In a federal district court in Washington, a liquor distributor sued the supplier of Four Roses bourbon for damages for improperly terminating its distribution agreement. The distributor also went after the new distributor the supplier switched to, which is allowed under state law, and won an award in arbitration based on the fair market value of lost distribution rights. The judge at arbitration found, that while the damages expert had the required expertise, he was not persuasive as to the amount of damages, and his estimate was reduced in the final award.

On the rocks? In the case against the supplier, the defendants argued that the damages expert (the same one from the arbitration) should be excluded under Daubert because his testimony would be a “rehash” of his opinion during the arbitration, which was found to be overly optimistic in terms of the projections and thus unreliable. But the court declined to exclude the expert, saying that optimism did not make his testimony unreliable as long as it was acceptable. The expert had disclosed his assumptions and methodology for determining lost profits, and the defendants did not show that the methods were not reliable.

The arguments to exclude the expert went to the weight rather than the admissibility of the testimony. The defendants can challenge the expert’s inputs and assumptions at trial.

The case is Am. Nw. Distribs. v. Four Roses Distillery LLC, 2024 U.S. Dist. LEXIS 148934; 2024 WL 3925038, and a case digest and full opinion are available on the BVLaw platform.