Businesses threatened by class action lawsuits have welcomed the recent development by the federal courts of increasingly stringent evidentiary burdens and standards for class certification under Federal Civil Procedure Rule 23. Of particular note has been the willingness of the federal appeals courts to insist that trial courts require that plaintiffs satisfy their burdens under Rule 23 with admissible evidence and not mere allegations, even if those determinations overlap the merits of the case. Now, the Seventh Circuit has made explicit what has been inferable from its, as well as other circuit court decisions: when an expert's report is crucial to class certification, district courts "must conclusively rule on any challenge to the expert's qualifications or submissions prior to ruling on a class certification motion." American Honda Motor Company, Inc. v. Allen, et al. (7th Cir. 4/7/10; per curiam, slip op. at 6).
On this interlocutory appeal under Federal Civil Procedure Rule 23(f) in which it vacated the district court's denial of Honda's motion to strike and its order certifying a class, the Court left no doubt that a "district court must perform a full Daubert analysis before certifying the class if the situation warrants." Id. This includes a challenge to the expert's qualifications, as well as to the reliability of any submission provided by the expert that is relevant to establishing any requirement under Rule 23 for class certification. Because the district judge had been reluctant, in connection with the class certification contest, to exclude the plaintiff's expert report at what the district judge called "this early stage of the proceedings" despite expressed reservations about the report, id . at 8-9, the case was remanded for further proceedings consistent with the opinion.
By rigorously enforcing the burdens that Rule 23 imposes upon a movant, this ruling is consistent with precedent recognizing the hydraulic pressure to settle, without regard to meritorious defenses, that a class certification ruling may place upon a defendant. Accordingly, plaintiffs are forewarned that if their motion for class certification relies upon expert testimony, a full Daubert challenge must be entertained by the district court in connection with the court's consideration of that motion.