In the recent appellate decision of Duennebeil v. Paramount Financial Services, 2025 UT App 141, the Utah Court of Appeals addressed the pivotal role of a Business, Financial & Marketing Expert Witness in litigation involving claims of negligence and misrepresentation by financial professionals. This case provides critical guidance on when expert testimony is required to establish the standard of care in complex investment disputes.
Background and Parties
A group of investors, including Roxanne Duennebeil and others, brought suit against Paramount Financial Services, Inc.—operating under the business name Live Abundant—its founder Douglas R. Andrew, and several licensed insurance agents. The investors alleged that the defendants introduced and recommended a real estate investment product that ultimately failed, resulting in significant financial losses. The claims included breach of fiduciary duty, negligence, negligent misrepresentation, and unjust enrichment.
Role and Methods of the Expert Witness
Central to the litigation was the question of whether the plaintiffs were required to present testimony from a Business, Financial & Marketing Expert Witness to establish the standard of care applicable to the defendants’ conduct. The Live Abundant Parties argued that the complexity of the investment products and the professional duties involved necessitated expert testimony to inform the jury about industry standards and proper conduct for financial and insurance professionals.
The plaintiffs, however, contended that the facts of the case—particularly the alleged misrepresentations regarding the defendants’ own investments and returns—were within the common knowledge and experience of lay jurors, obviating the need for expert analysis.
Court’s Daubert and Reliability Analysis
The trial court denied the defendants’ motions for judgment as a matter of law, holding that expert testimony was not required under the circumstances. The court reasoned that the jury could rely on its own common sense to determine whether the defendants breached their duties in presenting unregulated investment opportunities.
On appeal, the Utah Court of Appeals conducted a detailed analysis of when expert testimony is necessary in cases involving business and financial professionals. The court referenced precedent holding that expert testimony is generally required when the subject matter is beyond the common knowledge of laypersons, particularly in cases involving complex financial instruments or professional standards. However, the court also recognized exceptions where the alleged misconduct—such as lying about personal investment or exaggerating returns—is readily understandable by a jury without expert assistance.
The appellate court affirmed the trial court’s nuanced approach, emphasizing that the need for expert testimony must be assessed on a claim-by-claim and element-by-element basis. The court cited prior authority for the proposition that “the gravity of investment advisors misrepresenting their participation in an investment and the consequence of lying about, or even exaggerating, the return they have received on their investment is certainly within the common knowledge and experience of the lay[person].” Thus, for claims based on straightforward misrepresentation, expert testimony was not required.
Impact of Expert Testimony on the Outcome
The jury ultimately found in favor of the investors on several claims, including negligence, negligent misrepresentation, and unjust enrichment, but not on breach of fiduciary duty. The absence of a Business, Financial & Marketing Expert Witness did not preclude recovery on those claims where the jury could apply its own understanding. The appellate court’s decision underscores that while expert testimony is often indispensable in business and financial litigation, it is not universally required—particularly where the alleged conduct falls within the realm of ordinary experience.
This case stands as a significant precedent clarifying the boundaries of expert witness necessity in investment-related negligence actions, providing valuable guidance for litigants and courts confronting similar issues in the future.