Free Response to Motion - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No. 01-cv-2324-JLK-MEH CHARLES T. GREEN, PHILLIP R. WENTLAND AND MARILYN BREITHAUPT Plaintiffs, v. SEARS, ROEBUCK & COMPANY, a New York corporation, Defendant.

PLAINTIFFS' RESPONSE TO DEFENDANT'S MOTION TO EXCLUDE PLAINTIFFS' EXPERT WITNESS

Plaintiffs Charles T. Green, Phillip R. Wentland, and Marilyn Breithaupt, by and through their counsel, KING & GREISEN, LLP, hereby respond to Defendant's Motion to Exclude Plaintiffs' Expert Witness (#97)("Motion") as follows: I. INTRODUCTION In December of 2001, Plaintiffs filed their Complaint (#1) alleging that the termination of their employment with Defendant was motivated by unlawful age discrimination, in violation of the Age Discrimination in Employment Act of 1967, as amended ("ADEA"), 29 U.S.C. §§ 621 et seq. Green, Breithaupt, and Wentland had a combined ninety-three (93) years of service working for Sears as repair technicians. At the time of their terminations, they were fifty-nine (59), forty-eight (48) and fifty-three (53) years old, respectively. All three Plaintiffs received positive reviews, and all were

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ranked by their peers and managers as top technicians at the time of their termination from Sears. However, despite their excellent performance, top-rate training, Sears' certified skills and qualifications, and decades of loyal and dedicated service, in the Spring of 2000 Plaintiffs were advised by Sears they had not been selected for positions at the new Aurora facility. Sears used a brief and subjective interview process to create a justification for firing Plaintiffs, a process manipulated to guarantee the desired outcome. Sears then hired younger, less qualified employees from both inside and outside of its organization to replace these invaluable employees. A Settlement Conference is scheduled for December 1, 2006 with Magistrate Judge Michael E. Hegarty. The Final Trial Preparation Conference is scheduled for January 17, 2007 before Judge John L. Kane. A ten (10) day Jury Trial is set for January 29, 2007 before Judge John L. Kane. Plaintiffs endorsed one expert, Dr. Jane H. Lillydahl, Ph. D., a well-respected economist and statistician, to quantify Plaintiffs' economic losses as a result of their termination from Defendant. Dr. Lillydahl is a seasoned professional who has been retained as an expert in over ninety (90) court cases, and has been qualified and given testimony as an expert at trial and in arbitrations in more than forty-five (45) cases since 1982. See Exhibit 1, Dr. Lillydahl's CV. Dr. Lillydahl earned her Ph.D. in Economics from Duke University and her major fields of study were labor economics, demography, and economic development. Id. She is currently a consultant, and an Adjunct Professor in the Department of Economics at the University of Colorado, having previously worked as a Professor in the Department of Economics at the University of

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Colorado. Id. Dr. Lillydahl is a prolific author in her area of expertise, economics, and also presently serves as a reviewer for numerous scholarly journals and publishers. Id. In this case, relying on her economic expertise, Dr. Lillydahl performed an economic loss analysis, and found that Plaintiffs had suffered economic losses as a result of their alleged wrongful terminations. See generally Exhibit 2, Dr. Lillydahl's Report. On October 23, 2006, Defendant moved to strike Dr. Lillydahl as Plaintiffs' expert witness. Motion (#97). Defendant seeks to exclude Dr. Lillydahl's prospective testimony at trial because she is not a vocational rehabilitation expert, not a mitigation expert, but is instead a traditional labor economist. See generally Motion, p.5-6. Proceeding on a limited and flawed assumption about the matters in which Dr. Lillydahl is qualified to opine as an economist, Defendant's Motion improperly suggests that the Court's Daubert1 "gatekeeping" function be turned on its head -- in favor of a policy establishing a two- or three-tier expert requirement in employment discrimination cases. In making its argument, Defendant also seeks a shifting of its burden of proof in this case -- on its affirmative defense of a failure to mitigate -- onto these Plaintiffs. Further, in preparing for a rigorous cross-examination of Dr. Lillydahl at trial, Defendant deposed Dr. Lillydahl, and pressed her repeatedly for her opinions regarding the credibility of Defendant's designated experts. Under this tactical squeeze, Dr. Lillydahl revealed numerous inaccuracies and flawed assumptions of Defendant's "experts." By attacking Dr. Lillydahl here, Defendant is simply scrambling to put the toothpaste back in the tube.

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Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993)

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II.

ARGUMENT

A. The Applicable Legal Standard Federal Rule of Evidence 702 authorizes "a witness qualified as an expert by knowledge, skill, experience, training, or education," to give testimony if "scientific, technical or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue." Fed. R. Evid. 702. In evaluating a proffer of expert testimony pursuant to Federal Rule of Evidence 702, the Court possesses "latitude in deciding how to test an expert=s reliability, and to decide whether or when special briefing or other proceedings are needed to investigate reliability." Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999); see also See Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 596 (1993). Additionally, a trial court=s exercise of its Daubert gate-keeping function is reviewed for abuse of discretion. Gen. Elec. Co. v. Joiner, 522 U.S. 136, 139, 118 S. Ct. 512, 515 (1997); Goebel v. Denver and Rio Grande Western R.R., 215 F.3d 1083, 1087 (10th Cir. 2000). In deciding whether to admit expert testimony, the court must determine whether the testimony has "a reliable basis in the knowledge and experience of [the relevant] discipline." Dodge v. Cotter Corp., 328 F.3d 1212, 1222 (10th Cir. 2003)(quoting Kumho Tire Co. v. Carmichael, 526 U.S. 137, 149 (1999)(quoting Daubert, supra))(omission in original)(emphasis added). B. Defendant has not challenged the reliability or relevance of Dr. Lillydahl's testimony as an economist, but has instead sought to have the Court judge her as a vocational rehabilitationist and mitigation expert. The purpose of Daubert was to rid the courts of "junk science." G.E. Co. v. Joiner, 522 U.S. 136, 153 (1997) (Stevens, J. concurring in part and dissenting in part). In Daubert, the United States Supreme Court required trial courts to act as gatekeepers in
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order to ensure that proffered expert testimony is both reliable and relevant. Daubert, 509 U.S. at 589 (emphasis added). Under this two pronged standard, the Court must "assess the reasoning and methodology underlying the expert=s opinion, and determine whether it is scientifically valid and applicable to a particular set of facts." Goebel, supra, 215 F.3d at 1087 (citing Daubert at 592). Defendant concedes that "[Dr.] Lillydahl is an economist and mathematician." Motion, p. 2. The reliability of Dr. Lillydahl's economic analysis and opinion is largely unchallenged, and is unquestionably relevant to proving Plaintiff's case. Defendant merely derides Dr. Lillydahl's expert economic opinion as an unhelpful, "simplistic calculation"2 solely because it lacks, Defendant claims, an expert "vocational job analysis" or "mitigation related analysis" component. Motion, p. 2, 7. Defendant rails against Dr. Lillydahl because she "has never been qualified as an expert in the areas of vocational job analysis or damages mitigation," "has no formal training in vocational assessment," "has never been qualified as an expert witness in vocational assessment," and "was not retained to perform any vocational or mitigation related analysis." Motion, p. 2, 4 (emphasis added). The implication of these assertions is that Plaintiffs should be required to engage experts in these fields of "expertise" as well as retaining an economist. Defendant would have the Court require Plaintiffs to engage multiple expert witnesses -- economists, "vocational rehabilitationists" -- and even "mitigation
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Inasmuch as Defendant's reference to a "simplistic calculation" refers to an economic analysis, the Tenth Circuit appears to have long disagreed. See EEOC. v. Lee Way Motor Freight, Inc., 625 F.2d 918, 932 (10th Cir. 1979)(observing the "complexity" of the compensation problem). Defendant suggests that Dr. Lillydahl's proffered testimony must be "helpful" within its common meaning. Motion, p. 3, 7. However, Rodriguez-Felix, as cited by Defendant, states plainly and with authority that the "assist the trier of fact" factor of Fed. R. Evid. 702 "goes primarily to relevance." Rodriguez-Felix, 450 F.3d at 1123 n. 1 (quoting Daubert, 509 U.S. at 591).

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experts" -- to prosecute their claims. This unprecedented position would open the doors to all manner of "junk science," taxing judicial economy, and unnecessarily burdening plaintiffs with excessive -- and prohibitive -- additional costs. Defendant seeks to pervert the Daubert "gatekeeping" function to unnecessarily increase the costs of litigation, effectively closing the courthouse doors to prospective plaintiffs in employment discrimination cases. Requiring plaintiff in this type of case to produce a vocation rehabilitationist or mitigation expert is unprecedented, and appropriately so.3 Plaintiffs' review of the relevant caselaw failed to reveal anything other than the occasional requirement of such testimony in disability and personal injury cases where a physical impairment or injury has been alleged as a significant impediment to future employment, such as in Elcock, a Third Circuit slip-and-fall case cited by Defendant. This is an age discrimination in employment case. Plaintiffs presume that Defendant is not making the blanket assertion that reaching a certain age classifies one as impaired. Likewise, "mitigation expert" is a term usually reserved for appeals of criminal offenses; Defendants may wish otherwise, but complaining of age discrimination is not yet a capital offense. C. Defendant seeks to shift their burden of an affirmative defense onto Plaintiffs. Plaintiffs unquestionably have a legal duty to reasonably mitigate, and to offer some evidence of reasonable diligence in making their prima facie case of age discrimination. Sandia Corp., 639 F.2d at 627. Defendant has asserted a failure to mitigate damages as a full or partial defense to Plaintiffs' claims. Answer (#4), p. 5. Mitigation or failure to mitigate is an affirmative defense . . . and the defendant bears
In Elcock, the Third Circuit observed, "vocational rehabilitation is a social science that does not exactly mirror the fundamental precepts of the so-called harder sciences." Elcock v. Kmart Corp., 233 F.3d 734, 747 (3rd Cir. 2000)(cited by Motion at p. 4).
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the burden of proving the defense." Garcia v. Wal-Mart Stores, Inc., 209 F.3d 1170, 1174 (10th Cir. 2000)(finding no error for failing to instruct the jury on a mitigation defense where defendant offered no evidence in support of the defense). The parties' respective burdens are not the same, and Defendant seeks an effective shifting of its burden onto Plaintiffs. In making their prima facie case of age discrimination, Plaintiffs' "reasonable diligence" need not be shown by Dr. Lillydahl's economic damages testimony. In Praseuth, the Tenth Circuit upheld a finding for Plaintiffs on this question, deeming as sufficient evidence that "[plaintiff] applied for several jobs, searched classified job advertisements, and made monthly visits to the Kansas Job Services Offices." Praseuth v. Rubbermaid, Inc., 406 F.3d 1245, 1253 (10th Cir. 2005). In another case, Plaintiffs' burden was found sufficiently satisfied where the only evidence of "reasonable diligence" in mitigation was a plaintiff's testimony describing his efforts to find work by "submitting applications and resumes." Spulak v. K-Mart Corp., 894 F.2d 1150, 1158 (10th Cir. 1990); see also Nord v. U.S. Steel Corp., 758 F.2d 1462, 1472 (11th Cir. 1985)(upholding a determination of plaintiff's diligence based solely on plaintiff's testimony and an assessment of plaintiff's credibility). "Once a prima facie case of discrimination and resulting damage has been established, the defendant bears the burden of demonstrating that the plaintiff's conduct was so unreasonable as to constitute a failure to mitigate damages." Shore v. Federal Express Corp., 777 F.2d 1155, 1158 (6th Cir. 1985)(emphasis added). The burden on Defendant to prove its affirmative defense is a more specific, multi-pronged inquiry. To prove the affirmative defense of failure to mitigate, "the employer must establish that:

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(1) there were suitable positions which the claimants could have discovered and for which they were qualified, and (2) the claimants failed to use reasonable diligence in seeking such positions." Aguinaga v. United Food and Commercial Workers Int'l Union, 993 F.2d 1463, 1474 (10th Cir. 1993)(citing EEOC v. Sandia Corp., 639 F.2d 600, 627 (10th Cir. 1980)). Defendant criticizes Dr. Lillydahl's economic opinion because, in essence, she allegedly did not opine with the factual specificity needed to prove or disprove their affirmative defense. Defendant's critique is that Dr. Lillydahl did not offer an expert analysis of specific available jobs for which Plaintiffs were qualified, and the ability of Plaintiffs to discover them. Motion, p. 6-7. Plaintiffs are not required to offer such detailed analysis in their case in chief, and are certainly not required to offer Dr. Lillydahl as an expert on Defendant's behalf to prove Defendant's affirmative defense. In fact, Dr. Lillydahl's economic analysis and opinion is competent and comprehensive, and Defendant wishes to exclude Dr. Lillydahl because of deposition testimony that Defendant solicited from her, and with which they are dissatisfied. D. Defendant's objection goes to credibility, not admissibility. As a general rule, all questions regarding the reliability of the expert=s opinions, including conflicting evidence, the viability of the assumptions on which the expert opinions are based, deviation from generally accepted methodologies, and the expert=s credibility, go to the weight to be afforded that testimony, not its admissibility. See, e.g., Lutz Farms v. Asgrow Seed Co., 948 F.2d 638, 647-48 (10th Cir. 1991); see also Bright v. Land-O-Lakes, Inc., 844 F.2d 436, 441 (7th Cir.

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1988)("Experience and knowledge establish the foundation of an expert=s testimony; the accuracy of such testimony is a matter of weight and not admissibility"). As such, a party=s remedy for the alleged unreliability of an opponent=s expert opinions is cross-examination regarding those alleged shortcomings, and not exclusion. The Supreme Court explicitly recognized this principle in Daubert. See Daubert, 509 U.S. at 596 ("Vigorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence"). 1. Defendant has demonstrated an ability to cross-examine Dr. Lillydahl, and is dissatisfied with the result. Defendant solicited testimony in their deposition of Dr. Lillydahl, and it was not favorable to its vocational rehabilitation / mitigation theory of its affirmative defense. Dr. Lillydahl is not a "vocational rehabilitationist" or "mitigation expert" and does not claim to be. As an economist, she is, in fact, better qualified to opine on the opinions of Defendant's "experts" -- Ruth and Saltzman -- inasmuch as they purport to offer economic analysis of relevant foundational facts. Dr. Lillydahl testified that Ruth's assumptions regarding wage growth and Ruth's assignment of Green into a 75th percentile earnings category were "pretty rosy" and illogical. Exhibit 3, Dr. Lillydahl Deposition, p. 83 l. 9 ­ p. 84 l. 12. On Defendant's solicitation, Dr. Lillydahl called into question Ruth's assumptions regarding wage increase percentages. Id. at p. 85 l. 10-20. She also pointed out discrepancies between her economic analysis and the "vocational rehabilitation analysis" of Ruth, inasmuch as Ruth's calculations deviated from Plaintiff Breithaupt's income tax records. Id. at p. 85 l. 21 ­ p. 87 l. 13. Dr. Lillydahl also questioned Wentland's assignment of a ninety (90)

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percent salary comparability analysis of allegedly-available jobs, where no actual salary information existed4; Dr. Lillydahl opined that, from an economic analysis standpoint, employment is not fairly considered "comparable" if "you don't know the salary." Id. at p. 93 l. 1 ­ p. 94 l. 6. Dr. Lillydahl's deposition testimony also challenged Wentland's calculations, including Wentland's use of consumer growth figures instead of wage growth figures, and his discounting of past earnings to present value. Id. at p. 96 l. 23 ­ p. 98 l. 15. 2. Defendant incorrectly asserts that Dr. Lillydahl's methodologies are somehow lacking. As demonstrated above, Dr. Lillydahl has considered --albeit from an economic perspective -- "other expert's vocational and mitigation analysis." See also Exhibit 3, Dr. Lillydahl Deposition, p. 77 l. 23 ­ p. 78 l. 8. Dr. Lillydahl has properly offered economic opinions from her perspective as an economist, and has not ventured into the "softer science"5 of vocational rehabilitation. Dr. Lillydahl did, in fact, give due consideration to the peculiarities of each Plaintiff. See e.g., Exhibit 3, Dr. Lillydahl's Report, p. 30 l. 20 ­ p. 31 l. 24, p. 111 l. 1 ­ p. 112 l. 7, p. 115 l. 4-12. She accorded them appropriate weight in rendering her economic analysis, and critiqued Defendant's experts for giving them too much weight. Id. As for Dr. Lillydahl's methodology, Defendant begrudgingly concedes that she did factor in "the amount Plaintiffs have actually earned since being laid off." Motion, p. 2. This stands in contrast to the supposed "expert" in Elcock, who ignored actual,
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This manufacturing of facts out of whole cloth was the basis for excluding economic opinion in Elcock. Elcock, supra, 233 F.3d at 738, 755-756 (economic model "relied on assumptions wholly without foundation in the record," including subjects earning "twice his annual income" in the years before his personal injury, and using other made up numbers when actual "concrete numbers" of actual earnings existed). 5 Elcock, supra.

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available "concrete numbers." Elcock, supra, 233 F.3d at 755-56. The only factual challenge to Dr. Lillydahl's economic analysis that can be gleaned from Defendant's Motion is Defendant's characterization of supposed "undisputed" facts. Motion, p. 3. Defendant states that Plaintiff Wentland has "dropped out of the labor force" on two occasions since "leaving" Sears. Id. Defendant solicited Dr. Lillydahl's testimony in regards to these facts, and she testified that she had factored this into her analysis. Exhibit 3, Dr. Lillydahl Deposition, p. 40 l. 19 - 43 l. 1-25. What Defendant did not like is that Dr. Lillydahl correctly noted that on both of those occasions, had Plaintiff Wentland still been working at Sears, he would have continued to receive income from Sears. Id. Similarly, Defendant contends that Plaintiff Breithaupt "chose to begin a new career" as a matter of personal choice. Motion, p. 3. Dr. Lillydahl strongly critiqued this characterization, as it appeared in Saltzman's report. Exhibit 3, Dr. Lillydahl Deposition, p. 105 l. 16 ­ p. 106 l. 8. Defendant is clearly unsatisfied, having solicited from Dr. Lillydahl a solid critique of its own "experts" and their methodologies. However, the appropriate resolution of disagreement among persons designated as "experts" is crossexamination, not exclusion. III. CONCLUSION In requiring Dr. Lillydahl's testimony to incorporate some detailed vocational rehabilitation assessment or mitigation-related analysis of specific available jobs, Defendant seeks to burden Plaintiffs and the Court with the need for multiple experts, and with Defendant's own burden of proof on an affirmative defense of a failure to mitigate.

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Defendant asked for Dr. Lillydahl's opinion, and counsel was simply chagrined when they got it. For all these reasons, Defendant's Motion should be denied.

DATED this 13th day of November 2006. Respectfully submitted, KING & GREISEN, LLP

By: s/ Diane S. King______________ Diane S. King 1670 York Street Denver, Colorado 80206 (303) 298-9878 (303) 298-9879 (fax) [email protected] Attorneys for Plaintiff

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CERTIFICATE OF SERVICE I hereby certify that on this 13th day of November 2006, that I electronically filed the foregoing PLAINTIFFS' RESPONSE TO DEFENDANT'S MOTION TO EXCLUDE PLAINTIFFS' EXPERT WITNESS with the Clerk of Court using the CM/ECF system which will send notification of such filing to the following: Daniel E. Friesen [email protected] Thomas Leland [email protected]

_s/ Dianne Von Behren_______ Dianne Von Behren, Paralegal

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