- 8 -
The act of producing the reports to respondent constitutes an
adoption of belief in the truth of their contents pursuant to
rule 801(d)(2)(B) of the Federal Rules of Evidence.
Consequently, we hold that the requirements of rule 801(d)(2)(B)
of the Federal Rules of Evidence are satisfied and the Cardenas
reports are admissible.4
The estate vaguely suggests that the Cardenas reports were
provided to respondent during settlement negotiations and,
therefore, are inadmissible pursuant to rule 408 of the Federal
Rules of Evidence. Although respondent acknowledged at trial
that there may be some question as to whether the Cardenas
reports were provided to respondent during settlement
negotiations, the estate failed to demonstrate that such was the
case. Consequently, we hold that the estate has not shown that
the Cardenas reports are inadmissible pursuant to rule 408 of the
Federal Rules of Evidence.
The estate's other main argument against the admission of
Mr. Marx's report is based upon our holding in Diego Investors IV
4 The Cardenas reports are admissible on other grounds as
well. One significant distinction between expert and fact
witnesses is that experts are permitted to rely on evidence
outside the trial record. See H Group Holding, Inc. v.
Commissioner, T.C. Memo. 1999-334. The evidence outside the
record may be hearsay and need not be otherwise admissible, but
it can be used by the expert to formulate an opinion. See Fed.
R. Evid. 703.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011