On April 8, 2015, the Third Circuit held that expert testimony “critical to class certification” under Rule 23 must satisfy the Daubert reliability standard. In re Blood Reagents Antitrust Litig., No. 12- 4067 (3d Cir. May 8, 2015). This decision reflects the growing trend among federal courts of appeals of applying the Daubert standard to expert testimony at the class certification stage.  See, e.g., Messner v. Northshore Univ. HealthSys., 669 F.3d 802 (7th Cir. 2012); In re Zurn Pex Plumbing Prods. Liab. Litig., 644 F.3d 604 (8th Cir. 2011); In re Scrap Metal Antitrust Litig., 527 F.3d 517 (6th Cir. 2008). In light of this movement, defendants should be prepared to launch Daubert challenges and ensure their own expert witnesses can withstand such challenges.

In 2009, the District Court for the Eastern District of Pennsylvania consolidated 33 private suits that had been filed against defendants Immucor, Inc. and Ortho Clinical Diagnostics, Inc., accusing them of horizontal price-fixing in violation of the Sherman Act.  See In re Blood Reagents Antitrust Litig., 283

F.R.D. 222, 231 (E.D. Pa. 2012). Between 2000 and 2009, the prices of traditional blood reagents, typically used to test the compatibility between donated blood and the blood of potential recipients, increased by 2,000 percent. Id. at 227. At that time, defendants were the only two firms producing blood reagents for the U.S. market. Id. at 228.  After the district court granted preliminary approval of a proposed settlement between Immucor and plaintiffs, plaintiffs sought to certify a class of all individuals and entities who purchased traditional blood reagents from defendants on or after January 1, 2000. Id. at 231. The district court held a hearing on the settlement in 2012. Id.

To satisfy the predominance requirement under Rule 23(b)(3), plaintiffs relied in part on expert testimony regarding antitrust impact analyses and damages models. Id. at 234-40. Despite Ortho’s challenges to the damages models, the district court granted class certification. Id. at 239-44, 247. When rejecting Ortho’s objections, the district court relied on the Third Circuit’s Behrend v. Comcast Corp. decision, which the Supreme Court subsequently reversed. See 655 F.3d 182 (3d Cir. 2011), rev’d by Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013). Acknowledging that the lower court did not have the opportunity to review the Supreme Court’s later-issued opinion, the Third Circuit vacated the class certification and remanded for reconsideration. Blood Reagents Antitrust Litig., No. 12-4057, at 7. In addressing Ortho’s challenges to plaintiffs’ expert testimony, the Third Circuit  held that expert testimony relied on for class certification must satisfy Daubert. Id. at 8. The court explained that class certification, including expert testimony, must endure a “rigorous” analysis, which requires plaintiffs to affirmatively demonstrate Rule 23 compliance. Id. at 9. The court noted that plaintiffs cannot survive the analysis if they rely on expert testimony that does not satisfy Daubert. Id.

There is now a clear trend in the courts of appeals of requiring class certification expert opinion to satisfy Daubert. This most recent opinion from the Third Circuit perhaps reaches that conclusion more plainly and forcefully than other circuit court opinions, though. With the backdrop of this decision and the general pattern among circuit courts, companies that find themselves opposing class certification should take the following into consideration:

  • Be cognizant of the Daubert factors during discovery to build support for Daubert challenges; this may mean a more fulsome approach to expert discovery than some defendants historically may have undertaken in opposing class certification; and
  • Be prepared to defend retained witnesses against Daubert challenges brought by plaintiffs; this likewise may mean working more closely with a defense expert to ensure his or her testimony and underlying methodology satisfy the Daubert factors.