United States: Experts Must Satisfy Daubert Standards At Certification Stage

Last Updated: June 6 2018
Article by Gregory V. Mersol

D.C. District Court Follows Dukes Admonition

Nearly seven years ago, in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), the Supreme Court addressed, at least in significant respect, the question of whether experts must satisfy Daubert standards at the class certification stage. In that case, the plaintiffs sought to use expert testimony about claimed gender bias in "corporate culture," testimony the defendant sought to exclude. In relying on the testimony, the Dukes district court held that "Daubert did not apply to expert testimony at the certification stage." In response to this pronouncement, the majority of the Supreme Court simply stated, "We doubt that is so." We blogged this issue and the state of the law in 2011. Even prior to Dukes, it appeared that the majority of courts did find Daubert standards to apply.

Last month, the 9th Circuit issued its decision in Sali v. Corona Regional Medical Center, No. 15-56460 (9th Cir., May 3, 2018). We blogged that decision here. Curiously, while the 9th Circuit addressed and even relied upon various portions of the Dukes decision, it went on to hold that Daubert standards did not apply at the certification stage. The order does not meaningfully address the part of Dukes that specifically cast doubt on such a holding. The 9th Circuit then went on to find that the district court actually abused its discretion in denying certification of a class alleging improper time-keeping and payroll practices.

A more thorough and thoughtful opinion is that of the D.C. District Court in Campbell v. National Railroad Passenger Corp., Civil Action No. 99-2927 (D.D.C., Apr. 26, 2018). The Campbell case involved claims of race discrimination in a host of employment practices at Amtrak. The putative class included 11,000 unionized Amtrak employees, former employees and applicants for employment. The plaintiffs moved for certification, which the defendant opposed in part by arguing that the plaintiffs' experts could not meet Daubert standards.

In ruling on this issue, the court noted that the application of Daubert standards had "beguiled the federal courts" (citation omitted). Addressing the Supreme Court's decision in Dukes, it noted:

The Supreme Court has strongly hinted that district courts should apply the same standard at the class-certification stage that they would apply to expert testimony offered at a later stage of proceedings. See Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 354 (2011) (casting "doubt" on the conclusion "that Daubert did not apply to expert testimony at the certification stage of class-action proceedings").

Noting that the Supreme Court had been unable to reach the question later in the case of Comcast Corp. v. Behrend, 569 U.S. 27 (2013), the district court then engaged in a scholarly review of the case law on this issue. It found that most courts applied Daubert, some did not and some applied an intermediate standard. Those that did not apply Daubert tended to find that it was not appropriate to address merits issues at the certification stage or that doing so at that stage was "premature." But the majority that did follow Daubert did so for several reasons that included:

  • A full Daubert inquiry was more consistent with the "rigorous analysis" required of certification decisions generally.
  • The 2003 amendments to Rule 23 removed "conditional" certification as an option.
  • The Dukes decision obligated courts to consider merits issues at the certification stage.

The district court therefore concluded that Daubert standards did apply. While it found that two of the plaintiffs' experts did meet Daubert standards, one did not. That expert, Jay Finkelman, was an industrial psychiatrist. Based largely on documents selected by plaintiffs' counsel, Dr. Finkelman opined that Amtrak's policies were not "consistent with generally accepted human resources practices and the general principles of industrial organizational psychology." The court found, however, that Dr. Finkelman had not reviewed many critical documents, such as the depositions of Amtrak's human resources employees, job-selection documents, or the company's anti-discrimination policies or complaint procedures. Indeed, the court found that he frequently relied on slanted summaries of testimony prepared by plaintiffs' counsel. Worse, Dr. Finkelman did not "cite a single study, report, or other source for his opinions related to appropriate human-resources policies and practices. And, although he opines that Amtrak permitted an inappropriate degree of subjectivity in its hiring and promotion practices, Dr. Finkelman did not attempt to measure the degree of subjectivity at Amtrak." Finding significant problems with the claimed facts relied upon by Dr. Finkelman as well as his methodology (or lack of it), the district court excluded his testimony and ultimately denied certification.

The district court rightly decided this issue. The core of the plaintiffs' case was tied to a report that did little more than echo issues made up by their lawyers. Given the size of the case (as with any class action), relying on such flimsy evidence would only cost the court and the parties extensive resources for a case that likely could never be proven. Without a mechanism to screen out unsustainable expert testimony, courts would certify weak classes that simply cannot be sustained over time.

The bottom line: The 9th Circuit notwithstanding, most courts continue to apply the commonsense rule that Daubert standards should apply to experts in certification proceedings.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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