind pre-trial disclosures being made as early as possible, and the need to avoid “trial by surprise”, as well as the need to avoid the prejudice that may result from belated disclosure.

Although the Court acknowledges the benefit, especially in an appraisal case, of updated expert reports where concessions may be made to reach agreement with all parties on a particular issue to reduce the matters to be addressed by the Court, in this case the change was material, new and contested, so that to allow it would be contrary to the principle that supports the compliance with deadlines in order to avoid surprise that “deprive[s] the opposing party of an orderly process in which to confront and respond to the expert’s views.” See generally, Ams. Mining Corp. v. Theriault, __ A.3d __, __, 2012 WL 3642345, at *21 (Del. Aug. 27, 2012)(recent Delaware Supreme Court opinion upholding the exclusion of a witness sought to be offered for trial testimony after the applicable deadline passed for identifying witnesses).