Antitrust Law Daily Wrap Up, TOP STORY—3d Cir.: Class certification vacated in blood reagent price fixing case, (Apr 8, 2015)

By Jeffrey May, J.D.

Challenged expert testimony that is critical to certification of a proposed class must satisfy the Daubert standard in order to demonstrate conformity with Federal Rule of Civil Procedure 23, the U.S. Court of Appeals in Philadelphia has decided. Today, the court vacated an order certifying a class of direct purchasers of blood reagents pursuing price fixing claims against Ortho Clinical Diagnostics, Inc., a major producer of the products. The district court had rejected Ortho's challenges to the plaintiffs' expert's methodologies and testimony. The case has been remanded for further proceedings (In Re: Blood Reagents Antitrust Litigation, April 8, 2015, Scirica, A.).

Background. The plaintiffs are direct purchasers of traditional blood reagents, which are products used to test blood compatibility between donors and recipients. They alleged that duopolists in the traditional blood reagent market—Ortho and Immucor, Inc.—engaged in a nationwide price fixing conspiracy that led to a dramatic increase in prices. Immuncor settled with the plaintiffs, but the case proceeded against Ortho. In seeking class certification, the plaintiffs relied in part on expert testimony to produce their antitrust impact analyses and damages models.

Over Ortho's objections to the testimony, the district court in 2012 certified plaintiffs’ class of “[a]ll individuals and entities who purchased traditional blood reagents in the United States directly from Defendants Immucor, Inc., and Ortho-Clinical Diagnostics, Inc. at any time from January 1, 2000 through the present.” Ortho appealed.

Comcast Corp. v. Behrend. Following the district court's class certification order, the U.S. Supreme Court issued its decision in Comcast Corp. v. Behrend, 133 S. Ct. 1426, 2013-1 Trade Cases ¶78,316. In Comcast, the High Court reversed a Third Circuit decision that the lower court had relied upon in granting class certification.

In light of Comcast, the Third Circuit panel has concluded that greater scrutiny of the expert testimony was required at the class certification stage. Scrutiny of expert testimony must be rigorous. It was not sufficient that the expert models “could evolve to become admissible evidence” at trial, as the lower court suggested.

If challenged, a plaintiff's expert testimony on class certification issues must satisfy the standard set out in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). “Expert testimony that is insufficiently reliable to satisfy the Daubert standard cannot 'prove' that the Rule 23(a) prerequisites have been met 'in fact,' nor can it establish 'through evidentiary proof' that Rule 23(b) is satisfied,” according to the court. The Seventh and Eighth Circuits call for similar scrutiny, it was noted.

Issues for remand. On remand, the lower court was to determine which of Ortho’s reliability attacks, if any, challenged those aspects of the plaintiffs’ expert testimony offered to satisfy Rule 23. If necessary, the lower court would then conduct a Daubert inquiry before assessing whether the requirements of Rule 23 had been met, the appellate court explained.

The case is No. 12-4067.

Attorneys: Richard E. Coe, Joanne C. Lewers, Chanda A. Miller, and Paul H. Saint-Antoine (Drinker, Biddle & Reath) for appellant Ortho Clinical Diagnostics, Inc. Jay S. Cohen, Jeffrey J. Corrigan, Rachel E. Kopp, and Jeffrey L. Spector (Spector, Roseman, Kodroff & Willis) for appellees.

Companies: Immucor, Inc.; Ortho Clinical Diagnostics, Inc.

MainStory: TopStory Antitrust DelawareNews NewJerseyNews PennsylvaniaNews