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48. Should the stockholder be permitted to testify to his opinion?
A stockholder sued a corporation for losses he allegedly suffered when the price of the corporation's publicly traded stock dropped. The price drop occurred shortly after it was publicly revealed that the corporation had released false earnings reports. At trial, the stockholder seeks to testify that, in his opinion, the drop in the corporation's stock price was directly attributable to the public revelation about the false earnings reports. The stockholder has conceded that he has no formal education or training in economics or the stock market.
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B is incorrect. If otherwise qualified, an expert witness who has a personal interest in the outcome of an action may still testify in that action. The expert's personal interest may be explored on cross-examination. In this case, however, the stockholder is not qualified as an expert and, thus, may not testify to his opinion on stock price changes.
C is incorrect. Under FRE 701, as a lay witness, the testimony must be limited to that which is not based on scientific, technical, or other specialized knowledge within the scope of FRE 702. An admissible opinion about the cause of the price drop cannot be based on the stockholder's perception because such an opinion requires expertise the stockholder does not possess. Further, the stockholder's opinion testimony will not be helpful to the trier of fact because the stockholder is not an expert who is qualified to speak to the issue of causation.
D is incorrect. Under FRE 701, property owners may express opinions on the value of their property. Here, however, the stockholder seeks to express his opinion on the cause of the publicly traded stock's price drop. Such testimony requires a witness with specialized knowledge about the stock market, which the stockholder does not have.