A federal court in Connecticut recently held that an expert report evaluating the duties of class members in a misclassification wage and hour action was inadmissible. See Perkins v. Southern New England Telephone Co., 3:07-cv-96-JCH, 2011 WL 336715 (D. Conn. Jan. 31, 2011). The plaintiffs are Level One Managers for the Southern New England Telephone Co. (“SNET”), who are challenging their exempt classification under the FLSA and Connecticut law. The defendant disclosed an expert report prepared by an industrial and organizational psychologist containing several opinions regarding the job duties of the class members. The Court struck the report, finding that the opinions were legal conclusions involving “uncomplicated matters,” which would usurp the proper roles of the Court and jury.
The expert report contained four conclusions:
(1) The Level One Manager’s primary duty is management;
(2) Level One Managers regularly direct the work of Technicians or other employees;
(3) Level One Managers exercise a key role in making or influencing personnel decisions related to Technicians or other employees; and
(4) Level One Managers exercise discretion in the performance of their job.
Id. at *2. The plaintiffs argued that the report should be stricken under Daubert and because it expressed legal conclusions, thereby “usurping the roles of the court and the jury.” Id. The court rejected the Daubert challenge, noting that there was sufficient support for the expert’s methodology, but agreed with the plaintiffs’ second argument and on that basis ruled that the report was inadmissible.
Federal Rule of Evidence 704 and the scope of expert testimony within the Second Circuit
Federal Rule of Evidence 704 permits testimony which addresses an “ultimate issue” to be decided by the trier of fact. The Second Circuit, however, has placed limits on the use of prejudicial expert testimony that may address the “ultimate issue,” and legal conclusions by experts are often deemed inadmissible as such. See Nimely v. City of New York, 414 F.3d 381, 398 (2d Cir.2005) (applying Rule 403 to expert testimony). As the District Court in Perkins indicated, such expert testimony “usurps the role of the court in explaining the law and usurps the role of the jury in reaching a final conclusion based on all of the evidence.” Perkins, 2011 WL 336715, *3.
Courts have generally excluded expert testimony on the topic of whether or not an employee is properly exempt. See, e.g., Murray v. Ohio Casualty Corp., et al., No. 2:04-CV-539, 2005 WL 2373857, *3 (S.D. Ohio Sept. 27, 2005) (striking report by former Department of Labor Associate Solicitor opining that the plaintiff did not meet the administrative exemption). Some courts, however, have permitted expert testimony on factual subcomponents of a particular exemption, such as whether a particular position utilizes discretion, or the scope of managerial responsibilities between two groups of managers. Courts also frequently permit the use of expert testimony to provide insight on large numbers of employees. In Perkins, the expert’s report focused on factual subcomponents of the exemption. The plaintiff argued successfully, however, that an expert’s testimony about each component accomplishes the same result as providing an opinion on the ultimate classification question.
To illustrate the point, the Court focused on the first opinion—that the primary duty of Level One Managers is management. As the Court noted, the language of this opinion mirrors the language contained in the executive exemption language of the FLSA. The Court also noted that the opinion itself was uncomplicated. It was based on interviews of fourteen supervisors, a survey of employment documents, and observations of a single manager on the job. According to the Court, the information was well within the ability of a jury to determine, using the same testimony and documents, at trial. Id. at *4. Even if the expert report provided assistance to the jury, the Court expressed concern that it would unfairly bolster the testimony of those supervising the class members. “[The expert’s] testimony may suggest that, because a qualified psychologist believed the statements made by Level Two Managers, the jury should do the same.” Id.
This decision did come with a caveat. The Court noted that expert testimony could be “particularly helpful in a case involving hundreds of employees….” In this context, however, the expert only interviewed fourteen individuals. Under the circumstances, the questions asked (and information learned) could be easily replicated at trial.
This analysis could apply to each of the opinions proferred, with a similar result.
The Perkins case differs from the line of cases permitting expert testimony on factual subcomponents of an exemption in two material ways. First, many of the cases were bench trials, reducing the concern of improperly bolstering or usurping the role of the jury. See Barth, 2002 WL 1377715, *1 (concern that expert will attempt to interpret the law “is not a weighty one” in the absence of a jury). Second, the expert in Perkins based opinions on a handful of interviews, rather than a large survey of responses. This undermines the level of helpfulness of the expert testimony. See, e.g., Henry v. Quicken Loans Inc., No. 2:04-CV-40346, 2009 WL 3199788, *5 (E.D. Mich. Sept. 30, 2009) (affirming exclusion of expert report after excluding the job duty statements of 122 unidentified witnesses because the remaining materials relied upon by the expert – six interviews and observations – could be replicated at trial).
Early attempts to utilize expert testimony to establish that an employee, or class of employees, is properly exempt from overtime requirements failed when the expert sought to speak directly to the appropriateness of the classification. Parties have had mixed results when using experts to testify on factual subcomponents of a particular exemption. The use of expert testimony is more defensible in cases tried to the court or involving large numbers of employees. The defendant in Perkins did not qualify for the former, and failed to take advantage of the latter. While there were a large number of class members at issue, the defendant’s expert report included a limited subset of employees. Because this effort could be replicated at trial, the Court concluded that the testimony was not sufficiently helpful to the jury to counter the risk of improper bolstering.
1 The Court also agreed with the plaintiffs that the timing of the defendant’s disclosure was prejudicial. Defense counsel made representations to the Court that it did not intend to call an expert on liability. While the Court was hesitant to resolve the parties’ disagreements about subsequent representations, it determined that the failure to advise plaintiffs of its change of plans was sufficiently prejudicial to serve as an independent reason to strike the report. The Court recognized that it could permit the plaintiffs time to prepare a counter liability report, but refused to delay the case, already four years old, further.
2 The rule provides that “testimony in the form of an opinion or inference otherwise admissible is not objectionable because it embraces an ultimate issue to be decided by the trier of fact.” FED. R. EVID. 704(a).
3 See Barth, et al. v. Wolf Creek Nuclear Operating Corp., No. 97-4174-SAC, 2002 WL 1377715 (D. Kan. June 19, 2002) (expert permitted to testify on the topic of whether plaintiffs used discretion in their daily job duties).
4 See Donovan v. Waffle House, Inc. et al., No. C81-609A, 1983 WL 2108 (N.D. Ga. Sept. 26, 1983) (experts testified about the different levels of management authority between unit managers and grill operators.).
5 See, e.g., Johnson, et al. v. Big Lots, Inc., 561 F. Supp. 2d 567 (E.D. La. 2008) (evaluating expert opinion, based on a survey of 558 respondents, regarding the job duties of class members).