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Anderson v. Equifax Information Services, LLC

United States District Court, D. Kansas

March 29, 2018




         Plaintiff Angela Anderson filed suit against Defendant Equifax Information Services, LLC alleging violations of the Fair Credit Report Act (“FCRA”).[1] This matter comes before the Court on Defendant's Motion to Exclude or Limit the Testimony of Plaintiff's Expert, Evan Hendricks (Doc. 38), filed on February 17, 2017. The motion is fully briefed and the Court is prepared to rule. For the reasons explained below, Defendant's motion to exclude is granted in part and denied in part.

         I. Factual and Procedural Background

         Plaintiff alleges in this matter that Defendant erroneously mixed her credit file with that of another consumer, Angela Bierman-Bogart, sold consumer credit reports that included information belonging to that other consumer, and failed to remove those accounts and information from her credit file in response to Plaintiff's numerous requests. Each of the two counts in the Complaint alleged Defendant violated three separate provisions of the FCRA relating to the investigative and reporting duties for credit reporting agencies (“CRAs”). Specifically, § 1681e(b) requires a CRA to follow reasonable procedures to ensure maximum accuracy, § 1681i requires a CRA to comply with certain reinvestigation requirements, and § 1681b requires a CRA to provide a consumer's credit file to companies only if it has determined there is a permissible purpose. Count I alleged negligent violations and Count II alleged willful violations of all three provisions.

         On August 3, 2017, this Court granted Defendant's motion for summary judgment on all three FCRA violations asserted in the Complaint. First, the Court concluded that the § 1681e(b) “maximum possible accuracy” and § 1681i(a) “reasonable investigation” claims were time-barred. Second, the Court determined that summary judgment on Plaintiff's § 1681b “permissible purpose” violation must be granted in Defendant's favor because Defendant did not provide a “consumer report” within the meaning of the statute.

         On November 13, 2017, the Court granted in part and denied in part Plaintiff's motion to alter or amend the judgment. The Court denied Plaintiff's motion as to her permissible purpose claim. The Court granted her motion as to her maximum possible accuracy and reasonable reinvestigation claims, finding that these claims are not time-barred and that genuine disputes of material fact remain as to her allegations of actual damages and the issue of willfulness. The Court declined to rule on Defendant's motion to exclude or limit the testimony of Plaintiff's expert in the course of ruling on Plaintiff's motion to alter or amend the judgment, but explained that it would reopen the motion after the pretrial conference and after this matter was reset for trial. The Court reopened Defendant's motion on January 10, 2018.[2]

         II. Legal Standard

         The Court has broad discretion in deciding whether to admit expert testimony.[3]


A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if:
(a) the expert's scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;
(b) the testimony is based on sufficient facts or data;
(c) the testimony is the product of reliable principles and methods; and
(d) the expert has reliably applied the principles and methods to the facts of the case.[4]

         The proponent of expert testimony bears the burden of establishing its admissibility.[5] In order to determine whether an expert opinion is admissible, the Court performs a two-step analysis. First, the court must determine whether the expert is qualified by “knowledge, skill, experience, training, or education” to render an opinion.[6] “The issue with regard to expert testimony is not the qualifications of a witness in the abstract, but whether those qualifications provide a foundation for a witness to answer a specific question.”[7]

         Second, the court “must determine if the expert's proffered testimony . . . has ‘a reliable basis in the knowledge and experience of his discipline.'”[8] To determine reliability, the Court must assess “whether the reasoning or methodology underlying the testimony is scientifically valid.”[9] Expert testimony may be based “upon professional studies or personal experience, ” so long as the expert “employs in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field.”[10] Although an expert opinion “must be based on facts which enable [him] to express a reasonably accurate conclusion as opposed to conjecture or speculation . . . absolute certainty is not required.”[11] And it is not necessary to prove that the expert is “indisputably correct, ” but only that the “method employed by the expert in reaching the conclusion is scientifically sound and that the opinion is based on facts which satisfy Rule 702's reliability requirements.”[12]

         The Supreme Court's opinion Daubert[13] sets forth a non-exhaustive list of four factors that the trial court may consider when conducting its inquiry under Rule 702: (1) whether the theory used can be and has been tested; (2) whether theory has been subjected to peer review and publication; (3) the known or potential rate of error; and (4) general acceptance in the scientific community.[14] But “the gatekeeping inquiry must be tied to the facts of a particular case.”[15]

         Occasionally, courts allow generalized expert testimony to be admitted to explain general or background information. The Advisory Committee's note to Fed.R.Evid. 702 explains that

it might be important in some cases for an expert to educate the factfinder about general principles, without ever attempting to apply these principles to the specific facts of the case. For example, experts might instruct the factfinder on the principles of thermodynamics, or bloodclotting, or on how financial markets respond to corporate reports, without ever knowing about or trying to tie their testimony into the facts of the case. . . . For this kind of generalized testimony, Rule 702 simply requires that: (1) the expert be qualified; (2) the testimony address a subject matter on which the factfinder can be assisted by an expert; (3) the testimony be reliable; and (4) the testimony “fit” the facts of the case.[16]

         It is within the discretion of the trial court to determine how to perform its gatekeeping function under Daubert.[17] The most common method for fulfilling this function is a Daubert hearing, although such a process is not specifically mandated.[18] In this case, the parties have not requested a hearing on this motion. The Daubert issues have been fully and thoroughly briefed by the parties. The Court has carefully reviewed the extensive exhibits filed with the motions, including the expert's written reports and deposition testimony. The Court finds this review is sufficient to render a decision without conducting an oral hearing.

         III. Discussion

         Defendant moves to exclude or limit the testimony of Plaintiff's expert, Evan Hendricks, arguing that he is not qualified to render an expert opinion and that his opinions are not reliable. Specifically, Defendant moves to exclude Hendricks's testimony regarding the following topics: (1) Defendant's procedures and “inner workings”; (2) Plaintiff's damages and damages typically suffered by victims of credit reporting violations; (3) Defendant's state of mind (i.e. whether any FCRA violations were willful); (4) legal opinions, such as the adequacy of Defendant's reinvestigation procedures; (5) prior cases involving Defendant and consent decrees Defendant has entered into; and (6) various factual issues. Plaintiff argues that Hendricks is qualified to testify as to each of these topics and that his opinions are reliable. The Court addresses the admissibility of Hendricks's opinions as to each topic.

         A. Defendant's Procedures

         Hendricks proposes to testify regarding Defendant's policies and procedures, including those related to reinvestigations. Specifically, Hendricks intends to testify as to how Defendant's matching algorithm operates, how Defendant relies on the Automated Consumer Dispute Verifcation (“ACDV”) exchange to reinvestigate when consumers dispute information in their credit files, Defendant's practice of “parroting, ” and problems with these procedures.

         Hendricks states in his report that he is qualified to testify about these topics based on (1) his experience of thirty-three years editing and publishing a biweekly newsletter that covered the credit reporting industry; (2) his authoring of a book focused on the credit reporting industry and co-authoring of a book with a chapter on credit reporting; (3) serving as an expert witness in FCRA litigation; (4) testifying before Congress and state legislatures, and presenting at continuing legal education events on credit reporting topics; (5) serving as an expert consultant to government agencies and credit reporting companies; and (6) his FCRA Certification from the National Credit Reporting Association (“NCRA”). Defendant argues Hendricks is not qualified to testify as to these topics. Defendant argues Hendricks does not possess any education, work experience, or training related to the operation of a CRA. Defendant contends that Hendricks's sole qualification is based on his experience as “a professional witness against Equifax, ”[19] which is not enough to satisfy the requirements of Rule 702.

         The Court finds Hendricks is qualified to testify about Defendant's policies within the context of policies of other CRA and the credit reporting industry. Hendricks's qualifications go beyond simply serving as a professional witness, and include more than thirty years covering the credit reporting industry. Through his experience, he has gained detailed knowledge of FCRA standards, indicia of mixed files, and CRAs' reinvestigation procedures. A layperson is likely not to have this detailed knowledge, and the Court finds that Hendricks's testimony regarding the nature of credit reports, FCRA standards, mixed files, and Defendant's “inner workings” would be helpful to the trier of fact in understanding both credit industry standards and Defendant's policies and procedures regarding mixed files.[20]

         As to the second prong of the Rule 702 analysis, Defendant argues Hendricks's proposed testimony is unreliable because it does not satisfy the four Daubert factors. Defendant contends that Hendricks does not attempt to explain his methods, his methods have not been subjected to testing or peer review, he provides no known rate of error, and his methods are not generally accepted in the scientific community. Defendant also generally argues that the facts Hendricks states in support of his opinions are inaccurate.

         As the Supreme Court has explained, there are “many different kinds of experts, and many different kinds of expertise.”[21] Because of this diversity, the Supreme Court has made clear that the “Rule 702 inquiry [is] ‘a flexible one, '” and that the factors set forth in Daubert “do not constitute a ‘definitive checklist or test.'”[22] While in some cases the Daubert factors may be ...

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