March 31, 2016 Practice Points

SCOTUS Ruling Will Lead to More Daubert Challenges at Class Certification Stage

Was statistical evidence appropriately used in certifying a class of workers?

Eric S. Hochstadt

In its 6–2 decision on March 22, 2016, the Supreme Court in Tyson Foods v. Bouaphakeo (last visited Mar. 31, 2016) (hereinafter, Slip Op.) ensured that district courts will be forced to resolve the "battle of the experts" at the critical class certification stage. The key question addressed by the Supreme Court was whether statistical evidence was appropriately used in certifying a class of workers.

By way of brief background, employees of Tyson Foods who worked at a particular food processing plant brought a class action lawsuit seeking additional overtime pay for work-related "donning and doffing" their protective gear. Slip Op. at 2–3. The employees alleged that Tyson Foods did not pay them for that time resulting in underpayment of wages. Id. The company had not kept records for the time spent donning and doffing by employees. Id. at 5.As a result, employees used an expert to conduct a survey of donning and doffing time by employees at the particular plant for various tasks, and an estimate of the time was prepared. Id. Another expert for the employees used that information to derive an estimate of the uncompensated work for each employee. Id. at 5–6. Using that methodology, 212 of the 3,344 putative class members had no injury because the average donning and doffing time did not put them over the 40-hour threshold to qualify for overtime pay. Id. The company did not file a motion challenging the admissibility of this expert evidence under Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). Id. at 6. The class was certified and ultimately a jury verdict awarded $2.9 million in unpaid wages although the plaintiffs' expert evidence called for a $6.7 million award in unpaid wages. Id. at 7.

The Supreme Court analyzed whether the statistical evidence enabled the employees to meet their burden of showing that common questions would predominate over individual issues under Federal Rule of Civil Procedure 23(b)(3). Id. at 8–9. The company argued that each employee must provide that the amount of time spent donning and doffing, when added to his or her regular hours, amounted to more than 40 hours in a given week, and that this necessitated "person-specific inquiries" that would predominate over common questions. Id. at 9–10. Moreover, Tyson Foods claimed that the plaintiffs' statistical evidence "assum[es] away the very differences that make the case inappropriate for classwide resolution. Reliance on a representative sample, petitioner argues, absolves each employee of the responsibility to prove personal injury, and thus deprives petitioner of any ability to litigate its defenses to individual claims." Id. The employees argued that individual inquiries were "unnecessary because it can be assumed each employee donned and doffed for the same average time." Id. The Supreme Court concluded that "[w]hether this inference is permissible becomes the central dispute in this case." Id. at 9.

In affirming the grant of class certification, the majority rejected "the adoption of broad and categorical rules governing the use of representative and statistical evidence in class actions." Id. at 15. According to the majority, the "permissibility" of such evidence "turns not on the form a proceeding takes—be it a class or individual action—but on the degree to which the evidence is reliable in proving or disproving the elements of the relevant cause of action." Id. at 10. The majority cited the Federal Rules of Evidence for relevant evidence (401), excluding relevant evidence for prejudice, confusion, waste of time, or other reasons (403), and testimony by expert witnesses (702). Id.

In this case, the Supreme Court concluded that the statistical evidence did not trump the company's defense but, rather, the defense of the plaintiffs' expert evidence being unrepresentative or inaccurate was "common" to the class. Id. at 12. Also, the Supreme Court distinguished its holding from Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), where the "experiences of the employees … bore little resemblance to one another." Id. at 14.

The Supreme Court thus limited its holding by stating that "[t]he fairness and utility of statistical methods in contexts other than those presented here will depend on facts and circumstances particular to those cases." Id. at 15. Thus, it will be left to future class actions of all types and the district courts to assess whether and when—in the face of Daubert challenges—whether statistical evidence is admissible to support certifying a class. The admissibility of expert evidence will thus become even more crucial for parties and practitioners in the wake of Tyson Foods.

Eric S. Hochstadt is with Weil, Gotshal & Manges LLP in New York, New York.

Keywords: expert witnesses, litigation, Tyson Foods, class certification, statistical evidence

Copyright © 2016, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).