## Facts

- A recreational diver, Steven M. Wagner, claimed he injured his shoulder during a scuba dive conducted from the vessel *ILLUSIONS* in the British Virgin Islands.
- Wagner alleged the injury occurred while removing his buoyancy control device at the end of a dive and attributed the injury to negligence by Illusions Holdings, Inc. and the dive leader/captain.
- During discovery, Illusions noticed depositions of two British Virgin Islands-based individuals: Joe Giacinto (a dive operators association president) and Michael Van Balricum (a scuba business owner).
- Wagner demanded expert disclosures and reports before the depositions, asserting the witnesses were experts.
- Illusions proceeded without providing Rule 26(a)(2) disclosures, asserting the witnesses were lay witnesses.
- At deposition, neither witness testified from personal perception of the incident; both provided technical/industry testimony about local dive-site conditions, proper diving techniques, and scuba equipment use.
- Wagner moved to preclude their testimony and sought costs and fees related to the depositions and motion practice.

## Issues

1. Whether witnesses offering testimony based on specialized scuba-diving knowledge, without firsthand knowledge of the incident, must be treated as expert witnesses for purposes of Fed. R. Civ. P. 26(a)(2).
2. Whether failure to provide Rule 26(a)(2) expert disclosures and reports warranted preclusion under Fed. R. Civ. P. 37(c)(1).
3. Whether the court should award expenses, including attorney’s fees, caused by the failure to make required expert disclosures.

## Decision

- The court classified Giacinto and Van Balricum as expert witnesses because their opinions depended on specialized knowledge rather than personal observation of the events at issue.
- The court found Illusions failed to comply with Rule 26(a)(2) by not providing required expert disclosures and reports.
- The court precluded the witnesses from offering expert testimony at trial under Rule 37(c)(1), finding the noncompliance was neither substantially justified nor harmless.
- The court awarded at least some costs and/or fees associated with the depositions and the motion attributable to the discovery violation.

## Legal Principles

- Courts determine expert status based on the substance of the proposed testimony; labeling a witness “lay” does not avoid Rule 26(a)(2) when the testimony relies on scientific, technical, or other specialized knowledge.
- When a witness’s opinions are based on specialized knowledge rather than firsthand perception, the witness is subject to expert disclosure obligations under Rule 26(a)(2).
- Under Rule 37(c)(1), exclusion of undisclosed expert testimony is an appropriate sanction unless the failure to disclose is substantially justified or harmless.
- Expense-shifting, including attorney’s fees, may be imposed when a party’s discovery noncompliance causes avoidable deposition and motion costs.

## Conclusion

The court enforced Rule 26(a)(2) by treating technical scuba-industry testimony from non-eyewitnesses as expert opinion, precluding the testimony for lack of required disclosures and imposing monetary relief to address costs caused by the discovery violation.


In re Illusions Holdings, Inc., 189 F.R.D. 316 (S.D.N.Y. 1999)