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govinfo:USCOURTS-vtd-2_22-cv-00215-6
UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF VERMONT
BURLINGTON SCHOOL DISTRICT, )
)
Plaintiff, )
)
v. ) Case No. 2:22-cv-215
)
MONSANTO CO., SOLUTIA, INC., )
and PHARMACIA LLC, )
)
Defendants. )
OPINION AND ORDER
The Burlington School District (“BSD” or “Plaintiff”)
commenced this action after discovering polychlorinated
biphenyls (“PCBs”) at Burlington High School (“BHS”). Defendants
Monsanto Co., Solutia, Inc., and Pharmacia LLC (collectively
“Monsanto” or “Defendants”) are allegedly successors to the old
Monsanto company, which was the primary manufacturer of PCBs in
the United States for several decades. The Complaint asserts a
claim for damages resulting from PCB contamination at BHS.
Pending before the Court is Defendants’ motion to exclude
Plaintiff’s expert Christine Lee. Lee is a financial analyst
retained by Plaintiff to provide an opinion about the damages
incurred as the result of PCB contamination. Defendants submit
their motion to exclude pursuant to Rules 702 and 403 of the
Federal Rules of Evidence. For reasons set forth below, their
motion is denied.
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Background
The Complaint alleges that PCBs are toxic and dangerous
chemical compounds that were manufactured, marketed, and sold by
Monsanto in the United States from approximately 1929 to 1977.
BHS was constructed in the 1960s, and testing recently revealed
the presence of PCBs in its buildings. The BSD concluded that
because of PCB contamination, BHS had to be demolished.
Plaintiff hired Lee to calculate the cost resulting from
PCB contamination at BHS, with the assumption that PCBs were the
driving force behind the need to replace the school. Lee is a
financial analyst and a Principal of Industrial Economics,
Incorporated (“IEc”), an economics, finance, and environmental
science consulting firm in Cambridge, Massachusetts. She
received her undergraduate degree from the University of
California at San Diego, and a Master’s in Environmental
Management from Yale University. Her graduate coursework
included a mix of environmental sciences and economics. She has
worked for IEc for over twenty years, focusing on financial
analysis and economic damage calculations for public and private
entities impacted by environmental harms. ECF No. 138-2 at 6-7.
Lee calculated the cost of replacing BHS as $313,415,891,
with a present value of $216,383,648. She subtracted from this
the “but-for” scenario cost of renovating the school if PCB
contamination had not impacted the BSD’s decision-making. That
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alternative “but-for” cost scenario amounted to $113,906,963,
with a present value of $81,182,478. Accordingly, Lee’s total
damages calculation, being the difference between the two
scenarios calculated for present value, is $135,201,169.
Defendants’ motion is critical of Lee’s calculations in
several respects. They first argue that her calculations are not
consistent with Vermont law. Defendants contend that the Vermont
Supreme Court has allowed only two ways to calculate damages in
building contamination cases, and that Lee did not use either
method. Defendants next argue that Lee’s method is unreliable,
as she allegedly failed to consider a $10 million estimate for
remediating PCBs, failed to isolate damages attributable to
PCBs, and did not adequately account for differences between the
old and new BHS campuses. Defendants’ third criticism is that
Lee’s calculation amounts to “simple arithmetic” and thus does
not aid the jury. ECF No. 138 at 9, 18-19.
Plaintiff defends Lee’s analysis and argues that, rather
than bright line rules, the Vermont Supreme Court has endorsed a
case-by-case approach with a focus on reaching a fair and
reasonable result. Plaintiff argues that Lee’s methodology is
permitted under Vermont law, that her calculations are reliable
and helpful, and that she should be allowed to present her
opinions to the jury. Plaintiff further submits that Lee will
not opine on whether BHS needed to be completely rebuilt, as
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opposed to merely remediated, as that is a question of fact for
the jury. Her job, instead, is to assume that PCBs compelled the
BSD to rebuild the school, and to assess the cost of that
decision.
Discussion
I. Legal Standards: Rules 702 and 403
“Federal Rule of Evidence 702 imposes a special obligation
upon a trial judge to ensure that any and all [expert] testimony
. . . is not only relevant, but reliable.” Kumho Tire Co. v.
Carmichael, 526 U.S. 137, 147 (1999) (internal quotation marks
omitted). Witnesses may testify as experts if they are
“qualified . . . by knowledge, skill, experience, training, or
education.” Fed. R. Evid. 702. The Rule provides that a witness
who is qualified may testify in the form of an opinion or
otherwise if the proponent demonstrates to the Court that it is
more likely than not that:
(a) the expert’s scientific, technical, or other
specialized knowledge will help the trier of fact to
understand the evidence or to determine a fact in
issue; (b) the testimony is based on sufficient facts
or data; (c) the testimony is the product of reliable
principles and methods; and (d) the expert’s opinion
reflects a reliable application of the principles and
methods to the facts of the case.
Fed. R. Evid. 702. “The proponent of the expert testimony bears
the burden of establishing by a preponderance of the evidence
that the admissibility requirements of Rule 702 are satisfied.”
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United States v. Pollok, 139 F.4th 126, 140 (2d Cir. 2025)
(internal quotation marks omitted).
“In addition to the requirements of Rule 702, expert
testimony is subject to Rule 403,” which allows courts to bar
evidence “if its probative value is substantially outweighed by
the danger of unfair prejudice, confusion of the issues, or
misleading the jury.” Nimely v. City of New York, 414 F.3d 381,
397 (2d Cir. 2005) (quoting Fed. R. Evid. 403)). Because Rule
403 plays a “uniquely important role . . . in a district court’s
scrutiny of expert testimony, given the unique weight such
evidence may have in a jury’s deliberations,” courts “weighing
possible prejudice against probative force under Rule 403 . . .
exercise[ ] more control over experts than over lay witnesses.”
Id. (citing Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579,
595 (1993)).
II. Vermont Law on Damages
Defendants contend that Lee’s methodology is contrary to
Vermont law. Their primary citation is the Vermont Supreme
Court’s holding in Langlois v. Town of Proctor, 2014 VT 130.
Langlois involved a dispute with the Town of Proctor after the
Town neglected to turn off the plaintiff’s water as promised. As
a result of the Town’s inaction, the plaintiff’s pipes froze and
burst causing significant damage to her building. One question
before the court was how to properly assess damages.
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The Vermont Supreme Court noted that in the context of a
tort action for damage to real property, it had previously
stated the rule for damages as follows:
If the injury is temporary in the sense that
restoration can cure the harm, the reasonable cost of
repair may serve the need and provide adequate and
fair compensation. If the damage is permanent and
beyond full repair, the variance in value of the
property before and after the injury often affords the
better guide to a just award. It all depends upon the
character of the property and the nature and extent of
the injury.
Langlois, 2014 VT 130, ¶ 41 (quoting Bean v. Sears, Roebuck &
Co., 129 Vt. 278, 282 (1971)). The Town of Proctor argued that
the trial court should have also considered whether measuring
damages according to the cost of repair is inappropriate if that
cost is out of proportion to the underlying value of the
property. Id.
Langlois acknowledged that “our explanation in Bean that
‘[i]t all depends up on the character of the property and the
nature and extent of the injury’ is not especially descriptive,
but in that opinion we also refer to ‘reasonable cost of repair’
and a ‘just award.’” Id., ¶ 43 (quoting Bean, 129 Vt. at 282).
The Vermont Supreme Court clarified that “[o]ur touchstone for
determining damages, in tort as in contract, is reasonableness.”
Id. The court next concluded that, as the Town suggested, “the
proportionality of cost-of-repair damages relative to the value
of the property prior to a tort injury to property is part of
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the general inquiry on the reasonableness of damages.” Id. The
court also offered that although the trial court did not err in
providing a jury instruction consistent with the Bean standard,
“the instruction might have been clearer had it used the word
‘reasonable’ in reference to the amount of damages to be
awarded.” Id., ¶ 48.
In this case, Defendants argue that the calculation of
damages is limited to the measures specifically set forth in
Bean and Langlois. Those measures distinguish between temporary
and permanent harm, with damages from temporary harm being
determined by the cost of repair, and damages from permanent
harm assessed according to the value of the property before and
after that harm. As the Vermont Supreme Court stated in
Langlois, a trier of fact may also consider the doctrine of
“economic waste” and determine whether it is reasonable to
assess the entire cost of repair in light of the relative value
of the property. Id., ¶ 43. Because Lee’s calculations did not
apply any of these methods, Defendants argue that they must be
excluded.
Defendants are correct that Lee’s calculations did not
apply the measures described in Bean and confirmed in Langlois.
Specifically, she did not calculate the reasonable cost of
repair or evaluate the value of the property before and after
the harm. Instead, she considered that the BSD had planned a
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thorough renovation of the school, set to cost over
$100,000,000, but was instead compelled to raze and rebuild the
school due to PCB contamination. She therefore subtracted the
cost of the rebuild from the proposed cost of the renovation,
reasoning that the only significant difference between the two
scenarios was the presence of allegedly-harmful PCBs. Her
analysis also considered the present value of interest payments,
applied a discount rate, incorporated the cost of renting
alternate spaces, and applied certain deductions given the
larger size of the new building. Plaintiff submits that Lee’s
conclusions are reasonable, reliable, and consistent with
Vermont law.
The Court agrees with Plaintiff that Langlois was not as
rigid as Defendants depict. Langlois confirmed the holding in
Bean, but also credited the Town of Proctor’s contention that
taking the value of the building into account is part of “the
general inquiry on the reasonableness of damages.” Id. The
Vermont Supreme Court’s flexibility on that point illustrates
that while Bean provided a basic framework for certain types of
injuries, that framework did not strictly limit what the court
and the jury could consider when determining a reasonable
damages award. As the court counseled in Bean, “[i]t all depends
upon the character of the property and the nature and extent of
the injury.” 129 Vt. at 282.
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The property in this case – a large, public high school –
is significantly different in character from those at issue in
Langlois and Bean. Langlois involved a privately-owned building
with a commercial space on the first floor and an apartment on
the second floor. 2014 VT 130, ¶ 1. Bean involved a polluted
well on a farm. 129 Vt. at 280. In contrast to those two
properties, BHS was a school building dedicated to a “special
purpose,” and as such would “not typically [be] sold on the open
market,” thus complicating the calculation of an underlying fair
market value. ECF No. 144-2 at 10 (report of Defendants’ expert
Brian C. Underwood).
The nature and extent of the injury is also
distinguishable. See Sullivan v. Saint-Gobain Performance
Plastics Corp., No. 5:16-CV-125, 2021 WL 8344552, at *4 (D. Vt.
Jan. 26, 2021) (“Langlois concerned the discharge of water which
— while very damaging in the wrong location — is not a
contaminant.”). Unlike the water damage in Langlois or the water
quality issues in Bean, the PCBs in this case allegedly made
being on the BHS campus, particularly in certain buildings,
dangerous to human health. The BSD, which had already planned a
significant renovation, determined that renovation was no longer
viable given the level of PCB contamination, and that the campus
needed to be torn down.
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Plaintiff submits that the reasonableness of the BSD’s
decision to destroy and rebuild BHS is a question of fact for
the jury.1 Defendants criticize the choice to raze and rebuild,
arguing that Lee should have considered a proposed PCB
remediation plan that would have cost approximately $10 million.
Plaintiff argues that remediation itself would have involved
unknown additional expenses, including permanent monitoring and
the possibility of additional remediation if efforts to control
the contamination were unsuccessful. Plaintiff further reports
that the initial estimated cost of remediation did not include
BHS’s Building F, which test results revealed was the most
contaminated building on campus. More relevant to the current
motion, Lee was not asked to offer an opinion on those various
unknowns. The BSD chose not to remediate, the jury may evaluate
that decision, and Lee assessed the cost to Plaintiff of fully
eradicating PCBs at the school.
1 Defendants contend that there is no fact in dispute, and that
their position on that question is argued in full in their
motion for summary judgment. With respect to the instant motion
to exclude testimony, the Court will consider that question only
insofar as it is relevant under Rules 702 and 403. Lee’s task
was to perform an analysis as requested by the Plaintiff. She
was not asked to review whether the BSD’s decision to tear down
and rebuild the school was reasonable under the circumstances.
Moreover, whether Lee or another expert could have analyzed
additional scenarios is not the issue. Instead, the Court
considers only the contents of Lee’s proposed testimony in the
context of Vermont’s substantive law and the Federal Rules of
Evidence.
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Defendants further contend that Lee failed to consider the
doctrine of economic waste. As discussed previously, that
doctrine essentially requires a cap on damages if those damages
exceed the value of the building or property. In Langlois, the
Vermont Supreme Court held that “the proportionality of cost-of-
repair damages relative to the value of the property prior to a
tort injury to property is part of the general inquiry on the
reasonableness of damages.” 2014 VT 130, ¶ 43. The court did not
hold that consideration of economic waste must prevail over
other measures of reasonableness. Id.
Moreover, the complexity of applying the doctrine of
economic waste to BHS weighs against barring Lee’s testimony on
damages. Defendants intend to offer an expert who determined
that the “use value” of BHS for its demolition was effectively
zero due to accrued depreciation and deferred maintenance
issues. ECF No. 134 at 45-46 n.7. Defendants therefore argue
that “any cost-of-repair damages for PCBs would be unreasonable
and excessive under the economic waste doctrine.” ECF No. 179 at
10. While this issue, and others relevant to damages, will
likely be addressed in the context of Defendants’ motion for
summary judgment and perhaps again at trial, the Court declines
at this time to exclude an expert based on the theory the
Plaintiff is not entitled to any damages.
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Plaintiff is offering an expert to opine on what it deems
to be a reasonable assessment of damages. The Vermont Supreme
Court, while specifically endorsing certain measures of property
damage, has regularly asserted that the “touchstone for
determining damages . . . is reasonableness.” Langlois, 2014 VT
130, ¶ 43 (citing Bean, 129 Vt. at 282). The Court finds that,
rather than limiting that determination to precise formulas and
doctrines, the Vermont Supreme Court has displayed flexibility
depending on “the character of the property and the nature and
extent of the injury.” Id., ¶ 43 (quoting Bean, 129 Vt. at 282).
In this case, the character of the property is uniquely complex,
and the nature and extent of the injury was allegedly widespread
and toxic. The Court therefore finds that the formulas cited in
Bean and Langlois do not limit the scope of what is reasonable,
and will not exclude Lee’s proposed testimony as inconsistent
with Vermont law.
III. Lee’s Opinions
Defendants argue that Lee merely performed simple
subtraction. Her report, however, reveals a more complex
analysis. Lee modeled debt service payments by the BSD between
2020 and 2044, with coupons ranging from 3% to 6%, and converted
the payments to present day value based upon the payment date.
She also applied a discount rate. While Defendants argue that
Lee failed to consider differences between the old and new
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buildings, Plaintiff notes that she accounted for the larger
size of the new building, deducting only those costs impacted by
that larger size.
Defendants ultimately contend that because Lee’s analysis
is inconsistent with Vermont law, it is “irrelevant and
unhelpful” and must be barred under Rule 702. Defendants do not
challenge Lee’s qualifications to conduct the analysis set forth
in her report. They argue that she is not qualified to assess
fair market value, yet that assessment is not part of her
approach. Defendants’ other criticisms, such as the claim that
Lee improperly failed to consider utility upgrades in the new
building, can be explored during cross-examination.
For purposes of a Rule 702 evaluation, the Court finds that
Lee is qualified to conduct her analysis, that her report is
reliable under Vermont law, and that her testimony will be
helpful to the jury. Defendants do not challenge, and the Court
finds no issue with, either her data or the principles applied
in performing her calculations. In the end, Plaintiff has met
its burden of showing by a preponderance of the evidence that
Lee’s analysis meets each of the requirements of Rule 702,
including that her opinion reflects a reasonable application of
her expertise to the facts of this case. Fed. R. Evid. 702(d).
The Court similarly finds that Lee’s testimony, as
described on the record to date, will satisfy the requirements
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of Rule 403. See Fed. R. Evid. 403. Defendants argue that
because her testimony is inconsistent with Vermont law, it may
not be considered by a jury and its probative value is therefore
outweighed by the risk of it being misleading or confusing. The
Court finds that, to the contrary, Lee’s analysis is within the
bounds of the Vermont Supreme Court’s approach to damages.
Consequently, her testimony is likely to be probative on that
issue. The motion to exclude her testimony under either Rule 702
or Rule 403 is therefore denied.
Conclusion
For the reasons set forth above, Defendants’ motion to
exclude the expert testimony of Christine Lee (ECF No. 138) is
denied.
DATED at Burlington, in the District of Vermont, this 18
th
day of March 2026.
/s/ William K. Sessions III
Hon. William K. Sessions III
U.S. District Court Judge
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