United States: Do Daubert Standards Apply At The Certification Stage? Ninth Circuit Splits With Itself

It is fitting that the day after Halloween the Ninth Circuit issued its denial of rehearing en banc in Sali v. Corona Regional Medical Center, Case No. 15-56460, because the issue it raises, like Michael Myers in the Halloween movie series, should have been dead long ago.

We've blogged the issue of whether Daubert standards should apply at the certification stage on multiple occasions ( Aug. 3, 2011; May 7, 2014; May 8, 2018; and June 5, 2018). The overwhelming view of the courts is that they do – and for good reason. Certification is often THE issue in class litigation, and a certification decision puts overwhelming (and often definitive) pressure on the defendant to settle. It is not too much to ask that the facts supporting that decision be of evidentiary quality.

The circuit courts of appeal have generally found that Daubert standards do apply, with the sole exceptions being the Ninth and possibly Eighth circuits. In Wal-Mart Stores, Inc. v. Dukes, the Supreme Court cast significant doubt on the Ninth Circuit view. In noting the Ninth Circuit's determination in Dukes that Daubert admissibility standards did not apply in this context, Justice Scalia commented, "[W]e doubt that is so."

The Sali case was a wage and hour matter involving nurses, and it challenged various hospital pay practices. If you want to know more about the case background, we blogged about it here. In a nutshell, rather than hire an expert, the plaintiffs had a paralegal do largely unexplained spreadsheet computations regarding alleged unpaid overtime. The Ninth Circuit affirmed the district court's grant of certification based on what was not and could not have been evidence, not even bothering to cite, much less explain, the Supreme Court's skeptical language in Dukes. The defendant moved for rehearing en banc.

The majority of the Ninth Circuit voted not to rehear the case, but five of the judges dissented. They noted the conflict between the court's holding and its prior holdings regarding the importance and rigor of class certification decisions. They also noted the circuit split, although also noting that even the arguably contrary Eighth Circuit authority did not go so far. The dissent further noted Supreme Court authority, including Dukes, strongly suggesting that Daubert standards would need to be adhered to. The dissent used very strong language, accusing the majority of having "disdained" the class certification process and of putting the court "on the wrong side of a lop-sided circuit split."

The dissent has it right, but it is just that for now in the Ninth Circuit – the dissent. With a bitterly divided Ninth Circuit, a split in the circuits and the Supreme Court's questioning of this issue in Dukes and elsewhere, one can only hope that the Supreme Court accepts review and puts this issue to rest.

The bottom line:

The issue of whether Daubert standards apply at the certification stage now divides the Ninth Circuit and cries out for Supreme Court review.

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