Court of Appeals Reverses Daubert Decision

A tip of the hat to our DRI colleague Mike Weston for alerting us to an interesting 10th Circuit opinion from a couple weeks ago, Hoffman v. Ford Motor Co., 2012 WL 3518997 (10th Cir. Aug. 16, 2012).

Plaintiff was injured in a rollover car accident, and sued the car manufacturer alleging that a defect in the seat belt buckle caused it to release during the accident and allow her to be ejected from the vehicle.  In support of this theory, plaintiff presented the opinion of Dr. Good, a mechanical engineer, who theorized that the buckle most probably inertially unlatched during the accident due to an alleged design defect.  He ran a series of tests on buckles allegedly similar to the one in the accident, but ran into issues when he needed to make a comparison of the data from his lab tests to data from crash rollover tests to determine if the situation measured in the lab could actually occur in the real world.  Specifically, there was an absence of available data from relevant rollover crash tests (which present dynamic, multi-dimensional forces working on the component), and so he compared his results to data from planar crash data -- ones focused on only the horizontal plane (for example, a frontal car crash).

Ford moved to exclude the opinions as unreliable under Daubert, but the district court  (without a hearing) denied the motion, concluding Ford had failed to prove that the differences between the lab test results and the real world rollover accidents were significant.  Defendant appealed. (Note, whether she was even wearing her seat belt at all was hotly contested at trial. For purposes of the Daubert issue, the court assumed she was.) 

The court of appeals concluded that in permitting the testimony, the district court had not been "a sufficiently exacting gatekeeper; Daubert requires more precision."  Plaintiff failed to present a sufficient scientific connection between the accelerations and forces the expert found necessary to unlatch the buckles in the lab, and the acceleration and forces that would have occurred in the actual accident on the street. 

Specifically, the court of appeals held that the trial court should NOT have chastised the defendant for failing to show how the deficiency mattered, the failure to use rollover crash data. And the trial court should not have deemed it "unfair" for Ford to criticize the plaintiff because of the limited amount of rollover crash data available to the expert.  The state of the science is what it is.  And Ford did more than point out a deficiency in the method; it also explained why the deficiency rendered the testing and comparison suspect.  More importantly for our readers, "it was not Ford's burden to show Good's inertial unlatch opinion was unreliable and irrelevant.  Rather, it was plaintiff's burden to show reliability and relevancy."

It was undisputed engineering science that once a component is tested, the results must be applied to the whole vehicle setting; the lab results must be compared to data from the real world. Merely showing that similar buckles can be made to unlatch under certain lab conditions is irrelevant to whether the buckle at issue unlatched in the accident absent proof that the lab conditions were present and can be adequately and accurately related to the actual rollover-type accident.  Plaintiff's expert failed to explain adequately how the acceleration and forces present in the planar crash tests were similar enough to those present in a rollover accident. Nowhere did he show how his comparison was scientifically valid. Thus, his opinion was based on mere speculation, or on the assumption, that the levels of forces he found necessary to unlatch buckles in the lab were substantially similar to those that occurred in the subject accident.

Absent such evidence, plaintiff could not meet her burden.  Since plaintiff had a full and fair opportunity to present the case, and made no attempt to add or substitute other evidence, the court of appeals remanded with instruction for the district court to enter judgment as a matter of law for defendant.

 

 

Federal Court Denies Class Certification After Daubert Analysis

A  federal court late last month declined to certify three classes of consumers in litigation claiming that a defect in Harley-Davidson Motor Co. Inc.'s motorcycles caused severe wobbling and instability. See Steven C. Bruce, et al. v. Harley-Davidson Motor Co., Inc., et al., No. 2:09-cv-06588 (C.D. Cal.).

Plaintiffs were owners of Harley-Davidson motorcycles. According to plaintiffs, beginning in or before 2002, Harley-Davidson manufactured and sold touring motorcycles that had an alleged design defect in the form of an excessively flexible chassis. According to plaintiffs, the alleged defect caused “severe wobbling, weaving and/or instability,” especially occurring when riders made sweeping turns, and traveled at speeds above 55 miles per hour. Plaintiffs alleged that had they and other class members known of the defective nature of the vehicles, they would not have purchased or leased their motorcycles, or at least would have reduced the amount they were willing to pay for them. Hence, the classic alleged consumer fraud class action.

Plaintiffs moved for class certification, and relied on expert testimony to establish some of the Rule 23 elements.  Specifically, plaintiffs’ expert opined that a rider of a properly-designed
motorcycle should not experience a weave-mode instability event when riding within the
range of expected speeds.  He asserted that the class-purchased cycles shared a common design defect in the form of an “excessively flexible” chassis. The vehicles allegedly failed to “damp out,” or reduce, weave-mode oscillations to one half of their original amplitude within the time frame (a couple seconds) necessary to prevent them from becoming perceptible to the riders.

Defendants challenged the admissibility of that expert testimony under Daubert, contending that Rule 702 and Daubert apply with “full force” at the class certification stage. In support of this
position, Harley-Davidson relied primarily on Wal-Mart Stores, Inc., v. Dukes, 131 S. Ct. 2541 (2011), and Am. Honda Motor Co. v. Allen, 600 F.3d 813, 815–16 (7th Cir. 2010) (per curiam).  In Dukes, the Supreme Court noted that it doubted that Daubert did not apply at the certification stage of class-action proceedings. 131 S. Ct. at 2554. In American Honda, which we commented on here, the Seventh Circuit held that where an expert’s report or testimony is critical to class certification, a district court must conclusively rule on any challenge to the expert’s qualifications or submissions prior to ruling on the class certification motion. 600 F.3d at 815–16. Earlier this month, the Seventh Circuit reaffirmed its holding in American Honda, ruling that it was error for a district court to decline to rule on a Daubert motion at the class certification stage. Messner v. Northshore Univ. Healthsystem, 2012 U.S. App. LEXIS 731, *17 (7th Cir. Jan. 13, 2012).

Plaintiffs argued that a full Daubert inquiry into the reliability of expert opinions is not required or appropriate at the class certification stage. They cited In In re Zurn Pex Plumbing Prods. Liability Litig., 644 F.3d 604, 613 (8th Cir. 2011),which we criticized here, and in which the Eighth Circuit reasoned that an “exhaustive and conclusive Daubert inquiry before the completion of merits discovery” is not necessary due to the “inherently preliminary nature of pretrial evidentiary and
class certification rulings.”  See also Behrend v. Comcast Corp., 655 F. 3d 182, 204 n. 13 (3d Cir. 2011) (district court need not turn class certification into a "mini-trial”).

Here the district court found the approach adopted by the Eighth Circuit to be the appropriate application of Daubert at the class certification stage. Thus, a “tailored” or “focused” inquiry, to assess whether the experts’ opinions, based on their areas of expertise and the reliability of their analysis of the available evidence, should be considered in deciding the issues relating to class certification, said the court. Especially where discovery has been bifurcated into a class phase and a merits phase, an expert’s analysis may have to later adapt, as gaps in the available
evidence are filled in by merits discovery. Here, the court had granted defendants’ request for bifurcated discovery. Accordingly, the expert opinions would be assessed in light of the evidence currently available.

Even with a less than full inquiry, the court found that the proposed expert testimony must be excluded. In reaching this conclusion, the court decided the expert had not adequately
explained the scientific basis for his proposed standard, which also had not been accepted in
the field of motorcycle dynamics. While the evidence supported that the damping out of weave-mode oscillations may be an important factor for motorcycle stability, it did not establish that the expert's "rule" requiring the reduction of weave-mode oscillations to one half of their original amplitude within two seconds was scientifically valid.

The expert formed his opinions exclusively for the purposes of litigation and had not published his "rule" for peer review, providing further support for his exclusion.

Additionally, the court believed that he had not sufficiently accounted for other potential causes of the instability. He failed to consider and test for other possible causes including the use of non-specified tires and leaky shocks. See, e.g., Clausen v. M/V NEW CARISSA, 339 F. 3d 1049, 1058
(9th Cir. 2003) (“The expert must provide reasons for rejecting alternative hypotheses using scientific methods and procedures and elimination of those hypotheses must be founded on more than ‘subjective beliefs or unsupported speculation.’”).

Thus, plaintiffs failed to establish that common questions of law and fact predominated over individual inquiries. Once the opinions were excluded, plaintiffs failed to show that they had the ability to use common evidence by which they could demonstrate the defect. The fact that the chassis was the same for each vehicle ignored the failure to show how common evidence would ultimately be admissible to prove that they shared a common defect, and also was unavailing because it overlooked the Supreme Court’s admonition that a “rigorous analysis” will often “entail some overlap with the merits of the plaintiff’s underlying claim.” Dukes, 131 S. Ct. 2551.

Toyota MDL Judge Issues Discovery Order

The judge overseeing the Toyota unintended acceleration MDL has issued an order permitting expanded discovery. In Re: Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liability Litigation, Case No. 8:10ML2151 JVS (Order No. 5: Phase I Discovery Plan, July 20, 2010).

Judge Selna (C.D. Calif.) noted that the Phase I Discovery Plan being promulgated was intended solely to educate the parties about foundational issues involved in the litigation, including the identification of the proper parties to this litigation, the identity of relevant third-parties, organizational structure, the identify of relevant witnesses, and identity, nature, and location of relevant documents. The court expects that discovery on foundational issues during Phase I will enable the parties to develop a more narrowly tailored discovery plan for subsequent phases of the litigation and to be more focused, economical and efficient in subsequent phases of discovery. In addition to the foundational information to be provided to plaintiffs by Toyota, Phase I will also provide Toyota the opportunity to obtain foundational, threshold information from plaintiffs, the class representatives, and relevant third-parties.

Phase I Discovery will last for 100 days, and the parties agreed the Phase I discovery plan needs to be coordinated to the extent feasible with related cases pending in state courts.

Under the order, the Toyota Defendants are to produce witnesses pursuant to Rule 30(b)(6) to testify concerning the twenty-one issues, including:

• organizational structure,
• the roles and responsibilities of each of the various Toyota companies with respect to the design, manufacture and sale of Toyota vehicles,
• the identity, nature, location and retention of documents related to the design, evaluation, manufacture, and testing of the ETCS system and any modifications or adaptations of the ETCS system for Toyota vehicles,
• the identity of the persons and departments involved in the design, evaluation, testing and manufacture of the ETCS and its components,
• the identity, nature, location and retention of documents related to information Toyotas has received about speed control, surge, and SUA events in Toyota and Lexus vehicles, including specifically warranty records, customer complaints, claims and lawsuits,
• procedures employed for investigating and responding to complaints of unintended acceleration by owners or operations of any Toyota vehicles, and
• the internal decision-making process by the Toyota Defendants about what and when to inform Toyota customers, governmental agencies and the public about SUA events and the identities of the persons and departments involved in that decision-making process and the identity of the persons and departments involved in that process.

The court ruled that during this litigation the parties must endeavor to avoid duplicative depositions or repetitive questions and to avoid deposing any witness more than once on the same subject matter. But it held off on ruling on Toyota’s position that no Toyota witness deposed during Phase I
would be deposed again in subsequent phases of this litigation on the same subject matter, except by agreement of the parties. Plaintiffs did not agree with Toyota’s position.

Plaintiffs are to provide completed Plaintiff Fact Sheets and Class Representative Fact Sheets, including the production of any documents responsive to the fact sheets. Fact Sheet Responses to information requests are deemed interrogatory responses pursuant to FRCP 33 and may be treated as such at time of trial, under the order. Responses have to set forth all information known or reasonably ascertainable to the party and/or their counsel. The parties are obligated to make a reasonable search and diligent inquiry for information or documents responsive to the request.
Fact Sheet Responses to document requests and the production of documents are deemed responses and production under FRCP 34. 

Additionally, the Toyota Defendants shall be permitted to conduct inspections of the subject vehicles.  Plaintiffs and class representatives have to identify whether the subject vehicle exists, and if so, its current location, general condition, and vehicle identification number, if known.  The parties agreed that vehicle inspections would be permitted commencing in Phase I. The protocol for vehicle inspections will apparently be determined on a case-by-case basis. 

 

Parties File Joint Report in Toyota MDL

The three attorneys serving as interim plaintiffs' counsel in the Toyota multidistrict litigation have filed a joint Preliminary Report, pursuant to the Court’s April 14, 2010 CMO No. 1. See  In re Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liability Litigation, No. 8:10-ml-02151-JVS-FMO (C.D. Cal.,  4/30/10).

Among the topics covered were many of the basic MDL structural issues, including the proposed structure and roles of designated counsel.  The parties recommended 18 attorneys to serve in leadership positions. More than 80 law firms and attorneys had filed applications by the May 3rd deadline to serve as lead counsel or in some other leadership role in this MDL.

The plaintiffs' attorneys also recommended establishment of a core discovery committee led by the co-lead counsel for the two types of cases, personal injury and economic loss.  Plaintiffs’ outlined their Core Discovery (types of information and documents, and types of discovery). Proposed core discovery  included: (i) Floor Mat,  (ii) Pedal, and (iii) Electronic Throttle systems issues. Plaintiffs' core discovery includes probing allegations of the existence of a defect in Toyota vehicles responsible for alleged sudden unintended acceleration; and the design and manufacture process for the engine throttle control system (including pedals, floor mats, electronic control systems, accelerator pedals, throttle bodies, etc.).  They also outlined proposed document discovery, as far back as the 1990s, claiming that design of that system began in the 1990s and that it was put in place in some vehicles as early as model year 1998.

Similarly, defendants outlined their proposed discovery in personal injury cases and economic loss cases. A key issue for them is the preservation of the vehicles in testable condition.

The parties offered a brief statement of the facts and legal issues, including class certification issues, standing issues, the application of the economic loss rule, choice of law, and the statute of limitations. Defendants’ specifically requested coordination with state court proceedings. There are now reportedly about 100 cases in 22 states.

Toyota has previously announced that it had retained an outside engineering and scientific consulting firm to conduct a comprehensive, independent analysis of Toyota and Lexus vehicles using the ETCS-i system (Electronic Throttle Control System with intelligence) for concerns related to unintended acceleration.

Toyota has provided members of Congress with an interim, first phase report from this expert on its evaluation of the ETCS-i system, consistent with the company’s commitment to transparency regarding the quality and safety of its vehicles