Following the denial of a petition for rehearing en banc, over a spirited dissent, a Ninth Circuit panel issued its amended order on November 27, 2018 in Sali v. Corona Regional Medical Center, holding that evidence need not be admissible to be considered at the class certification stage. The panel held: "Inadmissibility alone is not a proper basis to reject evidence in support of class certification."
The panel found a declaration from a paralegal employed by plaintiff's counsel regarding damages suffered for wage and hour violations to be properly considered to support a motion for class certification. In his dissent to denial for the petition for rehearing en banc, Judge Carlos Bea wrote that the panel's decision on this issue was "plainly wrong," misread an earlier Ninth Circuit opinion on the issue and put the Ninth Circuit on the "short side of a lopsided circuit split."
The district court held that the class could not be certified because the plaintiffs did not submit admissible evidence to show they suffered damages comparable to the putative class, as required by the typicality element of Rule 23(a). The district court declined to consider a declaration submitted by a paralegal employed by the law firm representing the plaintiffs. The paralegal's declaration stated that he created a spreadsheet containing data from hundreds of time sheets and found that on average, the medical center's time policy undercounted clock-in and clock-out times by 8 minutes per shift. The district court recognized three deficiencies with the proffered declaration. Namely, the paralegal (1) lacked personal knowledge of the data in the spreadsheet and could not authenticate it, (2) offered opinion testimony; and (3) did not have the qualifications to make "cumulative conclusions" and analysis on raw data. The Ninth Circuit panel held that a motion for class certification need not be accompanied by admissible evidence because the certification decision can be changed later in the litigation and reversed the decision to exclude the paralegal's declaration.
The panel's decision suggests that a lax evidentiary standard for Rule 23 applies. According to Judge Bea's dissent, this is contrary to the decision in Ellis v. Costco Wholesale Corp. where the Ninth Circuit held that "evidence must be admissible for it to be considered at the class certification stage." He reasoned that "[f]ar from supporting the panel's opinion, Costco is inconsistent with it. But rather than rehearing this case en banc to correct the conflict, we have left district courts and litigants in an impossible position." With the panel's opinion in conflict with decisions of the Second, Third, Fifth and Seventh Circuits, and arguably with direction from the Supreme Court, it likely will not be the last word on the issue.
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