When Rule 702 Motions Fail: A Close Look At AECOM v. Flatiron

In AECOM Tech. Servs., Inc. v. Flatiron | AECOM, LLC, 2024 WL 22640 (D. Colo. 2024), the United States District Court for the District of Colorado addressed when expert testimony is not subject to be limited or excluded pursuant to Federal Rule of Evidence 702.

Background

In 2015, AECOM Technical Services, Inc. ("AECOM") and Flatiron | AECOM, LLC ("Flatiron") entered into an agreement, in which they agreed to work together to assemble a design/build team for the purposes of submitting a proposal to the Colorado Department of Transportation's ("CDOT") construction project known as C-470 Tolled Express Lanes Segment 1 Design-Build Project (the "Project"). AECOM provided the design and engineering services, and Flatiron submitted the proposal to CDOT. On or about June 16, 2016, CDOT awarded Flatiron the Project. Flatiron later claimed that AECOM's design failed to follow basic engineering and project requirements.

AECOM filed a motion in limine to exclude the expert testimony of Dr. Kenneth J. O'Connell and James Melvin Torres pursuant to F.R.E 702. Dr. Kenneth O'Connell served as Flatiron's standard of care expert and James Melvin Torres served as Flatiron's damage expert.

Court's Analysis

Kenneth O'Connell

Dr. O'Connell opined that AECOM's performance of Pre-Award Design services included 72 violations of the standard of care due to the "significant deviations" between AECOM's preliminary Pre-Award Design and the final released for construction design that Flatiron constructed. AECOM sought to exclude certain opinions Dr. O'Connell expressed because they would be unhelpful to the jury and were based on flawed methodology.

• Unhelpful to the Jury

AECOM argued that Dr. O'Connell's list of 72 violations of the standard of care failed to calculate or opine what, if any, scope growth, quantity increases, schedule impacts, cost increases, or damages were caused by the violations of the standard of care. Therefore, AECOM argued that Dr. O'Connell's opinion was irrelevant and would not be helpful for the jury to determine damages. Flatiron argued that when the standard of care is outside the common knowledge and experience of an ordinary person, expert testimony is needed and that its expert need not to quantify the damage caused by each individual violation of the standard of care when the violations are "intertwined and overlapping."

The Court agreed with Flatiron, since Dr. O'Connell was a standard of care expert, not a damage expert, the Court found that his opinions would help the jury understand the issue of liability. Consequently, the Court denied this portion of the motion.

• Methodology

AECOM argued that Dr. O'Connell's methodology was flawed because it treated every change between the Pre-Awarded Design and the final release for construction design as a violation of the standard of care without considering other factors. Specifically, he did not consider other confounding factors. Therefore, AECOM argued Dr. O'Connell's methodology was unreliable and would not assist the jury. Flatiron argued that what gives rise to the violation of the standard of care is not that there are differences between the Pre-Awarded Design and the final release for construction, but rather the reasons for why there are differences. Flatiron goes on to emphasize that its expert was not obligated to adopt AECOM's assumptions.

The Court agreed with Flatiron because the majority of AECOM's criticisms were directed at Dr. O'Connell's data and assumptions rather than his methodology. Therefore, "they go to the weight of his opinions, rather than their admissibility." See City of Westminster v. Centric-Jones Constructors, 100 P.3d 472, 477 (Colo. App. 2003). Consequently, the Court denied this portion of the motion.

James Melvin Torres

AECOM sought to exclude Mr. Torres's opinions that address AECOM's alleged violations of the standard of care. Specifically, the opinion that calculated damages based on what AECOM describes at the Total Cost Method. Under this method, AECOM explained that damages were "assumed to be the difference between the total costs incurred by the contractor to complete a project, and its bid amount." AECOM argued that this method is highly disfavored and that Colorado has rejected the Total Cost Method because it ignores causation and assumes all of plaintiffs' costs are prima facie reasonable. City of Westminster, 100 P.3d at 479.

AECOM acknowledges that Mr. Torres employed a slightly different method, namely the Modified Total Cost Method, which AECOM argued is a version of the Total Cost Method but modifies them by structuring such things as bid errors, unreasonable costs, and costs that are not the responsibility of the defendant. Flatiron disputed that Colorado courts have rejected the Total Cost Method by distinguishing AECOM's interpretation of City of Westminster, stating it "stands for the proposition that there should be a basis for differentiating between costs attributable to the defendant, and costs for which the defendant was not legally or contractually liable." 100 P.3d at 478. The Court permitted Torres to offer his damages opinion based on the Modified Total Cost Method because Flatiron would not be able to prove the damages element of its breach of contract claim. The Court denied this portion of the motion and found that challenges to Mr. Torres were best suited for cross examination.

Key Takeaways

The AECOM decision provides useful guidance on when courts may deny Rule of Evidence 702 motions.

1. Proof of Damages
   Under Colorado law, "the plaintiff in a breach of contract action ... must ... provide the factfinder with a reasonable basis for calculating actual damages in accordance with the relevant measure... However, proof of damages with mathematical certainty is not required." City of Westminster, 100 P.3d at 477.
   
   
2. Uncertainty in the Amount of Damages v. the Cause of Damages
   Uncertainty about the precise amount of damages does not preclude recovery. Uncertainty as to the cause from which the damages proceed does support the rejection of a damage claim because it is "too remote, or conjectural or speculative." City of Westminster, 100 P.3d at 478.

Conclusion

AECOM v. Flatiron underscores that Colorado courts will not grant a Rule of Evidence 702 motion when expert testimony will help the jury understand the issue of liability, the basis for experts have a reasonable basis for their calculation of damages, and when the uncertainty is around the amount of damages rather than the cause of the damages.

Practical Implications for Litigators and Carriers

The AECOM decision reinforces several practical realities of modern construction litigation that are of particular importance to litigators and insurance carriers.

First, total cost damages theories remain suspect. Colorado courts continue to view pure total cost methodologies with skepticism because they risk collapsing causation, presuming bid accuracy, and attributing all cost overruns to the defendant by default. While not categorically barred, total cost approaches invite heightened scrutiny and are vulnerable where they fail to meaningfully differentiate between defendant-caused costs and those attributable to other project participants or contractor inefficiencies.

Second, modified total cost theories remain viable, but only when grounded in documented causation analysis. The Court's ruling underscores that a modified total cost approach is not saved by nomenclature alone. To survive Rule 702 scrutiny, the expert must demonstrate a reasoned analytical process, including review of contemporaneous project records, evaluation of alternative causes of cost growth, and affirmative exclusion of costs attributable to non-defendant factors. Where project-wide disruption makes precise segregation impractical, courts are more likely to permit aggregated damages theories and leave allocation disputes for the jury.

Third, Rule 702 is not a substitute for trial or dispositive motion practice. The decision reflects a broader judicial reluctance to use expert admissibility rulings as a vehicle for resolving fact-intensive damages disputes. Where an expert's methodology is sufficiently reliable and tied to the evidentiary record, challenges to causation and allocation are more appropriately addressed through cross-examination, competing expert testimony, and motions for summary judgment, rather than exclusion.