As we touched on last summer,[1] whether a district court may certify a class action without resolving challenges to the admissibility of fact or expert evidence is still an unsettled question.  This question is particularly important with respect to expert evidence, given that class certification frequently hinges on competing experts’ opinions regarding the propriety of an aggregate action.  If an expert’s opinion is deemed inadmissible, the party proffering it is almost certain to be on the receiving end of an adverse certification ruling.

While the Supreme Court stated in Wal-Mart Stores, Inc. v. Dukes that it “doubts” the Daubert standard for admissibility of expert testimony does not apply at class certification, it did not definitively resolve the question and the Courts of Appeals have not answered it uniformly.[2]  Five Courts of Appeals have expressly held that a court must conduct a full Daubert analysis, but one—the Eighth Circuit—has held that only a “limited” Daubert analysis is appropriate while the remainder have not issued clear rulings.  Among the appellate courts that have declined to render a definitive ruling is the Sixth Circuit, which in 2020 stated it had “yet to settle th[e] matter.”[3]

On December 6, 2021, the U.S. District Court for the Northern District of Ohio issued an opinion that squarely addressed the question of whether Daubert applies at class certification.  The opinion, which surveyed the current state of the law, reaches the carefully reasoned conclusion that expert testimony must be admissible, and thus that any challenge to admissibility must be resolved, at class certification.  The decision thus serves as a guidepost to other courts within the Sixth Circuit.  And the court’s comprehensive reasoning may serve persuasive to other courts in circuits that have yet to resolve this open question.

In Desai v. Geico Casualty Company,[4] the plaintiff brought a putative class action alleging Geico failed to pay the actual cash value of his vehicle after a total loss.  Geico’s approach to calculating car value was to utilize a model that calculates the average of the adjusted price of comparable cars.  The plaintiff alleged this approach breached the terms of its insurance policy because it did not reimburse dealer, title, and license fees.  In support of his motion for class certification, plaintiff submitted expert testimony on the total fees paid by members of the putative class that were not reimbursed under Geico’s approach.  Geico filed a motion to exclude the expert’s testimony, arguing it did not meet the Rule 702 standard for admissibility.

In considering the defendant’s motion, the court first noted that “whether Rule 702 applies to evidence presented on a motion for class certification remains an unsettled question.”  The court noted the Supreme Court’s “doubt,” expressed in Dukes, that Rule 702 does not apply as well as the fact that the Court granted certiorari in Comcast Corp. v. Behrend to address the question but ultimately found it was not preserved for review.[5]  The court then considered the Sixth Circuit’s statements on the subject.  Although the Sixth Circuit has expressly declined to resolve the question of whether expert evidence must be admissible, in Lyngaas v. Curaden AG it held that the admissibility of fact evidence need not be “decide[d] conclusively at the class-certification stage.”[6]  The court then surveyed the other Courts of Appeal, noting that “a majority of the Circuits that have considered the question hold that on a motion for class certification expert evidence must comply with Rule 702.”[7]

Having surveyed the relevant decisions from the appellate courts, the Desai court then turned to its own determination of whether expert evidence must be admissible at class certification.  The court reasoned that the Federal Rules of Evidence, by their own terms, “apply to proceedings in United States courts.”[8]  Because the Rules of Evidence apply to all evidentiary proceedings with only limited delineated exceptions, “nothing in Rule 23 or Rules 701 through 706” suggest they do not apply to class certification, and the Supreme Court expressed “doubt” that the opposite conclusion is true, the court held “Rule 702 applies to class certification.”[9]

Having concluded that Rule 702 applies, the court proceeded to evaluate the plaintiff’s expert’s testimony under Daubert, striking certain portions of his report while finding others admissible.  Ultimately, the court found the plaintiff could not demonstrate predominance of common issues of fact and law over individual ones under Rule 23(b)(3) and denied certification.

The Desai court’s decision is significant in several respects.  Its comprehensive review of the appellate decisions in this area provides an informative overview.  The court’s conclusion that Rule 702 must apply to class certification based on the language of the Federal Rules of Evidence is also logically appealing and may prove persuasive to courts within the Sixth Circuit and other Circuits that have yet to resolve the question.

The court’s conclusion that the Sixth Circuit’s Lyngaas decision (which held admissibility of fact evidence need not be resolved) does not preclude it from finding Rule 702 applicable is also notable.  Under this reasoning, a litigant in the Sixth Circuit may offer inadmissible fact evidence but only admissible expert evidence at class certification.  We have previously questioned whether drawing distinctions between the treatment of fact and expert evidence can be justified under the Federal Rules of Evidence or Procedure.[10]  Until the Supreme Court makes a definitive determination, we expect courts to continue to reach varying conclusions on this question.

[2] See 564 U.S. at 354 (2011).

[3] Hicks v. State Farm First & Casualty Co., 965 F.3d 452, 456 (6th Cir. 2020).

[4] No. 1:19-CV-2327, 2021 WL 5762999 (N.D. Ohio Dec. 6, 2021).

[5] 567 U.S. 933 (2012).

[6] 992 F.3d 412, 428 (6th Cir. 2021).

[7] Desai, 2021 WL 5762999, at *10.

[8] Id. at *11 (quoting Fed. R. Evid. 101(a)).

[9] Id.

[10] See note 1.