Does Daubert Standard Apply in Class Certification?

In their effort to satisfy the commonality requirement of Rule 23(a), Plaintiffs relied in part on expert witness William Bielby, who opined concerning the supposed prevalence of gender discrimination in large institutions like Wal-Mart. Bielby’s testimony was not adequately scrutinized for reliability by the district court, despite Wal-Mart’s motion challenging the testimony under Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579 (1993).
Both the district court and the Ninth Circuit erred in failing to acknowledge that the Daubert standard applies to expert testimony proffered by plaintiffs in order to satisfy Rule 23’s class certification requirements. Instead, the lower courts ruled that a Daubert inquiry would intrude on merits issues in a manner supposedly prohibited at the class certification stage and that therefore Rule 23’s requirements were satisfied by applying a less demanding standard to evaluate the reliability, and hence admissibility, of Bielby’s testimony.

Federal Rule of Evidence 702 and the Court’s holding in Daubert create a single standard for evaluating the reliability of expert testimony, whether at trial or at the class certification stage of an action. Scrutiny of proffered expert testimony is no less important at the certification stage than at any other part of the litigation process. Indeed, recognizing the important consequences of class certification, this Court has ruled, specifically in the context of Title VII, the Court has ruled that a trial court may certify a class only after it has conducted a “rigorous analysis” to determine that all of Rule 23(a)’s requirements have truly been satisfied. Gen. Tel. Co. of the Southwest v. Falcon (“Falcon”), 457 U.S. 147 (1982).

Numerous circuit courts have therefore properly ruled that, for the purpose of this “rigorous analysis,” a trial court’s Rule 23 inquiry may permissibly, and sometimes must, overlap merits issues. Here the lower courts failed to follow the jurisprudence of this Court and the reasoning of courts in other circuits. They thereby permitted a class to be certified, at least in part, on the basis of expert testimony that was never properly tested for reliability under the Daubert standard but was instead admitted under a less rigorous, ad hoc, standard. The failure to apply sufficiently rigorous standards to Rule 23(a) determinations increases the likelihood that classes will be certified improperly, increasing the likelihood that defendants will be required to litigate meritless class actions. In such situations, business defendants are faced with the choice between hazarding trial and possible liability for huge money judgments or settling for large sums despite the weakness of the plaintiffs’ class claims.

Issue Areas:

Sound Science

Read the Amicus Brief:
Question(s) Presented:

Whether the class certification ordered under Federal Rule of Civil Procedure 23(b)(2) was consistent with Rule 23(a).


ALF’s Amicus Brief:

ALF and NELF argue in a joint amicus brief that the certification order in controversy is not consistent with rule 23(a). Plaintiffs rely heavily on their sociology expert, William Bielby, who opined that Wal-Mart and other large organizations are “vulnerable to gender bias.” Pet. App. 195a. This thesis, if accepted, would render every large organization — public or private, commercial or governmental or non-profit — open to a Title VII claim when, the the Ninth Circuit itself recognized, the facts suggest that the defendant’s culture “may include gender stereotyping.” The district court too noted that “Bielby’s opinions have a built-in degree of conjecture” and do not evidence that any stereotyping actually occurred or that it was common to all class members. At most the evidence offered by this testimony, if taken as true, would prove that Walmart’s pay and promotion policies could possibly result in individual disparities, not that such a disparity would necessarily or inevitably disadvantage women as a class. The evidence supplied by Bielby did not support his conclusion that Walmart discriminated against the putative class.

Because the testimony was unreliable, it should have been ruled inadmissible, however the district court denied Walmart’s motion to strike because it held, in error, that a “Daubert inquiry” was impermissible at the class certification stage because it touched too closely to issues of merit. The Ninth Circuit affirmed on narrower grounds that Daubert functions differently in class certification than at trial. Both of these courts erred, because Daubert application of Federal Rule of Evidence 702 is not limited to trial. Indeed, all three cases in the “Daubert trilogy” (Daubert, Joiner and Kumho Tire) reached this Court after summary judgment decisions. Nothing in this Court’s jurisprudence suggests that the analysis of evidence supporting class certification should be less rigorous. Lightening the evidentiary burden for certification will be a windfall for the plaintiff’s bar, in forcing large companies to settle once they become subjected to massive liability despite a weak showing supporting class certification. See Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007).

The Daubert standard applies to “any scientific testimony.” Amici ask this Court to reverse the erroneous decisions below.

Status:

On June 20, 2011, the Supreme Court issued a favorable opinion.

Date Originally Posted: January 24, 2011

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