The Witness Box

Commenting on expert evidence, economic damages, and interesting developments in injury, wrongful death, business torts, discrimination, and wage and hour lawsuits

Monday, June 30, 2008

Tall people are smarter than short people

New economic study confirms what Randy Newman are ready knew:

Tall people have higher self-esteem, social dominance, and now a new economic study finds that tall people have higher cognitive ability. Interesting work. Full CIte:

Journal of Political Economy, 2008, vol. 116, no. 3]
© 2008 by The University of Chicago. All rights reserved.

Stature and Status: Height, Ability, and Labor Market Outcomes
Anne Case and
Christina Paxson
Princeton University

Summary: The well-known association between height and earnings is often thought to reflect factors such as self-esteem, social dominance, and discrimination. We offer a simpler explanation: height is positively associated with cognitive ability, which is rewarded in the labor market. Using data from the United States and the United Kingdom, we show that taller children have higher average cognitive test scores and that these test scores explain a large portion of the height premium in earnings. Children who have higher test scores also experience earlier adolescent growth spurts, so that height in adolescence serves as a marker of cognitive ability.

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Friday, June 27, 2008

Drive-by Daubert Ruling

Judge throws out employment discrimination evidence on the way to a summary judgment for the plaintiffs...

In the last few years, the idea of stereo typing and racial profiling has really gained traction in employment discrimination cases. Prof. Bielby, a now well known sociologist from the University of Penn, has done a lot of research that suggest that race and gender stereotyping is unavoidable and happens all the time in the workplace.

In this case gender based employment discrimination case (CHADWICK v. WELLPOINT INC et al Federal Court-Maine), the plaintiffs alleged that the the employer had a policy of stereotyping female employees. In particular, the plaintiff was a mother of four who claims that she was discriminated against and should have received a job promotion that went to another employee.

The plaintiffs engaged a qualified sociologist with a Ph.D. from Cornell, who had studied and wrote her dissertation on the topic of gender stereotyping. She testified that some of the statements that were made by management were consistent with gender stereotyping behavior within the work place.

The judge, in a drive-by Daubert, disregarded her testimony stating that it would not help the trier of fact in this situation. He goes on to say in the court's order:


The plaintiff would like to have her expert testify about the extent of
sex based stereotyping in the United States and its workplaces, the meaning of certain words (for example, that “Bless you” in the context in which Miller
said it shows sexual stereotyping; likewise for the other supervisor’s
comment about child discipline strategy), and that it is very unlikely that a
man would have been told that he had too much on his plate because of school
and children. For the reasons I describe below, I conclude that the expert’s
testimony would not be helpful to a fact finder on the issues that are relevant to this decision....


While the judge did not make any assessment her qualifications or the underlying methodology she used in the report, he says:


The proposed expert testimony about the prevalence of sex-based stereotypes
in America is no substitute for actual evidence (direct or circumstantial)
about these decision makers and their beliefs and behaviors. The expert,
whatever her professional credentials, is not competent to testify about what these supervisors meant, consciously or unconsciously, in using certain words.


well01.pdf
well02.pdf

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Thursday, June 26, 2008

Defending age discrimination suits just got tougher

In a 7-1 ruling, the Court said that when older workers are disproportionately affected by an employment decision, the employer bears the burden of explaining whether there was a reasonable explanation other than age for the company's action.


No. 06-1505
Title:
Clifford B. Meacham, et al., Petitioners
v.
Knolls Atomic Power Laboratory, aka KAPL, Inc., et al

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Wednesday, June 25, 2008

Predatory lending is a myth

In recent years, a number of lenders have been hit with predatory-type lending lawsuits. In these lawsuits, which have mainly involved automobile finance companies and mortgage lenders, the complaint usually alleges that the lender took advantage of a particular group and charged them higher than normal rates. Payday lenders, which make unsecured loans based on a borrowers paycheck, are frequently in the media and criticized for the triple digit APRs that they charge borrowers for short term loans.

A new study by Edward Lawrence and Gregory Elliehausen, suggest that pay lenders are in fact not bad and satisfy a financial need for a segment of the population. (Analysis of Payday Loan Customers, Contemporary Economic Policy, Vol. 26, No. 2, April 2008, 299-316)

Using a national survey of payday loan, finance company, and credit card users the authors find:

- That most payday loan customers report a positive experience with payday lenders
- Most payday loan customers are aware of the cost of the loan (in terms of the finance charge; but not the APR however)
- Payday loan customers are not captive borrowers and instead use other types of credit as well.
- The use of payday loans is consistent with studies of income and life time earnings that suggest the use of payday loans fills a financial need, instead of imposing a cost, for borrowers

Overall the study is interesting but limited. For example, the survey used by the authors was provided by payday loan companies and did not actually address a number of the issues that policy makers are concerned about concerning predatory pricing. Moreover, there is no way to determine if the high APR charged on payday loans contributes in any part to the financial condition of the payday loan borrowers. In addition, the one regression model, that looks at and controls for many different factors, in the paper actually suggests that payday loans may be a problem and create a circular pattern of debt situation for some borrowers

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Tuesday, June 24, 2008

Nuts and bolts of a wage and hour class settlement

Texas Lawyer Newspaper reports that the plaintiffs in a donning and doffing case (Vogt v. Texas Instruments Inc., No. 3:05-cv-02244 ) recovered $355,000 in allegedly unpaid overtime.

The newspaper's report is somewhat true....

According to the COMPROMISE AND SETTLEMENT AGREEMENT AND RELEASE filed with the court, the 71 plaintiffs actually recovered about $65,000, or about $650 each after taxes, in back wages.

The plaintiff's attorneys recovered $290,000 in attorney and court fees.


FYI, in the case the lead plaintiff Wilford Vogt claimed that Texas Instruments failed to pay him and other similarly situated employees overtime wages from November 2002 through 2005, alleging that they were not compensated for time spent changing in — and out of — protective gear. This practice allegedly took 32 to 42 minutes each shift and was necessary before entering — and after leaving — designated “clean” manufacturing rooms.

The plaintiffs said that they were only compensated for 11.5 hours of work on 12-hour shifts. Texas Instruments contended that it complies with the law, noting its generous pay policies, which reportedly exceed legal requirements.
TI.pdf

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Monday, June 23, 2008

Lack of evidence does not exclude economic damage calculations

Daubert Watch 6.23.2008

In this LA personal injury case, defendants appealed the trial court's ruling admitting the testimony of Plaintiffs' vocational expert and expert economist. The defendants had stated at the trial court level that there was no evidentiary basis for the opinions of the witnesses.

The appeals court affirmed the trial court's ruling, stating that defendants had not challenged the scientific basis or expertise of either expert. Accordingly, trial court properly admitted the testimony.

See: dauberttracker.com

For more information on the plaintiff verdict, go to:
http://www.judgeconque.com/Jury%20Verdicts/lafayette.html

Philip Broussard, et al vs. Lafayette Ins. Co., et al; #20060333
DAMAGES - PERSONAL INJURY
Judge Patrick L. Michot (Div. "K") Presiding, April 2007
Plaintiff(s) Attorneys: Joseph Gaar, Jr.; Jason Welborn
Defendant(s) Attorneys: Richard Petre, Jr.

VERDICT: In favor of Plaintiff and against Defendants

AWARD:
Past Medical Expenses $ 84,079.25
Future Medical Expenses 12,000.00
Pain, suffering and disability; physical and mental (past, present,future) 154,000.00
Loss of past earnings 23,423.00
Loss of future earning capacity 165,000.00
Loss of enjoyment of life 20,000.00

TOTAL AMOUNT $ 458,502.25

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Friday, June 20, 2008

Women who wait earn more

Hot Research Friday!

Women who delay childbearing earn more money than women who have children at earlier ages. Kasey Buckles (2008), "Understanding the Returns to Delayed Childbearing for Workign Women" (AER 2008, 98:2, 403-407) finds that there is a raw return of approximately 3 percent per year of childbearing delay. The author finds that about 90% of the delay premium is explained by differences in observable characteristics such as education and occupation.

In short, women who delay are more educated, more skilled and more likely to be in professional careers.

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Thursday, June 19, 2008

Economics Wednesday

Economics Blogs

One 'angry economist', sums up his view on global warming...

Looking for a way to understand global warming in just one sentence? Try this one on for size:

I find no value in any mention of human-caused CO2 global warming when there is no corresponding mention of the 2-3 degree 1500 year +-500 warming / cooling cycle.

Or, its more succinct version:

A fart on a farm isn't noticable

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Saturday, June 14, 2008

Undocumented workers receiving workers compensation benefits

Gregory Presmanes and Seth Eisenberg article, 'Hazardous Condition: The Status of Illegal Immigrants and Their Entitlement to Worker's Compensation Benefits', review state worker's compensation laws across the country. They find that many states have adjudicated the issues and have generally found that illegal immigrants have a general entitlement to worker's compensation benefits.

According to the article, CA, CO, CT, FL, KS, LA, NJ, NC, OK, OR, PA, and TX have all recognized the general rights of illegal aliens to receivig worker's compensation benefits.

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Friday, June 13, 2008

Finance companies overcharge African-American automobile loan borrowers

Hot Research Friday!

Charles, Hurst, and Stephens (2008) article, "Rates for Vechicle Loans: Race and Loan Source" (AER, 2008 98:2,315-320), finds that finance companies, such as GMAC, charge African-American more than similarly situated White borrowers at finance companies. Some of their statistical models point to differences as large as 120 basis points (1.2%) higher rates for African-American borrowers.

The authors do not find a similar differential for African-American borrowers at banks. They also find that most of the difference in rates is between similarly situated African-American high interest rate borrowers and White hihg interest rate borrowers.

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Thursday, June 12, 2008

Court excludes the 'horse he rode in on' but lets expert testify

Daubert Watcher 6.10.2008

In a contracts case(American Fed. Bank vs. United States, US Ct. of Fed. Claims) , the court noted that one of the experts in the case (Dr. Anjan Thakor's) report was admitted into evidence although he relied upon a document that was not allowed into evidence in the case. The expert relied on the plaintiff's (American Federal) 1993 10-K, and that document was not admitted at trial.

The court said that Dr. Thakor's expert opinion could legitimately rely on documentary materials not admitted where such materials were "of a type reasonably relied upon by experts in the particular field." Fed. R. Evid. 703. American Federal's 10-K for 1993 satisfied that criterion.

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Wednesday, June 11, 2008

The principles of economics in 5 minutes

Economics in action

Need a refresher on the principles of economics This short entertaining clip provides a 'translation' of the popular Mankiw principle of economics textbook.

The clip: "Mankiw's 10 principles of economics, translated for the uninitiated", by Yoram Bauman, http://www.standupeconomist.com/ .

Dr. Bauman is the workds first and only stand up economist. The video is a hoot.

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Tuesday, June 10, 2008

Sports attendence soars in uncertain economic times

Economics In Action

....Gas prices are up. Food prices are up. So, oddly enough, is attendance at Major League Baseball games....MLB officials say attendance is 2.6 percent ahead of record-breaking figures from last season

“People seek the comfort of their sports addiction when there’s bad economic times,” said Andrew Zimbalist, a sports economist. “There’s something very deeply rooted about our sports attachments. People tend to give that up last.”

"Not everybody’s income falls during a recession,” said John Solow, an economics professor at the University of Iowa. “In total, people are getting poorer or it wouldn’t be considered a recession. But there are some people whose income continues to rise.
“What fraction of those tickets are sold to Joe Six-Pack and his family as opposed to corporations?”

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Saturday, June 07, 2008

Low economic loss occupations

Plaintiffs who work in occupations with fast growth are more likely to obtain jobs after an employment termination. All else equal, economic damages will be lower in these occupations.

The Occupational Information Network (O*NET) identifies the occupations that are growing "much faster than average" across all industries and predicts which occupations will grow the most.

Customer Service Representatives (1,158,000)
Registered Nurses (1,001,000)
Personal and Home Care Aides (519,000)
Home Health Aides (454,000)
Computer Software Engineers, Applications (300,000)
Counter and Rental Clerks (291,000)
Computer Systems Analysts (280,000)
Management Analysts (264,000)
Medical Assistants (199,000)
Network Systems and Data Communications Analysts (193,000)
Amusement and Recreation Attendants (182,000)
Pharmacy Technicians (178,000)
Bill and Account Collectors (165,000)
Securities, Commodities, and Financial Services Sales Agents (161,000)
Network and Computer Systems Administrators (154,000)
Computer Software Engineers, Systems Software (150,000)
Dental Assistants (130,000)
Fitness Trainers and Aerobics Instructors (107,000)
Pharmacists (95,000)
Personal Financial Advisors (88,000)
Financial Analysts (87,000)
Paralegals and Legal Assistants (84,000)
Dental Hygienists (82,000)
Physical Therapists (68,000)
Mental Health and Substance Abuse Social Workers

Notes: The list below reflects the top 25 fastest-growing occupations followed by the projected need for each occupation during the years 2006-2016. Note, these are the occupations with the highest projected need among those growing much faster than average (not by sheer volume). So, for example, while there is a projected need for 802,000 Janitors and Cleaners during 2006-2016, this occupation is not projected to grow as quickly as the occupations on the list below. Nearly half (11) of the occupations in the list arre from the health care industry. In addition, five occupations each come from the financial services and information technology industries, while the hospitality and retail industries are each represented twice on the list. Two occupations on the list fell under more than one industry: Customer Service Representatives, which top the list, fall under both the financial services and retail industries. Counter and Retail Clerks (#6) are listed under both the hospitality and retail industries.

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Friday, June 06, 2008

Katrina evacuees lower native worker wages

Hot Research Friday.

Molly Fifer McIntosh article 'Measuring the Labor Market Impacts of Hurricane Katrina Migration", finds that Hurricane Katrina migration depressed wages of native Houstonians 1.8%. Her work also found that the evacuees lower the probability of a Houston native being employed by 0.5 percentage.

In short, there are significant albeit modest, labor market effects associated with the Hurricane Katrina evacuees migration to Houston.

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Thursday, June 05, 2008

Immigrant Latino workers hit hard but still working

The Pew Hispanic Center (on 6/4/2008) released Latino Labor Report, 2008: Construction Reverses Job Growth for Latinos. Using data through the first quarter of 2008, the report finds the economic downturn having a disproportionate impact on Hispanic workers. especially Mexican immigrants and recent arrivals, have been hurt the most by the slump in the construction industry.

There are no signs Latino immigrants are leaving the U.S. labor market but they now play a smaller role in the growth of the Hispanic workforce than in recent years.

The report is available at the Pew Hispanic Center's website, http://www.pewhispanic.org/.

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Tuesday, June 03, 2008

Daubert Watch 5.39.3008: Economist passes the muster

In Mcdaniel vs. Gallery Model Homes, Inc. age discrimination case, in the Southern District of Texas, JOHN D. RAINEY, UNITED STATES DISTRICT JUDGE ruled that the defendant's concerns went to the weight NOT the admissibility of the economist's testimony.

The motion by the defense attorney is particular interesting. It is clear that there was a lot of bad blood betwen these two parties.

In the motion the defense complained of :

- The economic damage report (on back and front pay) not meeting rule 26(b) standards. (According to the motion the plaintiff's economist did not provide all the required documents )

- Plaintiff economist not having enough data to perform and adequate analysis

- The unknown rate of error of his worklife estimates

- Use of benefits multiplier and the fact that the ezpert did not know the exact benefits that the defendant provided

- Growth rate did not match the plaintiffs job. Economist used aggregate data not specific to sales

- Health of the plaintiffs. The plaintiffs had knee surgery that may have prevented them from performing some types of work. The economist did not include this in his analysis.


(see: dauberttracker.com for details)

Defense's Motion to Exclude : 58-1.pdf

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Monday, June 02, 2008

How an economic expert deposition should go...

In this economic expert deposition, the defendants are deposing a very seasoned economist in an age discrimination case. Overall the economist, Dr. Ken McCoin does a superb job at the deposition. Dr. McCoin is candid and open in his responses. When there are obvious things in which the economist should 'give in' on he does...

Part 1 Part 2

The depo is a good read for attorneys looking for good questions on economic damages calculations involving back and front pay. There are also good discussions on interest rates and other assumptions used in front pay and back pay calculations.

Side note: The defense attorney and the economist have a past professional history; they have worked together. Makes the reading very interesting.

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