Pogil v. KPMG L.L.P.

Background

Boris Pogil alleged that KPMG discriminated against him based on gender and caregiver status when it terminated his employment in a reduction-in-force in 2020. He also asserted other claims, including retaliation and unpaid-overtime claims. During discovery, Pogil offered the expert report of Joseph Rosenberg, a financial analyst and economist, to support his request for front pay—future damages intended to compensate for losses caused by unlawful termination.

Rosenberg’s report focused on the value of hypothetical contributions KPMG would have made to a 401(k) plan. It assumed that Pogil would have remained at KPMG for 33 years, been promoted one or more times, received annual raises and 10% bonuses, continued receiving contributions under KPMG’s 2022 401(k) plan, invested those contributions aggressively, and earned stock-market returns comparable to historical returns. The report estimated present-value losses ranging from $607,999 to $2,232,736 under its principal scenarios.

KPMG’s Motion

KPMG moved to exclude Rosenberg’s testimony under Federal Rule of Evidence 702, which permits expert testimony only when it is helpful, based on sufficient facts or data, produced by reliable methods, and reliably applied to the case. KPMG argued that the report was irrelevant because Pogil had obtained higher-paying employment, that it improperly included investment returns before discounting the award to present value, and that its assumptions were unreliable.

Pogil argued that his current employment was not comparable to his former KPMG position, that the comparability question should be left to a jury, and that challenges to Rosenberg’s assumptions concerned the weight of the evidence rather than its admissibility.

Court’s Analysis

The court declined to exclude the report as irrelevant. Whether Pogil had obtained, or could obtain, comparable employment was ultimately a question for the jury on the record before the court. The court therefore did not resolve that issue in deciding the motion.

The court nevertheless excluded the report because its analysis was speculative and unreliable at multiple steps. Rosenberg had no evidentiary basis for assuming that Pogil would have stayed at KPMG until retirement, particularly given Pogil’s history of changing jobs frequently and Rosenberg’s failure to analyze employee tenure at KPMG or comparable firms. The court also found no adequate basis for assuming that Pogil would have been promoted to Manager, later promoted again, or received annual bonuses for decades. Rosenberg did not claim expertise in KPMG’s promotion or bonus practices and described his promotion assumptions as hypotheticals.

The court found the remaining assumptions unsupported as well. The report assumed that KPMG would keep its 2022 401(k) plan in place for 33 years and that Pogil would invest aggressively, even though he had never participated in a 401(k) plan and the record contained no investment track record supporting that assumption. Taken together, these assumptions prevented the report from resting on a reliable foundation.

The court identified an additional problem with the report’s damages calculation. Rosenberg projected 33 years of hypothetical stock-market gains on the assumed 401(k) contributions, then discounted the total to present value. The court reasoned that a front-pay award is paid in advance and that the recipient may invest the award independently. Awarding both the present value of hypothetical investment gains and the opportunity to earn actual investment gains on the award could produce a duplicate recovery.

Disposition

The court granted KPMG’s motion to exclude the Rosenberg Report and directed the Clerk of Court to close the motion. The opinion did not decide Pogil’s underlying discrimination, retaliation, or overtime claims.