Stuart v. Global Tel*Link Corporation
MEMORANDUM OPINION AND ORDER granting 90 Motion to Intervene; denying 101 Motion to Exclude; denying 103 Motion for Partial Summary Judgment; granting 109 Motion to Amend/Correct; denying 112 Motion to Strike.The Clerk of the Court is directed to add Rocky Hobbs as a named plaintiff in this action upon such Complaints filing. Signed by Honorable Timothy L. Brooks on November 29, 2016. (rg)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
IN RE GLOBAL TEL*LINK
CORPORATION ICS LITIGATION
CASE NO. 5:14-CV-5275
MEMORANDUM OPINION AND ORDER
Currently before the Court are:
Plaintiffs Kaylan Stuart’s, Dustin Murilla’s, and Walter Chruby’s Motion to Amend
Class Action Complaint (Doc. 109), and Defendant Global Tel*Link Corporation’s
(“GTL”) Opposition (Doc. 117);
GTL’s Motion for Partial Summary Judgment (Doc. 103), Memorandum of Law in
Support (Doc. 104), and Statement of Undisputed Material Facts in Support (Doc.
105); all parties’ jointly Proposed Stipulation and Order (Doc. 108); Plaintiffs’
Response in Opposition to GTL’s Motion for Partial Summary Judgment (Doc. 115)
and Response to GTL’s Statement of Undisputed Material Facts and Responsive
Statement of Undisputed Facts (Doc. 114); and GTL’s Reply (Doc. 118);
Intervenor Rocky Hobbs’s Motion to Intervene (Doc. 90) and Memorandum of Law
in Support (Doc. 91); GTL’s Objection and Response (Doc. 94); and Mr. Hobbs’s
Reply (Doc. 96);
GTL’s Motion to Exclude Dr. Tardiff’s Expert Report (Doc. 101) and Memorandum
of Law in Support (Doc. 102); Plaintiffs’ Response in Opposition (Doc. 111); and
GTL’s Reply (Doc. 120); and
Plaintiffs’ Motion to Strike Portions of the Expert Report of Roy J. Epstein, Ph.D.
(Doc. 112) and Memorandum of Law in Support (Doc. 113); and GTL’s Opposition
For the reasons given below, Plaintiffs’ Motion to Amend Class Action Complaint (Doc.
109) is GRANTED, GTL’s Motion for Partial Summary Judgment (Doc. 103) is DENIED,
Mr. Hobbs’s Motion to Intervene (Doc. 90) is GRANTED, GTL’s Motion to Exclude Dr.
Tardiff’s Expert Report (Doc. 101) is DENIED, and Plaintiffs’ Motion to Strike Portions of
the Expert Report of Roy J. Epstein, Ph.D. (Doc. 112) is DENIED.
I. Plaintiffs’ Motion to Amend Class Action Complaint (Doc. 190), and
GTL’s Motion for Partial Summary Judgment (Doc. 103)
Paragraph 6 of Plaintiffs’ Amended Consolidated Class Action Complaint (Doc. 47)
currently reads, in relevant part, as follows:
Mr. Murilla paid unjust and unreasonable telephone charges during his term
of incarceration at Minnesota Correctional Facility – Moose Lake, which is
part of the Minnesota DOC, for interstate calls he made during the Class
Period to persons located in Texas using telecommunications services
operated by Defendant between August 2010 and March 2011.
Plaintiffs and GTL recently stipulated to class periods for each count in the Complaint,
and these newly-stipulated class periods exclude the telephone calls referenced in this
paragraph. See Doc. 108. In order to ensure that their Complaint pleads conduct that
falls within the newly-stipulated class periods with respect to each named Plaintiff,
Plaintiffs seek leave to amend paragraph 6 to read thus:
Mr. Murilla paid unjust and unreasonable telephone charges during his time
of incarceration at Minnesota Correctional Facility – Rush City, which is part
of the Minnesota DOC, for at least one interstate call he made during the
Class Period, using telecommunication services operated by Defendant,
including a call made on May 22, 2013.
(Doc. 109, p. 2).
Fed. R. Civ. P. 15(a)(2) states that “a party may amend its pleading only with the
opposing party’s written consent or the court’s leave. The court should freely give leave
when justice so requires.” GTL has withheld consent, see Doc. 117, so the issue here is
whether “justice so requires.” The Eighth Circuit has stated that “leave to amend . . .
should normally be granted absent good reason for a denial,” and explained further that
“[t]he classic ‘good reasons’ for rejecting an amendment are: ‘undue delay, bad faith or
dilatory motive, repeated failure to cure deficiencies by amendments previously allowed,
undue prejudice to the non-moving party, or futility of amendment.’” Popp Telcom v. Am.
Sharecom, Inc., 210 F.3d 928, 943 (8th Cir. 2000) (quoting Thompson-El v. Jones, 876
F.2d 66, 67 (8th Cir. 1989)). Although the “decision whether to permit an amendment of
the pleadings” is committed to the trial court’s discretion, “reviewing courts have found an
abuse of discretion in cases where the district court denied amendments based on facts
similar to those comprising the original complaint.” Id. Furthermore, “[t]he inclusion of a
claim based on facts already known or available to both sides does not prejudice the nonmoving party.” Id. However, “[w]here an amendment would likely result in the burdens
of additional discovery and delay to the proceedings, a court usually does not abuse its
discretion in denying leave to amend.” Id.
GTL offers three arguments in opposition to Plaintiffs’ Motion: that their proposed
amendment is untimely, that it is futile, and that permitting it would be unduly prejudicial.
The Court disagrees on all three points. Regarding timeliness: the Court’s scheduling
orders in this case have not yet imposed any deadlines for amendment of pleadings, see,
e.g., Doc. 78, and Plaintiffs filed the instant Motion on the very same day that the parties
filed the joint stipulation which necessitated it, see Docs. 108, 109.
As for undue
prejudice: Plaintiffs base their new allegation on “phone records produced by GTL during
discovery that Plaintiff Murilla did pay for a May 2013 call from Minnesota Correctional
Facility – Rush City”—and as noted in the preceding paragraph, “[t]he inclusion of a claim
based on facts already known or available to both sides does not prejudice the nonmoving party.” Popp Telcom, 210 F.3d at 943.
Turning finally to the issue of futility: although arguments over futility of amended
pleadings are ordinarily evaluated under the standard applicable to Rule 12(b)(6) motions
to dismiss, GTL contends that futility may be evaluated instead under the summary
judgment standard when the record is sufficiently developed and a summary judgment
motion is pending. See Doc. 117, pp. 8–9 (citing ITT Educ. Servs., Inc. v. AP Consol.
Theatres II Ltd. P’ship, __ F. Supp. 3d __, 2016 WL 3945267, at *9 (E.D. Ark. July 19,
2016)). 1 Here, there is indeed a pending Partial Motion for Summary Judgment (Doc.
103) filed by GTL, which the parties agree their joint stipulation has mooted in all respects
except as to this sole issue of futility. See Doc. 108, p. 2; Doc. 115, pp. 2–4. “The court
shall grant summary judgment if the movant shows that there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ.
P. 56(a). The Court must view the facts in the light most favorable to the non-moving
party, and give the non-moving party the benefit of any logical inferences that can be
drawn from the facts. Canada v. Union Elec. Co., 135 F.3d 1211, 1212–13 (8th Cir. 1997).
The moving party, GTL, bears the burden of proving the absence of any material factual
GTL does not contend that Plaintiffs’ proposed amendment would be futile under the
ordinary Rule 12(b)(6) standard, and if GTL had so contended, the Court would have
disagreed. Plaintiffs’ proposed amendment, accepted as true for the purposes of futility
analysis, obviously states a claim on which relief may be granted.
disputes. Fed. R. Civ. P. 56(c); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475
U.S. 574, 586-87 (1986); Nat’l Bank of Commerce of El Dorado, Ark. v. Dow Chem. Co.,
165 F.3d 602 (8th Cir. 1999). If GTL meets this burden, then Plaintiffs must “come forward
with ‘specific facts showing that there is a genuine issue for trial.’” Matsushita, 475 U.S.
at 587 (quoting Fed. R. Civ. P. 56(c)).
These specific facts must be “such that a
reasonable jury could return a verdict for the nonmoving party.” Allison v. Flexway
Trucking, Inc., 28 F.3d 64, 66 (8th Cir. 1994) (quoting Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 248 (1986)).
GTL points to Mr. Murilla’s deposition testimony that he made no interstate phone
calls after 2010 while incarcerated, and asserts that “Plaintiffs have no evidence to
support their claim that Murilla made and paid for an interstate call in 2013.” See Doc.
118, pp. 2–3. Of course this is not strictly correct because, as previously mentioned,
GTL’s own billing records indicate, at a minimum, that Mr. Murilla was billed for a 2013
interstate call. GTL counters that while these records “merely show that Murilla was
billed for this call,” they do “not show whether he (or anyone else) actually paid for the
call.” Id. at 3 (emphasis in original). But this argument misapplies the summary judgment
legal standard, which requires the Court to view the record in the light most favorable to
Plaintiffs and to give them the benefit of any reasonable inferences that can be drawn
therefrom. Besides the testimony to which GTL points, Mr. Murilla also testified that he
believes he “paid excessively high phone rates . . . [t]hroughout [his] incarceration,” see
Doc. 106-9, p. 9, lines 9:1–9:3, at “[a]ll the DOC correctional facilities” where he has been
incarcerated, see id. at 12, lines 16:5–16:7; that he has paid his phone bills through his
commissary account, see id. at 15, lines 38:2–38:13; and that he cannot remember all of
the calls he has made, see id. at 26, lines 74:17–74:21. A juror could consider the
aforementioned billing records in the context of Mr. Murilla’s entire testimony and
reasonably infer that he made, and paid for, an interstate call in 2013 that he was unable
to specifically remember. In other words, there is a material dispute of fact on this point
which renders summary judgment inappropriate.
GTL makes one other argument in support of futility: that Mr. Murilla’s injuries from
the 2013 call, even if proven, would amount to no more than 64 cents which, under the
common-law doctrine of “de minimis non curat lex,” is a trifle with which the law should
not concern itself. See, e.g., Smith v. Altier, 184 Minn. 299, 301–02, 238 N.W. 479 (1931);
Rauhoff v. Henry Gramling & Co., 42 F. Supp. 754, 756–57 (E.D. Ark. 1941). But Murilla
seeks not only to recover his 64 cents, but also to represent a nationwide putative class
of similarly situated individuals. This Court is of the opinion that whatever may be said of
the significance of 64 cents in isolation, a mountain of trifles is not itself a trifle.
Accordingly, Plaintiffs’ Motion to Amend Class Action Complaint (Doc. 190) is GRANTED,
and GTL’s Motion for Partial Summary Judgment (Doc. 103) is DENIED.
II. Mr. Hobbs’s Motion to Intervene (Doc. 90)
Rocky Hobbs has moved to intervene as a named plaintiff in this action, under Fed.
R. Civ. P. 24. See Doc. 90. Rule 24 provides for intervention of right, as well as for
permissive intervention. Mr. Hobbs argues that intervention is appropriate under either
of these avenues; GTL disagrees on both points.
The Court finds that permissive
intervention is warranted, and therefore does not reach the issue of intervention of right.
Rule 24(b)(1)(B) states that “[o]n timely motion, the court may permit anyone to
intervene who . . . has a claim or defense that shares with the main action a common
question of law or fact.”
However, Rule 24(b)(3) cautions that “[i]n exercising its
discretion, the court must consider whether the intervention will unduly delay or prejudice
the adjudication of the original parties’ rights.” Courts must “construe Rule 24 liberally
and resolve any doubts in favor of the proposed intervenors.” United States v. Ritchie
Special Credit Invs., Ltd., 620 F.3d 824, 831 (8th Cir. 2010) (quoting Kan. Pub. Emps.
Ret. Sys. v. Reimer & Koger Assoc., Inc., 60 F.3d 1304, 1307 (8th Cir. 1995)). “The issue
of the timeliness of a motion to intervene is a threshold issue” which is also committed to
this Court’s discretion, and must be “determined by considering all the circumstances of
the case.” Id. at 831–32. The factors to be considered include: “(1) how far the litigation
had progressed at the time of the motion for intervention, (2) the prospective intervenor’s
prior knowledge of the pending action, (3) the reason for the delay in seeking intervention,
and (4) the likelihood of prejudice to the parties in the action.” Id. at 832 (alteration
brackets removed). But “[a]s a general rule, intervention in a class action is considered
timely if it is sought prior to the time for opting out of the proposed class following
certification.” Hershey v. ExxonMobil Oil Corp., 278 F.R.D. 617, 620 (D. Kan. 2011) (citing
In re Cmty. Bank of N. Va. Second Mortg. Loan Litig., 418 F.3d 277, 314 (3d Cir. 2005)).
Here, intervention has been sought well before any deadline for opting out of the
proposed class. Indeed, no such deadline even exists yet, as class certification has not
even occurred; a motion on that issue is currently pending. See Doc. 92. And although
Mr. Hobbs’s counsel, who is also counsel for Plaintiffs in this action, has of course known
of this case from its inception, see In re Wholesale Grocery Prods. Antitrust Litig., 2015
WL 4992363, at *9 (D. Minn. Aug. 20, 2015) (imputing counsel’s knowledge of case to
intervenor because counsel had “participated in this case since its inception”), Mr. Hobbs
is seeking intervention in order to shore up potential deficiencies in class representation
that only arose less than three months before he filed the instant Motion, when Maryum
Cooper withdrew as a named plaintiff in this action. See Doc. 85; Doc. 91, p. 2.
As for prejudice to the existing parties, the Court believes none exists. GTL argues
there is prejudice because the addition of Mr. Hobbs as a named party would raise new
issues beyond those raised by the existing plaintiffs, and would cause additional
discovery, motion practice, and delay. However, the “new” issues identified by GTL—
claims arising after a particular 2013 Federal Communications Commission order was
issued, claims arising from the use of pre-paid accounts rather than from inmate debit
calls, and the enforceability of individual arbitration agreements—were already implicated
by the class that Plaintiffs sought to represent in their Amended Consolidated Class
Action Complaint, before Mr. Hobbs ever attempted to intervene. See Doc. 47, ¶ 45
(seeking to represent a class consisting of “all persons in the United States who, at any
time since 2000, have paid to use the telephone systems provided by GTL . . .”). If the
Court certifies a class with Mr. Hobbs as a class representative, then the Court will permit
GTL to conduct discovery into his adequacy as a class representative while the parties
conduct their general merits discovery; and if any currently unforeseeable problems with
Mr. Hobbs’s adequacy as a class representative are discovered, then the Court will
entertain an appropriate motion at that time. Cf. Hervey v. City of Little Rock, 787 F.2d
1223, 1227 (8th Cir. 1986) (“The court’s duty to assure compliance with Rule 23(a)
continues even after certification . . . .”); Fed. R. Civ. P. 23(c)(1)(C) (“An order that grants
or denies class certification may be altered or amended before final judgment.”). To
whatever extent necessary to prevent delay, the Court will impose appropriate deadlines
in its Final Case Management Order.
After considering all the circumstances of this case, then, the Court concludes in
its discretion that Mr. Hobbs’s Motion to Intervene is timely, and that his intervention would
not unduly delay or prejudice the adjudication of the original parties’ rights. The Court
further finds that Mr. Hobbs obviously has a claim that shares with the main action a
common question of law or fact. Therefore, given the liberal construction of Rule 24 that
the Eighth Circuit requires, see Ritchie Special Credit Invs., 620 F.3d at 831, the Court
will exercise its discretion to GRANT Mr. Hobbs’s Motion to Intervene (Doc. 90) under
Fed. R. Civ. P. 24(b)(1)(B).
III. Motions to Exclude or Strike Expert Reports (Docs. 101 and 112)
GTL has filed a Motion to Exclude the expert report of Plaintiffs’ class certification
expert, Timothy J. Tardiff, Ph.D. (Doc. 101). In its Motion, GTL asks this Court not to
consider Dr. Tardiff’s expert report and testimony “at the class certification stage or at any
other stage of this litigation” because his opinions “are not supported by sufficient facts,
data, or validation, and are not ‘sufficiently tied to the facts of the case [such that they will]
aid the [trier of fact] in resolving’ matters in dispute, as required by the Federal Rules of
Evidence and Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 592 (1993).” See Doc.
101, p. 1 (alterations in original). Similarly, Plaintiffs have filed a Motion to Strike Portions
of the Expert Report of GTL’s class certification expert, Roy J. Epstein, Ph.D., (Doc. 112),
because the offending portions are “not sufficiently tied to the facts of this case,” “not
supported by sufficient facts, data or validation as required by the Federal Rules of
Evidence and Daubert,” or are “impermissible legal opinion[s].” See Doc. 112, pp. 1–2.
The Court believes both of these Motions are either premature, or request relief that is
inappropriate or unnecessary at the class certification stage.
“[R]elevant expert testimony must be evaluated and weighed by the court before it
decides to certify a class.” In re Zurn Pex Plumbing Prods. Liability Litig., 644 F.3d 604,
611 (8th Cir. 2011). But the Eighth Circuit has “never required a district court to decide
conclusively at the class certification stage what evidence will ultimately be admissible at
trial.” Id. This is because “[c]lass certification is inherently tentative”—especially when,
as here, there has been bifurcated discovery which may result in “gaps in the available
evidence” at the class certification stage. Id. at 612–13 (internal quotation marks omitted).
“The main purpose of Daubert exclusion is to protect juries from being swayed by dubious
scientific testimony,” but “[t]hat interest is not implicated at the class certification stage
where the judge is the decision maker.” Id. at 613. In other words, “[t]here is less need
for the gatekeeper to keep the gate when the gatekeeper is keeping the gate only for
himself.” Id. (alteration in original).
The Court will deny both parties’ Daubert Motions, as it “believe[s] it is appropriate
for [the Court] to consider all evidence at this stage of the proceedings.” Blades v.
Monsanto Co., 400 F.3d 562, 569 (8th Cir. 2005). The Court will “consider all expert
testimony offered by both sides in support of or in opposition to class certification” and
will “afford that testimony such weight as [it] deem[s] appropriate.” Id. 2 In so ruling, the
Court is mindful of the fact that in Wal-Mart Stores, Inc. v. Dukes, the United States
Supreme Court observed in dictum that it “doubt[ed]” the correctness of the conclusion
The language that is quoted in the preceding two sentences appears in the district
court’s opinion in Blades, which the Eighth Circuit extensively block-quoted and affirmed
by the district court in that case “that Daubert did not apply to expert testimony at the
certification stage of class-action proceedings.” 564 U.S. 338, 354 (2011). To be clear,
this Court does not intend to rely, in its order on class certification, on any portion of an
expert report or testimony that does not satisfy Daubert as applied solely to issues of
class certification. See Zurn, 644 F.3d at 612 n.5. But to be frank, to whatever extent the
Supreme Court’s doubts are directed towards the question of what this Court can even
consider at the class certification stage, this Court does not share those doubts, and does
not view this dictum as controlling. Obviously, the Court must consider evidence in order
to make an informed determination of whether such evidence passes muster under
Daubert in the first place.
This Court believes that judicial economy is poorly served, and the likelihood of
prejudicial error is increased, by striking or excluding expert evidence prior to making any
ruling on class certification. The far safer, and far more efficient, approach is simply to
address Daubert issues within the class certification opinion itself, and only to the extent
that the class certification order implicates them. The parties may rest assured that in
every instance where this Court relies on expert materials in its class certification order,
it will explicitly cite to those expert materials, chapter and verse, and justify its reliance
thereupon. And to whatever extent a Daubert challenge has been raised against the
relied-upon portions, this Court’s class certification opinion will explain why that particular
challenge was unavailing.
The Court appreciates the arguments both sides have made as to the reliability
and relevance of these experts’ reports and testimony, and the Court will continue to
consider these arguments when ruling on class certification. Furthermore, counsel should
not interpret this Order as foreclosing oral argument at the class certification hearing on
how much weight should be given to what evidence the experts have offered in support
of their parties’ respective positions. But the Court will not be excluding or striking any
expert reports or testimony at this stage of proceedings. Accordingly, GTL’s Motion to
Exclude Dr. Tardiff’s Expert Report (Doc. 101) and Plaintiffs’ Motion to Strike Portions of
the Expert Report of Roy J. Epstein, Ph.D. (Doc. 112) are both DENIED.
IT IS THEREFORE ORDERED that:
Plaintiffs Kaylan Stuart’s, Dustin Murilla’s, and Walter Chruby’s Motion to Amend
Class Action Complaint (Doc. 109) is GRANTED;
Defendant Global Tel*Link Corporation’s Motion for Partial Summary Judgment
(Doc. 103) is DENIED;
Intervenor Rocky Hobbs’s Motion to Intervene (Doc. 90) is GRANTED;
Defendant Global Tel*Link Corporation’s Motion to Exclude Dr. Tardiff’s Expert
Report (Doc. 101) is DENIED; and
Plaintiffs Kaylan Stuart’s, Dustin Murilla’s, and Walter Chruby’s Motion to Strike
Portions of the Expert Report of Roy J. Epstein, Ph.D. (Doc. 112) is DENIED.
Plaintiffs may file a Second Amended Consolidated Class Action Complaint consistent
with the ones proposed at Docs. 90-1 and 109-1 by no later than December 5, 2016.
The Clerk of the Court is directed to add Rocky Hobbs as a named plaintiff in this action
upon such Complaint’s filing.
IT IS SO ORDERED on this
- day of November
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