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The Daubert Standard and Expert Opinion Evidence

The Gatekeeper Revisited –  Circuit Court Approaches to Daubert and Federal Rule of Evidence 702

John D. Hadden

Author's note: This article was originally published in the February 2017 issue of the American Association for Justice Product Liability Section Newsletter.

In 2010, the city of Pomona, California sued SQM North America Corporation over alleged contamination in the Chino Basin aquifer, the source of the city's water supply.[1] Pomona alleged that SQM's sodium nitrate fertilizer, imported from the Atacama Desert in Chile and applied during the first half of the 20th century, had leached perchlorate[2] into the soil, which, by 2007, exceeded California's Maximum Contaminate Level for water quality.[3] Pomona sought compensation from SQM for the costs of remediation and replacing contaminated water. To prove the contamination originated from SQM's fertilizer, Pomona presented the testimony of Dr. Neil Sturchio, who concluded that the dominant source of perchlorate in Pomona's water was soil from the Atacama Desert, strongly suggesting it originated from SQM's product.[4] Dr. Sturchio based his opinion on “stable isotope analysis,” a technique he helped pioneer, that compared the molecular makeup of perchorate samples from Pomona's water supply with reference samples from around the world.[5]

Prior to trial, SQM challenged Dr. Sturchio's testimony under Daubert v. Merrell Dow Pharmaceuticals[6] and Federal Rule of Evidence 702. The district court excluded the testimony, finding problems with both Dr. Sturchio's methodology and his application of the methodology to the facts.[7] On appeal, the Ninth Circuit reversed. It held that, as to the soundness of the witness's methodology—the stable isotope analysis method itself—the fact that the test was new and still being refined did not make it unreliable, particularly given that Dr. Sturchio had developed the method in conjunction with the federal government. These factors, the court concluded, established the reliability of the method. Furthermore, it held that Dr. Sturchio's alleged failure to strictly follow the protocol established by the Department of Defense's Guidance Manual (which he helped develop) in applying his methodology did not provide a basis for exclusion. Noting that the proper inquiry is whether the expert relied upon “a faulty methodology or theory as opposed to imperfect execution of laboratory techniques whose theoretical foundation is sufficiently accepted in the scientific community,” the court found that any defects were merely “imperfect execution” of the process and held that the jury should have heard the testimony.[8] The case was thus remanded for trial.

The Ninth Circuit's ruling set the stage for a petition for certiorari to the Supreme Court in which SQM argued that a deepening circuit split over the proper application of expert witness standards called for high court intervention.[9] It argued that the Ninth Circuit was at odds with other circuits and that it had improperly approved introduction of Dr. Sturchio's evidence despite purported problems with his execution.[10] The city of Pomona, unsurprisingly, disputed that such a significant split existed, and opposed the petition.[11] It downplayed the significance of the varying circuit approaches, pointing to case-specific factual distinctions in the cases, as well as arguing the merits of Dr. Sturchio's testimony in the underlying case.[12]

The Supreme Court ultimately declined to hear the case, but the arguments presented to the Court provide an illuminating view of the current state of the district courts' “gatekeeper” function as established by Daubert and preview future disputes concerning this evolving and important evidentiary issue. The remainder of this article will, after briefly reviewing the “Daubert trilogy”[13] leading to the 2000 revision of Federal Rule of Evidence 702, discuss and analyze the varying approaches of the circuit courts in considering the reliability of an expert's methodology, analysis, and conclusions.[14]

Background – The Daubert Trilogy and Federal Rule of Evidence 702

In Daubert v. Merrell Dow Pharmaceuticals, the Supreme Court held that the standard announced by the D.C. Circuit in 1923 in Frye v. United States,[15] permitting introduction of expert opinion testimony based on scientific techniques that were “generally accepted” as reliable in the scientific community, had been superseded by the Federal Rules of Evidence.[16] Although Frye was a circuit court case, the Supreme Court recognized that the standard it established for expert testimony was the commonly-accepted majority rule.[17] The Supreme Court found the Frye standard overly restrictive, noting the “liberal thrust of the Federal Rules and their general approach of relaxing the traditional barriers to opinion testimony.”[18] Under the new Daubert standard, the Supreme Court instructed lower courts to focus on reliability, providing a set of non-exclusive “general observations” that courts might weigh in considering admissibility: whether the scientific theory or technique could be tested; whether it was subject to peer review and publication; its known or potential rate of error; and, echoing a trace of the discarded Frye standard, the theory or technique's general acceptance.[19] Ultimately, the newly-announced test would be a flexible one, with the trial judge acting as gatekeeper ensuring that only relevant and reliable evidence was admitted.[20]

Four years later the Court revisited the subject in General Electric Co. v. Joiner.[21] Joiner is significant for two principal reasons. First, it established an abuse-of-discretion standard of review for district court decisions regarding expert testimony.[22] Second, it seemingly backed away from its statement in Daubert that a district court's focus should be on an expert's methodology rather than his or her conclusions.[23] Acknowledging that “conclusions and methodology are not entirely distinct from one another,” the Court noted that in some cases the expert's conclusions may show “too great an analytical gap between the data and the opinion proffered.”[24] Thus, a district court is not required to simply take the expert's word for it when determining whether a conclusion necessarily flows from the data.

Finally, in Kumho Tire Co. v. Carmichael, the Supreme Court held that the “reliability” standard established by Daubert and refined in Joiner applied to non-scientific experts, and that the non-exclusive considerations set forth in those cases could be relevant to a court's consideration of the reliability of all expert opinion testimony.[25] In the seventeen years since Kumho Tire, the Supreme Court has declined to revisit the substantive aspects of expert witness testimony.

In 2000, Federal Rule of Evidence 702 was amended to incorporate elements of the Daubert trilogy. Although sometimes referred to as a “codification” of those cases, the revised evidence rule only addresses the basic requirements of reliability, requiring such testimony to be “based on sufficient facts or data” that are the “product of reliable principles and methods,” and further requiring that the expert “reliably appl[y] the principles and methods to the facts of the case.”[26] The non-exclusive factors noted in Daubert were, however, discussed in the Rule's Committee Notes.[27]

In the aftermath of the Daubert trilogy and the 2000 amendment to Rule 702, a multitude of federal district and circuit court cases have considered admission of expert witness testimony. Moreover, many states have adopted the Daubert standard, often looking to federal precedent for interpretive guidance. [28] Therefore, federal circuit court interpretations can have nationwide significance. Some of the most significant cases are discussed below, demonstrating varying approaches to admission of expert opinion testimony.

First, Seventh, Eighth, and Ninth Circuit Approaches

Although it is not clear that the circuits are split as distinctly as SQM claimed in its petition for certiorari, there appear to be at least some differing trends in the case law. In the cases discussed in this section, courts have taken a more open approach to admission of expert opinion testimony, perhaps paying heed to the statements in Daubert and Joiner regarding a general preference for admission of relevant evidence. Very broadly speaking, these circuits have tended to place a greater emphasis on the reliability of an expert's methodology, while leaving questions about the expert's specific application of the methodology for the jury.

Among the most controversial post-Daubert decisions is Milward v. Acuity Specialty Products Group, Inc.[29] Plaintiff Milward claimed to have developed a rare form of leukemia due to workplace exposure to benzene. Reversing the district court's exclusion of the plaintiff's causation expert, the First Circuit noted that the abuse-of-discretion standard involved three separate considerations in this context: the court's findings of fact, under a clear error standard; its rulings on questions of law, reviewed de novo; and its judgment calls, subjected to a “classic abuse-of-discretion review.”[30] It then found that the plaintiff's expert witness, who opined that exposure to benzene could cause the form of leukemia involved, should have been allowed to testify. The expert based his conclusion on a “weight of the evidence” methodology that involved making certain inferences based on available evidence and professional judgment.[31] The court further concluded that the district court had erred in looking at the individual bases for the expert's opinion separately, as opposed to considering the totality of his evidence. Ultimately, it found that the methodology and testimony did not demonstrate the “analytical gap” proscribed in Joiner, because it was sufficiently based on a reliable scientific method. The decision has resulted in significant criticism[32] as well as praise,[33] including a symposium dedicated to the case at the Wake Forest University School of Law.[34]

Similarly, the Seventh Circuit appears open to accepting an expert's conclusion, even if it is not “unimpeachable,” where the methodology involved is reliable. In Manpower, Inc. v. Insurance Company of Pennsylvania, the court considered the opinions of a forensic accounting expert who had been excluded by the district court.[35] The dispute involved the calculation of business losses sustained by an insured under a business interruption insurance policy.[36] The insured's expert based his calculations on the formula required in the policy, along with a “basic growth rate extrapolation” formula, and therefore the district court found his methodology reliable.[37] Nevertheless, the district court found that the expert's data source, which based the growth rate of the company on a particular time period selected by the expert, lacked sufficient indicia of reliability, thus leading to exclusion of his testimony.[38] The circuit court held that the expert should have been permitted to testify because his methodology was sound, his data sources met the level of “sufficient facts or data” required by Rule 702, and any challenge to the selection of data sources was best suited for consideration by a jury.[39]

In Johnson v. Mead Johnson & Co., which also resulted in an unsuccessful petition for certiorari, the Eighth Circuit reversed the district court's exclusion of the plaintiff's three experts, who had been offered to prove that a bacterial infection leading to a child's serious injuries had likely originated in tainted baby formula.[40] As in Manpower, the circuit court found the expert's methodologies reliable, and found alleged imperfections in their execution—specifically, the failure to rule out all possible alternate sources of contamination—were not fatal to their opinions; the methods and data were “reliable enough to assist the trier of fact.”[41] The court also commented on the general liberalization of expert witness standard under Daubert: “While we adhere to this discretionary standard for review of the district court's Rule 702 gatekeeping decision, cases are legion that, correctly, under Daubert, call for the liberal admission of expert testimony.”[42]

Finally, as discussed earlier, in City of Pomona v. SQM North America Corp., the Ninth Circuit reversed the district court's exclusion of the city's expert, finding sufficient evidence that the expert's method and his application of that method were reliable.[43] The case is illustrative of the approach discussed in this section, which places greater emphasis on the methodology employed while declining to apply an overly strict exclusionary rule where possible imperfections in the data sources are present. Other circuits, however, have sometimes been less forgiving.

Second, Third, Sixth, and Tenth Circuit Approaches

In In re Paoli Railroad Yard PCB Litigation, decided the year after Daubert, the Third Circuit undertook an early and influential analysis of the new Daubert standard.[44] Although the court emphasized Rule 702's “liberal policy of admissibility,” In re Paoli's language has been frequently used by other courts to support exclusion of expert testimony, particularly in the context of allegedly faulty application of methodology.[45] The case involved toxic tort claims raised by residents living and working at or near a railyard where polychlorinated biphenyls (PCBs) were used over an extended period.[46] The decision itself is lengthy and complex, involving analysis of multiple experts and their testimonies as to numerous plaintiffs.[47] Substantively, the case could be viewed as a routine and reasonable analysis of the merits of various experts, whose opinions it sometime found reliable, though more often not.[48] But several of its observations stand out.

First, and perhaps most significantly, it noted that, as to application of data to methodology, “any step that renders the analysis unreliable under the Daubert factors renders the expert's testimony inadmissible. This is true whether the step completely changes a reliable methodology or merely misapplies that methodology.”[49] This language was cited in the Committee Notes to the 2000 amendment to Rule 702, and was argued, and rejected, in City of Pomona.[50] Second, and relatedly, the court noted that, despite Daubert's focus on methodology rather than conclusions, “this distinction has only limited practical import.”[51] This foreshadows the Supreme Court's revised view of this issue in Joiner, and perhaps bolster's the case's reputation among those courts citing it as a basis for stricter consideration of expert testimony.[52] Finally, the court noted the difficulty in discerning the proper standard of review. While it recognized that it was reviewing the district court's exercise of discretion, it also noted the tension between the usual “substantial deference” afforded a trial judge, on the one hand, and the preference for admissibility under the Federal Rules of Evidence on the other.[53] Ultimately, the court stated that it would undertake a more stringent review where the ruling would result in summary judgment.[54] This outcome-determinative approach to the abuse-of-discretion standard was rejected in Joiner, but the tension described in In re Paoli, and also recognized in Johnson and others remains largely unresolved.[55]

The Second Circuit, in Amorgianos v. National Railroad Passenger Corp., cited with approval the “any step that renders the analysis unreliable” language of In re Paoli in holding that the plaintiff's experts were properly excluded.[56] The case involved allegations that the plaintiff's workplace exposure to the chemical xylene caused him serious neurological dysfunction.[57] Excluding all three of the plaintiff's experts—an exposure expert and general and specific causation experts—the court upheld the district court's exclusions based on faulty data and “analytical gaps” that it found rendered the expert opinions unreliable.[58] To some extent, the case demonstrates the blurring of boundaries between methodology and application, as both the district and circuit courts found that the experts' analysis was partly the result of faulty methodologies.[59]

Tamraz v. Lincoln Electric Company similarly involved a review of the admissibility of an expert's causation testimony regarding alleged chemical-induced neurotoxicity—this time involving a Parkinson's Disease-related condition—and the Sixth Circuit concluded that the opinion was unreliable and should have been excluded.[60] The plaintiff's expert testified that Tamraz had developed “manganese-induced parkinsonism.”[61] The court concluded that the expert's analysis involved merely a “working hypothesis,” precisely the sort of ipse dixit[62] criticized in Joiner.[63] Although the expert's apparent admission that some of his reasoning was hypothesis or speculation likely doomed admission of his testimony, similarities can be drawn between the “weight of the evidence” analysis in the First Circuit's Milward opinion, in which the court found the expert's methods relied on reasonable inferences, and the expert's methods here, despite the courts' opposite conclusions.[64]

Finally, in Attorney General of Oklahoma v. Tyson Foods, Inc., the Tenth Circuit rejected the plaintiff's argument that the district court should have focused on the reliability of its experts' methodologies rather than exclude their testimonies due to alleged problems with the application of their methods.[65] The case involved an application for preliminary injunction brought by the State of Oklahoma to enjoin Tyson from applying chicken manure, which it claimed had caused bacterial contamination, to soil within the Illinois River Watershed.[66] The state proffered two experts, one testifying that the manure was the source of contamination based on DNA analysis, and the other applying a “principal component analysis” (PCA), identifying key chemical components of the contamination, with both reaching the same result that the contamination had originated from Tyson's product.[67] The circuit court affirmed the district judge's determination that, while the methodologies employed were generally accepted as reliable, the manner in which they had been applied was novel and untested.[68] Although parallels can be drawn between this case and City of Pomona, in the latter the circuit court found additional indicial of reliability, despite the relatively novel nature of the methodology involved.[69]

Conclusion

The Supreme Court's refusal to grant certiorari in City of Pomona and Johnson suggests that the circuit courts' approaches to expert witness testimony are not as deeply divided as some critics suggest. Nevertheless, there do appear to be distinct nuances in the weight courts attribute to errors in an expert's application of methodology, with the First, Seventh, Eighth, and Ninth Circuits taking a somewhat more liberal view of admission of such evidence than the Second, Third, Sixth, and Tenth. To the extent there is a discernible difference, it is perhaps largely attributable to a lack of clarity of the appropriate deference to be given district courts under the ostensibly more liberal admission standard espoused in the Daubert trilogy and the Federal Rules of Evidence. While the cases continue to develop in the district and circuit courts, practitioners should be mindful of this issue and the “tension” between these competing principles.

Footnotes

[1] City of Pomona v. SQM N. Am. Corp., No. 2:11-cv-00167-RGK-VBK (C.D. Ca. 2011). The suit was originally filed in state court and subsequently removed to the United States District Court for the Central District of California.

[2] See generally Nat'l Research Council, Health Implications of Perchlorate Ingestion (National Academies Press 2005).

[3] City of Pomona v. SQM N. Am. Corp, 750 F.3d 1036, 1041 (9th Cir. 2014), cert. denied, 135 S.Ct. 870 (2014).

[4] Id. at 1042.

[5] Id.

[6] Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579 (1993).

[7] City of Pomona, 750 F.3d at 1044-49; see generally City of Pomona, No. 2:11-cv-00167-RGK-VBK, Doc. 211 (C.D. Ca. Jan. 6, 2012) (order on motion to exclude expert).

[8] City of Pomona, 750 F.3d at 1047-48 (citing U.S. v. Chischilly, 30 F.3d 1144 (9th Cir. 1994)).

[9] Petition for cert., SQM N. Am. Corp. v. City of Pomona, No. 14-297, (U.S. 2014). The petition and subsequent filings are available at http://www.scotusblog.com/case-files/cases/sqm-north-america-corporation-v-city-of-pomona-2/.

[10] Id., at 10-17.

[11] See generally id., Br. in Opp.

[12] Id., Br. in Opp. at 5-6.

[13] Daubert, 509 U.S. 579; Gen. Elec. Co. v. Joiner, 522 U.S. 136 (1997); Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999).

[14] The emphasis in this article will be on these factors; while the witness's own expertise is always a threshold factor in determining whether his or her testimony should be admitted, such a determination appears to be relatively routine, and the most recent and significant cases generally focus instead on the reliability of the expert's methods and conclusions. See generally Kenneth S. Broun et al., McCormick on Evidence § 13 (7th ed. 2013).

[15] Frye v. U.S., 293 F. 1013 (D.C. Cir. 1923).

[16] Daubert, 509 U.S. at 588-89.

[17] Id. at 585.

[18] Id. at 588 (internal quotation marks omitted).

[19] Id. at 593-95. Unlike under Frye, however, this finding is not required and the trial judge merely has discretion to consider this factor.

[20] Id. at 594-95.

[21] Joiner, 522 U.S. 136.

[22] Id. at 142-43. The parties agreed that this was the correct standard, but disagreed as to whether the Eleventh Circuit had correctly applied it. The petitioner argued (and the Supreme Court agreed) that the circuit court had failed to give due deference to the district court's determination, while the respondent countered that because of the “outcome determinative” nature of the ruling, a more stringent review of the lower court's order was appropriate.

[23] Daubert, 508 U.S. at 595 (“The focus, of course, must be solely on principles and methodology, not the conclusions that they generate.”).

[24] Joiner, 522 U.S. at 146 (nothing “requires a district court to admit opinion evidence that is connected to existing data by only the ipse dixit of the expert.”).

[25] Kumho Tire, 526 U.S. 137, 147-50. The Court emphasized that its decision was that courts “may” use those considerations, not that they were required or appropriate in all cases.

[26] Fed. R. Evid. 702. The current text was modified in 2011 as part of the general “restyling” of the Federal Rules, but did not change the substantive meaning of the text. See Fed. R. Evid. 702, advisory committee's note (2011 amendment).

[27] Fed. R. Evid. 702, advisory committee's note (2000 amendment); see also Tome v. United States, 513 U.S. 150, 167 (1995) (noting highly persuasive significance of advisory committee notes) (Scalia, J., concurring).

[28] See, e.g., Ga. Code Ann. § 24-7-702 (stating that state courts in considering expert qualifications may draw on Daubert, Joiner, and Kumho Tire, as well as “other cases in federal courts applying the standards announced by the United States Supreme Court in these cases.”).

[29] Milward v. Acuity Specialty Prods. Grp., Inc., 639 F.3d 11 (1st Cir. 2011).

[30] Id. at 13-14.

[31] Id. at 17-19.

[32] See, e.g., David E. Bernstein, The Misbegotten Judicial Resistance to the Daubert Revolution, 89 Notre Dame L. Rev. 27 (2013). Professor Bernstein has been a particularly ardent advocate for stricter expert witness standards, advocating further amendment to Rule 702 to advance this end. David E. Bernstein & Eric G. Lasker, Defending Daubert: It's Time to Amend Federal Rule of Evidence 702, 57 Wm. & Mary L. Rev. 1 (2015).

[33] See, e.g., Steve C. Gold, A Fitting Vision of Science for the Courtroom, 3 Wake Forest J.L. & Pol'y 1 (2013).

[34] Lisa Snedeker, The Wake Forest Journal of Law and Policy co-hosts symposium exploring the repercussions of the First Circuit's decision in Milward v. Acuity Specialty Products, Wake Forest School of Law News and Events (May 14, 2012), http://news.law.wfu.edu/2012/05/the-wake-forest-journal-of-law-and-public-policy-co-hosts-symposium-exploring-the-repercussions-of-the-first-circuits-seminal-decision-in-milward-v-acuity-specialty-products/.

[35] Manpower, Inc. v. Ins. Co. of Pa., 732 F.3d 796 (7th Cir. 2013).

[36] Id. at 801.

[37] Id. at 801-02.

[38] Id. 801-03.

[39] Id. at 807-09.

[40] Johnson v. Mead Johnson & Co., 754 F.3d 557 (8th Cir. 2014), cert. denied, 135 S.Ct. 489 (2014).

[41] Johnson, 754 F.3d at 563-64.

[42] Id. at 562.

[43] City of Pomona, 750 F.3d at 1047-48.

[44] In re Paoli R.R. Yard PCB Litig., 35 F.3d 717 (3d Cir. 1994).

[45] Id. at 741.

[46] Id. at 732. The claims involved both personal injury and property damage claims against multiple entities that maintained the railyard.

[47] Id. at 752-71.

[48] Id.

[49] Id. at 745.

[50] City of Pomona, 750 F.3d 1047-48.

[51] In re Paoli, 35 F.3d at 746.

[52] Joiner, 522 U.S. at 147 (discussing exclusion of evidence where “there is simply too great an analytical gap between the data and the opinion proffered”).

[53] In re Paoli, 35 F.3d at 750.

[54] Id.

[55] Joiner, 522 U.S. at 142-43; Johnson, 754 F.3d at 562 (“the liberalization of the standard for admission of

expert testimony creates an intriguing juxtaposition with our oft-repeated abuse-of-discretion standard of review.”); cf. Kumho Tire, 526 U.S. at 152 (noting “considerable leeway” afforded district court's determinations).

[56] Amorgianos v. Nat'l R.R. Passenger Corp., 303 F.3d 256 (2d Cir. 2002).

[57] Id. at 260.

[58] Id. at 269-70.

[59] Id.

[60] Tamraz v. Lincoln Elec. Co., 620 F.3d 665 (6th Cir. 2010).

[61] Id. at 669-70.

[62] “[Latin ‘he himself said it'] Something asserted but not proved.” Black's Law Dictionary 833 (7th ed. 1999).

[63] Tamraz, 620 F.3d at 670; see also Joiner, 522 U.S. at 146.

[64] Milward, 639 F.3d at 17-19.

[65] Atty. Gen. of Okla. v. Tyson Foods, Inc., 565 F.3d 769 (10th Cir. 2009).

[66] Id. at 773.

[67] Id. at 780-81.

[68] Id. Because the case involved a preliminary injunction, the district judge was sitting as the trier of fact. The defendant's motion to exclude the experts was denied, but the district judge applied the Daubert factors for purposes of weighing the evidence, a procedure the Tenth Circuit found appropriate. Id. at 780.

[69] City of Pomona, 750 F.3d at 1047-48.

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