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ABA SECTION OF LABOR AND EMPLOYMENT LAW3rd ANNUAL CLE CONFERENCE
THE WAGE & HOUR TRACKLITIGATING WAGE AND HOUR CLASS ACTIONS
WASHINGTON, D.C.
November 6, 2009
David BorgenGoldstein, Demchak, Baller, Borgen & Dardarian
300 Lakeside Drive, Suite 1000Oakland, CA 94612Tel: (510) 763-9800Fax: (510) 835-1417
Shannon Liss-RiordanBrant A. Casavant
Lichten & Liss-Riordan, P.C.100 Cambridge St., 20th Floor
Boston, MA 02114Tel: (617) 994-5800Fax: (617) 994-5801
Suzanne J. ThomasK&L Gates LLP
925 Fourth Avenue, Suite 2900Seattle, WA 98104Tel: (206) 370-6642Fax: (206) 370-6315
Eve CervantezAltshuler, Berzon LLP
177 Post Street, Suite 300San Francisco, CA 94108-4733
Tel: (415) 421-7151Fax: (415) 362-8064
Theodora LeeLittler Mendelson
650 California Street, 20th FloorSan Francisco, CA 94108
Tel: (415) 677-3132Fax: (415) 743-6770
TABLE OF CONTENTS
PAGE(S)
I. PRE-LITIGATION RECLASSIFICATION OF NON-EXEMPT EMPLOYEES .... 1
II. WAGE AND HOUR CLASS OR COLLECTIVE ACTION CASE MANAGEMENTPLANNING 5
A. Each Group Action Presents its own Management Challenges 6
1. "View from the Bench" - the role of the Court: 7
B. The Manageability of a Class Action is Different than Managing a Class Actionfor Purposes of Determining whether Class Certification is Appropriate 7
C. Development of Case Management Plan 8
D. The Parties' Management Challenges 9
1. Are the Plaintiff and Class Counsel "Adequate"? 9
2. Are "Anonymous" Plaintiffs appropriate? 10
3. Care Must be Taken in Pre-certification, Post-filing Contact with PotentialClass Members 13
a. Precautionary Steps: 14
E. Discovery Strategies 16
1. What Documents Mayan Agency or Employer Have to Produce Relating toits Investigation Leading to, or in Defense of, Suit? 16
F. Is a Special Discovery Master Needed? 18
1. View from the Bench 18
G. Some Strategic Considerations Regarding Motions to Dismiss and OtherDispositive Motions 18
1. Timing of Summary Judgment and other Dispositive Motion Strategies ..... 18
2. View from the Bench: 19
3. Consider the Value of Initial Limited Discover, Especially PreliminaryDiscovery as to the Appropriateness of Certification 19
4. When Does the Mootness of the Claims of a Class Representative or otherPlaintiff Mandate Dismissal of a Case? 19
H. Timing and Significance of Class Certification 21
1. When Should a Certification Motion be Made? 21
I. Case Management Post-Certification 22
1. Development of a Joint Case Management and Notice Plan 22
2. Decertification Issues 22
J. What Motions are Subject to Interlocutory Appeal? 22
K. Bifurcation of Liability and Damages 23
III. HYBRID ACTIONS 24
IV. OFFERS OF JUDGMENT (RULE 68) 31
A. Attorneys' Fees as "Costs" under the FLSA 32
B. "Picking Off' Named Plaintiffs in Wage and Hour Class Actions 35
V. REPRESENTATIVE TESTIMONY 43
VI. EXPERT EVIDENCE IN CLASS ACTIONS 48
A. Introduction 48
1. Data 49
a. Internal Data Sources 49
b. External Data Sources 52
B. Identifying Threshold Challenges For Expert Testimony 52
1. Expert Must Be Qualified on the Issues Presented 53
2. Expert's Opinion Must Not Address Matters of Common Knowledge 55
3. Expert's Legal Opinions Are Inadmissible as They Do Not Assist the Trier ofFact 57
4. Expert's Speculation Is Inadmissible as It Does Not Assist the Trier of Fact57
5. Expert Must Apply a Reliable Methodology to the Facts 58
C. Examining Expert Witnesses At Deposition & TriaL. 61
1. Disclosures and Expert Reports 61
2. General Examination Subjects for Expert Witnesses 62
a. Qualifications 62
b. First-Hand and Second-Hand Knowledge 63
c. Factnal Assnmptions and Hypothetical Questions 64
d. Prior Testimony and Pnblications 66
e. Relationship with the Opposing Party and CounseL 68
3. Examination Subjects for Time and Motion Experts 69
D. Procedures For Challenging And Excluding Expert Testimony 70
1. Motions In Limine and Daubert Hearings 72
2. Voir Dire Examination 72
3. Objections and Motions to Strike 73
This paper will focus on procedural issues that are frequently encountered in the litigation
of wage and hour class and collective actions. The topics selected for discussion below include
pre-litigation reclassification of non-exempt employees, case management, hybrid actions,
Rule 68 offers, representative evidence, and use of expert witnesses, This paper is the product of
a collaborative effort of the authors and panelists and no particular section or statement
necessarily has the agreement of all authors.
I. PRE-LITIGATION RECLASSIFICATION OF NON-EXEMPT EMPLOYEES
Sometimes employers voluntarily reclassify employees formerly classified as "exempt"
to "non-exempt" employees entitled to overtime compensation for hours worked over 40.
Similarly, employers may change work rules to compensate employees for time spent "donning
and doffing" protective equipment, even though they were formerly not compensated for this
time, or change time clock procedures to more accurately reflect breaks taken or time worked.
Employers may make these changes for any number of reasons, including (I) a general review of
workplace practices, by a lawyer or non-lawyer, that determines the employer may not be in
compliance with the FLSA or state wage and hour laws; (2) lawsuits against other employers in
the same industry or with similar pay practices; or (3) a lawsuit against the employer challenging
one or more workplace policies as violating the FLSA or state wage and hour laws.
Employers may wonder if their changes in workplace policy can be used against them in
current or future litigation. On one hand, the answer is simple. In general, employers should
always strive to bring the workplace into compliance with federal and state law. If a violation is
not corrected, the employer continues to accrue liability, and may in the end owe workers much
more than if the workplace policy were corrected sooner. Moreover, an employer who fails to
correct a known violation may be subjected to a three year rather than a two year statute of
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limitations under the FLSA, and may also be subjected to various penalties under state law, for
"willfully" violating the law.
However, it is possible that workers suing their employer for workplace violations will be
able to use the change in workplace policies as evidence against their employer. In recent years,
employers have argued that such evidence cannot be used in litigation, because it is barred by
Federal Rule of Evidence 407 as a "subsequent remedial measure."
Federal Rule of Evidence 407 provides, in relevant part "[w]hen, after an injury or harm
allegedly caused by an event, measures are taken that, if taken previously, would have made the
injury or harm less likely to occur, evidence of the subsequent remedial measure is not
admissible to prove negligence [or] culpable conduct .... This rule does not require the
exclusion of evidence of subsequent measures when offered for another purpose ..." The
purpose of excluding evidence of subsequent remedial measures is to encourage potential
defendants to take precautions without fear that such precautions will be used as evidence against
them. See, e.g., Stecyk v. Bell Helicopter Textron, Inc., 295 F.3d 408, 415 (3d Cir. 2002); Cann
v. Ford Motor Co., 658 F.2d 54, 60 (2d Cir. 1981).
Although commonly an issue in tort cases, courts have applied Rule 407 to exclude
evidence of subsequent remedial measures in a handful of employment cases. See, e.g., Dennis
v. County ofFairfax, 55 F.3d 151,154 (4th Cir. 1995) (discrimination case); McLaughlin v.
Diamond State Port Corp., 2004 WL 3059543 at *3 (D. Del. Dec. 30,2004) (discrimination). In
particular, Rule 407 has occasionally been applied in an FLSA case. See, e.g., Abel v. Dep't. of
Carr., 1995 WL 106535, at * I (D. Kan. Jan. 12, 1995) (indicating that the court would exclude
evidence of changes to workplace rules with respect to roll calls and meal breaks made in
response to a prior lawsuit, if offered to prove culpability in FLSA lawsuit); Carda v. E.H
2
Oftedal & Sons, Inc. 2005 U.S. Dist. LEXIS 26375, at *1 (D.S.D. March 23,2005) (exclusion of
subsequent remedial measures - employer's change in record keeping policy after plaintiff filed
FLSA suit - "supports the public policy of preventing a party from being punished for making
positive changes"). Other courts have excluded similar evidence on the basis that it is simply not
relevant. See Liger v. New Orleans Hornets NBA Ltd P'ship, 2008 WL 348800 at *2 (E.D. La.
Feb. 6,2008) ("evidence of [defendant's] post-lawsuit compliance with the FLSA is not relevant
to determining whether [defendant] can claim the exemption during the period of time before the
lawsuit was filed.... [Such evidence] neither negates an essential element of the FLSA
exemption, nor demonstrate[s] insufficient evidence to establish the FLSA exemption").
Plaintiffs have several good arguments for admission of the evidence, despite F.R.Evid.
407. Often the decision to reclassify employees, or to change other workplace rules, is made as
the result of a written analysis or report concerning compliance or noncompliance with federal
and state workplace rules. In general, any such analysis or report, as opposed to the actual
change in policy or procedure, is admissible under F.R.Evid. 407. That is because Rule 407 does
not prohibit introduction of"evidence of a party's own analysis of events, even if those events
result in the party taking remedial action." In re Chicago Flood Litigation, No. 93 Civ. 1214,
1995 WL 437501, *5 (N.D. Ill. July 21, 1995). Courts differentiate between post-event
investigations, and the remedy itself, and exclude evidence only of the remedy. See, e.g., Brazos
River Authority v. GE Ionics, Inc., 469 F.3d 416, 430 (5th Cir. 2006) (admitting post-accident
investigations); Prentiss & Carlisle Co., Inc. v. Koehring-Waterous Div., 972 F.2d 6,10 (1st Cir.
1992) (post-event reports, with remedial measures redacted, are not subsequent remedial
measures); Rocky Mountain Helicopters v. Bell Helicopters Textron, 805 F.2d 918 (10th Cir.
1986) (Rule 407 only bars the actual remedial measure, not initial steps toward ascertaining
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whether any measure is necessary); Zeigler v. Fisher-Price, Inc., 302 F. Supp. 2d 999, 1020-21
(N.D. Iowa 2004) (admitting product recall press release over Rule 407 objections). This is
because post-event investigations do not make the event "less likely to occur," as required by
Rule 407. See Brazos River Auth., 469 F.3d at 430 n. 10 (citing 2 Weinstein, et aI., Federal
Evidence § 407.01[1] (2d ed. 1997)). Thus, any report or analysis leading up to a change in
workplace rules is generally admissible under F.R.Evid. 407.1
Moreover, Rule 407 only excludes subsequent remedial measures when used to prove
uegligence or culpable conduct; it does not exclude evidence of "subsequent measures when
offered for another purpose." Fed.R.Evid.407. In an FLSA or state wage and hour case,
plaintiffs may often seek to introduce this evidence for some reason other than to prove
culpability. For example, plaintiffs may use this evidence to prove that they are "similarly
situated" for purposes of collective action certification. If the employer prepared a report or
analysis about potential workplace violations, and then waited a substantial length of time before
implementing workplace changes, plaintiffs may be able to argue that the employer's inaction
after receipt of the report constitutes evidence of a "willful" violation, and is admissible for that
reason.
Ultimately, an employer needs to insure compliance with federal and state wage and hour
law, and cannot escape liability by hiding its head in the sand (and, indeed, may incur even more
liability for "willful" violations by attempting to do so). If an employer's work place rules
violate wage and hour law, this can generally be proven by other facts, irrespective of any
change to company policy. So while a change in company workplace rules may provide
1 Although reports prepared by attorneys may be protected from disclosure by the attorney-clientprivilege or work-product protection, widely disseminated reports, summaries of reports sent toall affected managers, or reports constituting business decisions rather than legal advice, may notbe so protected.
4
plaintiffs' counsel with further evidence ofliability or susceptibility to collective action
certification, and probably cannot be wholly excluded by the bar against introduction of
subsequent remedial measures, employers should not eschew recommended and necessary
changes to workplace rules for fear ofpotential liability. The potential liability for inaction is
much greater.
II. WAGE AND HOUR CLASS OR COLLECTIVE ACTION CASE MANAGEMENTPLANNING
Litigators face various challenges and opportunities in the management of class,
collective, and agency wage/hour actions. Employees and former employees (including
"cOimnon-law employees) may seek "wage and hour" relief through various vehicles which
provide group relief. One obvious tool for such relief is class action relief pursuant to Fed. R.
Civ. P. 23 class action relief, or equivalent class relief under local jurisdiction laws and rules.
"Collective action" relief may be sought under the Fair Labor Standards Act ("FLSA"),
29 U.S.C. § 216(b), by an employee on behalf of herself and other similarly situated employees.
While there may be some similarities between class actions and collective actions, there are also
a number of substantive differences. As noted recently:
An action under the FLSA "may be maintained against any employer ... by anyone or more employees for and in behalf of himself or themselves and otheremployees similarly situated." 29 U.S.C. § 216(b). All plaintiffs in a FLSAcollective action must "give[] [their] consent in writing to become such a party,"and this consent must be "filed in the court in which such action is brought." 29U.S.c. § 216(b). A collective action differs from a class action in that, amongother things, it is not subject to the numerosity, commonality, typicality, andrepresentativeness requirements set forth in Fed.R.Civ.P. 23, see Vengurlekar v.Silverline Techs., Ltd., 220 F.R.D. 222, 229 (S.D.N.Y.2003). Rather, thethreshold requirements governing an FLSA collective action are those describedabove: plaintiffs must be similarly situated, and they must opt in to the proposedaction through the filing of consent. See Hunter v. Sprint Corp., 346 F.Supp.2d113, 117 (D.D.C.2004).
Whalen v. United States, 85 Fed.Cl. 380, 382-383 (2009) ("Whalen IF').
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Courts generally take a two-step approach when considering collective actions under the
FLSA. First, the court examines the pleadings and submissions of the proposed collective action
to analyze whether the proposed class members are similarly situated. If so, the court may
conditionally certify the class. This is a relatively low standard. Putative class members are
given notice and the opportunity to "opt in." The action proceeds as a representative action
throughout discovery. The plaintiffs burden at this stage is minimal, largely because of the
preliminary nature of the deternlination that potential plaintiffs are similarly situated. The second
stage of an FLSA collective action inquiry occurs after discovery is largely complete and
generally is predicated on a motion for "decertification" by the defendant. A much more robust
analysis is engaged in to determine whether the employees are sufficiently similarly situated to
continue to proceed as a class. If the clainlants are not similarly situated, the class is decertified.
The claims of the opt-in plaintiffs are dismissed without prejudice. The class representatives
then proceed to trial on their individual claims.
In addition to class and collective actions brought by employees or former employees,
various governmental agencies, such as The Department of Labor ("DOL") or similar state
agencies, have statutory authority to pursue damage and/or injunctive relief directly against an
employer? The DOL can also pursue group remedies.
A. Each Group Action Presents its own Management Challenges
Each "constituency" affected by group actions must tackle case management issues.
Such constituencies include direct FLSA plaintiffs; class representatives; opt in, opt-out or others
affected by group actions; objectors; counsel for parties; courts, and special magistrates all have
to tackle the management of group actions.
229 U.S.C.A. §§ 21 I(a), 217.
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1. "View from the Bench" - the role of the Court:
While the parties playa unique role in pursuing and defending group actions, the courts
play an even more special role. As the Honorable Barbara A. Rothstein reminds federal courts:
Class actions demand that judges playa unique role. There is no such thing as asimple class action. Everyone has hidden hazards that can surface withoutwarning. Your role includes anticipating the consequences of poorly equippedclass representatives or attorneys, inadequate class settlement provisions, andoverly generous fee stipulations. The high stakes of the litigation heighten yourresponsibility, and what's more, you cannot rely on the adversaries to shape theissues that you must resolve in the class context. Indeed, you have to decide firstwhich individuals on the plaintiff side - class representatives and class counselcan represent the class adequately and whom you should appoint to do so. And,once the adversaries agree on a settlement, you must decide - largely without anyclash of views from class counsel, class representatives, or the defendant whether that settlement is fair, reasonable, and adequate to satisfy the interests ofthe class as a whole. This guide attempts to clarify the class action standards thatinform those decisions and to make the application of those standards moretransparent and available to judges and to policy makers faced with the task ofimproving them. It is designed to help you determine when class representativesand counsel are "adequate" and whether a settlement's terms are "fair" to theclass as a whole, "reasonable" in relation to the class's legitimate claims, and"adequate" to redress class members' actual losses.
Managing Class Action Litigation: A Pocket Guide for Judges, Second Edition, Barbara J.Rothstein & Thomas E. Willging3 ("Pocket Guide"), pp. 1_2.4
B. The Manageability ofa Class Action is Different than Managing a Class Actionfor Purposes ofDetermining whether Class Certification is Appropriate.
Even if a class action may be "unmanageable" in at least the court's mind, that does not
necessarily mean that such an action cannot satisfY the "manageability factor" when certification
is sought. The more important question is whether the action would be more manageable than a
series of individual actions. In Williams, et af. v. Mohawk Industries, Inc., 568 F.3d 1350 (I I th
3 The Honorable Barbara J. Rothstein is a District Judge, United States District Court, w.o. WA,and the Director of the Federal Judicial Center.
4 While the Pocket Guide "is designed to help federal judges manage the increased number ofclass action cases filed in or removed to federal courts as a result of the Class Action FairnessAct of 2005 (CAFA)," many points presented seemingly apply to a federal court's managementof any class action litigation.
7
Cir. 2009), the 11th Circuit Court of Appeals discussed that difference and found that the District
Court abused its discretion when it denied the employees' motion for class certification in a
Racketeer Influenced and Corrupt Organizations Act ("RICO") action. Claims by the proposed
class representatives, that the employer conducted the affairs of an enterprise by hiring illegal
labor, which the depressed employees' wages, were typical of claims of absent class members, as
required for certification of the class in the RICO action, regardless of whether the proposed
representatives worked at more than one location; the claims were based on same legal theory,
that hiring of illegal aliens depressed wages of all legal hourly workers regardless of location.
The case was remanded "for the district court to conduct a pragmatic assessment of whether
common issues predominate over individual issues and whether a class action is superior to other
forms of relief under Rule 23(b)(3)":
Although the district court concluded that the employees' proposed class actionwould be unmanageable, we have explained two reasons that the factor ofmanageability is ordinarily satisfied so long as common issues predominate overindividual issues:
First, we are not assessing whether this class action will create significantmanagement problems, but instead determining whether it will create relativelymore management problems than any of the alternatives Second, where a courthas already made a finding that common issues predominate over individualizedissues, we would be hard pressed to conclude that a class action is lessmanageable than individual actions.
Id., 568 F.3d at 1358 (citation omitted; emphasis added).
C. Development ofCase Management Plan
As in any litigation, parties should create a case management plan from the outset. Some
aspects of that plan should include:
• Issuance of document retention/litigation-hold notices
• Considerations regarding the appropriate jurisdiction
• Is there a requirement to arbitrate?• Is there a basis for removal to federal court?
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• Considerations regarding the Complaint
• Should any "impertinent" or "scandalous" material be struck?• Is a more sufficient statement necessary?
• Considerations regarding the Answer
• Are the proper parties in interest named?• What are appropriate affirmative defenses (see Exhibit B for examples)?• Are there grounds for a cross-claim or counterclaim?• Is there a basis to seek to strike affirmative defenses?
• Considerations regarding discovery, including to support or challenge affirmativedefenses
• Preparation of initial discovery requests
• Preparation of strategic requests for admissions
• Considerations of Fed. R. Civ. P. 30(b)(6) depositions
• Considerations regarding electronic discovery
• Considerations of choice oflaw
• Considerations regarding timing of dispositive or evidentiary motions
• Considerations regarding timing of class certification
• Considerations regarding stipulations with opposing counsel regarding a discoverycalendar, and briefmg schedule, including considerations regarding seeking leave toalter the page limitations for briefmg, such as by reserving additional Reply pages
• Considerations regarding expert witnesses
• Considerations regarding trial and jury consultants
D. The Parties' Management Challenges
1. Are the Plaintiff and Class Counsel "Adequate"?
Obviously, care needs to be given to selection of an appropriate class representative.
Counsel should "vet" such plaintiffs to determine the strength of their claims, their backgrounds
and sophistication, whether they have a history of litigation and related issues.
Class counsel needs to ensure that they have the financial, personnel and technical
resources to manage a class and to take an action to conclusion, particularly if it is large in scale
or where plaintiffs or witnesses may reside around the country. Depending on the size of the
group and the sophistication of the issues presented, large data banks may be necessary to
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manage class actions and discovery. Counsel needs to ensure that they have substantive
experience with the areas oflaw at issue, and technical expertise, such as in managing electronic
discovery issues.
Certain discovery may be allowed surrounding the resources and skill sets of class
counsel, and challenges, as appropriate, can be made at the certification stage, or earlier where
appropriate.
2. Are "Anonymous" Plaintiffs appropriate?
Group actions present the potential for plaintiffs to seek to proceed anonymously, either
due to fears of retaliation, or because an agency, such as the DOL, seeks to invoke the
"informant" privilege. Such issues present management challenges, and can provide for the
basis to seek to dismiss claims on behalfof such plaintiffs.
In Whalen v. United States, 80 Fed.C!. 685, 687, n.2 (2008) ("Whalen I "), the collective
action was pressed on behalf of both named and anonymous Air Traffic Controller plaintiffs,
who alleged unpaid overtime under the FLSA. The Court noted that: "Although the complaint
alleges that plaintiffs "hereby consent to sue for violations of the FLSA, pursuant to 29 U.S.C.
§ 216(b)," and cites a "fear" of "retaliation" as cause for most of the plaintiffs filing
anonymously, Comp!. 'If'lf 2, 5, consent forms were supplied with the Complaint only for Messrs.
Whalen and Morgan. Plaintiffs did not file a motion for leave to file consent forms under sea!."
Defendant moved to dismiss due to the fact that the anonymous plaintiffs were not "named" in
the Complaint.
Determining whether and how parties may file anonymously is included within the
court's "authority to manage the process ofjoining multiple parties [in a collective action] in a
manner that is orderly, sensible, and not otherwise contrary to statutory commands or the
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provisions of the Federal Rules of Civil Procedure." Hoffinann-La Roche Inc. v. Sperling, 493
U.S. 165,170,173,110 S.Ct. 482,107 L.Ed.2d 480, 482 (1989).
In addressing claims by plaintiffs that they should be allowed to proceed anonymously,
trial courts balance the competing interests involved by weighing the party's need for anonymity
against the general presumption that parties' identities be available to the public and the
likelihood of prejudice to the opposing party. The Court noted five factors that it should
consider when weighing whether to allow plaintiffs to proceed anonymously:
Five factors guide this inquiry: " '(1) the severity of the threatened harm; (2) thereasonableness of the anonymous party's fears; ... (3) the anonymous party'svulnerability to such retaliation,' " (4) whether disclosure of the party's identitywould best serve the public interest, ... [and (5)] the "precise prejudice at eachstage of the proceedings to the opposing party, and whether proceedings may bestructured so as to mitigate that prejudice." [citations omitted].
Id., at 691.
The anonymous plaintiffs claimed that unspecified fears of retaliation supported their
request for anonymity. The Defendant United States argued: (1) without proof of a reasonable
fear of retaliation, plaintiffs have not overcome the presumption '''that parties' identities be
available to the public and the likelihood ofprejudice to the opposing party,' " Def.'s Mot. at 5-6
(quoting Wolfchild, 62 Fed.Cl. at 552-53); (2) not knowing the identities of the plaintiffs
prevents the govermnent from investigating their allegations; (3) anonymous plaintiffs may have
filed duplicatively in a prior suit; and (4) allowing plaintiffs to file under fictitious names simply
on grounds that they fear retaliation would render defending FLSA lawsuits difficult for the
govermnent by hindering its ability to investigate individual claims.
After analyzing these arguments, the Court ruled that the record before it was inadequate
to analyze the factors of the five-part test, and provided plaintiffs with a chance to add evidence
within 30 days:
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To bolster the record, plaintiffs must provide the court with (1) the anonymousplaintiffs' actual names (under seal), (2) their consent fonns, pursuant to 29U.S.C. § 216(b), also under seal, and (3) explicit cause for proceedinganonymously. To establish cause, the plaintiffs must present more than the currentbare allegation of retaliation; they must present evidence that potential retaliationis a real possibility, such that the court can properly balance that possibilityagainst the public interest in disclosure and any prejudice to the defendant.
Whalen I, passim. "Subsequently, plaintiffs failed to provide such names and consent fonns and
never made any evidentiary showing of cause to maintain the anonymity of these plaintiffs.
Accordingly, the action was dismissed as to anonymously described plaintiffs ATC1 through
ATC50." Whalen II, supra, 85 Fed.CI. 380,381.
The DOL has historically sought to protect the identity of employees or fOffiler
employees from whom it obtained statements as part of its investigation or litigation against an
employer alleged to have committed wage and hour violations. In FLSA lawsuits filed by DOL,
the "infonnant's privilege"s may be used to protect from discovery the names of infonnants who
precipitated the suit by filing complaints with DOL. Does I thru XXIII v. Advanced Textile
Corp., 214 F.3d 1058, 1072-73 (9th Cir. 2000).
Once the DOL brings a group action against an employer, using the informants' privilege
to protect the identity of plaintiffs seeking damages is problematic. This issue is presently being
played out in Solis v. Washington Department ofCorrections, U.S. District Court, WD Tacoma,
Case Number 08-5362. The district court largely rejected the DOL's claim ofinfonnant
privilege in an enforcement action relating to overtime and record keeping. The defendant
sought witness infonnation and statements, the DOL's methods for calculating overtime, and the
5 The infonnant's privilege is not to be lightly invoked. us. v. Reynolds, 345 U.S. 1,7 (1953);Mitchell v. Bass, 252 F.2d 513, 516 (8th Cir. 1958). It must be raised by a fonnal claim ofprivilege lodged by the head of the department that has control over the matter, after actualpersonal consideration by that officer. Id. The "agency head" may delegate authority to claimthe privilege, but only to a subordinate of high authority, and the delegation must beaccompanied by specific guidelines on the use of the privilege. Martin v. Albany BusinessJournal, Inc., 780 F.Supp. 927, 931 (N.D.N.Y. 1992).
12
personnel file of its wage hour investigator who led the probe, the ruling said. The district court
largely rejected the DOL's contention that various types ofprivilege protected the information,
specifically denying that the informant's privilege shielded the information and materials related
to witnesses in the case. Most of the documents requested by the state merely name the
employees who could potentially receive back wages, but who are not necessarily informants,
the court ruled.
3. Care Must be Taken in Pre-certification, Post-filing Contact withPotential Class Members
Many times, employees that an employer may want to interview are members of a union.
Additional precautions are advisable when interviewing such individuals.
The National Labor Relations Act protects employees from any interference with their
right to engage in concerted activities for the purpose of collective bargaining. See 29 U.S.c.
§ 158(a)(1); Public Employees Relations Commission v. City o/Vancouver, 107 Wn. App. 694,
704-705 (2001) (discussing authorities). Generally, an employer may not interrogate its
employees regarding their union activities because of the "inherent danger of coercion."
Johnnie's Poultry Co., 146 N.L.R.B. 770, 774-75 (1964), enf denied, 344 F.2d 617 (8th Cir.
1965); NLRB v. Vancouver, 604 F.2d 596, 599 n.1 (9th Cir. 1979). The National Labor Relations
Board ("the Board") and the federal courts, however, allow an employer the limited privilege to
question its employees regarding protected union activities when the employer is investigating
facts to prepare a defense against an unfair labor practice complaint. Johnnie's Poultry Co., 146
N.L.R.B. at 774-75. To exercise this limited privilege, however, an employer must adhere to the
safeguards against coercion of protected rights that were enunciated by the Board in Johnnie's
Poultry.
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When an employer conducts an interview of an employee to ascertain facts relevant to an
unfair labor practice charge, Johnnie's Poultry, 146 NLRB at 775, requires the employer to:
(I) communicate to the employee the purpose of the interview; (2) assure the employee that no
reprisal will take place; (3) obtain the employee's participation in the interview on a voluntary
basis; (4) ensure the questioning of the employee occurs in a context free from employer hostility
to union organization; (5) avoid questioning that is coercive in nature; (6) raise only those
questions that are relevant to the issues in involved in the complaint; (7) refrain from eliciting
information concerning an employee's subjective state of mind; and (8) avoid questions that
might otherwise interfere with the statutory rights of employees.
a. Precautionary Steps:
The safeguards ofJohnnie 's Poultry may not be required where: (l) the interviews likely
will not require or involve any inquiry into the employees' union activities; and (2) the Board
and the courts generally have not required employers to adhere to the safeguards outside the
context of an employer's investigation into an unfair labor practice complaint, which necessarily
requires inquires into the employees' union activities. Nevertheless, because union activity may
be indirectly or inadvertently addressed in interviews, two basic cautionary steps should be
taken.
I. Prior to commencing any interview, clearly communicate the following three
points to the employee:
(l) inform him or her of the purpose of the questioning;
(2) assure him or her that no reprisal will take place as a result of theinterview; and
14
(3) obtain his or her pennission to participate in the interview on a voluntaryb
. 6aSlS.
2. During the course of each interview, adhere to the issues relevant to the complaint
and avoid any questioning that could easily be construed as interrogation regarding an
employee's protected union activities or the union activities of other employees.
3. It is a good idea to have a prepared script to use in interviewing putative class
members of potential opt ins. This provides unifonnity of communication and some evidence of
what was said. A sample script could be fashioned from the below:
You may wonder why you were contacted to meet with me. You have not been singledout in any way. As I mentioned on the telephone, attorneys for the Employer will be talking to abroad range of other employees. With your pennission, I would like to ask you some questionsabout your job duties and the job duties of others; how you and other employees keep track ofand report the time you work; what you and other employees typically do during your work days;and any other infonnation you might have that will help us understand or respond to the lawsuit.
As I have already explained, this is a voluntary interview. If you are at all uncomfortablewith discussing any of the issues that I just listed, you have the right to end this interview now orat any time after we begin. Nothing bad will happen if you decide to end the interview.Likewise, you will not receive a promotion, raise, or any other benefit if you continue theinterview. In short, proceeding with this interview is completely up to you and will not impactyour status with the Employer.
Finally, because we are attempting to address a pending lawsuit and do not want anymore disruption than necessary in the workplace, we ask that you not discuss our conversationwith your coworkers or anyone else.
Are you comfortable going forward at this point?Do you have any questions about the statement I just read to you?May I ask you some questions?[If employee asks questions about whether he or she is subject to discipline as a result of
things said in interview, respond with: No discipline will be imposed upon anyone with respectto issues related to overtime policies or tracking hours. I cannot guarantee that __ will notconduct an investigation or consider discipline if infonnation comes out that suggests publicsafety has been compromised.]
[If employee asks whether his or her supervisor will be told what is said during theinterview, respond with: No. However, I cannot guarantee that will not conduct an
6 See Public Employees Relations Commissioner, 107 Wn. App. at 707 n.9 (providing anabbreviated version of the Johnnie's Poultry warning as expressed in L & L Wine & LiquorCorp, 323 N.L.R.B. 848, 853 (1997), and Day/on Typographic Servo v. NLRB, 778 F.2d 1188,1195 (6tl1 Cir.l985)). See Exhibit C.
15
investigation or consider discipline if infonnation comes out that suggests public safety has beencompromised.]7
E. Discovery Strategies
1. What Documents Mayan Agency or Employer Have to ProduceRelating to its Investigation Leading to, or in Defense of, Suit?
The work product doctrine creates a qualified privilege for "documents and tangible
things that are prepared in anticipation oflitigation or for tria!." Fed. R. Civ. P. 26(b)(3). The
government has a high burden to establish work product protection for its documents. Because
the federal rules "clearly favor[] the disclosure of relevant material ... the government carries
the onus to convincingly demonstrate the necessity of withholding relevant material from its
adversaries." s.E.c. v. Nat'Z Student Mktg. Corp., No. 225-72,1974 WL 415, *7 (D.D.C. June
25, 1974).
The threshold detennination under the work product analysis is whether the document
was prepared in anticipation of litigation, not simply as part of a government investigation.
"[P]apers prepared during the investigative period - when the agency accumulates and evaluates
factual material- is not necessarily covered by Rule 26(b)(3)." Id., 1974 WL 415 at *7
(citations omitted). Indeed, investigation documents "presumably are prepared in the assessment
and review process and, if they be held to be in anticipation of litigation, it is hard to see what
would not be." Courts routinely order production of government investigation files, despite
assertions that they constitute work product. See, e.g., Peterson v. United States, 52 F.R.D. 317,
321 (S.D.llI. 1971) (reports of audits prepared by IRS field agent); Culinary Foods, Inc. v.
Raychem Corp., 150 F.R.D. 122, 130 (N.D.ll!. 1993) (internal OSHA documents).
7 It may be advisable to infonn employees clearly that the attorney represents the employer andthat statements may be against their interest.
16
"[D]etennining whether a party can claim that an investigation reasonably implied
pending litigation depends upon the nature of the agency investigation and how regularly such
investigations result in litigation." Id. at 908. DOL investigations are part of its regular business
and often do not result in litigation. Reich v. Great Lakes Collection Bureau, Inc., 172 F.R.D.
58,61 (W.D.N.Y. 1997) ("these investigations are done in the ordinary course of DOL's
activities ... are not conducted by attorneys and do not automatically lead to litigation"); Martin
v. Ronningen Research & Dev. Co., Inc., No. 1:91:CV559, 1992 WL 409936, *4 (W.D. Mich.
Oct. 13, 1992) (in Grand Rapids DOL office, only five percent of investigations result in
litigation). Therefore, conununications before the decision is made to litigate may not be
protected and may need to be produced.
Costco Wholesale Corp. v. Superior Court 74 Ca1.Rptr.3d 345 (2008), review granted,
(previously published at: 161 Ca1.AppAth 488) involves issues surrounding outside counsel's
investigation of class action claims that certain managers were misclassified as exempt. After
the claims were filed, in-house counsel for Costco hired outside counsel to "... to undertake [a]
comprehensive factual investigation and legal analysis regarding the classification of managers
within Costco Warehouses." Such counsel interviewed two managers and assured them that
"their conununications would be treated as confidential and protected by attorney-client
privilege." Also, according to attorney Hensley, she relied upon "the information [she] received
from Costco, [her] legal research, and [her] expertise with respect to wage and hour law" to write
a 22-page letter to attorney Brandon dated August 4, 2000, "addressing the exempt status of
certain Costco warehouse managers in California." According to attorney Hensley, the letter
reflected her "legal advice to [Costco] and also [her] own impressions, conclusions, and legal
research." The parties disputed Costco's exemption defense. Plaintiffs served written discovery
17
seeking documents related to the investigation of the exempt classification for Costco' s
managers in California. Costco objected on the bases of attorney-client privilege and work
product doctrine. Plaintiffs contended Costco waived any privilege by placing its knowledge and
expectations at issue. Costco was successful in precluding discovery of a majority of the August
4, 2000, letter, but other portions of it were deemed subject to production. The court held that
the non-redacted portions "inconsequential and do not infringe on the attorney-client
relationship. They came from non-privileged written job descriptions and interviews with the
two managers." Costco's Motion for a Writ of Mandate to prohibit disclosure was denied.
Notably, review has been granted.
F. Is a Special Discovery Master Needed?
1. View from the Bench
Special masters, court-appointed experts, and other judicial adjuncts with specialexpertise may be useful in a variety of contexts in class action litigation.Specifically, judges have appointed special masters to oversee discovery andresolve disputes in cases in which the number and complexity of documents mightgenerate a large number of disputes. See MCL 4th § 11.424. The emergence ofelectronic discovery and of a new industry of party experts on electronicdiscovery may increase the need for the court to appoint a discovery master.Judges have also used magistrate judges, special masters, court-appointed experts,technical advisors, and other adjuncts to assist them in evaluating classsettlements (see MCL 4th § 21.644), and have appointed special masters or otheradjuncts to administer settlements and participate in resolving claims viaalternative dispute resolution (ADR) or other methods (see MCL 4th § 21.661).
Pocket Guide, pg. 33.
G. Some Strategic Considerations Regarding Motions to Dismiss and OtherDispositive Motions
1. Timing of Summary Judgment and other Dispositive MotionStrategies
The decision of when a defendant should bring dispositive motions will guide the entire
case. While it may be problematic for a plaintiff s representative to seek such reliefprior to class
18
certification, in many cases, it makes perfect sense for the defense to seek to eliminate either
some or all claims prior to a conrt entertaining a certification motion.
2. View from the Bench:
Given the flexibility in the rules, the most efficient practice is to rule on motionsto dismiss or for snmmary judgment before addressing class certification. Rulingon class certification may prove to be unnecessary. The most important actionsyou can take to promote settlement are to rule on dispositive motions and then, ifnecessary, rule on class certification.
If the parties decide to talk about settlement before you make any ruling on classcertification, they may urge you to certify a class for settlement purposes only ~ asettlement class - as opposed to certifying a litigation class for a possible trial.
Pocket Guide, supra, pp. 8-9.
3. Consider the Value ofInitial Limited Discover, EspeciallyPreliminary Discovery as to the Appropriateness of Certification.
If claims may be susceptible to summary judgment, the parties and the conrt may be well
served by doing discovery in stages that first address issues of liability, and then address issues
of damages only if necessary. The discussion below regarding the efficiency of bifurcating
liability and damages phases oftrial are analogous in this context.
4. When Does the Mootness of the Claims of a Class Representative orother Plaintiff Mandate Dismissal of a Case?
The named plaintiff who no longer has a stake may not be a suitable class representative,
but that is not a matter ofjurisdiction and would not disqualify him from continuing as class
representative until a more suitable member of the class was found to replace him. Robinson v.
SheriffofCook County, 167 F.3d 1155, 1157-58 (7'h Cir.1999); Walters v. Edgar, 163 F.3d 430,
433 (7th Cir.1998). In a non-employment context, consider Wiesmueller, v. Kosobucki, et al.,
(7'h Cir. 2008), in which an out-of-state law school graduate sued the state of Wisconsin based on
its practice allowing graduates of the two law schools in the state to be admitted to the practice of
law without having to take the Wisconsin bar exam, while graduates from other schools had to
take the exan1. The plaintiff moved for snmmary judgment; the defendants moved to dismiss.
19
After the judge denied the plaintiffs motion but while the defendants' motion to dismiss was
pending, the plaintiff moved to certify a class consisting of other graduates of out-of-state law
schools who want to practice law in Wisconsin. The district judge granted the motion to dismiss
the plaintiff s claim and having done so denied as moot the plaintiff s motion to certify the class.
The appellate court noted that if a class had been certified prior to dismissal of the plaintiffs
claim, the named representative may still act as the representative of the unnamed class
members, but noted a different result would follow if the claims were dismissed prior to
certification. Plaintiffs' dispositive motion practice prior to moving for group certification is at
least somewhat disfavored. While distinguishing other cases, such as where the parties agreed to
defer on certification until after a ruling on the merits,8 the Wiesmueller court noted that "the
plaintiff, as well as the district judge, put the cart before the horse, by moving for class
certification after moving for summary judgment."
Bernall v. Vankar Enterprises, Inc., Case 5:07-cv-00695-XR (WD TX Sept. 30, 2008
DKT 86) is a good example of a plaintiff first successfully seeking class certification, and then
successfully moving for sUlmnary judgment on claims that the employer improperly credited tips
against minimum wage obligations. The employer summarily argued that summary judgment
for plaintiffs was inappropriate; that it should be granted a defense summary judgment; and that
the collective action be decertified. Not surprisingly, the court did not find such conclusory
statements persuasive. Because the court found that damages would be readily calculable, an
evidentiary hearing was ordered following the grant of summary judgment to plaintiffs.
8 See, e.g., Banks v. National Collegiate Athletic Association, 977 F.2d 1081, 1085-86 (7th Cir.1992).
20
H. Timing and Significance ofClass Certification
1. When Should a Certification Motion be Made?
The timing on seeking certification is important for many reasons. While discovery may
be necessary in order to provide support or defense to the certification motion, plaintiffs may
want to seek early certification to avoid prolonged opportunity for the employer to have pre
certification contact with the employees, or to otherwise build defenses. Plaintiffs may also want
to test their certification request, in order to cure frailties that may interfere with certification,
especially to be able to make available cures, if any, within the statute of limitations period.
As discussed above, conditional certification may be proper to allow collective actions to
at least prelinrinarily proceed in a representative capacity. In such matters, it is prudent to seek
such certification sooner rather than later.
Where determining an issue of law may resolve the case as a whole, such as if it is
dismissed for failure to state a claim, while the "plaintiffs" or counsel may not prevail, they will
save significant resources in avoiding certifYing a class based on a claim that lacks legal merit.
However, when the plaintiffs believe that they do not have sufficient evidence to rebut a
dispositive motion, they should invoke Fed. R. Civ. P. 56 (f) as appropriate.
Babineau v. Federal Express Corp., _ F.3d _ (11 th Cir. July 27, 2009) provides a
good overview of appellate review of a district court's denial of class certification of claims
alleging failure to pay for "all hours worked." Holding that the district court acted within its
discretion, the 11th Circuit affirmed the district court's conclusion that "certification was
improper primarily because individualized factual inquiries into whether and how long each
employee worked without compensation would swamp any issues that were common to the
class." The Court noted that: " ... the principle that district courts should not evaluate the merits
of plaintiffs' claims "should not be talismanically invoked to artific[i]ally limit a trial court's
21
examination of the factors necessary to a reasoned determination of whether a plaintiff has met
her burden of establishing each of the Rule 23 class action requirements." Slip Op. at 13.
I. Case Management Post-Certification
1. Development of a Joint Case Management and Notice Plan
Plaintiffs sometimes move for an "Order Directing That Action Proceed as Class Action,
Determining The Class, and Restricting Communication With Class Members" in order to
determine a method of proceeding after certification. Defendants and the courts have a similar
interest in proceeding deliberately after certification. Cashman, et al. v. Dolce
International/Hartford, Inc. et aI., 225 F.R.D. 73 (2004) provides a good example of the required
elements of a class action management plan ordered by the court after class certification. The
Court required the parties to create:
a jointly proposed class action management plan, which should include thefollowing: (1) an agreed upon document that will be used to provide notice uponall putative members of the class; (2) a proposed timetable for providing notice tothe class and a proposed deadline for putative class members to opt out of theclass; (3) a proposed mechanism allowing class members to enter their ownindividual appearances in this matter; (4) a list of all ascertainable class members,with their last known mailing address; and (5) any other issues that counsel for theClass and Defendants believe are appropriate to bring to the Court's attention.
These are the kinds of issues that all parties must address if certification is granted.
2. Decertification Issues
In collective actions, or in class actions where later discovery may show that certification
was not warranted, the defense should actively consider moving to decertify some or all of the
class. While this is specifically contemplated in FLSA collective actions, the defense should not
overlook considerations of whether decertification may be appropriate in other group actions.
J. What Motions are Subject to Interlocutory Appeal?
In Williams v. Mohawk Industries, Inc., 568 F.3d 1350 (11 th Cir. 2009), defendant
Mohawk moved to dismiss the employees' complaint for failure to state a claim, Fed.R.Civ.P.
22
12(b) (6). The district court granted the motion as to one claim of unjust enrichment based on the
alien workers' hesitation to bring worker's compensation claims, but denied the motion as to all
other claims. At the request of Mohawk, the district court certified the order for an interlocutory
appeal.
Contrast McElMurray et al. v. US Nat'! BankAss'n, 495 F.3d 1136 (9th Cir. 2007), in
which plaintiffs brought bring an interlocutory appeal from a district court order denying their
motion to issue notice of a collective action brought under § l6(b) of the Fair Labor Standards
Act ("FLSA"), 29 U.S.C. § 216(b). The Ninth Circuit held that the collateral order exception to
the final judgment rule was inapplicable here because the district court's order is not "effectively
unreviewable on appeal from a fmaljudgrnent." Coopers & Lybrandv. Livesay, 437 U.S. 463,
468,98 S.Ct. 2454, 57 L.Ed.2d 351 (1978); see also Cohen v. Beneficial Indus. Loan Corp., 337
U.S. 541, 546-47, 69 S.Ct. 1221,93 L.Ed. 1528 (1949). It thus dismissed Appellants'
interlocutory appeal for lack of appellate jurisdiction.
K. Bifurcation ofLiability and Damages
Group actions may provide a compelling case in which separate the trial on the liability
issues from the trial on the damage issues, pursuant to Rule 42(b) ofthe Federal Rilles of Civil
Procedure. The Manual for Complex Litigation, Pt 1 § 4.12, often recommends a bifurcated trial
procedure, noting:
In some cases, separate trials of separate issues result in a more orderlypresentation of evidence, a better understanding of the evidence in relation to theparticular issue or issues under consideration by the trier of facts, and may avoidan unnecessary trial of other issues. It is recommended that, when these benefitscan be achieved by separate trials, separate trials of separate issues be utilized.
In re Farmers Insurance Exchange Claims Representatives Overtime Pay Litigation, 336F.Supp.2d 1077 (D. Or. 2004) ("Farmers MDL").
23
Damages in a wage and hour case are fact dependent on the issues decided in the liability
phase, such as:
• The period for which damages are sought, including statute of limitations issues,which may vary per employee;
• What kinds of damages (compensatory, liquidated or other forms of damages) areavailable to any given employee;
• Considerations regarding prejudgment interest; and
• Whether federal and at least certain state law applies to some, but not all, plaintiffs.
Many efficiencies can result from bifurcating liability from damage determinations. If
the liability phase proceeds before proceeding to a damage phase, significant aspects of
discovery may be avoided if the plaintiffs' claims are not successful on the merits. Expert and
other testimony could be avoided in the liability phase, decreasing the length and costs of trial.
Farmers MDL used a bifurcated approach. In the liability phase, the court held that all three tiers
of certain workers and other categories of claim handlers were nonexempt, but that certain
adjusters and certain other types of claim handlers were exempt; that the defendant had a good
faith defense to FLSA liability for one time period but not another; that FLSA and state-law
liquidated damages were available for one time period but not another; and that certain state law
remedies and limitations periods were applicable as to some categories of class members for
certain time periods based on the exemption issue findings. See 336 F. Supp. 2d at 11 -12. The
damages phase was then structured to meet the liability findings, with individual class member
claims and proofs limited to the time periods and remedies determined in the exemption phase.
III. HYBRID ACTIONS
In the past decade, the field of wage and hour litigation has given rise to "hybrid" or
"dual" class actions, which permit plaintiffs to simultaneously pursue violations of both the Fair
Labor Standards Act (FLSA) and state laws where those violations arise from a common course
24
of misconduct. True to their name, "hybrid" class actions combine the opt-in procedures ofthe
Fair Labor Standards Act (FLSA), 29 U.S.C. § 216(b), and the opt-out procedures of Rule 23 of
the Federal Rules of Civil Procedure. Generally, Rule 23 governs all putative class actions
asserting both federal and state-law claims that are filed in federal court. Pursuant to Section
216(b), however, all private claims for violations of the FLSA must proceed as "collective
actions" on an opt-in basis. Thus, where employees seek to assert class-wide violations of both
the FLSA and state wage and hour laws in federal court, they must do on a "hybrid" basis,
whereby prospective class members must affirmatively join the lawsuit (i.e., "opt in") to assert
their FLSA claims, but are presumed to be class participants for purposes of their state law
claims unless they expressly dissent (i.e., "opt out,,).9
Hybrid class actions present a number of interesting legal issues, but two issues have
received the lion's share of judicial and academic attention. Specifically, the question of
whether the courts should allow Section 216(b) opt-in actions to proceed simultaneously
alongside Rule 23 opt-out class actions has given rise to two conflicting approaches. Many
courts following the Circuit Court for the District of Columbia, Lindsay v. Government
Employees Ins. Co., 448 F.3d 416 (C.A.D.C. 2006), have allowed hybrid actions to proceed,
ruling that such actions comport with the purpose and intent of the FLSA and assist in the
efficient and economical resolution of identical federal and state law claims. Some courts
follow De Ascencio v. Tyson Foods, Inc., 342 F.3d 301 (3d Cir. 2003) (rejecting hybrid actions
9 This was not always the case, however. As Andrew Brunsden recently explained, "[t]here wasa time ... when both FLSA section 216(b) and Rule 23 provided for opt-in actions." Andrew C.Brunsden, "Hybrid Class Actions, Dual Certification, and Wage Law Enforcement in the FederalCourts," 29 Berkley J. Emp. & Lab. L. 269, 280-281 (2008). In 1947, Congress amended theFLSA to expressly incorporate an opt-in requirement for collective actions. Id. Then, in 1966,"Rule 23 was amended to remove the opt-in requirement" and to establish an "opt-out regime formonetary damages class actions." Id "As a result, distinct procedural mechanisms emerged forRule 23 opt-out class actions and FLSA section 216(b) opt-in collective actions." Id.
25
as a model for resolving concurrent federal and state law claims based largely on the notion
that such actions constitute an "end run" around Section 216(b)'s opt-in requirement). The
courts that have adopted this approach have raised administrative concerns relating to the
complexities of adjudicating parallel state and federal claims for two overlapping classes has
been evaluated by courts and commentators as weighing either in favor of or against hybrid
class treatment.
The issue of whether to certify hybrid class actions has resulted in two conflicting
appellate decisions and divided the courts into two schools of thought. For almost ten years,
the approach adopted by many federal district courts is to certify a collective action under
Section 216(b) and then assert supplemental jurisdiction over the plaintiffs' state-law claims,
which the courts then certifY as a Rule 23 class. See, e.g., McLaughlin v. Liberty Mutual
Insurance Co., 224 F.R.D. 304 (D. Mass. 2004); BaGoldman v. Radioshack Corp., 2003 WL
21250571, at *2-3 (E.D. Pa. 2003); Chavez v. IBP, Inc., 2002 WL 31662302, at *2-5 (E.D.
Wash. 2002); Beltran-Benitez v. Sea Safari, LTD., 180 F. Supp. 2d 772,773-74 (E.D.N.C.
200 I). These cases "downplay the issue of congressional intent and emphasize that factors
such as judicial economy and efficiency strongly favor the exercise ofjurisdiction over Rule
23 class actions that involve identical facts and highly similar legal theories." Bamonte v. City
ofMesa, 2007 WL 2022011, at *4 (D. Ariz. 2007). In McLaughlin v. Liberty Mutual
Insurance Co., 224 F.RD. 304 (D. Mass. 2004), for example, the district court for the District
of Massachusetts certified a hybrid action, noting that doing so "would facilitate a federal
forum for federal claims because it would allow the federal court to hear both federal and state
law claims, rather than only the state court being able to hear both federal and state law
claims." Id. at 313. The court in that case dismissed the defendant's argument that asserting
26
supplemental jurisdiction over the state law claims and then certifYing a Rule 23 class based on
those claims would hale "a defending party ... into court against his will." Id. The court
explained that no such concern presented itself in that case, because "[t]he pendent state law
claims are being brought by additional plaintiffs, rather than against additional defendants, so
no risk exists of haling an additional defendant into court - the defendant is already properly
before this court." Id.
These early opinions were adopted by the Circuit Court for the District of Columbia in
Lindsay v. Government Employees Ins. Co., 448 F.3d 416 (C.A.D.C. 2006), where the Circuit
Court reversed a district court's refusal to certifY a hybrid action after denying supplemental
jurisdiction over the plaintiffs' pendent state-law claims. In that case, two insurance claims
adjusters brought suit against their employer for failure to pay overtime in violation of the
FLSA and state law. Id. at 418. The employer classified all of its claims adjusters as
administrative employees who were exempt from overtime compensation, and the employees
claimed that they had been misclassified. Id. at 418-419. The plaintiffs sought certification of
an opt-in collective action under Section 216(b) for their FLSA claim, and an opt-out class
action for their state law claim under Rule 23. Id. at 419. Although the district court certified
the Section 216(b) opt-in collective action, it refused to certify a Rule 23 class on the grounds
that it could not exercise supplemental jurisdiction over the state law claim. Id.
The Circuit Court reversed this decision as error. Id. at 425. In so holding, the Circuit
Court rejected the idea that hybrid class actions would permit plaintiffs to make an "end run"
around the opt-in procedures set forth in the FLSA, thereby defeating congressional intent, by
explaining that the differences presented by Section 216(b) and Rule 23 were "mere[ly]
27
procedural" and could not "curtail section 1367's jurisdictional sweep." Lindsay, 448 F.3d at
424.
Numerous courts in several jurisdictions have adopted and expanded upon the Circuit
Court's decision in Lindsay. As in Lindsay, the courts in these cases reject the notion that
Section 216(b) and Rule 23 present anything more than a procedural conflict that does not
defeat supplemental jurisdiction, and emphasize the efficiency and economy of permitting
hybrid certification. See, e.g., Perkins v. Southern New England Telephone Co., 2009 WL
350604, at *4-*5 (D. Conn. 2009); Wren v. RGIS Inventory Specialists, 256 F.R.D. 180,210
(N.D. Cal. 2009); Osby v. Citigroup, Inc., 2008 WL 2074102, at *3 (W.D. Mo. 2008); Morales
v. Greater Omaha Packing Co., Inc., 2008 WL 5255807, at *3 (D. Neb. 2008); Damassia v.
Duane Reade, Inc., 250 F.R.D. 152, 162-163 (S.D.N.Y. 2008); Bouaphakeo v. Tyson Foods,
Inc., 546 F. Supp. 2d 870, 889 (N.D. Iowa 2008); Nerland v. Caribou Coffee Co., Inc., 564 F.
Supp. 2d 1010, 1028 (D. Minn. 2007); Sjoblom v. Charter Communs., LLC, 2007 WL
4560541, at *4 (W.D. Wis. 2007); Cryer v. InterSolutions, Inc., 2007 WL 1191928, at *2-*4
(D.D.C. 2007); Westerfield v. Washington Mut. Bank, 2007 WL 2162989, at *2 (E.D.N.Y.
2007); Salazar v. Agriprocessors, Inc., 527 F. Supp. 2d at 876; Bamonte v. City ofMesa, 2007
WL 2022011, at *4-*5; Brickey v. Dolencorp, Inc., 244 F.R.D. 176, 179 (W.D.N.Y. 2007).
Lindsay stands in stark contrast to the Third Circuit's decision in De Ascencio v. Tyson
Foods, Inc., in which the Court reversed a district court decision to exercise supplemental
jurisdiction over the plaintiffs' pendent state law claims and, from there, to certify a Rule 23
class on those claims. refused to certify hybrid class actions based in large part on the
disparity between opt-in and opt-out rates, which those courts have found warrants denial of
supplemental jurisdiction over pendent state-law claims. In De Ascencio, 342 F.3d 301 (3d
28
Cir. 2003), the Third Circuit reversed the district court's certification of a hybrid class action
on the grounds that it had abused its discretion by exercising supplemental jurisdiction over the
plaintiffs' state law claim. In that case, employees at a chicken-processing plant brought suit
alleging that they were owed compensation for the time they spent "donning and doffing" (i. e.,
putting on and taking off protective work gear). Id. at 303. The plaintiffs initially moved the
district court to allow them to issue notice to the prospective class members under Section
2l6(b), which the court granted. Id. at 304-305. Subsequently, after the opt-in period had
closed, the plaintiffs moved to certify a Rule 23 class based on their state-law claim, which the
court granted. Id. at 305.
On appeal, the Third Circuit held that the district court had erred in exercising
supplemental jurisdiction over the plaintiffs' state law claims, and therefore had erred in
certifYing the state-law class under Rule 23, because the state-law claims predominated over
the federal question presented by the FLSA claim. Id. at 309-311. In so holding, the Court
noted that the state-law claims raised new and novel questions oflaw. Id. at 311.
Furthermore, the Court held that supplemental jurisdiction was inappropriate because
permitting the hybrid class action model to proceed in that case would allow plaintiffs to make
an "end run" around the FLSA's opt-in procedures by asserting state-law claims and seeking
certification of a Rule 23 class, thereby thwarting Congress' intent in enacting the FLSA's opt
in procedures. Id. at 311. Truly dispositive in the Court's opinion, however, was the respective
sizes of the classes at issue. The state law claim certified under Rule 23 consisted of a class of
approximately 4,100 individuals, while the FLSA claim certified under Section 2l6(b)
included only 447 opt-in plaintiffs. Id. at 305. Based on these numbers, the Court
characterized the hybrid class action as "causing the federal tail represented by a comparatively
29
small number of plaintiffs to wag what is in substance a state dog," which would have
permitted the plaintiffs to make an "end run" around the FLSA's limiting opt-in provision,
thereby defeating Congress' intent in enacting that requirement. Id at 311.
De Ascensio has not developed as much judicial traction as Lindsay, though several
courts have refused to certify hybrid class actions by declining to exercise supplemental
jurisdiction over the plaintiffs' state-law claims based on that decision. These courts are
largely confined to the Third Circuit. See, e.g., Ramsey v. Ryan Beck & Co., Inc., 2007 WL
2234567, at *2 (E.D. Pa. 2007); Brothers v. Portage Nat. Bank, 2007 WL 965835, at *4-*5
(W.D. Pa. 2007); Hyman v. WM Fin. Servs., Inc., 2007 WL 1657392, at *3 (D.N.J. 2007);
Evancho v. Sanoji-Aventis Us., Inc., 2007 WL 4546100, at *5 (D.N.J. 2007); Evans v. Lowe's
Home Centers, Inc., 2006 WL 1371073, at *2 (M.D. Pa. 2006); Aquilino v. Home Depot
US.A., Inc., 2006 WL 2023539, at *1-*2 (D.N.J. 2006). A few arise in other jurisdictions,
however. See, e.g., In re American Family Mut. Ins. Co. Overtime Pay Litig., 2009 WL
2253211, at *7 (D. Colo. 2009); Neary v. Metropolitan Property & Cas. Ins. Co., 472
F.Supp.2d 247, 251-253 (D. Conn. 2007); Roe-Midgett v. CC Servs., Inc., 2006 WL 726252, at
*2 (S.D. Ill. 2006); Gleww v. Eastman Kodak Co., 2006 WL 1455476, at *4-*5 (W.D.N.Y.
2006); Jackson v. City ofSan Antonio, 220 F.R.D. 55, 59 (W.D. Tex. 2003). As in De
Ascensio, these decisions all rest on the principle that permitting Section 216(b) opt-in actions
to rnn concurrently along with Rule 23 class actions would allow plaintiffs to make an "end
run" around the FLSA's opt-in mechanism, and "subvert congressional intent with respect to
29 U.S.C. § 216(b) by utilizing the very provision that Congress created to preclude opt-out
class actions under the FLSA as the original jurisdictional predicate to supplemental
jurisdiction over an opt-out class action." Bamonte, 2007 WL 2022011, at *4.
30
IV. OFFERS OF JUDGMENT (RULE 68)
The offer ofjudgment is a creature of the Federal Rules of Civil Procedure.
Specifically, Rule 68 of the Federal Rules of Civil Procedure provides that:
(a) Making an Offer; Judgment on an Accepted Offer. At least 14 daysbefore the date set for trial, a party defending against a claim may serve on anopposing party an offer to allow judgment on specified terms, with the coststhen accrued. If, within 14 days after being served, the opposing party serveswritten notice accepting the offer, either party may then file the offer and noticeof acceptance, plus proof of service. The clerk must then enter judgment.
(c) Offer After Liability is Determined. When one party's liability to anotherhas been determined but the extent ofliability remains to be determined byfurther proceedings, the party held liable may make an offer ofjudgment. Itmust be served within a reasonable time-but at least 14 days-before the dateset for a hearing to determine the extent of liability.(d) Paying Costs After an Unaccepted Offer. If the judgment that the offereefinally obtains is not more favorable than the unaccepted offer, the offeree mustpay the costs incurred after the offer was made.
Fed. R. Civ. P. 68. 10 In simpler terms, Rule 68 provides that defendants may serve upon a
plaintiff an offer setting forth the terms on which the defendant will accept a judgment against
it. If the plaintiff accepts the offer, the parties notify the court and judgment is entered against
the defendant. If the plaintiffs rejects the offer and prevails at trial, but recovers an amount
less than that offered by the defendant, then the plaintiff may not recover the cost of pursuing
the suit. Instead, the plaintiff must pay the costs incurred by the defendant after the date of the
offer of judgment.
In the context of wage and hour litigation, issues concerning offers ofjudgment arise
most noticeably under the FLSA. Specifically, the interplay between offers ofjudgment and
the mandatory attorney's fee provision of the FLSA has given rise to a split in authority over
10 Rule 68 was recently amended to allow service of offers ofjudgments 14 days prior to trial orhearing. In its prior form, the deadline imposed by Rule 68 was ten days. This amendment wentinto effect on December 1,2009, to reflect the change in the Rule 6(a) method for computingperiods of less than 11 days. Fed. R. Civ. P. 68 advisory committee notes.
31
whether plaintiffs who prevail on an FLSA claim, but who rejected an offer of judgment in a
greater amount, may still recover attorney's fees as "costs" under that statute. Offers of
judgment are also at the center of a controversy concerning whether defendant's may "pick
off" lead plaintiffs by making offers of judgment prior to certification ofFLSA collective
actions.
A. Attorneys' Fees as "Costs" under the FLSA.
Rule 68 provides that a plaintiff who rejects an offer ofjudgment and later recovers less
than that offer at trial must pay "costs." As the Supreme Court held in Marek v. Chesny, the
term "costs" refers to "all costs properly awardable under the relevant substantive statute or
other authority." 473 U.S. 1,9 (1985). Thus, where the statute underlying the action defines
"costs" to include attorney's fees, such fees are to be included as costs for purposes of Rule 68.
Id. at 9-10. The FLSA provides that the court "shall, in addition to any judgment awarded to
the plaintiff or plaintiffs, allow a reasonable attorney's fee to be paid by the defendant, and
costs of the action." 29 U.S.C. §2l6(b). Thus, the FLSA does not define "costs" as including
attorney's fees, but instead treats the two as separate recoverable items. This rule is fairly
straightforward, and most courts have concluded that attorney's fees are recoverable where, for
example, an offer of judgment accepted by the plaintiff is silent as to whether it includes
attorney's fees.
In Tyler v. Meola, 113 F.R.D. 184 (N. D. Ohio 1986), for example, the district court
ruled that an offer of judgment that included "costs" but was silent on whether it also included
attorney's fees entitled the plaintiff to recovery of such fees. In that case, the plaintiff brought
suit alleging failure to pay overtime in violation of the FLSA. Id. at 185. The defendant
served an ofIer ofjudgment in the amount of $1,100, which included costs. Id. The plaintiff
accepted the offer and further requested that the court award attorney's fees. Id. Although the
32
defendant objected, arguing that the term "costs" included in its offer was intended to
encompass attorney's fees, the court disagreed. Id. at 186. After citing to Marlek and 29
U.S.C. § 216(b), the court explained that, "[u]nlike the normal settlement situation, it is
incumbent upon the movant under Rule 68 to expressly state that the offer of judgment figure
includes an amount setting any claims for attorney fees." Id. The court "liken[ed] this
situation to a typical offer and acceptance between parties to a contract," noting that:
The clarification submitted by defendant was too late since the plaintiff hadalready accepted defendant's Rule 68 offer of judgment. If the defendant hadintended to include attorney fees as part of the $1,100, it should have explicitlystated this in the original offer.
Id. Accordingly, the court awarded attorney's fees to the plaintiff as recovery separate fromthe $1,100 offered by the defendant. Id. at 187.
By contrast, in Arenciba v. Miami Shoes, Inc., the Eleventh Circuit held that an offer of
judgment in an FLSA overtime case that left "costs" to the court's determination did not entitle
it to award attorney's fees. 113 F.3d 1212, 1214 (11 th Cir. 1997). In that case, the defendant
served an offer ofjudgment on the plaintiff in the amount of $4,000. Id. at 1212. The offer
did not mention costs or attorney's fees. Id. After accepting the offer, the plaintiff filed a
motion for costs and attorney's fees, and the district court reserved jurisdiction to award such
costs and fees in this [mal judgment. Id. On appeal, the Eleventh Circuit held that this was
error. Id. at 1214. Specifically the Court ruled that, "[b]ecause § 16(b) of the FLSA does not
define 'costs' to include attorney's fees, the district court erred in reserving jurisdiction to
award [plaintiff! attorney's fees. See 29 U.S.C. § 216(b)."
On a similar note, the courts are unanimous in holding that plaintiffs in FLSA cases
may obtain attorney's fees even if they reject Rule 68 offer ofjudgment and subsequently
obtain a final judgment for a lesser amount. In Fegley v. Higgins, for example, the Sixth
Circuit ruled that plaintiffs seeking unpaid wages and overtime under the FLSA could recover
33
attorney's fees despite rejecting an earlier offer of judgment for an amount greater than his
actual recovery. 19 F.3d 1126, 1128, 1135 (6tl1 Cir. 1994). In that case, the Court reasoned
that the FLSA provided for both attorney's fees and costs, and treated those two items as
separate under the statute. Id. at 1135. Thus, the Court held, "Rule 68 offer does not affect
the trial court's award of attorney fees under § 216(b)." Id. The Court then rejected the
defendant's argument that the district court abused its discretion by awarding $40,000 in
attorney's fees to the plaintiff, stating that such an award furthered the remedial purposes of
the FLSA:
[T]his lawsuit furthers the objectives of the FLSA by penalizing an employerwho neglected to pay an employee overtime or to even maintain any records ofhis hours worked; it therefore encourages employer adherence to the mandatesof the FLSA in the future.
Id.
Building on Fegley, the Tenth Circuit also awarded attorney's fees to a plaintiff after he
rejected an offer of judgment that exceeded his final recovery in Dalal v. Alliant Techsystems,
Inc., 182 F.3d 757 (10th Cir. 1999). In that case, the plaintiff brought suit for discrimination in
violation of the Age Discrimination in Employment Act (ADEA). Id. at 759. Before trial, the
defendant served the plaintiff with an offer of judgment in the amount of$150,000, which the
plaintiff rejected. Id. After prevailing trial, the jury awarded the plaintiff $36,075 as damages,
and the district court further awarded $90,000 in front pay, $146,666 in attorney's fees, and
$4,000 in expert witness fees (totaling $276,741). Id. On appeal, the defendant argues that the
award of attorney's fees was an in error on the grounds that the plaintiff had rejected the earlier
offer of judgment. Id. at 760. The Tenth Circuit disagreed. Id. The Court noted that the
ADEA, "[b]y reference to the Fair Labor Standards Act ... requires the award of reasonable
attorney's fees and costs to a prevailing party." Id. Since "Rule 68 does not bar any award of
34
attorney fees in an FLSA case for services rendered after a Rule 68 offer is made and a
plaintiff recovers less than the amount offered in settlement," the Court reasoned, the plaintiff
in that case was entitled to attorney's fees for his ADEA claim. Id.
While the courts are llilanimous in holding that a plaintiff may still recover attorney's
fees under the FLSA despite rejecting an earlier Rule 68 offer of judgment, a number of courts
have treated the plaintiff s rejection of an offer of judgment as a factor in determining whether
attorney's fees are warranted or reasonable. In Haworth v. State ofNevada, the Ninth Circuit
held that plaintiffs seeking back wages were not precluded from obtaining attorney's fees
under the FLSA after having rejected an offer ofjudgment, but ruled that the district court had
abused in discretion in actually awarding attorney's fees in those circmnstances. 56 F.3d 1048,
1050 (9th Cir. 1995). There, the Ninth Circuit agreed with the lower court in ruling that the
FLSA "defines attorney fees separately from costs," and therefore "Rule 68 did not bar the
plaintiffs from recovering reasonable attorney fees for services rendered in their FLSA action
after the Rule 68 settlement offer was made." Id. at 1051. The Ninth Circuit nevertheless
concluded that awarding attorney's fees constituted an abuse of discretion given that:
[O]ther than the one FLSA violation [which the defendant] conceded, theplaintiffs succeeded on not a single theory at trial. And, even on the concededclaim, the plaintiffs failed to recover the damages they sought. They recovereda judgment which was close to a quarter of a million dollars less than they couldhave had by accepting the Rule 68 offer. Clearly, the only one who benefited bypursuing the litigation after the Rule 68 offer was made was the plaintiffs'attorney.
Id. at 1052.
B. "Picking Off' Named Plaintiffs in Wage and Hour Class Actions.
Courts have long recognized that Rule 68 may be used by defendants "as a sword" to
preemptively terminate class litigation by tendering offers of judgment for the full damages
requested upon named plaintiffs, and then filing motions to dismiss on the ground that that the
35
action is moot. This tactic has met with little success once a class has been certified. It is
well-settled that a defendant may not moot a class action after the class has been certified
simply by serving an offer of judgment upon the named plaintiff, which he or she then accepts.
This was the essential holding in Sosna v. Iowa, 419 U.S. 393 (1975), where the Supreme
Court ruled that the claims of the class as a whole were not mooted by the fact that the named
plaintiff had accepted an offer of judgment from the defendant. There the Court reasoned that,
"[w]hen the District Court certified the propriety of the class action, the class of unnamed
persons described in the certification acquired a legal status separate from the interest asserted
by the [lead plaintiff]." Id. at 399. Courts have likewise rejected attempts to moot class
litigation where the defendant serves offers ofjudgment on lead plaintiffs during the pendency
of a motion for class certification. See, e.g., Whitten v. ARS Nat 'I Serv., Inc., 200 I WL
1143238, at *6 (N.D. Ill. 200 I) (defendant's offer of judgment does not moot plaintiffs claim
where plaintiff filed for class certification approximately three weeks prior); Henderson v.
Eaton, 2001 WL 969105, at *6 (E.D. La. 2001) (defendant's offer of judgment does not moot
plaintiff s claim during pendency of motion for class certification; an opposite rule would
"place the class action remedy totally at the mercy of defendants"); Silva v. Nat 'I Telewire
Corp., 2000 WL 1480269, at *1 (D.N.H. 2000) (defendant's offer of judgment does not moot
plaintiffs claim during pendency of motion for class certification; "plaintiff s claim was not
resolved by the defendant's offer of judgment" because "there is no existing class on whose
behalf the plaintiff could accept the offer of judgment").
Yet the authority is less clear with regards to whether defendants may successfully
dismiss putative class actions by tendering offers of judgment upon the named plaintiffprior to
the plaintiff moving for class certification. As a general matter, and outside the context of
36
wage and hour litigation, federal district courts are divided over the issue. This question has
resulted in two contradictory approaches, the first developed by the district court for the
Eastern District of New York in Ambalu v. Rosenblatt, 194 F.R.D. 451 (E.D.N.Y. 2000), and
the second established in response by the district court for the Southern District ofIowa in
Liles v. American Corrective Counseling Services, Inc., 201 F.R.D. 452 (S.D. Iowa 2001).
In Ambalu, the named plaintiff brought suit unfair and deceitful debt collection
practices as a putative class action under the Fair Debt Collection Practices Act (FDCPA)
against the defendant, a debt collection agency. 194 F.R.D. at 452. Prior to the plaintiffs
moving for class certification, defendant served upon the plaintiff an offer of judgment for the
full statutory damages, plus the cost of the action and reasonable attorney's fees to be
determined by the court. Id. The plaintiff rejected the offer, and the defendant moved to
dismiss the case as moot. Id. The court allowed the motion to dismiss, noting that the
defendant had "offered all that [the plaintiff] could hope to recover through this litigation." Id.
The court also rejected the plaintiffs argument that the offer of judgment failed to compensate
the entire class, claiming that such an argument had "no force ... because no class has been
certified and plaintiff has not moved for certification since filing this action on November 16,
1998 [over two years prior]." Id.
Unlike Liles, discussed below, only a handful of district courts, most of them in the
State ofNew York, have adopted the reasoning set forth in Ambalu and allowed defendants to
dismiss class actions as moot after first serving offers of judgment on the named plaintiff or
plaintiffs. See, Edge v. C. Tech Collections, Inc., 203 F.R.D. 85, 88 (E.D.N.Y. 2001) Tratt v.
Retrieval Masters Creditors Bureau, Inc., 2001 WL 667602, at *2 (E.D.N.Y. 2001); Wilner v.
OSI Collection Servs., Inc., 198 F.R.D. 393, 395 (S.D.N.Y. 2001).
37
The district court for the Southern District of Iowa reached the opposite outcome in
Liles. As in Ambalu, the plaintiff in Liles brought a putative class action suit under the FDCPA
for unfair and deceptive debt collection practices. 201 F.R.D. at 453. The defendant served an
offer of judgment for the full statutory damages to the named plaintiff prior to the plaintiff
having filed a motion for class certification. Id. When this was rejected, the defendant moved
to dismiss the action as moot, citing Ambalu. Id. at 454-455. The court rejected Ambalu and
the defendant's arguments, however, explaining that the plaintiff:
[F]iled this action as a class action. As such, she has assumed a responsibility tomembers of the putative class and this Court has a special responsibility toprotect their interests, regardless of whether a motion for class certification hasbeen filed. Hinging the outcome of this motion on whether or not classcertification has been filed is not well-supported in the law nor sound judicialpractice; it would encourage a "race to payoff' named plaintiffs very early inlitigation, before they file motions for class certification.
Id. at 455.
Liles has found greater traction among the district courts than Ambatu, resulting in a
number of decisions in which the courts have rejected attempts to preemptively "pick off' a
plaintiff and thereby terminate the class action before it is certified. See, e.g., McDowall v.
Cogan, 216 F.R.D. 46, 51 (E.D.N.Y. 2003); Nasca v. GC Servs. Ltd. Partnership, 2002 WL
31040647, at *3 (S.D.N.Y. 2002) (refusing to dismiss the case as moot but finding for the
defendant on the merits); Bond v. Fleet Bank (RJ), NA., 2002 WL 373475, at *5 (D.R.I. 2002)
(precluding the defendant from rendering the case moot by making an offer ofjudgment six
days after the filing of the complaint); White v. OSI Collection Servs., Inc., 2001 WL 1590518,
at *4 (E.D.N.Y. 2001) (precluding the defendant from picking off the plaintiff by serving an
offer of judgment the day after the plaintiff filed her complaint).
This division in opinions is evidenced in the specific context of FLSA collective action
litigation. The majority trend, arising primarily from reasoning articulated by the Eleventh
38
Circuit in Cameron-Grant v. Maxim Healthcare Services, Inc., 347 F.3d 1240 (11 th Cir. 2003),
is to dismiss a plaintiff's FLSA collective action claims as moot following an offer of
judgment on the theory that FLSA collective actions, brought under 29 U.S.C. § 216(b), do not
raise questions concerning the rights of unnamed class. In Cameron-Grant, four plaintiffs
brought suit as an FLSA collective action for unpaid wages and unpaid overtime. 347 F.3d at
1242-1243. The plaintiffs subsequently moved for notice to be issued to the prospective class
members under Section 216(b). Id. at 1244. While that motion was pending, the defendant
stipulated to paying the plaintiffs' claims for unpaid wages and overtime, satisfying all their
FLSA claims, and the plaintiffs stipulated to dismissal of their claims. Id. The district court
then denied the motion to allow notice to be issued to the prospective class members and
dismissed the case as moot. Id. The Eleventh Circuit affirmed the district court's decision,
reasoning that no cognizable interest adverse to the defendant's remained upon which to base
the lawsuit. Specifically, the Eleventh Circuit held that:
Even if the § 216(b) plaintiff can demonstrate that there are other plaintiffs"similarly situated" to him, see 29 U.S.C. § 216(b), he has no right to representthem. Under § 216(b), the action does not become a "collective" action unlessother plaintiffs affirmatively opt into the class by giving written and filedconsent.... Until such consent is given, "no person will be bound by or maybenefit from judgment." ... Thus, in contrast to Rule 23 class actions, theexistence of a collective action under § 216(b) does depend on the activeparticipation of other plaintiffs. In other words, under § 216(b), the nanledplaintiff does not have the right to act in a role analogous to the private attorneygeneral concept.
Id. at 1249. A nnnlber of courts have taken this rationale and used it as a basis for dismissing
FLSA collective actions as moot following an offer of judgment made to the named plaintiff
prior to any motion for certification. See, e.g., Rollins v. Systems Integration, Inc., 2006 WL
3486781 (N.D. Tex. 2006) (dismissing plaintiff's FLSA collective action as moot following
rejection of offer of judgment; "although [plaintiff] purports to bring this action 'on behalf of
39
those similarly situated,' he has presented no evidence, and the record is devoid of any
evidence, that any other employee or former employee of [defendant] has consented in writing
to join [plaintiffs] action"); Darboe v. Goodwill Indus. ofGreater N.Y & N. N.J, Inc., 485 F.
Supp. 2d 221, 223-24 (E.D.N.Y. 2007) ("In contrast [to Rule 23], an FLSA collective action
requires members of the class to take the affirmative step of 'opting in' to the action to be a
part of the action and bound by its terms. Where no class member has opted in to the collective
action, the named plaintiff is deemed to represent himself only. In such cases, application of
Rule 68 to moot a single plaintiff s claim creates no conflict with the policy underlying the
collective action procedure"); Ward v. Bank ofN. Y, 455 F. Supp. 2d 262,268-69
(S.D.N.Y.2006) (defendant's Rule 68 offer ofjudgment mooted the plaintiffs FLSA claim).
In Vogel v. American Kiosk Management, 371 F. Supp. 2d 122 (D. Conn. 2005), for
example, the district court held that the defendant's offer of judgment to the representative
plaintiff in an FLSA collective action mooted her claim and required dismissal. In that case,
the plaintiff brought suit alleging that the defendant had failed to pay overtime in violation of
the FLSA, and sought to pursue to her case as a national collective action. Id. at 123-124.
Within two months of filing the complaint, the defendant tendered an offer ofjudgment on the
plaintiff, and subsequently moved to dismiss the action as moot. Id. In weighing that motion,
the court cited to Ambatu before ruling that the plaintiffs action must properly be dismissed as
moot following the offer ofjudgment. Id. at 126-128. Specifically, the court reasoned that
none of the policy considerations which would normally prevent it from dismissing the case
applied because the lawsuit was brought as a collective action under Section 216(b) of the
FLSA, as opposed to Rule 23 of the Federal Rules of Civil Procedure. Id. at 126. As the court
explained, actions brought pursuant to Section 216(b) are "not subject to Rule 23 requirements
40
and principles." Id. "[U]nlike Rule 23 class actions," the court explained, "plaintiffs in a
collective FLSA action must 'opt in' in order to be bound by any judgment or result." Id. at
127. Thus, the court held, even if the named plaintiff "can demonstrate that there are other
plaintiffs 'similarly situated' to him, he has no right to represent them absent their consent by
an opt-in." Id. at 127-128. Section 216(b) entitles the plaintiff to present "only her claim on
the merits," not those of others, and therefore the "general application of Rule 68 Offers of
Judgment applies such that settlement ofa plaintiffs claims moots an action." Id. at 128.
Certain courts have, however, distanced themselves from Cameron-Grant and refused
to dismiss as moot FLSA collective actions following the defendant's offer ofjudgment,
although the decisions of those courts are the result more of analytic side-stepping than
contrary analysis. In Yeboah v. Central Parking Systems, for example, the district court for the
Eastern District of New York rejected the defendant's motion to dismiss an FLSA collective
action after it had served an offer of judgment on the named plaintiff. 2007 WL 3232509, at
*4-*5. There the court agreed with the position, argued by the defendant, that dismissal is
required "where no other similarly situated individuals have opted in and the offer ofjudgment
satisfies all damages of the plaintiff, plus all costs and attorney's fees " Id. at *3. The court
refused to dismiss the case, however, because "one other individual filed a notice of
consent to participate as an opt-in plaintiff' after the offer of judgment was made. Id. at *4.
The presence of this one opt-in plaintiff, the court reasoned, "require[d] the conclusion that
even if defendant's Rule 68 offer represented or exceeded plaintiffs maximum recovery, it
neither mooted plaintiffs FLSA claim nor deprived this Court of subject matter jurisdiction
over this matter." Id. at *5.
41
Similarly, in a recent decision handed down by the Fifth Circuit, the court refused to
dismiss a putative FLSA collective action as moot after the defendant served an offer of
judgment upon the named plaintiff. In that case, Sandoz v. Cingular Wireless LLC, 553 F.3d
913 (5th Cir. 2008), the defendant served the offer of judgment one month after the plaintiffs
complaint was filed. Id. at 914. The plaintifffailed to accept this offer within the specified
time period, and the defendant moved to dismiss. Id. That motion was denied, and the
defendant sought and was granted interlocutory appeal. Id. Three weeks after the denial of the
defendant's motion to dismiss, the plaintiff filed a motion for certification of the collective
action. Id.
On appeal, the Fifth Circuit accepted the defendant's argument that the Rule 23 class
actions and Section 216(b) collective actions operated using different principles - "[t]hat is, the
language of § 216(b) and the cases construing that provision demonstrate that [plaintitf! cannot
represent any other employees until they affirmatively opt in to the collective action." Id. at
918. The Court recognized the plaintiffs concern, namely, permitting dismissal would permit
defendants to "'pick off a named plaintiff s FLSA claims before the plaintiff has a chance to
certify the collective action would obviate one purpose of the collective action provision." Id.
at 919. Still, if its analysis had ended there, the Court recognized that it was bound to dismiss
the plaintiffs action as moot. Id. The Court was able to avoid this outcome, however, through
application of the "relation back" doctrine." Id. The Court explained that the plaintiff had
timely filed a motion for class certification following the denial of the defendant's motion to
dismiss, and that this motion "relates back to the date the plaintiff filed the initial complaint."
Id. at 920-921. On this point, the Court reasoned, "the differences between class actions and
FLSA § 216(b) collective actions do not compel a different result regarding whether a
42
certification motion can 'relate back' to the filing of the complaint," since the differences
between Rule 23 class actions and FLSA § 216(b) collective actions alter only "the conceptual
mootness inquiry." Id. at 920. By way of example, the Court stated that, "[i]fthe court ...
grants the motion to certify, then the Rule 68 offer to the individual plaintiff would not fully
satisfy the claims of everyone in the collective action; if the court denies the motion to certify,
then the Rule 68 offer of judgment renders the individual plaintiffs claims moot." Id. at 920
921. The Court thus concluded that, "although the district court was correct to suggest that
[defendant's] motion to dismiss was premature, it failed to give the proper reason: that so long
as [plaintiff] timely filed a motion to certify her collective action, that motion would relate
back to the date she filed her initial state court petition." Id. at 921.
Finally, in Sanders v. MPRJ, Inc., 2008 WL 5572846 (W.D. Okla. 2008), the district
court refused to dismiss an FLSA collective action as moot after the defendant had served an
offer ofjudgment on the named plaintiff. There the court "recognize[ed] that there is a split of
authority as to whether a settlement or offer ofjudgment as to the named Plaintiff which would
fully satisfy his or her economic claim moots an FLSA collective action which has not been
conditionally certified and/or in which no other person has joined as plaintiff," but refused to
"align itself' on other grounds. Id. at *1. Specifically, the court explained that the offer of
judgment did not moot the plaintiff s claim for overtime because the defendant failed to show
"that $10,500, plus reasonable attorney fees and costs, the amount of its offer ofjudgment, is
equal to or in excess of what Plaintiff could recover in overtime wages and liquidated damages
under the FLSA." Id.
V. REPRESENTATIVE TESTIMONY
Using representative testimony at trial avoids presentation of cumulative and repetitive
testimony. As a result, the trial is far shorter and more manageable. Federal Rules of Evidence
403 and 611 permit district courts to limit unnecessary, duplicative, and unduly burdensome
43
presentation of trial evidence. That discretion includes the discretion to permit representative
testimony at trial, both as to the liability detenllination and as to damages.
The predicate for using representative evidence in an FLSA action is the detennination
that class members are similarly situated for purposes of the analysis at issue. Assuming the
Court makes the second-stage similarly-situated detemlination in plaintiffs' favor, the case can
and should be tried on the basis of representative evidence - i.e., testimony from a selection of
class members and other percipient witnesses. However, where a court detennines, after hearing
evidence, that the testimony is not actually representative, the court may then decertifY the
collective action. See Johnson v. Big Lots Stores, Inc., 561 F. Supp. 2d 567 (E.D. La. 2008)
(decertifying collective action following bench trial where evidence presented revealed that
plaintiffs were not actually similarly situated, and it appeared that some plaintiffs might have
been misclassified whereas others were properly treated as exempt employees.) In contrast,
other courts have upheld jury verdicts based on representative testimony, specifically finding that
there was sufficient evidence by which a jury could have detennined that the testifYing plaintiffs
were similarly situated to those who did not testify. Stillman v. Staples, Inc., 2009 WL 1437817,
*18-20 (D. N.J. May 15, 2009).
Representative evidence has been used in numerous FLSA actions to detennine various
liability issues, including exemption issues, on a classwide basis. Reich v. Gateway Press, Inc.
13 F.3d 685, 697-701 (3d Cir. 1994) (court detennined on classwide basis that reporters were
misclassified as exempt professional employees; 22 out of 70 employees testified); Brock v.
Norman's Country Market, Inc., 835 F.2d 823 (II th Cir. 1988) (court detennined on classwide
basis that 8 employees were misclassified as managers; at least one employee did not testifY);
Donovan v. Burger King Corp. 672 F.2d 221,224-25 (I st Cir. 1982) (court detennined on
44
classwide basis that 246 assistant managers working in 44 different restaurants were not exempt
"executive" employees based on limited testimony from witnesses from six stores; court also
limited number of witnesses after hearing substantially the same testimony from six witnesses);
Janowski v. Castaldi, 2006 WL 118973, *5 (E.D.N.Y. Jan. 13,2006) (Plaintiffs '''need not
present testimony from each underpaid employee; rather, it is well established that [they] may
present the testimony of a representative sample of employees as part of [their] proof of the
prima facie case under FLSA.'" (quoting Reich v. S. New England Telcoms. Corp., 121 F.3d 58,
67 (2d Cir. 1997)) (alterations in Oliginal); Theibes v. Wal-Mart Stores, 2004 WL 1688544 at *1
(D. Or. July 26,2004) representative testimony regarding Wal-Mart's alleged pattern or practice
of suffering or permitting off-the-clock work); Alvarez v. IBP, Inc., 200 I WL 34897841, *6
(E.D. Wash. Sept. 14, 2001), rev'd in part on other grounds ("The use of representative evidence
is well accepted for determining liability in FLSA cases."); Murray v. Stuckey's Inc., 939 F.2d
614 (8th Cir. 1991) (each side presented testimony regarding common issue of exempt!
nonexempt status of store managers working at different stores; court decided issue on classwide
basis); Donavan v. Bel-Lac Diner, Inc., 780 F.2d 1113, 1115-16 (4th Cir. 1985) (district court
properly made classwide determinations regarding whether employees received uninterrupted
30-minute breaks based on representative testimony; approximately 30 out of 98 employees
testified);.
Representative evidence may also be used to establish a pattern and practice among class
members of working uncompensated overtime, and/or to prove up damages. See, e.g., Anderson
v. Mt. Clemens Pottery Co., 328 U.S. 680, 687-88 (1946); Grochowski v. Phoenix Constr., 318
F.3d 80, 88 (2d Cir. 2003) ("[T]he plaintiffs correctly point out that not all employees need
testify in order to prove FLSA violations or recoup back-wages, [but] the plaintiffs must present
45
sufficient evidence for the jury to make reasonable inference as to the number of hours worked
by non-testifying employees.); Martin v. Selker Bros., Inc., 949 F.2d 1286, 1296-98 (3d Cir.
1991) (plaintiffs could use representative testimony to make prima facie case that non-testifying
employees performed some work for which they were not properly compensated); Brennan v.
General Motors Acceptance Corp., 482 F.2d 825,826-29 (5th Cir. 1973) (no error in pennitting
representative evidence to establish prima facie case that non-testifying employees worked
overtime for which they were not compensated); Bell v. Farmers Ins. Exch., 115 Cal.App.4th
715,746-50 (Cal.Ct.App. 2004; Takacs v. Hahn Auto. Corp., 1999 WL 33127976, *1 (S.D. Ohio
Jan. 25, 1999) ("Based upon Mt. Clemons Pottery, courts including the Sixth Circuit, have
uniformly held that damages in an FLSA overtime case can be proved with testimony from a
representative group of plaintiffs and, thus, without requiring each plaintiff seeking same to
testify.") .
When an employer has failed to keep accurate records of an employee's work time, an
employee need only establish "as a matter ofjust and reasonable inference" that work was
performed for which the employee was improperly compensated. Anderson, 328 U.S. 680, 687
688 (1946). The employee is only required to provide a reasonable approximation of the
number of hours worked for which overtime compensation is owed. Id. Once an employee has
provided that reasonable estimate, the burden switches to the employer to "pinpoint evidence of
the precise amount of work performed or to negate the reasonableness of the inferences to be
drawn from the [employees'] evidence." Dove v. Coupe, 759 F.2d 167, 173-175 (D.C. Cir.
1985). The burden of disproving an employee's approximation if"a significant one[.]" Blake v.
CMB Construction, Civ. No. 90-388-M, 1993 WL 840278 at *5 (D.N.H. March 30, 1993).
46
Representative testimony depends more on the quality of the witnesses than their quality.
The testimony of a relatively small subset of the class will sometimes be enough to find liability.
For example, in Donovan v. New Floridian Hotel, Inc., 676 F.2d 468, 472 (11 th Cir. 1982), the
court upheld an award of damages to 207 FLSA plaintiffs that followed a trial in which only 23
plaintiffs testified. Similarly, in Alvarez v. IBP, Inc., 339 F.3d 894 (9th Cir. 2003), afrd on other
grounds, 546 U.S. 21, 126 S.Ct. 514 (2005), the Ninth Circuit upheld a verdict for over 800
FLSA plaintiffs that was based on testimony from fewer than 50 of those plaintiffs. The First
Circuit affirmed an FLSAjudgment in favor ofplaintiffs where six out of246 class members
testified at trial. Burger King Corp., 672 F.2d at 224-25.
The Eleventh Circuit recently rejected defendant's argument that plaintiffs' use of
representative evidence ~ only 7 of 1,424 plaintiffs testified - rendered the jury's verdict
unreliable. Morgan v. Family Dollar, 551 F.3d 1233 (11 th Cir. 2008). In particular, the court
noted that, as it was defendant's burden to prove that an exemption applied, it could never be
said that plaintiffs had put on too few witnesses on this topic. Id. at 1278. See also Walters v.
American Coach Lines ofMiami, Inc., 2009 WL 1708811 (S.D. Fla. June 17, 2009) (noting that
defendant could put on its Motor Carriers Act exemption defense via representative testimony,
should it choose to do so, but that defendant had the burden to call as many plaintiffs as
necessary to establish its defense). Given this standard, some courts have been unwilling to limit
the number of witnesses that defendants can put on. In one recent case, for example, plaintiffs
intended to put on representative plaintiff witnesses from 14 of defendant's restaurants, and
argued that defendant should not be permitted to call witnesses from other restaurants, because to
do so would reopen the court's prior ruling that the deposed opt-ins were similarly situated and
would defeat the purpose of allowing the case to proceed as a collective action. Roussell v.
47
Brinker International, Inc., 2009 WL 595978, at * I (S.D. Tex. March 6,2009). The court
disagreed, however, and held that "to restrict testimony to practices at those stores alone would
unfairly prejudice Defendant by not allowing it to put on its best case." Id at *2.
Accordingly, although representative testimony is well accepted in FLSA cases, its
precise contours will vary from case to case depending on who has the burden of proof on any
particular issue, and what evidence is put on by the other side.
VI. EXPERT EVIDENCE IN CLASS ACTIONS
A. Introduction
Expert evidence plays an important role in employment class action litigation for several
reasons. Experts can offer opinion evidence regarding the ultimate issues of commonality and
typicality with respect to Rule 23 of the Federal Rules of Civil Procedure or the similarly situated
requirement of the Fair Labor Standards Act (FLSA). In an FLSA case, a time and motion
expert might opine that employees in a particular job category perform their tasks in a similar
fashion, at a particnlar rate, so the question of whether they are exempt can be decided on a
classwide basis.
In FLSA collective actions, employees may allege that their job duties do not qualify
them as exempt from the overtime laws, or that their employerworks them off-the-clock.
Plaintiffs frequently contend that these issues can be litigated classwide with the help of surveys
that are administered to class members. The contention is that surveys efficiently gather
information from class members, which then can be synthesized and presented to a jury.
Because survey research is used in various social sciences, and is itself a branch of statistics, a
variety of professionals may claim expertise in this methodology as well. In addition, courts
generally will require the plaintiffs to produce some evidence, even at the class certification
stage, that the challenged screening procedure adversely impacts putative class members.
Typically, an industrial psychologist or a statistician provides this testimony.
48
1. Data
An employer's records typically are not collected or organized with litigation in mind.
Rather, databases of such information usually are constructed for particular business or
governmental purposes that have little to do with the pending litigation. The challenge therefore
is to determine whether useful information can be gleaned from these databases that bears on the
relevant factual and legal issues. Data may be classified as either internal or external to the
employer.
a. Internal Data Sources
Internal data sources typically consist of the employer's payroll and personnel records,
along with the employer's fmancial records. In addition, the employer may maintain records,
such as EEO - I reports and affirmative action plans, to comply with government regulations.
See 29 C.F.R. § 1602.7; 41 C.F.R. part 60.2. In most businesses these data are maintained
electronically, which greatly facilitates producing and analyzing this information. But, because
these data serve purposes that are not litigation related, they may not be suitable to address
questions pertinent to the litigation unless modified or supplemented.
The information contained on internal databases may be both over- and under-inclusive.
Because an employer's databases typically are designed for a variety of business purposes, they
are likely to include information that is unrelated to the subject matter of the litigation, and/or is
confidential. For example, an employer's payroll database may include information about an
employee's deductions from gross pay that are of a personal nature and are not material to the
case. Items such as child support payments, 401(k) contributions, and medical insurance
premiums may make requests for the employer's "persOimel database" objectionably overbroad
and invasive of employees' privacy interests. Similarly, an employer's financial records may be
relevant in determining whether an employee's profit based bonuses are calculated properly, but
those records also are likely to include a wide variety of information that is extraneous to that
49
calculation. Consequently, these databases may include far more information than a statistical
expert legitimately may require.
Conversely, the employer's electronic databases may be under-inclusive as well because
information that is pertinent to the litigation may not be coded electronically. For example, some
courts regard an employee's salary with a previous employer as a consideration that legitimately
may explain an alleged gender difference in pay. Yet, some employers may collect this
infonnation, if at all, on the employee's job application, but fail to enter it into their intemal
database.
Relevant information may be stored on a multitude of databases that must be linked
together. For example, an employer may compensate its employees by paying both a salary and
a stock bonus. If the bonus is part of a stock plan or other benefit package, it may be omitted
from a payroll database that primarily is used to generate weekly or montWy paychecks.
Obviously, an analysis predicated solely on the payroll database would miss an important
component of an employee's total compensation.
More widespread are employers who believe they have detemlined correctly that a
category of employees is exempt from the FLSA's overtime requirements. Because these
employees are paid a salary that does not vary with the number of hours worked, the employer
may perceive no business purpose in documenting their hours. Obviously, if the employer is
sued for violating the overtime law, the missing data will be higWy relevant.
Accordingly, requests for "the employer's personnel or payroll database" are likely to
result in a series of frustrating exchanges between counsel. A plaintiff who makes such an
overbroad request is likely to be met in response with well-founded objections fTOm the defense
attomey. Indeed, the defense attomey who makes a similar request of the employer/client is
likely to encounter resistance as well, for the client may recognize that this encompasses far
more infonnation than any expert legitimately needs and infringes upon the privacy rights of
50
third parties. Thus, it behooves attorneys on both sides, as well as their experts, first to identify
the issues relevant to the lawsuit, then to identify the internal data that are likely to be most
helpful in addressing those questions and how it can be produced most efficiently.
A data dictionary essentially is a menu of all the items contained within a particular
database. Some, but by no means all, databases list the fields of data they contain. An expert
who is educated about the issues in the case should be able to use the data dictionary to identify
those fields of data that are most pertinent. The employer may then be able to extract from the
larger database those designated fields of information for the appropriate group of employees
(within the appropriate timeframe) and provide this to its adversary and/or its expert.
Often, the most time-consuming, and therefore expensive, work begins after the data are
extracted. An unfortunate by-product of the fact that the employer's databases rarely are
maintained with litigation in mind is that some of the data may be incomplete or inaccurately
constructed or maintained with respect to issues pertinent to the case. For example, an
employee's gender may be highly relevant to a lawsuit, but of no practical relevance to the
employer's day-to-day business. As a result, this information can be miscoded in the database
and the error can persist, with no one the wiser, until it becomes a central concern in a lawsuit.
Similarly, an error in entering an employee's educational attainment may pass unnoticed until it
appears as an outlier - a higWy-educated person in a menial position, or vice versa - when the
data are analyzed by the expert. Frequently, these errors can be corrected only by consulting the
employee's personnel file or someone with first-hand knowledge about the employee.
Apart from data inaccuracies, there often are conventions that are adopted to code or
arrange data that are not documented in any formal way. For example, occasionally an employee
will appear in a database who apparently has two dates on which employment was terminated.
With some employers this may reflect that the employee worked for an initial period, tenninated
(hence the first termination date), was rehired, and then terminated again (hence the second
51
termination date). If the employer considers the date on which that employee first began
working to be determinative of seniority, benefit entitlement, etc., the second start date may be
deemed irrelevant and go unrecorded. This anomalous pattern can be confounded if an employer
tracks its employees by assigning identification numbers, but recycles these numbers after
employees leave. In that case, it may be difficult to be certain whether the database contains the
record of a given employee who experienced two terms of employment, or two employees who
were assigned the same identification number.
Some databases may characterize an employee's status in ways that may not correspond
to the relevant legal definition. For example, an employer's database may define ajob change as
a promotion although there was no change in responsibilities or pay. Alternatively, employees
may be characterized as employed, in order to continue their eligibility for benefits, when in fact,
they no longer report for work and they have terminated their employment. See Thurman v.
Sears, Roebuck & Co., 952 F.2d 128 (5th Cir. 1992).
b. External Data Sources
External data sources are those external to the employer and typically compiled by
various government agencies, researchers whose work is sponsored by the government, or third
parties with whom the employer has contracted to perform particular services, such as payroll
processing. With few exceptions these public data do not relate exclusively to the defendant or
its workforce. Although public data sources may provide highly accurate descriptions of the
population or entity that is its subject, that population may differ markedly from the plaintiffs or
defendants in the particular lawsuit. Additionally, because the external survey probably was not
intended for litigation, it is important to know whether its idiosyncrasies or definitions are
compatible with that use.
R IdentifYing Threshold Challenges For Expert Testimony
Like other witnesses, expert depositions help an opponent discover facts and strategies,
narrow the disputed issues, identify critical witnesses, prepare for cross-examination at trial, and
52
assess the settlement value of the case. Additionally, when deposing or cross-examining an
expert witness at trial, a central and standing goal is to create a record for excluding all or part of
the proffered opinion. In most jurisdictions, expert opinions will be admitted if:
• the witness is qualified as an expert by his or her knowledge, skill, experience, training,or education;
• the opinion relates to scientific, teclmical, or other specialized knowledge that is beyondcommon expenence;
• the opinion will assist the court or jury to determine a disputed fact;
• the opinion is based on sufficient facts or data known or perceived by the witness;
• the opinion is based on principles and methods reasonably relied upon by other experts;and
• the witness has applied such principles and methods reliably to the facts of the case. SeeFED. R. EVID. 702, 703.
Because the failure to satisfy these factors will usually result in exclusion of the expert's
opinion, they are essential subjects for deposing or cross-examining any expert witness.
1. Expert Must Be Qualified on the Issues Presented
A witness may qualify as an expert based on knowledge, skill, training, experience or
education in the field. Microfinancial, Inc. v. Premier Holidays Int'l, Inc., 385 F.3d 72,80 (l st
Cir. 2004); Miles v. General Motors Corp., 262 F.3d 720, 724 (8th Cir. 2001). Neither a formal
education nor a professional degree is a prerequisite for qualification. For example, an expert
may be qualified based solely on experience, training, or special knowledge in an occupation,
trade, or craft. FED. R. EVID. 702 advisory committee's notes on 2000 amendments; Poulis
Minott v. Smith, 388 F.3d 354,360 (l5t Cir. 2004) (fishing boat captain); Ty, Inc. v. Sojtbelly's,
Inc., 353 F.3d 528,534 (7th Cir. 2003); Asplundh Mfg. Div. v. Benton Harbor Eng'g, 57 F.3d
1190,1213 (3d Cir. 1995); Thomas v. Newton Int'l Enters., 42 F.3d 1266, 1270 (9th Cir. 1994)
(longshoreman). Some judges qualify experts with minimal credentials. Of course, if the
53
expertise of the witness is based primarily on his or her experience, counsel must lay a
foundation showing how the experience creates expertise. Id.
The sufficiency of expertise required to testify as an expert depends on the facts of the
case. Microjinancial, 385 F.3d at 80 (IRS agent specializing in fraud investigations); Smelser v.
Norfolk S. Ry. Co., 105 F.3d 299,303 (6th Cir. 1997). Many individuals are experts in their
respective fields. That status does not mean they are qualified to testify on a particular issue in a
case. For instance, an accountant may not be able to testify about as many topics as an
economist. Similarly, a psychologist can perform tests to determine a person's mental health
problem, while a psychiatrist is often unqualified to do such tests. A psychiatrist may provide a
medical diagnosis of a person's mental health, yet a psychologist cannot. The court must
determine whether the proposed expert's qualifications provide a sufficient foundation for him or
her to offer an opinion on a specific question. United States v. Chang, 207 F.3d 1169, 1173 (9th
Cir. 2000), reh 'g denied, 532 U.S. 953 (2001); Berry v. City ofDetroit, 25 F.3d 1342, 1350 (6th
Cir. 1994).
Counsel must draw a critical distinction between the expert's qualifications in the abstract
versus the relevance of his or her credentials to the specific issue to which the expert opinion is
directed. Both subjects are relevant, but only one affects the admissibility of the opinion. Most
experts, particularly those who testify often, have sufficient credentials. The basis for
challenging their qualifications will often be found in showing that their expertise is limited to
matters outside the scope ofthe action. To illustrate, a Nobel physicist and a civil engineer may
both be qualified to offer testimony on the mechanics of a suspension bridge, even though the
weight of the testimony and their credibility may vary widely. However, even if both witnesses
have special knowledge about suspension bridges, their specific expertise must be tailored to the
subject at issue in the action. The Nobel Laureate may be unqualified to offer opinions on the
construction of suspension bridges, while the civil engineer may be well-qualified to testify on
that subject. Hochen v. Bobst Group, Inc., 290 F.3d 446,452 (lS! Cir. 2002); Goodwin v. MTD
54
Prods., Inc., 232 F.3d 600,608-09 (7th Cir. 2000); Tanner v. Westbrook, 174 F.3d 542,548 (5th
Cir. 1999) (obstetrician unqualified to testify on the causes of cerebral palsy). Thus, even if an
expert's credentials are impeccable, counsel may successfully exclude the testimony by showing
that the witness' expertise does not pertain to the specific issues in the action. Challenges to this
testimony should highlight the expert's lack of knowledge and prior work experience regarding
the more narrow points of his or her opinions.
2. Expert's Opinion Must Not Address Matters of Common Knowledge
Opinion testimony may be admitted anytime it would assist the trier of fact, which is
particularly true in those instances where the issue ordinarily caml0t be resolved without
teclmical or specialized knowledge. Fed. R. Evid. 702; Kumho Tire Co., Ltd. v. Carmichael,526
U.S. 137, 156 (1999); Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 591 (1993). By
their very nature, matters of common knowledge do not require technical or specialized expertise
and, therefore, should be excluded. United States v. Cruz, 363 F.3d 187, 196-97 (2d Cir. 2004)
(expert could not explain meaning of slang phrase); United States v. Hanna, 293 F.3d 1080,
1086-87 (9th Cir. 2002) (no expert testimony was needed to decide whether a reasonable person
would feel threatened by the communication); Evans v. Mathis Funeral Home, Inc., 996 F.2d
266,268 (11 th Cir. 1993); Persinger v. Norfolk & Western Ry. Co., 920 F.2d 1185, 1188 (4th Cir.
1990). Likewise, opinions should be excluded where an expert is merely instructing jurors on
inferences from the evidence that they may draw on their own. Nichols v. American Nat 'I Ins.
Co., 154 F.3d 875,883 (8th Cir. 1998).
Nevertheless, courts have discretion to conclude that such opinions are helpful and
relevant to a disputed issue. Matters that seem common to some individuals may be less familiar
to others. Tyus v. Urban Search Mgmt., 102 F.3d 256, 263 (7th Cir. 1996) (opinion admitted to
explain how an all-Caucasian advertising campaign affects African Americans). The court must
balance the goal ofproviding jurors with helpful information with the prejudice that results from
having a witness (often paid) simply advocate a position from the pedestal of a court-qualified
55
"expert." A recurring tactic is for experts to offer opinions regarding human emotions, veracity,
or motives. United States v. Charley, 189 F.3d 1251, 1267 (lOth Cir. 1999) (no opinion
testimony to bolster credibility); United States v. Gonzalez-Maldonado, 115 .3d 9, 15, 17-18 (I st
Cir. 1997) (excluded opinion on whether witnesses were lying or "appeared relieved"); United
States v. Castaneda, 94 F.3d 592, 595 (9th Cir. 1996) Gurors could assess the fear of illegal aliens
facing deportation). In the context of employment discrimination cases (including class actions),
expert opinions purporting to identify an employer's motives for personnel decisions or different
treatment are usually rejected, though not always. Curtis v. Oklahoma City Pub. Scb. Bd. of
Educ., 147 F.3d 1200, 1219 (lOth Cir. 1998) Gury could decide if recruitment plan evidenced
retaliation); Barfield v. Orange County, 911 F.2d 644, 651 (11 th Cir. 1990); Torres v. County of
Oakland, 758 F.2d 147, 150-51 (6th Cir. 1985); Kotla v. Regents ofUniv. ofCal., 115 Cal.App.4tl1
283,284 (2004) (human resources expert could not testify whether personnel records had the
hallmarks of retaliation, as 'jurors are capable of deciding a party's motive for themselves
without being told by an expert"). But see Davis v. Combustion Eng'g, Inc., 742 F.2d 916,919
(6th Cir. 1984) (personnel expert allowed to testify that plaintiffs discharge reflected
discrimination based on a review of the records). Similarly, parties may attempt to offer expert
testimony for the purpose of explaining human grief, reactions to trauma, and other forms of
emotional distress damages. Rulings on the admissibility of such testimony are mixed, as most
jurors have an understanding of these matters. Vogler v. Blackmore, 352 F.3d 150, 154 (5th Cir.
2003); Smith v. Ingersoll-Rand Co., 214 F.3d 1235, 1244 (lOth Cir. 2000); Navarro de Cosme v.
Hospital Pavia, 922 F.2d 926,931-32 (1st Cir. 1991); El Meswari v. Washington Gas Light Co.,
785 F.2d 483, 487 (4th Cir. 1986) Gury could assess mother's grief at losing child). Opinion that
merely attacks a witness' credibility or motive invades the jury's function and should not be
admitted. Skidmore v. Precision Printing & Packaging, Inc., 188 F.3d 606, 618 (5th Cir. 1999)
(psychiatrist testified that plaintiffs symptoms and recollections looked genuine); Nichols v.
American Nat 'I Ins. Co., 154 F.3d 875,882 (8th Cir. 1998) (no testimony that plaintiff was a
malingerer and influenced by "recall bias" and "secondary gain").
56
3. Expert's Legal Opinions Are Inadmissible as They Do Not Assist theTrier of Fact
With increasing frequency, attorneys are offering expert testimony for the purpose of
coaching jurors on the law. Judges determine the law, not juries: "Each courtroom comes
equipped with a 'legal expert,' called ajudge, and it is his or her province alone to instruct the
jury on the relevant legal standards." Burkhart v. Washington Metro. Area Transit Auth., 112
F.3d 1207, 1213 (D.C. Cir. 1997). Legal conclusions masked as expert opinion do not assist the
jury in deciding a disputed fact and are, therefore, inadmissible. Estate ofSowell v. United
States, 198 F.3d 169, 171 (5th Cir. 1999) (opinion on what a reasonable fiduciary would do);
Nieves-Villanueva v. Soto-Rivera, 133 F.3d 92, 99 (1 st Cir. 1997). For example, some attorneys
may attempt to introduce expert testimony on whether the facts indicate that discrimination or
harassment occurred, or whether a person is disabled within the meaning of a statute, both of
which constitute inadmissible legal opinions. Wilson v. Muckala, 303 F.3d 1207, 1219 (10th Cir.
2002); Broussard v. University ofCal., 192 F.3d 1252, 1257 (9th Cir. 1999); Kotla, 115 Cal.App.
4th at 294. If the opinion requires the expert to use terms with special legal meanings, the
opinion is more likely to be excluded as a legal conclusion. McHugh v. United Servo Auto. Ass 'n,
164 F.3d 451,454 (9th Cir. 1999) (opinion interpreting contract terms); Woods V. Lecureux, 110
F.3d 1215, 1219-20 (6th Cir. 1997) ("deliberately indifferent" conduct); Strong V. E.l Du Pont de
Nemours Co., Inc., 667 F.2d 682, 685-86 (8th Cir. 1981) ("unreasonably dangerous" product).
4. Expert's Speculation Is Inadmissible as It Does Not Assist the Trier ofFact
An opinion is generally unhelpful if based on speculative assumptions or unsupported by
evidence in the record. Nelson V. Tennessee Gas Pipeline Co., 243 F.3d 244, 250 (6th Cir. 2001),
cert. denied, 534 U.S. 822 (2001); Talley v. Danek Med., Inc., 179 F.3d 154, 162 (4th Cir. 1999);
Guillory V. Domtar Indus., Inc., 95 F.3d 1320, 1330 (5th Cir. 1996); In re Air Disaster at
Lockerbie, Scotland, 37 F.3d 804, 824 (2d Cir. 1994). The opinion is not only unhelpful in those
circumstances, but it also increases the likelihood of causing unfair prejudice, confusing the
issues, or misleading the jury. Yet expert opinions need not resolve an issue with certainty.
57
Jahn v. Equine Servs., P.s.e., 233 F.3d 382, 392 (6th Cir. 2000); Smith v. Ford Motor Co., 215
F.3d 713,715 (7th Cir. 2000). Some degree of speculation is inevitable and necessary at trial,
which often goes to the weight of the testimony rather than admissibility. Examples include
testimony to prove a person's earning capacity and the probability and amount of future; lost
earnings from an injury or disability; projected lost profits; and the present cash value of future
payments or future earnings. Malloy v. Monahan, 73 F.3d 1012, 1015 (loth Cir. 1996); Hull v.
United States, 971 F.2d 1499, 1511-12 (loth Cir. 1992); Gates v. Northwest Ins. Co., 881 F.2d
215,218 (5th Cir. 1989). But see Group Health Plan, Inc. v. Philip Morris USA, Inc., 344 F.3d
753,758-61 (8th Cir. 2003) (predictions of future business activity were "inspired guesses at
best"); In re Air Crash Disaster at New Orleans, 795 F.2d 1230, 1235 (5th Cir. 1986).
5. Expert Must Apply a Reliable Methodology to the Facts
The admissibility of expert opinions often turns on the method employed by the witness
in reaching a conclusion, rather than the expert's qualifications or the conclusion itself.
Admissible testimony must be "the product of reliable principles and methods." Kumho Tire
Co., Ltd. v. Carmichael, 526 U.S. 137, 152 (1999); Jahn, 233 F.3d at 392; Moore v. Ashland
Chem. Inc., 151 F.3d 269, 276 (5th Cir. 1998) (en banc). Where an opinion is not based on the
knowledge and experience of the expert's discipline, the conclusion is unreliable and little more
than a "subjective belief or unsupported speculation." Kumho Tire, 526 U.S. at 147-48; Daubert
v. Merrell Dow Pharms., 509 U.S. 579, 590 (1993).
The court must "make certain that an expert, whether basing testimony upon professional
studies or personal experience, employs in the courtroom the same level of intellectual rigor that
characterizes the practice of an expert in the relevant field." Kumho Tire, 526 U.S. at 152. For
example, scientific opinion requires an inference or assertion grounded in reliable scientific
methods or procedures. So-called "junk science" is inadmissible in most jurisdictions. Daubert,
509 U.S. at 591. For a discussion of states declining to apply the federal standard to "junk
science," see Alice B. Lustre, AImotation, Post-Daubert Standards for Admissibility ofScientific
58
and Other Expert Evidence in State Courts, 90 A.L.R. 5th 453 (2001) (identifying Arizona,
California, Florida, Illinois, Kansas, Maryland, Michigan, MiImesota, Mississippi, Missouri,
New Jersey, New York, Pennsylvania, and Washington). Likewise, testimony based on
specialized or technical knowledge must have a reliable basis in the knowledge or experience
recognized in that particular field. Kumho Tire, 526 U.S. at 147-49. There is no fixed test for
assessing the reliability of expert testimony, but the following factors are relevant:
• whether the expert's methodology can be (or has been) tested;
• whether the methodology has been subjected to peer review;
• whether there is a known rate of error;
• whether there are standards controlling the technique used;
• whether a known technique is generally accepted in the relevant scientific or technicalcommunity;
• the degree to which the expert is qualified;
• the relationship of more established modes of analysis;
• the nonjudicial uses for the technique; and
• whether the research was conducted independently (rather than for litigation purposes).
Kumho Tire, 526 U.S. at 149-50; Daubert, 509 U.S. at 594; First Tenn. Bank Nat '/ Ass'n v.
Barreto, 268 F.3d 319, 335 (6th Cir. 2001) (opinion based on 40 years in banking industry was
reliable). Oddi v. Ford Motor Co., 234 F.3d 136, 145 (3d Cir. 2000), cert. denied, 532 U.S. 921
(2001). Courts scrutinize whether the testimony is about matters "growing naturally and directly
out of research they have conducted independent of the litigation," or whether it was developed
simply to testify. Daubert v. Merrell Dow Pharms., Inc., (Daubert II) 43 F.3d 1311, 1317 (9th
Cir. 1995); Hose v. Chicago Nw. Transp. Co., 70 F.3d 968,973 (8th Cir. 1995).
No single factor is controlling ~ the inquiry is flexible and the factors are neither
exclusive nor exhaustive. Daubert v. Merrell Dow Pharms., 509 U.S. 579, 591; Pipitone v.
59
Biomatrix, Inc., 288 F.3d 239, 246 (Fifth Cir. 2002), reh 'g denied, 37 Fed. Appx. 93 (5th Cir.
2002); United States v. Hankey, 203 F.3d 1160, 1167-68 (9th Cir. 2000).
Courts are more persuaded when analyses supporting an expert's conclusions have been
subjected to scrutiny through peer review and publication in journals. Daubert, 509 U.S. at 591
(publication increases the likelihood that the flaws in methodology will be detected). However,
peer review and publication are less significant in deciding the admissibility of connnon subjects,
such as economic opinions regarding lost future wages. Pipitone, 288 F.3d at 245-46.
Additionally, the value of publication and peer review diminish when novel facts or obscure
issues are unlikely to interest scholarly journals. Mere differences of opinion among experts do
not make an opinion unreliable. Walker v. Soo Line R.R. Co., 208 F.3d 581,588-89 (7th Cir.
2000); Brown v. Southeastern Pa. Transp. Auth., 35 F.3d 717,746 (3d Cir. 1994).
Even if the methodology is reliable, the expert must apply those methods to the facts of
the case. Daubert, 509 U.S. at 593. Courts will evaluate the expert's conclusions to decide
whether they could reliably flow from the facts known to the expert and the methodology used;
clear mistakes in the investigation or reasoning process should be excluded. General Elec. Co. v.
Joiner, 522 U.S. 136, 146 (1997); Amorgianos v. National R.R. Passenger Corp., 303 F.3d 256,
266 (2d Cir. 2002); Elcock v. Kmart Corp., 233 F.3d 734,754-56 (3d Cir. 2000). This question
involves an examination of "whether the reasoning or methodology underlying the testimony is
scientifically valid and ... whether that reasoning or methodology properly can be applied to the
facts in issue." Daubert, 509 U.S. at 592-93. If the information is so lacking in probative force
and reliability that no reasonable expert could base an opinion on it, the opinion may be
excluded. Zaremba v. General Motors Corp., 360 F.3d 355, 358-60 (2d Cir. 2004); Brown, 35
F.3d at 741-42.
"Once a trial judge determines the reliability of the proffered expert's methodology and
the validity of his [or her] reasoning, the expert should be permitted to testify." Deputy v.
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Lehman Bros., Inc., 345 F.3d 494,507 (7th Cir. 2003) (flaws in the opinion are to be addressed
on cross-examination) (internal citation omitted); Jahn v. Equine Servs., P.s.e., 233 F.3d 382,
390-93 (6th Cir. 2000). Attacks on the content of the opinion, the adequacy of methodology
used, or the suspect nature of an expert's views go to the weight of the opinion, not admissibility.
Amorgianos, 303 F.3d at 267 (cross-examination, contrary evidence, and jury instructions are the
appropriate means of attacking suspect but admissible evidence); Miles v. General Motors Corp.,
262 F.3d 720, 724-25 (8th Cir. 2001); Smith v. Ford Motor Co., 215 F.3d 713,719 (7th Cir.
2000); Ambrosini v. Labarraque, 101 F.3d 129, 138 (D.C. Cir. 1996) (courts should avoid
judging the weight afforded to the expert's conclusion). The burden of exploring the facts and
assumptions underlying the opinion fall "squarely on the shoulders of opposing counsel's cross
examination." United States v. 14.38 Acres orLand, 80 F.3d 1074, 1078 (Fifth Cir. 1996);
Newell Puerto Rico, Ltd. v. Rubbermaid Inc., 20 F.3d 15,20 (1 st Cir. 1994).
The fact the judge allows the expert to give his or her opinion does not end the matter.
The jury ultimately determines whether the expert's opinion is based upon reliable information
and whether the conclusion fits the case; unsound opinions may be rejected. Darn v. Burlington
N Santa Fe R.R. Co., 397 F.3d 1183, 1196 (9th Cir. 2005); Harris v. General Motors Corp., 201
F.3d 800,804 (6th Cir. 2000); Huval v. Offshore Pipelines, Inc., 86 F.3d 454, 457 (5th Cir. 1996).
Absent clear errors, the better tactic is impeaching the expert on cross-examination. lt serves to
reinforce your expert's testimony and damage the opponent's case.
C. Examining Expert Witnesses At Deposition & Trial
1. Disclosures and Expert Reports
The expert report will contain a wealth of infonnation to start the preparation for their
deposition and cross-examination:
• all opinions to be offered; the bases for each opinion;
• the information considered in forming the opinion;
• exhibits used to support the opinion;
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• the qualifications of the expert;
• publications authored by the expert;
• his or her compensation; and
• a list of other cases in which he or she has testified as an expert (at trial or deposition).
See, e.g., Fed. Rules Civ. Proc. 26(a)(2).
In jurisdictions where detailed reports are required, some attorneys claim that they prefer
not to take the expert's deposition because the report (coupled with their own expert's advice)
provides sufficient information and they do not want to prepare the opposing expert for
anticipated trial questions.
Additionally, experts often rely on infonnation provided by the attorneys who engage
them. Be sure to propound document requests (usually with the deposition notice) seeking
production of all documents reflecting communications, oral or written between the expert and
opposing counsel, as well as all draft reports and notes prepared by the expert. These documents
provide a starting point and, in turn, will supply your own expert with infonnation to address the
competing opinions. Be advised, however, that counsel risks sanctions, disqualification, and
ethics charges if he or she engages in ex parte contact with an opposing expert. Erickson v.
Newmar Corp., 87 F.3d 298,302 (9th Cir. 1996) (since the rules of civil procedure provide for
limited and controlled discovery of an opponent's expert, "all other fonns of contact are
impliedly prohibited").
2. General Examination Subjects for Expert Witnesses
a. Qualifications
Even though the court may have detennined that a witoess is qualified to testify, an
expert may still be impeached about his or her qualifications. While demeaning treatment of any
witness (including experts) will usually offend jurors, a tactful comparison of the respective
experts' credentials has its place; the opposing expert may even concede your expert's stature in
the field. At deposition, the expert should be questioned on any irregularities or omissions from
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the resume or curriculum vitae, including gaps in employment, odd career paths, and possible
discharge, suspensions, sanctions, or similar discipline during employment or engagements.
Expert resumes and curriculum vitae contain exaggerations as well. His or her field of expertise
should be narrowed as far as possible.
b. First-Hand and Second-Hand Knowledge
An expert may base an opinion on any facts perceived by or made known to the expert.
See, e.g., Fed. R. Evid. 703. If the information is used by experts in the field on the particular
subject, the facts or data need not be admissible evidence for the testimony to be admitted. Id.
Rather than prejudge the opinion, courts afford counsel wide latitude to impeach the opinion on
cross-examination.
Opinion testimony may be based on information (even if inadmissible) derived from the
expert's own observations. This is often the case with so-called "in-house" experts (e.g.,
engineers), but it can be common in class actions, such as overtime class actions where the
expert literally observes workers to assess their job tasks.
More frequently, information is provided to the expert through means other than personal
observations (e.g., reports, studies, publications), including interviews or statements from other
witnesses. United States v. Floyd, 281 F.3d 1346, 1349 (11 th Cir. 2002); United States v. Corey,
207 F.3d 84,89-92 (lst Cir. 2000); Cooper v. Carl A. Nelson & Co., 211 F.3d 1008, 1020-21 (ih
Cir. 2000); Tyler v. Bethlehem Steel Corp., 958 F.2d 1176, 1188 (2d Cir. 1992); Werth v. Makita
Elec. Works, Ltd., 950 F.2d 643, 648 (loth Cir. 1991). Examples include consultations with other
experts, United States v. Brown, 299 F.3d 1252, 1256-57 (11 th Cir. 2002); Scott v. Ross, 140 F.3d
1275, 1286 (9th Cir. 1988). But see Dura Auto. Sys. oflnd., Inc. v. CTS Corp., 285 F.3d 609,
613-14 (7th Cir. 2002), reh'g denied, 2002 U.S. App. LEXIS 10265 (ih Cir. May 29, 2002)
(consultation with other experts may undermine reliability and lead to disqualification); TK-7
Corp. v. Estate ofBarbouti, 993 F.2d 722, 732-33 (loth Cir. 1993), surveys, media reports, and
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government statistics. IQ Prods. Co. v. Pennzoil Prods. Co., 305 F.3d 368,376 (5th Cir. 2002),
cert. denied, 538 U.S. 944 (2003); Trull v. Volkswagen ofAm., Inc., 187 F.3d 88, 97 (lS! Cir.
1999); United States v. Brown, 7 F.3d 648, 652-53 (7th Cir. 1993). Although experts may base
their opinions on the reports of others, an exclusion applies to reports specifically prepared for
litigation. Munoz v. Orr, 200 F.3d 291, 301-02 (5th Cir. 2000) (reliance on data compiled by
plaintiffs gave rise to "connnon sense skepticism"); Westfield Ins. Co. v. Harris, 134 F.3d 608,
612 (4th Cir. 1998); Triton Corp. v. Hardrives, Inc., 85 F.3d 343, 346 (8th Cir. 1996); Brown v.
Southeastern Pa. Transp. Auth., 35 F.3d 717, 762 (3d Cir. 1994) (patient's self-report was
prepared for litigation); In re Imperial Credit Indus. Sec. Litig., 252 F. Supp. 2d 1005, 1012
(C.D. Cal. 2003) (expert cannot rely on opinions by other experts developed for use in other
litigation). In employment class actions, the most connnon examples of such improper materials
are employee surveys prepared by counsel for use in the litigation. Yapp v. Union Pacific R.R.
Co., 301 F. Supp. 2d 1030, 1037 (E.D. Mo. 2004), class certification denied, 229 F.R.D. 608
(E.D. Mo. 2005); Gibson v. County ofRiverside, 181 F. Supp. 2d 1057, 1067-68 (C.D. Cal.
2002).
The burden falls on opposing counsel to expose all defects in the opinion through cross
exanlination. Toucet v. Maritime Overseas Corp., 991 F.2d 5, 10 (l5! Cir. 1993). However, an
expert's credibility may be impeached, and the admissibility of his or her testimony challenged,
if the evidence relied upon (i. e., the questionnaires) are tainted with bias, prejudice, or prior
inconsistent statements. By confirming that the expert relied on suspect sources, counsel may
impeach or exclude the opinion by creating a record of the erroneous facts upon which the expert
relied. United States v. Diaz, 25 F.3d 392, 394 (6th Cir. 1994); Grubbs v. Hannigan, 982 F.2d
1483,1487 (10th Cir. 1993).
c. Factual Assumptions and Hypothetical Questions
In addition to direct evidence, experts may base testimony on assUll1ed facts so long as it
has an evidentiary foundation in the record and is relied upon in the expert's field. United States
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v. Conn, 297 F.3d 548, 554 (7'h Cir. 2002), cert. denied, 538 U.S. 969 (2003); Certain
Underwriters at Lloyd's v. Sinkovich, 232 F.3d 200,203 (4th Cir. 2000); Asplundh Mfg. Div. v.
Benton Harbor Eng'g, 57 F.3d 1190, 1202 (3d Cir. 1995). Opinions that are based entirely on
assumptions and have no evidentiary support are inadmissible. Bonner v. ISP Techs., Inc., 259
F.3d 924, 929-30 (8th Cir. 2001) ("[o]n1y if the expert's opinion is so fundamentally unsupported
that it can offer no assistance to the jury must such testimony be excluded"). Opinions that are
simply conclusory assertions, unsupported by specific facts, are inadmissible. Thomas v. City of
Chattanooga, 398 F.3d 426, 431 (6th Cir. 2005), cert. denied, 126 S. Ct. 338 (2005); Thomas v.
Christ Hosp. & Med. Ctr., 328 F.3d 890,894 (7tll Cir. 2003). However, the assumed facts need
not be undisputed. The question is whether there is some evidence and reasonable grounds to
support the facts. Turner v. Burlington N Santa Fe R.R., 338 F.3d 1058, 1060-62 (9th Cir.
2003); Brown v. Southeastern Pa. Transp. Auth., 35 F.3d 717, 748 (3d Cir. 1994); Toucet, 991
F.2d at 10.
Opinions based on assumed facts are often illustrated through hypothetical questions. A
good series of hypothetical questions will help attorneys to accomplish many goals, such as:
• to isolate the essential premises of the adverse opinion;
• to identify weaknesses in the opinion;
• to solicit information that will identifY key witnesses and facts in the opponents' case;
• to flush out the opponent's trial strategy;
• to highlight areas of agreement between both experts; and
• to sununarize the strengths of their case by asking the opposing expert to assume theirversion of the facts.
In doing so, an expert may be forced to concede that his or her opinion - and, hence, a
determination of the ultimate facts by the expert (and the jurors) - would be different if premised
on the opponent's version of the facts. The strategy is not to simply discredit the expert or prove
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that one is more persuasive than the other, but instead to essentially neutralize the expert
opinions on both sides and revert the trial into a contest of each side's respective version of the
facts. Many opposing experts will concede that alternative theories are plausible, and an expert
who becomes stubborn or extreme in an opinion will often lose credibility with a jury. Your own
expert should be a good resource in identifying the factual assumptions needed to support the
opposing expert's opinion.
One drawback is that hypothetical questions tend to prompt distracting objections and
arguments, extended redirect examination of the witness, or judicial instructions that may make
the issues more confusing or uninteresting for the jury. Many good hypothetical questions also
lack a proper foundation. Hypothetical questions must contain all of the material facts and be
supported by the evidence. Fluckey v. Chicago & Nw. Transp. Co., 838 F.2d 302, 303 (8th Cir.
1988). Questions that contradict the available evidence or omit essential facts are improper.
Boodoo v. Cary, 21 F.3d 1157, 1162 (D.C. Cir. 1994). Questions with too many facts may
effectively result in a legal conclusion. Estate ofSowell v. United States, 198 F.3d 169, 171 (5th
Cir. 1999) (hypothetical about what a reasonable fiduciary would do called for legal conclusion
where it used precise facts of the case). Even if the opinion is admissible, experts may be
impeached if they relied on inaccurate or nonexistent facts in formulating their opinions, some of
which will be evident from the facts that the expert omits from his or her report or notes.
Perreira v. Secretary ofDep 't ofHealth & Human Servs., 33 F.3d 1375, 1377 (Fed. Cir. 1994).
d. Prior Testimony and Publications
The most intelligent or credentialed expert is not necessarily the most persuasive witness.
Many designated experts in civil litigation, particularly high stakes class actions, are retained
because of their experience and performances as prior witnesses. Experts who testifY repeatedly
for one side (e.g., always for the plaintiffs' bar, or vice versa) do not appear impartial.
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Furthermore, as expert testimony has emerged into its own industry, greater opportunities
for impeachment have come with it - particularly with the expert disclosure requirements and the
advent of electronic resources. Many experts expose themselves to impeachment by offering
opinions that conflict with testimony in other cases, which thereby undermines reliability and
tends to show bias. Document requests and depositions should always explore the other lawsuits
in which the expert has testified (e.g., deposition and trial transcripts), which may reveal
conflicting positions for use as impeachment. Because the expert will know the facts of a prior
case better than counsel, he or she will usually offer various differences in the facts which render
the cases distinguishable and, hence, maintain consistency in the opinions. Counsel must explore
in discovery and establish that the other case is truly comparable (and have the supporting facts
to prove it) before proceeding with this line of questioning at trial.
Another form of prior "testimony" to impeach an expert may be found in his or her
publications, seminars, or other professional activities. Many designated experts have views (or
a reputation for their views) on general industry practices and should be questioned to determine
whether the views reflect a bias. To be sure, the expert will know the subject matter better than
counsel and should be careful not to offer clear contradictions. However, the content of an
opposing expert's publications or professional activities may simply evidence an agenda or,
alternatively, bolster the position of your own expert. For example, the expert may acknowledge
differing schools of thought on the subject matter, and his or her opinion may fall in the minority
view. Similarly, the expert should be questioned about how their views on a subject align with
other known experts in the field. The expert should also be questioned on what publications or
treatises he or she considers to be authoritative or reliable. All of these subjects may provide
information that will help expose the witness as a paid advocate, dilute the perception of the
expert witness as an objective authority, and strengthen the position of the proponent's expert.
Publications present tricky areas of examination. Experts may be cross-examined about
their knowledge or awareness of a particular author or publication, but the publication itself is
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inadmissible unless it has been established as a reliable authority by the expert's testimony or
admission on direct or cross-examination, other expert testimony, or judicial notice. Fed. R.
Evid. 803(18); Caruolo v. John Crane, Inc., 226 F.3d 46, 54 (2d Cir. 2000); United States v.
Turner, 104 F.3d 217,221 (8th Cir. 1997); Carroll v. Morgan, 17 F.3d 787,790 (5th Cir. 1994).
Even if the text qualifies as a learned treatise and the foundational requirements are met, it may
only be read into evidence (i.e., it may not be received as an exhibit or taken into the jury room).
Charts and videotapes contained in learned treatises may be shown to the jury as exhibits since
there is no other practical way to bring the evidence before the jury. Constantino v. Herzog, 203
F.3d 164, 171 (2d Cir. 2000). However, pitfalls may arise because many experts know their
subject better than counsel and can often use the publication to support their opinion. Any
appearance of bickering with the expert or, worse, receiving a lecture from the expert, will likely
have a negative impact on the jury.
e. Relationship with the Opposing Party and Counsel
Prior professional, social, fmancial, and personal relationships with a party or opposing
counsel are relevant to the expert's credibility and bias. In addition to any prior professional
engagements with the same counsel, some experts have a surprising level of social relationships
with counsel, such as being neighbors or college friends and having children who share the same
school. Any prior relationships with counsel undermine the expert's credibility with jurors.
The expert's credibility will also be undermined where counsel has controlled the flow of
evidence or tainted his or her review. Connnon topics include:
• the date ofthe expert's first involvement in the case;
• all meetings and contacts with opposing counsel;
• prior familiarity with any facts relevant to the case;
• steps taken by the expert to prepare for deposition and trial; and
• whether the expert has been informed what opinion would be most favorable to the case.
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Due to the prevalence of professional witnesses, the payment of fees to expert witnesses
has become less significant as a tool for impeachment. Indeed, statutes in many jurisdictions
require an opponent to pay the expert's fee to testifY at a deposition, which implies the practice is
acceptable as a matter of public policy. Extended questioning on the issue may simply confinn
that both sides have "hired guns" as experts. Nevertheless, the details and circumstances of the
expert's compensation may reflect some unusual arrangements. The amount of the expert's fee,
the parameters of the fee agreement (e.g., financial interest or bonuses based on the outcome),
the source of payment (e.g., opposing counsel), and the circumstances of the engagement (e.g.,
on an aunual retainer) are discoverable and could imply a bias that exceeds the tolerance of most
jurors. Similarly, the percentage of the expert's income from litigation and his or her repeat
clients should be explored (i. e., is the expert still a professional or simply a professional
witness?).
3. Examination Subjects for Time and Motion Experts
The explosion of wage and hour class actions has increased demand for experts who
study, observe, and report on employee work duties. Although the time and motion experts were
used more often in job-safety and workers' compensation cases, many are now called upon to
testify on whether employees are performing overtime-exempt tasks, working off-the-clock,
taking legally mandated meal or rest breaks, and otherwise conforming to the myriad of federal
and state wage regulations.
For the reasons described above, there are serious doubts about whether any of these
individuals qualifY as experts or conform to the standards set forth in Daubert or Kumho Tire.
Many of these designated witnesses are merely collecting data about employees based on their
own personal observations, and then offering summaries and extrapolations from the sample
data. The testimony may be excluded on multiple grounds, such as:
• the testimony does not require specialized knowledge, training, orexpenence;
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• the trier of fact may assess the data based on common knowledge andexpenence;
• the expert must necessarily offer legal op1111Ons and conclusions indetennining how to classifY his or her observations (i. e., whether the taskinvolves exempt work, whether the task is incidental or related to otherwork tasks, whether the employee is engaged in work or break time, etc.);and
• the sample size and application is not based on a reliable methodology.
Potential examination subjects include:
• Methodology Employed
Basis for choosing the process & method
Alternative methods available, considered, and rejected
Variances in the potential outcomes
• Sample Data
Basis for selecting sample and criteria
Role of counsel and client in selecting sample and criteria
Omissions from the sample data
• Basis for Allocating Time to Tasks
Qualitative judgments
Training to make qualitative judgments
Necessity for legal conclusions
• Work & Tasks Observed
Prior briefing about the job and tasks
Interaction with employees
D. Procedures For Challenging And Excluding Expert Testimony
The court must make a preliminary decision on expert opinions to ensure that: the
proposed expert is qualified to testifY; the opinion rests on a reliable foundation; and the content
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is relevant to the case. See Fed. R. Evid. 104(a); Kumho Tire Co. v. Carmichael, 526 U.S. 137,
149 (1999); Daubert v. Merrell Dow Pharms., 509 U.S. 579, 591 (1993). This gatekeeping
function applies to all expert opinion, regardless of whether the testimony is based on scientific,
teclmical, or other specialized knowledge. Kumho Tire Co., 526 U.S. at 147-48. However, the
court's gatekeeping role is limited to determining the admissibility ofthe testimony; the court
does not judge the persuasiveness of the opinion. Fed. R. Evid. 702 advisory committee's notes
on 2000 amendments; Cavallo v. Star Enter., 100 F.3d ll50, ll57-58 (4th Cir. 1996).
Neither the Federal Rules of Evidence nor the Supreme Court's Daubert decision call for
any specific procedure to make this determination. However, the expert's reliability must be
apparent from the record. Mukhtar v. California State Univ., 299 F.3d 1053, 1066 (9th Cir.
2002), amended, 319 F.3d 1073 (9th Cir. 2003); United States v. Velarde, 214 F.3d 1204, 1210
(10th Cir. 2000). For this reason, the proponent should request that the court state its reliability
findings on the record. City a/Tuscaloosa v. Harcros Chems., Inc., 158 F.3d 548, 565 (II th Cir.
1998); United States v. Shay, 57 F.3d 126, 134 (I st Cir. 1995). While courts have discretion to
decide how to perform the gatekeeping function, a hearing is not required so long as the court
has a sufficient basis for its decision. Anderson v. Raymond Corp., 340 F.3d 520,523-24 (8th
Cir. 2003) (court reviewed deposition testimony); In re Hanford Nuclear Reservation Litig.,
292 F.3d 1124, 1138-39 (9th Cir. 2002) (no hearing is required, and the court may decide the
issue based on deposition testimony, affidavits, and reports); Kirstein v. Parks Corp., 159 F.3d
1065, 1067 (7th Cir. 1998). There are three primary ways to challenge the admissibility of expert
testimony before and during trial: (I) motion in limine; (2) voir dire; and (3) ordinary
objections. Regardless of the method, without a timely objection and motion to strike the
testimony, challenges to the admissibility of expert testimony are waived in the absence of plain
error affecting substantial rights. See Fed. R. Evid. 103(a); Alfred v. Caterpillar, Inc., 262 F.3d
1083,1087 (loth Cir. 2001), cert. denied, 535 U.S. 928 (2002); Price v. Kramer, 200 F.3d 1237,
1251 (9th Cir. 2000); Miksis v. Howard, 106 F.3d 754, 761 (7th Cir. 1997).
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1. Motions In Limine and Daubert Hearings
Objections may be asserted through a motion in limine to exclude inadmissible opinions
that are presented in the expert's report or elicited during deposition. McGlinchy v. Shell Chern.
Co., 845 F.2d 802, 806-07 (9th Cir. 1988) (motion in limine granted where pretrial discovery
established that the opinion was based on assumptions unsupported by any evidence). These
motions create a good record, afford the court with more time for deliberation, avoid disputes in
front of a jury, and expedite the trial. Additionally, the court's decision often helps the parties
prepare for trial by identifying the specific testimony that will be admitted. Many courts (and
clients) prefer Daubert motions before trial in order to avoid delays and ensure a thorough
presentation of the evidentiary issues rather than force witnesses and jurors to wait in court.
Oddi v. Ford Motor Co., 234 F.3d 136, 154 (3d Cir. 2000), cert. denied, 532 U.S. 921 (2001)
(motion in limine is an efficient procedure for evaluating reliability); Allison v. McGhan Med.
Corp., 184 F.3d 1300, 1309 (11 th Cir. 1999). In fact, when a ruling on admissibility turns on
disputed factual issues or significant reliability questions, the failure to hold a Daubert hearing
may be an abuse of discretion. Elcock v. Kmart Corp., 233 F.3d 734,745-46 (3d Cir. 2000)
(case remanded for Daubert hearing); Padillas v. Stork-Gamco, Inc., 186 F.3d 412, 418 (3d Cir.
1999). During the course of the hearing, the trial court may consider offers of proof, affidavits,
stipulations, leamed treatises, testimonial or other documentary evidence, and legal argument. In
re Hanford Nuclear Reservation Litig., 292 F.3d at 1139; Nelson v. Tennessee Gas Pipeline Co.,
243 F.3d 244, 249 (6th Cir. 2001); Oddi, 234 F.3d at 154. The court also has discretion to
conduct a full hearing with testimony from the proposed witness. United States v. Alatorre,
222 F.3d 1098, 1101-05 (9th Cir. 2000); United States v. Nichols, 169 F.3d 1255, 1262-64 (10th
Cir. 1999).
2. Voir Dire Examination
Because the burden falls on the proponent to establish that the witness is qualified as an
expert, an ordinary objection may block introduction of the opinion testimony. The opponent
should seek leave to interrupt direct examination and conduct a voir dire examination of the
72
witness regarding the expert's qualifications. Hoult v. Hoult, 57 F.3d I, 4 (I st Cir. 1995) (the
court may have an independent duty to assess qualifications on voir dire, even in the absence of
an objection). The purpose of voir dire questioning is to raise sufficient disputes about the
expert's qualifications so that the judge can deem the testimony inadmissible. After voir dire,
the court decides whether the witness is qualified to offer an opinion on the issue. Accordingly,
the voir dire procedure should be requested at the beginning of the expert's testimony, before any
substantive opinions are offered.
The tactic is rarely successful at trial, and the preferred approach is to raise these
objections in a pretrial Daubert motion. The chances of a favorable ruling by the court on a
pretrial motion or persuading the jury that the expert is not qualified on cross-examination are
greater than securing a ruling that the expert is not qualified at trial. However, voir dire can be a
valuable tool for highlighting the witness' lack of expertise or training on the issue and the
credentials of your own witness, even if the objection is overruled later. Information elicited on
voir dire may also be useful in cross-examining the expert later or raising doubts about the
opinion before the expert has had an opportunity to speak. To blunt this effect, the court has
discretion to order the voir dire examination outside of the jury's presence. Baker v. Dalkon
Shield Claimants Trust, 156 F.3d 248,250-51 (1st Cir. 1998).
3. Objections and Motions to Strike
Timely and specific objections must be made to the expert opinion on all applicable
grounds. See Fed. R. Evid. 103(a)(I). Unlike other evidentiary objections (e.g., hearsay), an
objection or motion to strike expert opinions should state the element missing from the record
(e.g., qualification, lack of reliable methodology, legal conclusion, improper hypothetical). Fed.
R. Evid. 103(a)(I); United States v. Pettigrew, 77 F.3d 1500, 1516 (5th Cir. 1996); McKnight v.
Johnson Controls, Inc., 36 F3d 1396, 1406-07 (8th Cir. 1994). Failing to object to the opinion
when offered, or failing to move to strike the opinion within a reasonable time, waives the
objection and absent plain error, precludes appellate review.
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Motions to strike are necessary bnt frequently ineffective ways of challenging improper
opinions, as the proverbial horse is usually out of the bam by then. Nevertheless, if a witness
answers an improper question before an opponent has an opportunity to object (or before the
court rules on the objection), a motion to strike and the accompanying jury instruction should be
made to preserve the issue for appeal. United States v. Walton, 908 F.2d 1289, 1292 (6th Cir.
1990). Likewise, if a witness does not answer the question presented and instead offers
gratuitous commentary, the objecting party must move to strike the answer as nonresponsive.
United States v. McKneely, 69 F.3d 1067, 1076 (10th Cir. 1995). At times the inadmissibility of
the answer will not be uncovered until cross-examination. In these instances the opponent
should move to strike the testimony from the record as soon as the defect becomes apparent.
Fedorczykv. Caribbean Cruise Lines, Ltd., 82 F.3d 69,75 (3d Cir. 1995); United States v.
Sepulveda, 15 F.3d 1161,1183 (lstCir. 1993).
Sometimes lost in all of the requirements for the admission of expert opinions are the
many alternative objections that provide a basis for exclusion. Courts will often rule that the
opinion is admissible expert testimony, but nevertheless exclude the opinion on alternative
grounds, such as: relevance, lack of foundation, or undue prejudice. United States v. Verduzco,
373 F.3d 1022, 1033-34 (9th Cir. 2004), cert. denied, 543 U.S. 992 (2004) (prejudice); Goodwin
v. MID Prods., Inc., 232 F.3d 600, 609-10 (7'h Cir. 2000) (cumulative); United States v.
Shedlock, 62 F.3d 214, 219 (8th Cir. 1995) (confusion); United States v. Rivera, 971 F.2d 876,
887 (2d Cir. 1992) (relevance). Indeed, some trial courts may prefer to avoid Daubert scrutiny
on appellate review, opting instead for the deferential standards applied to the more flexible and
less detailed rules of evidence.
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