In this guest column from Law360, NERA Senior Vice President Dr. Denise Neumann Martin and former Senior Vice President Dr. Elizabeth Becker discuss the circuit court split that emerged this spring over whether the Daubert standard should apply to expert testimony at the class certification stage of civil litigation. The US Court of Appeals for the Seventh Circuit, in American Honda Motor Co. Inc. v. Richard Allen et al., came down squarely in support of applying Daubert at the class certification stage. Meanwhile, the US Court of Appeals for the Ninth Circuit, in Dukes v. Wal-Mart Stores Inc., although advocating a “rigorous standard” of review, fell short of relying on Daubert at the class certification stage. It gave the nod to the district court’s certification of a class of as many as 1.5 million women alleging employment discrimination.

Dr. Becker and Dr. Martin note that the resolution of this split in support of the application of Daubert may play an important role in ensuring the efficient allocation of judicial resources on alleged Title VII violations. Currently, approaches used by trial lawyers leave larger employers uniquely vulnerable to bet-the-bank class actions relative to small and midsize employers—even in circumstances where women and minorities are treated better by these large employers. Statistical evidence in support of class certification is frequently relied upon by district courts, despite arguments by defense counsel that excessive aggregation and omitted variables negate the reliability of the reported statistics. Application of Daubert to class questions could eliminate potential waste of judicial and litigant resources in situations where discrimination is alleged to exist on the basis of superficial analysis, but where a proper statistical analysis would show these results to be spurious.