Opinion
MDL No: 2785 Case No. 17-md-2785-DDC-TJJ
04-11-2019
IN RE: EpiPen (Epinephrine Injection, USP) Marketing, Sales Practices and Antitrust Litigation (This Document Applies to Consumer Class Cases)
MEMORANDUM AND ORDER
This multi-district litigation presents itself at the class certification stage. Consistent with Scheduling Order No. 5 (Doc. 1263), plaintiffs already have filed their Motion for Class Certification (Doc. 1353) and defendants already have filed their Memorandum in Opposition to Class Certification (Doc. 1503-3). A class certification hearing is scheduled for June 11 and June 12, 2019 (Doc. 1421). Before the court is defendants Mylan's and Pfizer's Motion to Amend Scheduling Order No. 5 (Doc. 1486) to add a Daubert briefing schedule to the class certification proceedings. Because the trend of authority supports challenges to expert witnesses at the class certification stage and because expert witnesses are likely to play an important role in the court's class certification analysis, the court grants defendants' Motion to Amend.
Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579 (1993).
I. Procedural History and Arguments on Motion to Amend
In November 2018, the court issued Scheduling Order No. 5, establishing briefing deadlines for class certification consistent with those requested by the parties. Doc. 1263 at 1. Scheduling Order No. 5 established a December 7, 2018, deadline for plaintiffs to move for class certification; a March 18, 2019, deadline for defendants' response to the motion for class certification; and an April 22, 2019, deadline for plaintiffs' reply. Id. Scheduling Order No. 5 didn't refer to challenges to experts at the class certification stage, through separate motion practice. See id. at 1-2.
Plaintiffs timely moved for class certification. Doc. 1353. On March 8, 2019, the court held a telephone status conference. Before the conference, defendants submitted a letter informing the court that the parties disagreed about adding a Daubert briefing schedule to Scheduling Order No. 5. Doc. 1486-1. The parties and the court discussed the matter during the status conference, and defendants filed a Motion to Amend, to which they attached the aforementioned letter. Doc. 1486. In their Motion to Amend, defendants contend a trend of authority supports allowing Daubert briefing at the class certification stage because the propriety of the experts offered by plaintiffs may affect the analysis that governs plaintiffs' burden at the class certification stage. Doc. 1486-1 at 2-3. Plaintiffs' Response advances three arguments: (1) a Daubert analysis either does not apply or is not required at the class certification stage; (2) Scheduling Order No. 5 does not provide for Daubert motions and briefing; and (3) defendants have not satisfied the good cause standard, established by Federal Rule of Civil Procedure 16(b)(4), for amending a scheduling order. Doc. 1494 at 3-8. Defendants' Reply argues that the proposed amendment satisfies the good cause standard because Daubert briefing will not delay the class certification process and will assist the court's analysis. Doc. 1513 at 5-6.
II. Analysis
Resolving defendants' Motion to Amend hinges on two questions: (1) does Daubert apply at the class certification stage; and (2) have defendants satisfied the Rule 16(b)(4), good cause standard for amending a scheduling order. The court addresses each question in turn, below.
A. Role of Daubert at Class Certification Stage
After reviewing the relevant case law, the court concludes that the trend of authority favors allowing Daubert-style challenges at the class certification stage. While it appears the Tenth Circuit has yet to address the matter, at least three other circuits have approved the practice in published opinions. See Messner v. Northshore Univ. Healthsystem, 669 F.3d 802 (7th Cir. 2012); Ellis v. Costco Wholesale Corp., 657 F.3d 970, 982 (9th Cir. 2011); In re Zurn Pex Plumbing Prods. Liab. Litig., 644 F.3d 604, 612-14 (8th Cir. 2011). A fourth has signaled its approval in an unpublished decision. Sher v. Raytheon Co., 419 F. App'x 887, 890-91 (11th Cir. 2011). Plaintiffs, conversely, do not identify a single circuit that has rejected the role of Daubert at the class certification stage.
The trend of authority in favor of applying Daubert at the class certification stage is in accord with suggestions from the Supreme Court. See Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 354 (2011) (expressing doubt about district court's conclusion that Daubert did not apply at class certification stage). Likewise, several recent opinions from district courts within the Tenth Circuit have permitted, or signaled the availability of, Daubert-style challenges at the class certification stage. See Beltran v. InterExchange, Inc., No. 14-cv-03074-CMA-CBS, 2018 WL 1509258, at *4 (D. Colo. Mar. 27, 2018) (adopting magistrate judge's order employing "relaxed Daubert-like standard"); Miller v. Farmers Ins. Grp., No. CIV-10-466-F, 2012 WL 8017244, at *5 (W.D. Okla. Mar. 22, 2012) (relying on language from Wal-Mart Stores, Inc. to conclude it was appropriate to apply Daubert); In re Cox Enters., Inc. Set-Top Cable Television Box Antitrust Litig., No. 09-ML-2048-C, 2011 WL 6826813, at *14 (W.D. Okla. Dec. 28, 2011) (same); see also In re Syngenta AG MIR 162 Corn Litig., No. 14-md-2591-JWL, 2016 WL 5371856, at *7 (D. Kan. Sept. 26, 2016) (suggesting availability of Daubert challenge at class certification stage: "Although Syngenta challenges the reliability of those experts' opinions, it . . . did not raise a Daubert challenge, and the Court assumes the admissibility of those opinions at this stage").
But, the case law contains some dissonance about the proper breadth of Daubert-style challenges at the class certification stage. Compare Am. Honda Motor Co. Inc. v. Allen, 600 F.3d 813, 815-16 (7th Cir. 2010) (requiring full Daubert analysis where expert opinion is "critical" to class certification determination), with In re Zurn, 644 F.3d at 611-13 (adopting "tailored Daubert analysis" rather than Seventh Circuit's position). Thus, the court will synthesize the available, persuasive authority to establish its view of the scope and contours of Daubert proceedings at this stage of the litigation.
Federal Rule of Civil Procedure 23 establishes the requirements for class certification. Class "certification is proper only if 'the trial court is satisfied, after a rigorous analysis, that the prerequisites of Rule 23(a) have been satisfied.'" Wal-Mart Stores, Inc., 564 U.S. at 350-51 (quoting Gen. Tele. Co. of the Sw. v. Falcon, 457 U.S. 147, 161 (1982)). The court must not confuse the "rigorous analysis" required at the class certification stage with an exposition into the merits of the claim; but, "sometimes it may be necessary for the court to probe behind the pleadings before coming to rest on the certification question." Falcon, 457 U.S. at 160. In accord with this latter sentiment, "[t]he class determination generally involves considerations that are enmeshed in the factual and legal issues comprising the plaintiff's cause of action." Id.
Expert opinions often play an important role at the class certification stage. See, e.g., In re Urethane Antitrust Litig., 251 F.R.D. 629, 634 (D. Kan. 2008) (observing that both parties "submitted and rely heavily on competing expert affidavits"). Thus, before granting or denying class certification based on expert evidence, a court must "ensure that the basis of the expert opinion is not so flawed that it would be inadmissible as a matter of law." In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124, 135 (2d Cir. 2001) (superseded by statute on other grounds); see Vickers v. Gen. Motors Corp., 204 F.R.D. 476, 479 (D. Kan. 2001) ("[A] court should not 'certify a class on the basis of an expert opinion so flawed that it is inadmissible as a matter of law.'" (ellipsis omitted) (quoting In re Visa Check/MasterMoney Antitrust Litig., 192 F.R.D. 68, 75 (E.D.N.Y. 2000))). Beyond this most basic threshold, the role and scope of the Daubert analysis increases in step with the importance of the expert opinion to plaintiff's showing of Rule 23(a)'s requirements. If, for instance, a plaintiff relies entirely on expert evidence to satisfy a Rule 23(a) requirement for certification, a nearly full-fledged Daubert analysis may be appropriate. See Sher, 419 F. App'x at 890 ("[I]f the situation warrants, the district court must perform a full Daubert analysis before certifying the class.") (citing Am. Honda Motor Co., Inc., 600 F.3d at 816). In raising a Daubert-style challenge to expert evidence at the class certification stage, it is therefore incumbent on the challenging party to establish the importance of the expert relative to the putative class plaintiff's Rule 23(a) burden. Only once the expert's importance is established can the court determine the appropriate scope of its Daubert analysis. See Messner, 669 F.3d at 814 (observing that Daubert hearing only necessary where challenged expert opinion was "critical" to motion for class certification).
Even where a challenging party establishes the importance of expert evidence relative to a Rule 23(a) requirement, the contours of Federal Rule of Evidence 702 and typical, pre-trial Daubert practice are not entirely applicable within the class certification setting. Rule 702 provides:
A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if:
(a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;
(b) the testimony is based on sufficient facts or data;
(c) the testimony is the product of reliable principles and methods; and
(d) the expert has reliably applied the principles and methods to the facts of the case.
One of Daubert's primary functions is to impart upon the trial judge a gatekeeping function so that juries do not hear evidence that is incompatible with Rule 702's requirements. Bitler v. A.O. Smith Corp., 400 F.3d 1227, 1232 (10th Cir. 2005). But, a judge, not a jury, decides class certification. The concerns underlying Daubert thus are not fully in play and this may make a "less stringent application of Daubert" appropriate. In re Zurn, 644 F.3d at 613.
Also, as the parties remain engaged in merits discovery at the class certification stage, the information available to experts is limited. Id. at 612-13; see also Doc. 1517 at 2 (setting July 31, 2019, non-expert discovery deadline). As such, the requirements for admissibility announced in Rule 702(b) and 702(d) are not fully formed. A district court, thus, should apply "a focused Daubert analysis which scrutinize[s] the reliability of the expert testimony in light of the criteria for class certification and the current state of the evidence." In re Zurn, 644 F.3d at 614. As a consequence, any Daubert analysis performed by the court will focus primarily on: (1) the knowledge, training, experience, and qualifications of the expert; and (2) the methodology relied on by the expert in formulating the challenged opinion.
Finally, the forthcoming class certification determination is but a preliminary determination subject to reevaluation and amendment in light of developments in the case. See Bennett v. Sprint Nextel Corp., 298 F.R.D. 498, 503 (D. Kan. 2014) (observing that a court "has authority to later redefine or even decertify the class if necessary"); see also Fed. R. Civ. P. 23(c)(1)(C) ("An order that grants or denies class certification may be altered or amended before final judgment."). It follows that any Daubert ruling specific to the class certification stage is subject to amendment for purposes of the class certification determination and is not finally determinative of the admissibility of the expert's testimony at a trial on the merits. See In re Zurn, 644 F.3d at 610 ("We have never required a district court to decide conclusively at the class certification stage what evidence will ultimately be admissible at trial.").
B. Rule 16(b)(4) Good Cause
Having identified the contours of Daubert-style challenges the court will apply at the class certification stage in this case, the question remains whether amending Scheduling Order No. 5 to add a Daubert briefing schedule is appropriate. "[T]he district court is afforded broad discretion in managing the pretrial schedule." Rimbert v. Eli Lilly & Co., 647 F.3d 1247, 1254 (10th Cir. 2011). Federal Rule of Civil Procedure 16 governs amendments to scheduling orders. Under Rule 16(b)(4), "[a] schedule may be modified only for good cause and with the judge's consent." "A scheduling order is not a frivolous piece of paper, idly entered, which can be cavalierly disregarded by counsel without peril." Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 610 (9th Cir. 1992) (internal quotation marks omitted). But, "while the pretrial order defines a lawsuit's boundaries," Summers v. Mo. Pac. R.R. Sys., 132 F.3d 599, 604 (10th Cir. 1997) (quoting Hull v. Chevron U.S.A., Inc., 812 F.2d 584, 588 (10th Cir. 1987)), the Tenth Circuit also has "recognized that a scheduling order can have an outcome-determinative effect on the case and 'total inflexibility is undesirable,'" Rimbert, 647 F.3d at 1254 (quoting Summers, 132 F.3d at 604). In this latter vein, "[a] scheduling order which results in the exclusion of evidence is . . . 'a drastic sanction.'" Id. (quoting Summers, 132 F.3d at 604).
Here, the court concludes the anticipated important role of expert testimony in the class certification determination and the authority supporting Daubert analysis at the class certification stage provide good cause for amending Scheduling Order No. 5. Based in part on the parties' recent request to extend the deadline for expert discovery beyond the deadline for non-expert discovery, it long has been evident that expert evidence will play a significant role in this case. See Doc. 1517 (adopting parties' proposal to delay expert discovery deadline to November 15, 2019). Daubert briefing, thus, may prove crucial to the court's ability to decide the class certification question. And, not amending Scheduling Order No. 5 to permit Daubert briefing would impose a drastic sanction because considering expert evidence that does not satisfy Daubert may have an outcome-determinative effect on class certification. And, in the Seventh Circuit at least, it is reversible error for a district court to refuse to address a Daubert challenge to an expert whose opinions are critical to class certification. Messner, 669 F.3d at 811-14; see also Sher, 419 F. App'x at 890-91 (adopting Seventh Circuit position). Accordingly, the state of the law and the importance of the issue suffices. It provides good cause for amending Scheduling Order No. 5 to permit Daubert briefing, as limited by this Order's discussion about the role of Daubert at the class certification stage.
III. Conclusion
Defendants Mylan and Pfizer have satisfied the court that Rule 702 and Daubert play a role at the class certification stage. The scope of that role, however, depends on the specifics of both the litigation and the challenged expert opinions relative to plaintiffs' Rule 23 burden. Thus, it is incumbent on the party raising the Daubert challenge to establish that a full-fledged Daubert analysis, as opposed to a tailored Daubert analysis, is appropriate. To focus briefing to the Daubert issue relative to Rule 23(a) and class certification, opening briefs and response briefs on the Daubert opinion shall not exceed 20 pages and reply briefs shall not exceed 10 pages.
IT IS THEREFORE ORDERED BY THE COURT THAT Mylan's and Pfizer's Motion to Amend Scheduling Order (Doc. 1486) is granted.
IT IS FURTHER ORDERED BY THE COURT THAT Scheduling Order No. 5 (Doc. 1263) is amended to add the following deadlines: (1) Daubert motions relating to the class certification stage shall be filed by May 21, 2019; (2) response briefs shall be filed by June 7, 2019; and (3) reply briefs shall be filed by June 21, 2019. Opening briefs in support of motions, as well as response briefs, shall be limited to 20 pages. Reply briefs shall be limited to 10 pages.
IT IS FURTHER ORDERED BY THE COURT THAT Scheduling Order No. 8, issued contemporaneous to this Memorandum and Order, supersedes Scheduling Order No. 5.
IT IS SO ORDERED.
Dated this 11th day of April, 2019, at Kansas City, Kansas.
s/ Daniel D. Crabtree
Daniel D. Crabtree
United States District Judge
s/ Teresa J. James
Teresa J. James
United States Magistrate Judge