The Court of Appeals for the Ninth Circuit issued a decision recently in Olean Wholesale Grocery Cooperative, Inc. v. Bumble Bee Foods LLC (“Olean Wholesale”), confirming that district courts must rigorously examine competing expert evidence when determining whether the requirements of class certification have been satisfied.

In Olean Wholesale, litigation related to the long-running tuna price-fixing saga, purchasers of packaged seafood alleged a price-fixing conspiracy against the three largest domestic producers of packaged tuna. At class certification, the parties’ experts disagreed on whether a sufficient portion of the proposed class had been harmed by the alleged scheme. The plaintiffs’ expert “relied on statistical evidence in the form of a regression model which purports to prove that the price-fixing conspiracy harmed all, or nearly all, of the Class members.” The defendants’ expert challenged this methodology, arguing that this “model incorrectly assumed every direct purchaser was injured—and necessarily in the same way.” Under these competing models, the plaintiffs’ expert concluded that a de minimis portion—less than 6%—of the class suffered no injury, while the defendants’ expert concluded that this number was actually much higher, at 28%.

Though likely dispositive, the district court declined to resolve the dispute.  Observing that defendants’ “criticisms are serious and could be persuasive to a finder of fact,” it nonetheless held that “determining which expert is correct is beyond the scope” of a class certification motion, and was instead for the jury to resolve. The critical issue, according to the district court, was whether plaintiffs’ method was “capable of showing” impact on all or nearly all class members.  Satisfied that it was, the court certified the class.

On appeal, the Ninth Circuit vacated the district court’s decision. The court reasoned that the disagreement between the two experts was not simply a jury question, but rather, implicated the threshold question of Rule 23(b)(3) predominance. The court held that the statistical analysis could be used to satisfy the predominance inquiry but found that “the district court abused its discretion by not resolving the factual disputes necessary” to actually determine whether the requirement had been satisfied here.   Deferring determination of class-wide impact in every arguable case, the court observed, effectively “amounts to a delegation of judicial power to the plaintiffs, who can obtain class certification just by hiring a competent expert.” “If savvy crafting of the evidence were enough to guarantee predominance,” the court continued, “there would be little limit to class certification in our modern world of increasingly sophisticated aggregate proof.” See Richard A. Nagareda, Class Certification in the Age of Aggregate Proof, 84 N.Y.U. L. Rev. 97, 103 (2009).

While class action plaintiffs need not achieve absolute certainty as the class certification stage, Olean Wholesale makes clear that mere possibility will not suffice.  Defendants should continue to urge courts to engage with, evaluate, and weigh competing evidence at class certification, even where—indeed, especially where—plaintiffs rely on complex, representative evidence and regression models.