Judge Forrest, in an opinion today, denied class certification in a case accusing Deutsche Bank of misleading public statements concerning its exposure to mortgage-backed securities. The opinion was driven by Judge Forrest’s decision to disqualify the plaintiffs’ expert, Michael Marek, who testified that Deutsche Bank’s global registered shares (“GRSs”) traded on an efficient market. She concluded he was not qualified to offer the opinions he offered, and that there were major methodological problems with his opinions:
While Marek has proffered opinions in areas as diverse as damages, loss causation, and market efficiency in his career, and although Marek has “achieved professional designation of Chartered Financial Analyst” and is a member in good standing of the CFA Institute, Marek does not have any of the basic graduate education, teaching, or research experience or publications that would provide the Court some basis to believe that he has the qualifications necessary to make his opinions reliable: he has not been specially trained by academics in the field; he has not written articles, taught any courses, or conducted any relevant research. Instead, Marek’s training appears to have been one year he spent working for a firm after college and then his work for an economist who was later indicted for submitting false declarations. The fact that Marek has -after Torkelson was indicted -now gone into business as an “expert” himself, does not an expert with reliable qualifications make. For this court to rely on testimony from someone who lacks real expertise asks this Court to dispense with the need for real qualifications. That is not the law. One cannot become an expert simply by deeming himself as such . . . . Several of the flaws in Marek’s analysis demonstrate his lack of true qualifications. For instance, in Marek’s first report, he fails to tackle plainly important considerations: that more than 90% of the DB GRSs were traded outside the U.S., that another market (Germany) drove the pricing in the U.S., that the financial crisis was ongoing throughout the Class Period, and that there were short sale bans in both the U.S. and in Germany at various points during the Class Period.
Our prior post on the case is here.