What would Daubert say about those damages? (continued from 2.25.2007)

Here is are four things to think about (and documents to collect) to begin an analysis of the dairy company's lost profits in the the business interruption lawsuit (see 2.25.2007 post).

1. Daily production volumes for the 60 days before, the day of, and 60 days after the incident in the year of the incident and a year before the incident.

[Reason: allows the analyst to see if the company really incurred a lost production do to contimination or were they able to scale up production in other areas?]

2. A list of and documentation of any specific orders, such as copies
of purchase orders or contracts (including requirements contracts),
that went unfilled as a result of the contamination

[Reason: Was the company pre-selling orders or did they make the products and then sell and market them after they were produced? Can be a big factor]

3. How long was the plant production shut down to locate and clean up the contamination?

4. What is your typical production in a day? Does this fluctuate throughout the day?

What would Daubert say about those damages? 1.25.06 part I

Case Background:

In this business interruption case where the owner of a dairy company is demanding that supplier pay for lost profits that it incurred as a result of receiving contaminated input product from the supplier. There is little question that the supplier supplied the contaminated input to the dairy company.

At this point, the case is at the pre-lit stage and the attorneys, and the insurance company would like to settle with the diary company without proceeding to the litigation stage. However, to do this the attorneys and the insurer in the case must have a handle on what the economic damages look like.

What documents do you need in a case like this? Check back....we will discuss....

Malone and Zwier on Experts

E.10 Remind the expert not to be an overt advocate (p.45)

You want the jury to believe that your expert has been objective and relatively independent....

excerpted from National Institute for Trial Advocacy publication (www.nita.org), Expert Rules, 100 (and more) Points You Need to Know about Expert Witnesses, Second Edition by David Malone and Paul Zwier

Nixon Peabody attorney: Wage and hour lawsuit outlook may worsen for employees in 2007

Excerpted from: Recent Class Action Rulings Offer Good News for EmployersPhilip M. Berkowitz, New York Law Journal01-19-2007, http://www.law.com/jsp/law/LawArticleFriendly.jsp?id=1169114541849

According to Nixon Peabody attorneys Philip M. Berkowitz and Randy Gidseg, while the year 2006 saw many similar, high-profile, big-money settlements, a number of recent developments in the class action world suggest that plaintiffs in FLSA cases may have a more difficult time in the courts obtaining a victory.

The article notes that even under the looser definition of 'similarly situated' in FLSA cases, courts have recently been denying plaintiffs class certification in wage and hour cases where the plainitiff has failed to show that the proposed class is composed of similary members. It cites Briggs v. Arthur T. Mott Real Estate LLC as an example.

It further notes that recent DOL decisions suggest that, even if plaintiffs successfully obtain class certification under the FLSA, it may be harder for them to actually win their case. For examples, the authors cite: See Letters from Paul DeCamp, Administrator, U.S. Department of Labor, Employment Standards Administration, Wage and Hour Division, dated Nov. 27, 2006 (registered representatives) and Sept. 8, 2006 (mortgage loan officers).

Wage and hour focus article 2: Time Clock Rounding

Time clock rounding thread from 'labor law talk bulletin board'
(http://www.laborlawtalk.com/showthread.php?t=166921)

Clock Rounding in Employer's Favor Iowa (Employee Question)

I know you get this question a lot, but I wanted to ask it to show my employer. My employer has a clock system that rounds to 1/10 hour (6 minutes), always in the employer's favor. For example, if we clock in at 7:55 it rounds to 8:00 and if we clock out at 4:35 it rounds to 4:30. Is this legal? My supervisor (the assistant manager) says that because they give us a 15 minute break morning and afternoon, the rounding doesn't matter because the rounding wouldn't take as much away from us as the breaks that they give us. I think these are two separate things.Is this rounding always in the employer's favor legal?

If not, can you give me "chapter and verse" to cite to them, either from Iowa or US regulations?The one concession I have gotten from them (after pushing hard a couple of years ago) was that if we clock in late but within the first six minutes of our starting time, we only have to work an equivalent number of minutes in the afternoon to make it up rather than having the full unit taken from us.

Laborlawtalk response #1,

I can tell you that it is not legal for rounding to always work in the employer's favor. Rounding is permitted but only if it is done even-handedly; no matter whose favor it works in.However, I will have to let Patty, Robb, Scott or one of the other payroll experts supply the exact links. (It's Federal, btw.)

Laborlawtalk response #2

The following link is to the federal rules. I do not know what rules Iowa has (if any), but state law cannot make the federal rules go away.http://www.dol.gov/dol/allcfr/ESA/Ti...9CFR785.48.htm

Attorney: Tennessee courts finally joins the Union

According to the blog, John Day on Torts, the local rules concerning expert witness testimony in Middle Tennessee Federal Court may be a changing and coming in line with other Federal courts.

John Day says: "The Federal Court for the Middle District of Tennesse has a local rule on expert witness that has been criticized for decades. " The local rules in the state essentially require everything to to be written out - including definitions of words, etc. - and then require the expert to read from the report which does little more than bore a jury to death

According to Day on Torts blog: "The Sixth Circuit Court of Appeals has reversed a judgment because the Court enforced the rule. In Thompson v. Doane Pet Care Co., No. 05-5377 (Dec. 15, 2006) the Court said that the [Tennesse] local rule was inconsistent with the Federal Rules of Civil Procedure, including Rule 89(a)(2), which provides that "[a] local rule imposing a requirement of form shall not be enforced in a manner that causes a party to lose rights because of a nonwillful failure to comply with the requirement."

For the full post, click here.

Wage and hour focus article 1

Time and motion experts should work together with statisticians when performing time and motion studies

Case: MARIA CHAVEZ, et al., on behalf of themselves and all others similarly situated v. IBP, INC. and TYSON FOODS, INC., all Delaware corporations, Washington, Eastern District, CV-01-5093-RHW, 2005 U.S. Dist. LEXIS 29714

Punchline: Chavez v. IBP shows the importance of representativeness of a time and motion study used to measure time spent working of the clock. The plaintiffs' shadow study of time spent walking to and from job posts was disallowed and ruled to be unreliable because the study relied on non-representative walking observations

Background (from the court's order concerning the defendant's motion to decertify the class)This is a class action brought under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-219, as well as the Washington state Minimum Wage Act ("MWA"), RCW chapter 49.46.005 et seq., the Industrial Welfare Act, RCW chapter 49.12.005 et seq., and the Wages-Deductions-Contribution-Rebate Act, RCW chapter 49.52. The Court has jurisdiction over the class members' FLSA claims under 29 U.S.C. § 216(b) and 28 U.S.C. § 1331.

The named Plaintiffs, Maria Chavez, Ranulfo Gutierrez, Paz Arroyo, Antonio Martinez, and Silverio Diaz, were employed at the Tyson beef slaughter, processing, and hides divisions in Pasco, Washington (the "Pasco Plant") sometime after November 1, 1998. The Rule 23 class was defined in the Court's certification order as: All individuals performing production work in the Pasco plant processing, slaughter and hides division during any time between November 2, 1998 through May 14, 2002, excluding supervisors, managers, quality control employees, guards, mechanics, laundry room employees, janitors, knife room employees, and packaging department employees whose jobs are limited to work performed after the product has been bagged and boxed.

The class is comprised of 1,136 opt-in Plaintiffs bringing claims under the FLSA and Washington state law, and 3,909 Rule 23 Plaintiffs (including 116 FLSA opt-in Plaintiffs with state and federal claims and 2,797 Rule 23 Plaintiffs with only Washington state claims) (Ct. Rec. 633). At trial, 36 processing class members, 14 slaughter class members, and 3 hides class members testified. In total, approximately 5% of the opt-in class, and less than 1% of the opt-out class, testified. The class Plaintiffs seek damages for uncompensated work performed during the period commencing on November 2, 1998, and ending on December 31, 2003.

Expert's part and court opinion of time and motion expert's work:

In a previous case (Alvarez), Plaintiffs presented the testimony of Dr. Kenneth Mericle on the issue of amount of time employees spend walking from their lockers to the production room floor. Dr. Mericle calculated the Alvarez walking times by utilizing a standard rate of speed developed by industrial engineers. In the present action, Plaintiffs assert that the Alvarez walking calculations vastly underestimate the time actually spent walking, and present alternative times based on Dr. Mericle's shadowing study. Dr. Mericle concludes that the average pre-shift walking times for Slaughter are 1.822 minutes and for Processing are 2.622 minutes (Id.). These times include "walking segments from the locker, to the workstation and includes walking to clean glasses and obtain knives, sand paper and miscellaneous job related equipment but not walking for gloves." (Id.)

The Court finds that Dr. Mericle's new walking calculations include instances where employees unnecessarily backtracked or retraced their steps; therefore, they are not an accurate representation of walk time that is work. In addition, Dr. Mericle's walking calculation included a significant amount of walking to complete job activities that were unique to certain job categories. Therefore, the Court finds that Dr. Mericle's calculations did not provide representative evidence of the walking time expended by the class as a whole.

What could have been done: A more representative sample of walking observations could have yielded a more scientifically valid study and may have not been subject to the the same criticisms.

A high stakes way of handling Daubert motions

How do most judges handle Daubert motions? Do they hold pre-trial hearings or just rule based on briefs?

One Federal Judge has an interesting approach to handling Daubert motions. He decides all motions right at the time the expert is to testify live at trial. When the challenged expert comes up, the Judge sends the jury out of the room and then allows the challenging side to cross examine the challenged expert witness.

The stakes are high because if the Judge allows the expert to testify then the time that the challenging party spent crossing the challenged expert witness is deducted from the challenger's allotted time. If the challenging party wins, then the time spent crossing the challenged expert is deducted from the challenged expert's side (the challengee?).

Needless to say, attorneys think long and hard in this judge's court before bringing a Daubert motion.

Damage expert services will cost their own client millions

Source: http://www.law.com/jsp/law/LawArticleFriendly.jsp?id=1168263432906

Broward, Fla., Circuit Judge Leroy Moe ruled Monday that Motorola willfully violated court orders during a $10 billion trade secrets trial late last year. In violation of the judge's order Motorola placed experts on the stand who previously had read other witnesses' testimony. The ruling could expose the electronics giant to millions in fines, attorney fees and trial costs.

The plaintiffs, SPS Technologies, will get a new trial. SPS attorneys also asked Judge Moe to fine Motorola $118 million -- $100 million in sanctions, $11 million in attorney fees and $7 million in costs. The amount of attorney fees, costs and sanctions to be levied against Motorola will be determined in a later hearing.

Judge says: Let them both in!

In a N.J. employment discrimination case, Judge William Walls, faced with dueling stats experts found both of the cases to be admissible.

Background and case from www.dauberttracker.com

The plaintiffs were former and current employees of the defendants Johnson & Johnson. The plaintiff filed an employment discrimination suit on behalf of themselves and other similarly situated employees against Johnson & Johnson. The case was filed pursuant to Section 1981 of the Civil Rights Act of 1871, as amended by the Civil Rights Act of 1991, and the New Jersey Law Against Discrimination, N.J. Stat. ¤ 10:5-1.

The expert statistical report, prepared by Dr. Janice Madden and Dr. Alexander Vekker ("Madden Report"), was relied upon by the plaintiff to support their claim of commonality. Defendant filed a motion to strike the Madden Report arguing that (1) the Madden Report was irrelevant to class certification and therefore "unfit" under Daubert and (2) the Madden Report was unreliable.

The Madden Report concluded that from 1997 to 2003: (1) African American employees were less likely than comparably qualified white employees to be selected for promotion, (2) African Americans and Hispanics had lower base salaries than comparably qualified whites, and (3) there was an average wage differential at hire by race and ethnicity. The court rejected defendant's motion to preclude the Madden Report in light of the fact that the Madden Report controlled for job hierarchy, job function, age, tenure at Johnson & Johnson, and education.

The court held that Dr. Madden's regressions were not so incomplete that they were unreliable or irrelevant.

The Defendant submitted the Wise Report prepared by Dr. David Wise, an expert on statistical data, to support its contention that the Johnson & Johnson companies were not a single class environment for the purpose of class certification. The Wise Report concluded: (1) there was no common pattern of compensation and promotion consistently adverse to African American and Hispanic employees, (2) the data were inconsistent with the assumption that the determinants of compensation and promotion were the same at all Johnson & Johnson companies, (3) few of the estimated minority effects were statistically different than zero, and (4) to the extent that there were differences in compensation and promotion, they were small and could be explained by small differences between the job-related attributes of minority and white employees.

The court denied plaintiff's motion to strike the expert report as it concluded that the report was not so fatally flawed as to be inadmissible as a matter of law.

Therefore, the court denied both the plaintiff and defendant's motion to strike each other's expert

What some judges think about economic testimony

A task force of judges, attorneys and economists were tasked with determining if economic evidence in anti-trust cases was useful or confusing to judges and juries. In a nutshell, the economists generally believed that their testimony was useful and not confusing. In contrast:

“A majority of Task Force members believe that there is a problem with confusing economic testimony in the federal courts....some characterize the problem as significant and others characterize it as only modest…"


See, 'Final Report of Economic Evidence Task Force" August 1, 2006' (at the bottom of the page..)