The 2010 amendments to Rule 26 were designed to protect from disclosure communications between attorneys and their experts and sought to delineate the discovery boundaries of expert-related materials. First, Rule 26(a)(2)(B)(ii) was modified to require disclosure of "facts or data" considered by an expert witness, eliminating the broader language requiring disclosure of "data or other information." Despite increasing protection for attorney-client communications and attorney work product, the advisory committee instructed courts to interpret "facts or data" broadly, compelling disclosure of allfacts and data considered, rather than just those on which the expert relied. Fed. R. Civ. P. 26(a)(2)(B) advisory committee's note (2010 amend.).
Another change was the addition of Rule 26(b)(4)(C), which added work-product protection for "communications between the party's attorney and [testifying experts], regardless of the form of the communications." Rule 26(b)(4)(B), also added in 2010, states that the work-product doctrine protects all drafts of expert reports. According to the advisory note on Rule 26, the amendment aims "to limit disclosure to material of a factual nature by excluding theories or mental impressions of counsel." Fed. R. Civ. P. 26(b)(3)(B) advisory committee's note (2010 amend.). Rule 26(b)(4)(C) carves out three specific exceptions, rendering discoverable all communications relating to expert compensation, facts and data that the attorney provided and the expert considered, and any attorney-proffered assumptions on which the expert relied.
Since the amendments became effective, courts nationwide have applied the new standard preserving the attorney work-product privilege and protecting expert draft reports. However, they have also generally followed the advisory committee instructions that the terms "facts" and "data" should be construed broadly, concluding that such materials as statutes and policies, draft worksheets prepared by clients, and documents generated by the experts, including case summaries and notes, outlines, memos, presentations, and letters, are all discoverable. See, e.g., D.G. v. Henry, 2011 WL 1344200, at *1 (N.D. Okla. 2011); In re Application of Republic of Ecuador, 280 F.R.D. 506, 512–13 (N.D. Cal. 2012), aff'd sub nom. Republic of Ecuador v. Mackay, 742 F.3d 860 (9th Cir. 2014).
The essence of the modified rule encouraged full disclosure of all expert work product, protecting only drafts of expert reports and the "theories or mental impressions" of attorneys. Fed. R. Civ. P. 26(b)(3)(B) advisory committee's note (2010 amend.). Thus, despite the greater protection for attorney-expert communications, the standard remains favorable to the party seeking disclosure. See Oklahoma v. Tyson Foods, Inc., 2009 WL 1578937, at *5 (N.D. Okla. June 2, 2009).
One of the remaining challenges in the wake of the 2010 amendments is in drawing lines between the roles of a single expert who initially consults and subsequently testifies. It is common for attorneys to retain a consulting expert with the intention of retaining a separate testifying expert to avoid disclosure of all work product and communications involving the former. However, attorneys often turn their consulting experts into testifying witnesses due to considerations of cost, efficiency, and subject-matter expertise. In such circumstances, a question often arises: Where along the expert spectrum do the materials and communications become discoverable? Courts are clear that a mere temporal demarcation between an expert's work as a consultant and his or her work as a testifying witness is not sufficient to protect the consulting work from disclosure. See Yeda Research & Dev. Co. v. Abbott GmbH & Co. KG, 292 F.R.D. 97, 112 (D.D.C. 2013) ("[W]hether time has passed is not the pertinent inquiry.").
The touchstone of the inquiry is the substantive nature of the work performed. Id. (stating that the key question is the substantive relationship between the expert's two roles). Thus, an expert's work on two distinct types of subject matter—such as analyzing compensation data to determine pay disparity in a gender discrimination class action as a consulting expert and later analyzing promotion data to determine disparate treatment or impact for purposes of testimony—would create such a line of demarcation. However, an expert who analyzed compensation data to determine pay disparity among managers as a consultant and was then asked to testify about compensation data involving nonexempt employees might not be able to establish the bright lines necessary to protect from disclosure the materials generated in connection with the former. Moreover, if an attorney or client is employing two sets of experts from the same firm, supplying a consulting expert with one set of materials and a testifying expert with a different set of materials can help preserve that substantive separation; the consulting expert can then have access to documents from which the testifying expert will be walled and will thus not be required to disclose.
Experts at Class Certification
Until the Third Circuit decision In re Hydrogen Peroxide Antitrust Litigation, 552 F.3d 305 (3d Cir. 2008), as amended (Jan. 16, 2009), courts were reluctant to weigh expert testimony at the class-certification stage, taking to heart the holding of Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974), that courts should not address the merits of a case at that pretrial stage.
The Hydrogen Peroxide court departed from this principle, holding that to meet the rigorous standards of class certification, the district court must weigh the credibility of competing experts to the extent that testimony goes to the requirements of Rule 23. Although a court may decline to consider an expert's opinion if it deems that testimony unnecessary to determine certification, it may not shrink from considering a "genuine legal or factual dispute because of a concern for an overlap with the merits." After Hydrogen Peroxide, other circuit courts followed suit in holding that an inquiry into what would otherwise be the merits of a case was suitable at the class-certification stage. See e.g., Am. Honda Motor Co. v. Allen, 600 F.3d 813, 816 (7th Cir. 2010) (holding that a conclusive Daubert analysis is required at class certification).
This then laid the foundation for Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2541 (2011), in which the Supreme Court, in dicta, cast doubt on the district court's conclusion that a Daubert inquiry did not apply to experts at the class-certification stage. Id. at 2553–54 ("We doubt that is so."). Although the issue of the role of the expert was not front and center in Dukes, the Court's discussion of the rigor of the Rule 23 standard, particularly related to the element of commonality, led to a recognition that determinations under Rule 23 often "entail some overlap with the merits" of the underlying claim. See Brinker Rest. Corp. v. Superior Court, 53 Cal. 4th 1004, 1023–24 (2012). That recognition led to the question of what role expert testimony should play at class certification where an "overlap of the merits" might be appropriate.
In the wake of Dukes, many courts seized on Justice Scalia's Daubert dicta to conclude that a rigorous expert analysis was required at the class-certification stage, recognizing the principle that some consideration of the merits may be appropriate at this stage in the proceedings. See, e.g., Fosmire v. Progressive Max Ins. Co., 277 F.R.D. 625, 629 (W.D. Wash. 2011). The stage was then set for the Supreme Court to address the issue squarely in Comcast v. Behrend, 133 S. Ct. 1426 (2013), in which the issue presented was "whether a district court may certify a class action without resolving whether the plaintiff class has introduced admissible evidence, including expert testimony, to show that the case is susceptible to awarding damages on a class-wide basis." However, the Supreme Court sidestepped the issue, changing the question presented on appeal and engaging in a narrower holding that certification was improper because the plaintiffs failed to establish that damages could be measured on a class-wide basis. Thus, although Comcast dodged the issue of whether a court must engage in a full Daubert analysis at the class-certification stage, the lower courts in growing numbers are answering this question in the affirmative, and the roles of experts in high-stakes cases will therefore likely increase in importance.
Managing the Costs of Expert Services
As experts' roles in litigation increase and attorneys begin retaining experts at earlier phases in litigation, attorneys must consider the cost of hiring an expert. Attorneys should identify the objectives of an expert's services and develop with the expert a mutual understanding on the scope of engagement. A helpful retention letter sets forth the services to be performed, the respective responsibilities of expert, client, and client counsel, and the applicable expert billing rate. To avoid the surprise of an unexpected bill, the retention letter may require monthly periodic billing, and the parties may agree to a budget.
In most complex litigation, issues arise that were not anticipated at the outset of the engagement. Regular communication with experts will ensure that the engagement is progressing as expected and that experts have the required information to form the basis of their opinions. Attorneys and their experts should proactively discuss any revised cost expectations if the scope of the expert services has changed. Clear and frequent communication with experts will ensure that there are no surprises regarding the expert deliverables and associated costs.
Keywords: litigation, expert witnesses, consulting witness, testifying witness, Federal Rule of Civil Procedure 26, disclosure
Gary Friedman is a partner at Weil, Gotshal & Manges, LLP, in New York City, New York. David Greenbaum is a vice president of Litigation and Employment for Nuance Communications, Inc., in Mahwah, New Jersey. Brian Sullivan is a director at Navigant Consulting, Inc., in Philadelphia, Pennsylvania. Daniella Adler, an associate at Weil, Gotshal & Manges, LLP, in New York, also assisted in the preparation of this article.
Navigant Consulting is the Litigation Advisory Services Sponsor of the ABA Section of Litigation. This article should be not construed as an endorsement by the ABA or ABA Entities.