264 F.R.D. 150 (E.D.Pa. 2010), C. A. 03-6604, Behrend v. Comcast Corp.

Docket Nº:Civil Action 03-6604.
Citation:264 F.R.D. 150
Opinion Judge:PADOVA, District Judge.
Party Name:Caroline BEHREND, et al. v. COMCAST CORPORATION, et al.
Attorney:Carol A. Mager, Console Law Office LLC, Philadelphia, PA, Katherine T. Kelly, Heins Mills & Olson PLC, Minneapolis, MN, Stephen Shackelford, Jr., Susman Godfrey LLP, Dallas, TX, for Caroline Behrend. Alycia Regan Benenati, David M. Max, Dorit Ungar, James T. Cain, Michael E. Hagenson, Michael S. ...
Case Date:January 07, 2010
Court:United States District Courts, 3th Circuit, Eastern District of Pennsylvania
 
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264 F.R.D. 150 (E.D.Pa. 2010)

Caroline BEHREND, et al.

v.

COMCAST CORPORATION, et al.

Civil Action No. 03-6604.

United States District Court, E.D. Pennsylvania.

January 7, 2010

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Carol A. Mager, Console Law Office LLC, Philadelphia, PA, Katherine T. Kelly, Heins Mills & Olson PLC, Minneapolis, MN, Stephen Shackelford, Jr., Susman Godfrey LLP, Dallas, TX, for Caroline Behrend.

Alycia Regan Benenati, David M. Max, Dorit Ungar, James T. Cain, Michael E. Hagenson, Michael S. Shuster, Kasowitz, Benson, Torres & Friedman LLP, New York, NY, Burt M. Rublin, Jason A. Leckerman, Ballard Spahr Andrews & Ingersoll, LLP, Philadelphia, PA, for Comcast Corp.

MEMORANDUM

PADOVA, District Judge.

I. INTRODUCTION

Presently before the Court in this antitrust suit alleging violations of Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1, 2, is the Plaintiffs' Amended Motion for Class Certification. On May 3, 2007, the Court granted a motion to certify the class. However, following the decision of the United States Court of Appeals for the Third Circuit in In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305 (3d Cir.2008) (" Hydrogen Peroxide " ), we granted Comcast's motion to reconsider the certification decision and the putative Class (" the Class" ) filed the pending Amended Motion.

The only certification issue that remains in dispute is the requirement of Fed.R.Civ.P. 23(b)(2) that common issues of law and fact predominate. 1 To support its certification arguments, the Class has propounded the expert reports of Dr. Michael Williams 2 and Dr. Hal Singer.3 Its damages expert, Dr. James McClave, has also submitted reports to show class-wide damages.4 Comcast has responded with the expert reports of Dr. Tasneem Chipty 5 and Dr. David J. Teece.6

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The experts' opinions raise substantial issues of fact and credibility that we are required to resolve to decide the pending motion. See Peroxide, 552 F.3d at 316 (stating that the requirements of Rule 23 are not merely " pleading rules" and an " overlap between a class certification requirement and the merits of a claim is no reason to decline to resolve relevant disputes when necessary to determine whether a class certification requirement is met" ). Having rigorously analyzed the expert reports, as well as the testimony presented by the parties during a four-day evidentiary hearing, we conclude that the Class has met its burden to demonstrate that the element of antitrust impact is capable of proof at trial through evidence that is common to the class rather than individual to its members, and that there is a common methodology available to measure and quantify damages on a class-wide basis.

II. STANDARD OF REVIEW

A. Class Certification

In order to obtain class certification, a party must satisfy the four prerequisites of Rule 23(a) and show that the action can be maintained under at least one of the provisions of Rule 23(b).7 Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 613-14, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997). The Class in this case seeks certification under Rule 23(b)(3), which provides that certification is permissible if " the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3). The twin requirements of Rule 23(b)(3) are referred to as the predominance and superiority requirements. Comcast concedes that the Class satisfied the Rule 23(a) prerequisites and the Rule 23(b)(3) superiority requirement; the sole remaining issue is whether it satisfies the predominance requirement of Rule 23(b)(3).

Class certification is only appropriate " if the trial court is satisfied, after a rigorous analysis," that each requirement of Rule 23 has been met. Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982). " Class certification is an especially serious decision, as it ‘ is often the defining moment in class actions (for it may sound the " death knell" of the litigation on the part of plaintiffs, or create unwarranted pressure to settle nonmeritorious claims on the part of the defendants).’ " In re Constar Int'l Inc. Sec. Litig., 585 F.3d 774, 780 (3d Cir.2009) (quoting Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 259 F.3d 154, 162 (3d Cir.2001)).

The United States Court of Appeals for the Third Circuit has recently clarified what is meant by " rigorous analysis." Rigorous analysis requires " ‘ a thorough examination of the factual and legal allegations,’ " Hydrogen Peroxide, 552 F.3d at 316 (quoting Newton, 259 F.3d at 167), and the resolution of all legal or factual disputes relevant to Rule 23 by a preponderance of the evidence to " make findings that each Rule 23 requirement is met or is not met," id. at 320. In other words, we must find, based on " all relevant evidence and arguments presented by the parties," that " the evidence more likely than not establishes each fact necessary to meet the requirements of Rule 23." Id. The district court's findings, while conclusive with respect to class certification, do not bind the fact-finder on the merits. Id.; see also

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In re New Motor Vehicles Can. Exp. Antitrust Litig., 522 F.3d 6, 24 (1st Cir.2008); In re Initial Pub. Offerings Sec. Litig., 471 F.3d 24, 41 (2d Cir.2006) (" In re IPO " ); Unger v. Amedisys, Inc., 401 F.3d 316, 323 (5th Cir.2005).

Although a district court inquires into the merits of the case insofar as " arguments that go to the merits of a plaintiff's cause of action ... also implicate the class certification decision," Jackson v. Se. Pa. Transp. Auth., 260 F.R.D. 168, 184 (E.D.Pa.2009), such an inquiry is merely preliminary. Hydrogen Peroxide, 552 F.3d at 317. A plaintiff need not establish by a preponderance of the evidence the merits of its claims at the class certification stage, and any inquiry into the merits that is not necessary to a Rule 23 decision is precluded. Jackson, 260 F.R.D. at 184 (citing Newton, 259 F.3d at 166-67, and Hydrogen Peroxide, 552 F.3d at 317-18). However, the movant must do more than " assur[e] ... the court that it intends or plans to meet the requirements" of Rule 23. Hydrogen Peroxide, 552 F.3d at 318; see also Wachtel v. Guardian Life Ins. Co., 453 F.3d 179, 186 (3d Cir.2006) (holding that there must be " full and clear articulation of the litigation's contours at the time of class certification" ).

As with other matters relating to Rule 23 requirements, " [e]xpert opinion ... calls for rigorous analysis." Hydrogen Peroxide, 552 F.3d at 323, 325 (" Rule 23 calls for consideration of all relevant evidence and arguments, including relevant expert testimony of the parties." ). A district court must not uncritically accept expert opinion testimony " as establishing a Rule 23 requirement merely because [it] holds the testimony should not be excluded, under Daubert or any reason." Id. at 323. Performing a rigorous analysis may require the district court to weigh conflicting expert testimony at the certification stage and determine whether an expert's opinion is persuasive or unpersuasive. Id. at 323, 324 (noting that " a district court may find it unnecessary to consider certain expert opinion with respect to a certification requirement, but it may not decline to resolve a genuine legal or factual dispute" relevant to class certification); see also In re IPO, 471 F.3d at 42 (disavowing an earlier holding " that an expert's testimony may establish a component of a Rule 23 requirement simply by being not fatally flawed" ); Blades v. Monsanto Co., 400 F.3d 562, 575 (8th Cir.2005). The court must resolve expert disputes to the extent necessary to determine whether a Rule 23 requirement has been satisfied even if the dispute implicates the credibility of one or more experts. Id. at 324.

B. Rule 23(b)(3) Predominance Requirement

Predominance requires that " ‘ [i]ssues common to the class must predominate over individual issues.’ " Hydrogen Peroxide, 552 F.3d at 311 (quoting In re Prudential Ins. Co. Am. Sales Practice Litig., 148 F.3d 283, 313-14 (3d Cir.1998)). The district court must " consider whether plaintiff's legal claim, if plausible in theory, ‘ is also susceptible to proof at trial through available evidence common to the class.’ " Jackson, 260 F.R.D. at 184 (quoting Hydrogen Peroxide, 552 F.3d at 325). The district court's analysis of predominance " is especially dependent upon the merits of a plaintiff's claim," Constar, 585 F.3d 774, 2009 WL 3462032 at *3, since " the nature of the evidence that will suffice to resolve a question determines whether the question is common or individual." Hydrogen Peroxide, 552 F.3d at 311 (quoting Blades, 400 F.3d at 566). Accordingly, " ‘ a district court must formulate some prediction as to how specific issues will play out in order to determine whether common or individual issues predominate in a given case.’ " Id. (quoting In re New Motor Vehicles Can. Exp. Antitrust Litig., 522 F.3d 6, 20 (1st Cir.2008)).

Notwithstanding the Supreme Court's observation that " [p]redominance is a test readily met in certain cases alleging consumer or securities fraud or violations of the antitrust laws," Amchem, 521 U.S. at 625, 117 S.Ct. 2231, the district court should not " relax its certification analysis, or presume a requirement for certification is met, merely because a plaintiff's claims fall within one of those substantive categories." Hydrogen Peroxide, 552 F.3d at 322. Therefore, " the

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court should not suppress ‘ doubt’ as to whether a Rule...

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