United States District Court, S.D. New York
July 2, 2004.
EEOC, et al., Plaintiffs,
MORGAN STANLEY & Co., et al., Defendants.
The opinion of the court was delivered by: RONALD ELLIS, Magistrate Judge
OPINION & ORDER
The parties in this class action sex discrimination lawsuit
have submitted to the Court motions seeking to exclude expert
testimony at trial under Federal Rule of Evidence 702 and
Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579
(1993). For the reasons discussed below, the motions to exclude
Dr. Farrell Bloch, Dr. Barbara Gutek, Dr. William Wecker, Dr.
Louis L. Wilde, and Sheldon Wishnick are DENIED; the motions to
exclude Dr. William Bielby, Dr. June O'Neill, and Dr. Christopher
Winship are DENIED, IN PART, and GRANTED, IN PART; and the
motions to exclude Roger Blanc and Dr. Ira T. Kay are GRANTED.
The motions to exclude proposed experts span topics that
include statistics, sociology, and damages. In total, plaintiff
Equal Employment Opportunity Commission ("EEOC") has submitted
six motions to exclude, plaintiff-intervenor Allison Schieffelin
("Schieffelin") has submitted one, and defendants Morgan Stanley
& Co., Inc. and Morgan Stanley Dean Witter ("Morgan Stanley")
have submitted three. Judge Richard M. Berman recently severed the EEOC's pattern and
practice claim from Schieffelin's individual claims to conduct
separate trials. See Order Dated June 3, 2004 at 1-2. Damages
will be determined in a third, subsequent proceeding, in a format
yet to be determined. See id. at 2. The experts challenged in
the motions before the Court span all three proceedings.
A. STANDARD OF ANALYSIS
Federal Rule of Evidence ("Rule") 702 governs the admissibility
of expert testimony at trial:
If scientific, technical, or other specialized
knowledge will assist the trier of fact to understand
the evidence or to determine a fact in issue, a
witness qualified as an expert by knowledge, skill,
experience, training, or education, may testify
thereto in the form of an opinion or otherwise, if
(1) the testimony is based upon sufficient facts or
data, (2) the testimony is the product of reliable
principles and methods, and (3) the witness has
applied the principles and methods reliably to the
facts of the case.
Rule 702, most recently amended in 2000, reflects the United
States Supreme Court's analysis of the admissibility of expert
testimony in Daubert v. Merrell Dow Pharmaceuticals, Inc.,
509 U.S. 579 (1993), and Kumho Tire Co. v. Carmichael, 526 U.S. 137
(1999). See FED. R. EVID. 702 advisory committee's notes at
423. The Daubert Court established that Rule 702 imposes a
special role on the trial court to function as a "gatekeeper"
regarding the admissibility of expert testimony, determining both
its relevance and its reliability. 509 U.S. at 589; see also
Amorgianos v. Nat'l R.R. Passenger Corp., 303 F.3d 256
, 265 (2d
Cir. 2002). The Court discussed a non-exhaustive list of specific
factors that a court may consider, such as (1) whether the
expert's theory or technique can be, or has been, tested; (2)
whether the theory or technique has been subjected to peer review
and publication, (3) the known or potential rate of error of a
particular technique and the existence and maintenance of
standards and controls, and (4) whether the technique or theory has been generally accepted
in the scientific community. See Daubert, 509 U.S. at 593-94.
In its Kumho opinion, the Court made clear that the trial
court's gatekeeping obligation established under Daubert
applies to all testimony based on "technical or other specialized
knowledge," and not just scientific knowledge. Kumho, 526 U.S.
at 141. It also held that the factors articulated in Daubert
may apply to nonscientific expert testimony, id. at 150-51, but
that the trial court possesses flexibility in determining what
are reasonable measures of reliability. Id. at 152. The trial
court's discretion in determining how to assess reliability,
the Kumho court determined, should be as broad as its
discretion regarding whether to find relevant evidence
reliable. Id.; see also Robert Zaremba v. G.M.C.,
360 F.3d 355, 357-58 (2d Cir. 2004).
In Daubert, 509 U.S. at 595, the Court highlighted the fact
that the trial court's focus regarding admissibility must be
"solely on principles and methodology, not on the conclusions
that they generate." See also Amorgianos, 303 F.3d at 266
("the district court must focus on the principles and methodology
employed by the expert, without regard to the conclusions the
expert has reached or the district court's belief as to the
correctness of those conclusions"). Testimony that meets the
standards of Rule 702 is still subject to the rigors of
"[v]igorous cross-examination, presentation of contrary evidence,
and careful instruction on the burden of proof," which provide
the "traditional and appropriate means of attacking shaky but
admissible evidence." Daubert, 509 U.S. at 596. The Advisory
Committee Notes accompanying Rule 702 observe that "the rejection
of expert testimony is the exception rather than the rule." FED.
R. EVID. 702 Advisory Committee's Notes at 424; see also U.S.
Info. Sys. v. IBEW Local Union No. 3, 313 F. Supp.2d 213, 226
(S.D.N.Y. 2004). Other evidentiary rules impact the trial court's assessment of
the admissibility of expert testimony. The trial court must
ensure that any testimony admitted meets the basic, foundational
standard of admissibility set forth in Rule 104(a) of the Federal
Rules of Evidence. See Daubert, 509 U.S. at 592-93; FED. R.
EVID. 702 Advisory Committee's Notes at 423. The proponent of the
proposed testimony continues to have the burden of establishing
admissibility under Rule 104(a) by a preponderance of the
evidence. See Bourjaily v. United States, 483 U.S. 171
(1987). The Court in Daubert also noted that Rule 403 provides
the trial court with an important safeguard to limit otherwise
relevant evidence. Id. at 595 (quoting Jack B. Weinstein,
Rule 702 of the Federal Rules of Evidence is Sound: It Should Not
be Amended (July 10, 1991), in 138 F.R.D. 631, 632).
Finally, the trial court's determination regarding the
admissibility of expert testimony is reviewed for abuse of
discretion, Zaremba, 360 F.3d 355 at 357 (citing G.E. v.
Joiner, 522 U.S. 136, 143 (1997)), and a "decision to admit or
exclude expert scientific testimony is not an abuse of discretion
unless it is `manifestly erroneous.'" Id. (quoting
Amorgianos, 303 F.3d at 265).
B. STATISTICAL EXPERTS
1. Farrell Bloch
The EEOC proposes to use the testimony of Dr. Farrell Bloch
("Bloch"), who holds a Ph.D. in labor economics, to "assist the
jury in understanding whether there is a pattern of differential
treatment with respect to compensation and promotion between men
and women" in Morgan Stanley's Institutional Equities Division
("IED"). EEOC's Memorandum of Law in Opposition to Morgan
Stanley's Motion to Exclude Expert Testimony of Dr. Farrell Bloch
("EEOC Mem. Opposing Excluding Bloch") at 1. In particular, the
EEOC states that Bloch evaluated pay and promotion information from Morgan Stanley's
personnel database, and found that it had paid comparable female
employees less than men in similar departments. Id. at 2. He
also found disparities in the promotion rates between men and
women. Id. at 3. Bloch prepared an initial report in 2002, and
a rebuttal report in 2004.
Morgan Stanley argues that Bloch's testimony should be excluded
because his opinions and statistical evidence are unreliable and
irrelevant. See Morgan Stanley's Memorandum in Support of its
Motion to Exclude Testimony of EEOC's Statistician Farrell Bloch
at 1-2, 5-6. First, it asserts that Bloch's compensation analyses
improperly group together employees performing different job
functions, and his rebuttal report fails to cure this problem.
Id. at 6-10. Because the elements of a pay discrimination case
under Title VII require assessment of classmembers' pay in
comparison to non-members for "work requiring substantially the
same responsibility," id. at 6 (quoting Belfi v.
Prendergast, 191 F.3d 129, 139 (2d Cir. 1999)), Morgan Stanley
claims that Bloch's analyses are inadmissible. Second, while
Bloch controls for department and length of service, id. at 13,
Morgan Stanley asserts that his analyses do not incorporate
non-discriminatory explanatory factors, and thus have no
probative weight. Id. at 10-17. Third, Morgan Stanley claims
that Bloch's analyses produce few statistically significant
results. Id. at 17-21. Finally, Morgan Stanley claims that
Bloch (1) improperly expanded his study to non-U.S. citizens in
offices outside of the United States, who are not protected under
Title VII, id. at 22; (2) improperly combined separate sets of
results to create the appearance of statistically significant
disparities, id. at 23-24; (3) used flawed methodology in his
2004 rebuttal report, id. at 25-27; (4) inappropriately pooled
pay and promotion decisions by different decision makers, id.
at 27-28; and (5) used software that produced fundamental errors.
Id. at 28-30. The EEOC maintains that Bloch's testimony meets the
requirements of Rule 702 and is admissible. See EEOC Mem.
Opposing Excluding Bloch at 1, 4. It asserts that Bloch's use of
experience and education are appropriate proxies for performance
and productivity, id. at 9-10, and that even Morgan Stanley
agrees that the variables it identified as missing are not
objectively quantifiable. See id. at 8. The EEOC argues that
these types of disputes should more properly be decided by the
jury, and that Morgan Stanley has not come forth with analyses
that rebut those of Bloch's studies. Id. at 10. The EEOC
further notes that Bloch, in his rebuttal report, incorporated
new analyses in an attempt to respond to Morgan Stanley's
criticisms, and that the new analyses showed little difference.
Id. at 3. The EEOC also submits a declaration by Bloch dated
April 8, 2004, in which he points out that there exists no
comprehensive, common database in this case. Declaration of
Michael Ranis in Support of EEOC's Response to Morgan Stanley's
Motion to Exclude Testimony of Plaintiffs' Expert Dr. Farrell
Bloch, Exhibit 1 (Declaration of Dr. Farrell Bloch) at 2. As a
result, Bloch states that the parties' analyses and critiques
cannot properly be tested against each other. See id.
The Court agrees with the EEOC that an evaluation of Bloch's
testimony should be left to the jury and that Morgan Stanley's
criticisms should be raised on cross-examination. First, Morgan
Stanley does not dispute Bloch's academic qualifications.
Disputes regarding the proper variables to employ in statistical
studies are more properly left for juries to consider and to
decide. Moreover, the variables identified by Morgan Stanley's
statistical expert, Dr. William Wecker ("Wecker") "an
employee's ability to interact productively with other employees;
assistance provided to co-workers; work ethic; participation in
firm recruiting, mentoring and training; and competitive market
dynamics. . . ." EEOC's Notice of Motion and Motion in Limine to
Exclude the Opinions and Testimony of Dr. William Wecker, Exhibit
1 (Report of William Wecker, Ph.D.) at 4 are subjective, and Wecker has
identified no data that captures this information.*fn1 While
Morgan Stanley is not required to perform its own analysis, the
absence of such analysis means that the effect of such variables
is speculative for statistical purposes. The jury can decide
whether the objective items used by Bloch are reasonable
substitutes. Finally, Wecker presents no data suggesting that
characteristics not considered by Bloch vary by gender at Morgan
Stanley.*fn2 At trial, each party may attempt to convince
the jury what impact, if any, such variables might have on
promotions. The Court thus finds that Bloch's testimony satisfies
Rule 702, and concludes that Bloch's analyses are more probative
than not. As a result, Morgan Stanley's motion is DENIED with
respect to this proposed witness.
2. William Wecker and Louis L. Wilde
Morgan Stanley proposes to use the testimony and opinions of
Wecker and Dr. Louis L. Wilde ("Wilde") to challenge the analyses
and conclusions of Bloch. Morgan Stanley Memorandum of Law in
Opposition to EEOC's Separate Motions to Exclude the Opinions and
Testimony of William Wecker and Louis Wilde ("Morgan Stanley Mem.
Opposing Excluding Wecker and Wilde") at 1. Wecker's report
examines whether Bloch's statistical analyses permitted an
inference that disparities in pay and promotion rates were caused
by gender. Id. The report concludes that Bloch's 2002
compensation analyses "fail to consider the `two major
determinates of compensation: job function and job performance,'"
and that Bloch's compensation analysis does not take account of
any factors assessed by IED managers. Id. at 2. Wecker also
repeated and scrutinized Bloch's promotion analyses, and
performed affirmative analysis of certain promotion data from
1995 to 2001, and concluded that there are many instances of statistical insignificance. Id. at 2-3. Wecker
also concluded that Bloch, in his rebuttal report, was not able
to cure the deficiencies that Wecker highlighted. Id. at 4.
Wecker performed statistical analyses to support these
criticisms. Id. at 4-5. In particular, he notes that Bloch was
not able to incorporate "meaningful measures" of job function and
job performance. Id. at 4.
Wilde's report focuses on the validity of the statistical
methods used by Bloch to estimate damages related to the claims
that Morgan Stanley under-compensated and failed to promote
women. See id. at 1. Through statistical analyses of Bloch's
data, and his own affirmative analyses, Wilde claims to show that
there are methodological shortcomings that render Bloch's
calculations unreliable and irrelevant. Id. at 3-4. He also
contends that his affirmative analysis demonstrates that the rate
of growth in compensation is either identical for men or women,
or favors women. Id. at 3. Wilde concludes that Bloch's 2004
report is also methodologically flawed. Id. at 6-7. Finally,
Wilde's report critiques the damages claims related to
Schieffelin's case, and the expert report of her actuarial
expert, Sheldon Wishnick. Id. at 1-2.
The EEOC objects to Wecker's testimony and opinions because he
did not "construct his own analysis of promotion and compensation
practices at IED as a whole," and thus cannot demonstrate that
his criticisms of Bloch would have yielded a different outcome.
EEOC Memorandum of Law in Support of its Motion in Limine to
Exclude Testimony and Opinions of William Wecker, Ph.D. at 1. As
a result, the EEOC claims that Wecker's analysis is insufficient
to rebut Bloch. Id. at 1 (citing Bazemore v. Friday,
478 U.S. 385, 400-05 (1986)). It also says that Wecker's analyses of
two sample groups within the IED are not reliable, irrelevant,
and prejudicial because of their limited sample sizes, and are
allegedly "tainted" because they were based on certain
information provided during a private interview with a Morgan
Stanley Managing Director (notes of which were provided to the EEOC only
after Bloch's reports were completed). Id. at 10-14. The EEOC
also argues that Wecker's regression analysis of compensation is
"unreliable because it is based on tainted and incomplete
information about job functions which is inconsistent with the
Defendants' own database," and does not incorporate worldwide
data. Id. at 2, 14-21. Finally, the EEOC appears to claim that
Wecker's opinion that gender did not play a part in Morgan
Stanley's employment decisions is inadmissible because it is an
impermissible legal conclusion regarding an ultimate issue in the
case. Id. at 22-23.
The EEOC finds fault with Wilde's proposed testimony for
essentially the same reasons. Because Wilde performed no
empirical studies of his own, the EEOC maintains that his
criticisms are inadequate and an unreliable rebuttal to Bloch.
EEOC's Memorandum of Law in Support of its Motion in Limine to
Exclude the Opinions and Testimony of Dr. Louis L. Wilde at 4-11.
The EEOC also alleges that Wilde's criticisms are merely
speculatory, as well as prejudicial and misleading. See id.
at 11-12. Moreover, the EEOC argues that Wilde has improperly
given his opinion regarding the ultimate legal issue of
discrimination because Wilde notes that if multiple regression
analyses like Bloch's fail to account for key nondiscriminatory
factors, "`then the statistical analysis cannot be the basis for
an inference of intentional gender discrimination.'" Id. at
12-13 (quoting Declaration of Michael Ranis in Support of
EEOC's Motion in Limine to Exclude the Opinions and Testimony of
Dr. Louis L. Wilde, Exhibit 2 (Rebuttal Expert Report of Louis L.
Wilde) at 5).
Morgan Stanley argues that a defendant may rebut a statistical
analysis in different ways, and is not required to perform
affirmative statistical analyses. Morgan Stanley's Mem. Opposing
Excluding Wecker and Wilde at 8 (citing Robinson v.
Metro-North Commuter R.R. Co., 267 F.3d 147, 159 (2d Cir. 2001)). It may, for example, point out
omitted variables in plaintiff's analysis. Id. at 8-9 (citing
Bickerstaff v. Vassar Coll., 196 F.3d 435, 449 (2d Cir. 1999);
Hollander v. Am. Cyanamid Co., 172 F.3d 192, 202-03 (2d Cir.
1999); Raskin v. Wyatt Co., 125 F.3d 55, 67 (2d Cir. 1997)).
Morgan Stanley maintains that its experts have performed analyses
of IED at the job levels in which Bloch found significant
results, albeit selectively in scope. Morgan Stanley's Mem.
Opposing Excluding Wecker and Wilde at 9-11. It also states that
both Wecker and Wilde's opinion testimony address ultimate issues
of fact, which are admissible under Rule 704, and are not
impermissible legal conclusions. Id. at 11-15.
The Court finds that Morgan Stanley's position is correct. From
an admissibility perspective, its experts' critiques and analyses
of the EEOC's statistical case are sufficient. More affirmative
analyses are not required, see Robinson, 267 F.3d at 159,
though they may be advisable. As with Bloch's testimony and
opinions, the Court finds that the EEOC's issues regarding Wecker
and Wilde's analyses impact their probative weight, not their
admissibility, and should be leveled at trial. Finally, the EEOC
has not sufficiently demonstrated that Wecker and Wilde's
statements regarding ultimate issues in the case are legal
conclusions, and not factual discussions, that merit exclusion.
As a result, the EEOC's motions to exclude Wecker and Wilde's
testimony and opinions are DENIED.
C. SOCIAL SCIENCE EXPERTS
1. William Bielby
The EEOC argues that Dr. William Bielby, a social scientist
with a Ph.D. in Sociology, will "assist the Court and Jury in
understanding the findings from social science research about
factors that create and minimize workplace gender bias, including
how gender stereotypes affect personnel decisions, organizational
policies and practices that create barriers to career advancement for women, and the kind of policies and procedures
that effectively minimize gender bias, particularly in
male-dominated work environments." EEOC's Memorandum of Law in
Opposition to Defendants' Motion to Strike Testimony of Dr.
William Bielby ("EEOC's Mem. Opposing Excluding Bielby") at 1-2.
In particular, it offers Bielby's testimony to provide background
summaries of pertinent social science research about gender bias
in the workplace, id. at 4, which form the basis for his
conclusions about the IED. Declaration of Thomas E. Dutton in
Support of Morgan Stanley's Motion to Exclude Testimony of
Plaintiffs' Expert William T. Bielby, Exhibit A (Expert Report of
William T. Bielby, Ph.D., November 22, 2002) ("Bielby Report") at
6. The EEOC also offers his testimony in order to apply this
social science research to the present case, and through a
"social framework analysis," to assess whether gender bias exists
in the IED. See EEOC's Mem. Opposing Excluding Bielby at 4.
Bielby explains that his report is not intended to be a
scientific study about discrimination at Morgan Stanley,
Declaration of Thomas E. Dutton in Support of Morgan Stanley's
Motion to Exclude Testimony of Plaintiffs' Expert William T.
Bielby, Exhibit A (Expert Rebuttal Report of William T. Bielby,
Ph.D., February 9, 2004) at 5, but relies upon widely accepted
social science research about gender bias in the workplace to
examine the IED's policies and practices. Id. Bielby finds that
a male-dominated work environment exists at the IED, Bielby
Report at 21-26; the IED utilizes "arbitrary and subjective
procedures" for pay and promotion decisions, id. at 26-32;
Morgan Stanley's policies and practices regarding equal
employment opportunities do not adequately detect and minimize
gender bias, id. at 32-42; and that Schieffelin was negatively
impacted by gender barriers while working at the IED. Id. at
Morgan Stanley claims that Bielby is unqualified as an expert
because he lacks "first hand knowledge" of Morgan Stanley by
basing his opinions on deposition testimony; his opinions are based on subjective views; his background is not in
social psychology, human resources, or personnel policies; and he
has done no studies of the IED. Morgan Stanley's Memorandum of
Law in Support of Its Motion to Exclude Testimony of Plaintiffs'
Expert William Bielby ("Morgan Stanley's Mem. to Exclude Bielby")
at 17-18. Taking issue with his methodology, Morgan Stanley
argues that Bielby's opinions are unreliable. Id. at 19-21
(citing statements by Morgan Stanley experts Dr. Christopher
Winship ("Winship") and Dr. Barbara Gutek ("Gutek"), see infra,
that critique his methodology as without scientific basis and
omitting inconsistent literature; further claiming that a "social
framework analysis" is not an accepted approach. Morgan Stanley's
Reply Memorandum of Law in Support of its Motion to Exclude
Testimony of Plaintiffs' Expert William Bielby at 1-2).
Morgan Stanley also contends that Bielby's testimony is not
relevant and inadmissible under Evidence Rules 401 and 403
because his opinions would supplant the roles of counsel and the
jury in making inferences, and because he "impermissibly shifts
the burden of proof to Morgan Stanley." Morgan Stanley's Mem. to
Exclude Bielby at 23-26. Bielby allegedly supplants the role of
counsel by arguing that discrimination existed, and the role of
the jury by assessing credibility of testimony. Id. at 23.
Morgan Stanley additionally claims Bielby's opinions that
"stereotyping is automatic," the IED is a "`male dominated
culture,'" and the IED's policies are "`arbitrary and
subjective,'" are irrelevant to making out the EEOC's Title VII
claims since they cannot prove intentional discrimination. Id.
at 25. It maintains that his opinions will not assist the jury
because he misapplies the burden of proof by indicating that
gender bias is inevitable in the IED without appropriate
safeguards lacking at Morgan Stanley. Id. Relying on Rule 403,
Morgan Stanley states that Bielby's "mere expectation that gender
discrimination is on average the cause of any gender disparities
in IED pay and promotion and that Schieffelin experienced gender bias" will confuse and
mislead the jury by indicating the outcome that the jury should
reach. Id. at 26 (citing Rowe Entm't, Inc. v. William Morris
Agency, 2003 WL 22272587, at *10 (S.D.N.Y. Oct. 2, 2003)).
The EEOC counters that Bielby is well-qualified, EEOC Mem.
Opposing Excluding Bielby at 2-4, and that he has not proffered
opinions outside of his area of expertise. Id. at 19-23. The
EEOC also asserts that these opinions are based on sound,
judicially-accepted social science methodology. See id. at
9-11. It states that Bielby has used reliable methods in applying
this social science research to the present case. Id. at 11-18.
The EEOC points out that courts do not require independent
studies of data, and allow analysis of documents as done by
Bielby. Id. at 18. It contends that defendants' issues
regarding Bielby's use of social science literature and research
go to the weight, not the admissibility, of Bielby's testimony.
See id. at 25-29.
After reviewing Bielby's background and his reports, which
demonstrate acceptable research and application, the Court finds
that he is qualified and that his methodology is reliable in this
case. Morgan Stanley's critiques of Bielby's testimony, including
that he does not rely on first-hand knowledge or studies, that
his opinions are subjective, that a social framework methodology
is not accepted, and that he omits inconsistent literature, are
factors that should be evaluated and weighed by the trier of
Bielby's discussion about the susceptibility of the IED's pay
and promotion procedures to gender bias would tend to confuse the
jury about the burden of proof. The gist of his conclusion is
that in a male-dominated context where men are in charge women
are discriminated against unless certain safety measures are
instituted. He therefore asks the jury to begin with the
expectation of discrimination and compel Morgan Stanley to prove
that it took enough steps to prevent it. His argument, that given Morgan Stanley's "male-dominated work
environment," its discretionary pay and promotion system "has the
features that social science research demonstrates creates
significant barriers to equal employment opportunity for women,"
Bielby Report at 32, provides a theoretical explanation for
discrimination. While his testimony would be helpful in
understanding the mechanism of discrimination, and consequently,
in fashioning an appropriate remedial scheme, it may not
illuminate the initial inquiry, i.e., whether Morgan Stanley
Bielby may properly testify about gender stereotypes, and about
how these stereotypes may have affected decisions at Morgan
Stanley. He may also testify regarding whether policies and
practices relating to gender bias might affect employees'
utilization of an equal employment opportunity program, but may
not seek to show that alleged deficiencies in such a program are
evidence of discrimination.
Morgan Stanley's motion to exclude the testimony of Bielby is
DENIED, IN PART and GRANTED, IN PART, to the extent that
Bielby shall not be allowed to discuss his theories regarding
whether the IED's "arbitrary and subjective" pay and promotions
procedures, in conjunction with a male-dominated workplace,
result in discrimination.
2. Barbara Gutek
Morgan Stanley says that Gutek, a psychologist, will testify
that Bielby's opinions are unscientific, since there exists no
scientific research and no consensus in the field about what
policies and practices are best for handling complaints of
discrimination. Morgan Stanley's Memorandum in Opposition to
EEOC's Motion in Limine to Exclude Testimony and Opinions of
Defendants' Proposed Rebuttal Expert Barbara Gutek ("Morgan
Stanley's Mem. Opposing Excluding Gutek") at 3-4. In her report,
Gutek states that "[i]n the absence of any evidence that there is a documented set of effective practices, there is
likewise no evidence that there is a better or more effective way
of handling or investigating complaints than the processes used
by Morgan Stanley." EEOC's Notice of Motion and Motion in Limine
to Exclude the Opinions and Testimony of Defendants' Proposed
Rebuttal Expert Dr. Barbara Gutek, Exhibit 1 (Report of Barbara
A. Gutek, Ph.D.) at 8. Morgan Stanley also asserts that Gutek
will explain that Bielby inappropriately relies on her academic
work to extrapolate about stereotypes in the workplace. Morgan
Stanley's Mem. Opposing Excluding Gutek at 5.
The EEOC argues that Gutek's testimony and opinions are
unreliable because her earlier writings and testimony in other
litigation are actually consistent with Bielby's claims regarding
anti-discrimination policies and procedures. EEOC's Memorandum of
Law in Support of its Motion in Limine to Exclude the Opinions
and Testimony of Defendants' Proposed Rebuttal Expert Dr. Barbara
Gutek at 4. It also states that Gutek has provided opinions in
other litigation about gender stereotyping in the workplace,
apparently applying her academic work to a broader context than
in her present report, and thus rendering her allegation not
credible and unreliable. Id. at 10-11. Morgan Stanley responds
to the EEOC's arguments by saying that Gutek's opinions are
reliable, and establish the unreliability of Bielby. Morgan
Stanley's Mem. Opposing Excluding Gutek at 7.
Gutek's expert report and supporting affidavit are detailed,
clear, and straightforward, and pass a threshold evaluation of
reliability. Her disputes about Bielby's methodology, as
discussed in the previous section, should be assessed and weighed
by the trier of fact. Her testimony and opinions are directly
relevant to the claims in the case, including Morgan Stanley's
ninth affirmative defense that the "EEOC cannot seek relief on
behalf of those who failed to make use of Defendants' internal
complaint procedures. . . ." Defendants' Answer to Plaintiff Equal Employment Opportunity Commission's Amended
Complaint at 4. The EEOC's motion to exclude Gutek is DENIED.
3. Ira T. Kay
Morgan Stanley proposes to use the testimony and opinions of
Dr. Ira T. Kay ("Kay"), a compensation consultant who holds a
Ph.D. in Labor Economics, to rebut testimony proposed by Bielby
and Bloch. See Morgan Stanley's Memorandum in Opposition to
EEOC's Motion in Limine to Exclude the Testimony and Opinions of
Defendants' Proposed Expert Ira Kay ("Morgan Stanley's Mem.
Opposing Excluding Kay") at 1-2. It states that Kay assesses how
"Morgan Stanley's compensation system fits into the compensation
customs and practices of Wall Street firms and explains how
legitimate business reasons motivate financial service firms to
adopt the type of compensation system that Morgan Stanley uses."
Id. at 1. Kay challenges Bielby's designation of the IED's
compensation process as "arbitrary," characterizing it instead as
"a qualitative system that requires management judgment" that
helps to retain top employees and maintain Morgan Stanley's
success. Declaration of Michael Ranis in Support of EEOC's Motion
to Exclude Testimony and Opinions of Defendants' Proposed
Rebuttal Expert Witness, Ira T. Kay, Exhibit 1 (Expert Report of
Ira T. Kay, Ph. D.) ("Kay Report") at 2-4. Kay also claims that
there is a "major flaw" in Bloch's statistical analysis, Morgan
Stanley's Mem. Opposing Excluding Kay at 1, because he fails to
factor in differences in job functions for people with the same
officer title. Kay Report at 2.
The EEOC objects to Kay's proposed testimony and opinions,
alleging that they are not relevant and will not assist the jury.
EEOC's Memorandum of Law in Support of its Motion to Exclude
Opinions and Proposed Testimony of Defendants' Proposed Rebuttal
Expert Witness, Dr. Ira T. Kay, Ph.D. ("EEOC's Mem. to Exclude
Kay") at 2. Among other arguments, it points out that Morgan Stanley's conformity to industry customs and
practices regarding compensation is irrelevant to disproving
discrimination, EEOC's Reply Memorandum in Further Support of Its
Motion in Limine to Exclude Testimony and Opinions of Ira Kay,
Ph.D. ("EEOC's Reply Mem. to Exclude Kay") at 3-5; that the
"qualitative" nature of the IED's compensation process is
undisputed, EEOC's Mem. to Exclude Kay at 3; and that any
implication that a successful company consequentially has a
non-discriminatory compensation system is illogical and
irrelevant. See EEOC's Reply Mem. to Exclude Kay at 7-10. The
EEOC also contests Kay's qualifications, the sufficiency of his
data, and the broadness of his applications. See EEOC's Mem. to
Exclude Kay at 9-24. It seeks to have Kay's observations
regarding Bielby and Bloch excluded for lack of scientific rigor,
and argues that Kay must be excluded if the Court excludes the
opinions of Bielby and Bloch. Id. at 24-25.
Morgan Stanley, in its opposition to the EEOC's motion, says
that Kay is qualified, and that his opinions are reliable,
relevant, and admissible. Morgan Stanley's Mem. Opposing
Excluding Kay at 7-12. It states that the EEOC's criticisms of
Kay's testimony are "misguided and based upon a fundamental
misreading of his report." Id. at 12. It argues that Kay's
testimony is largely based on his personal experience and facts
of which he has personal knowledge, and that he did not have to
conduct a scientific study before commenting on industry custom
and practice or critiquing Bloch. Id. at 15-18. Morgan Stanley
claims that even if the Court excludes Bielby and Bloch, Kay's
opinions should be admitted since his testimony will still be
relevant, admissible, and helpful to the jury. In particular, it
will be useful to respond to Bielby's assertions about the
"arbitrary" nature of the IED compensation system, and to assist
the jury to understand the financial services industry, its pay
practices, and how Morgan Stanley compares with the industry.
Id. at 7-10, 18-19. The Court finds that Kay's proposed testimony and opinions are
irrelevant to the present case, and will not assist the trier of
fact. The fact that Morgan Stanley's compensation is consistent
with industry practices is irrelevant to a determination of
whether the company discriminated. Companies have imposed
discriminatory practices on a variety of systems. Similarly,
Morgan Stanley's success within the system is irrelevant to an
evaluation of discrimination.*fn3 Certainly, the EEOC could
not make the converse claim in prosecuting an employer.
Though the parties may differ regarding the implications of
Morgan Stanley's discretionary compensation structure, the
mechanics of the system itself is not a contested point. Kay's
attempt to create an issue by latching on to the word "arbitrary"
is unavailing. It is clear from the context that Bielby relates
the term to "subjective," and not to "whimsical."
Kay also points to certain factors not included by Bloch, but
this is not his major focus and does not rescue his overall
testimony. Taken as a whole, the Court finds that Kay's proposed
testimony would ultimately be unhelpful and superfluous. The
EEOC's motion to exclude the testimony and opinions of Kay is
4. June O'Neill
Morgan Stanley proposes to use the testimony and opinions of
Dr. June O'Neill ("O'Neill"), a labor economist, as a rebuttal
witness to (1) demonstrate that "not all disparities in pay
between men and women are due to discrimination by employers,"
but factors such as gender roles and occupational choices; (2) to
present O'Neill's statistical analysis of gender differences in
occupations that it claims "is highly relevant to an
understanding of the factors that affect women's career paths,
pay, and promotion at Morgan Stanley;" (3) to critique Bielby's assertions regarding Morgan Stanley's "arbitrary and subjective"
pay and promotion system, the impact of gender stereotypes at the
IED, and to point out that Schieffelin was one of the
highest-paid individuals at her level and thus was not harmed;
(4) to critique Bloch's lack of controlled factors, the paucity
of his findings regarding gender differences for compensation at
the officer levels, and other methodological concerns regarding
his original and rebuttal analyses; and (5) to present a cohort
study regarding compensation based in the IED in North America,
which shows that there were no statistically significant
differences between men and women hired in the professional
positions between 1990 and 1992, and 1993 and 1995. Morgan
Stanley's Memorandum of Law in Opposition to EEOC's Motion in
Limine to Exclude the Opinions and Testimony of Dr. June O'Neill
("Morgan Stanley's Mem. Opposing Excluding O'Neill") at 1, 3-9.
The EEOC contends that O'Neill's opinions "regarding the
average numbers of women in broad occupational categories
throughout the national economy, her stereotypical use of certain
characteristics of those occupations and her belief that systemic
gender discrimination does not exist under her concept of
`economic theory'" are irrelevant to the pay and promotion claims
in this case. EEOC's Memorandum of Law in Support of its Motion
in Limine to Exclude Testimony and Opinions of June O'Neill,
Ph.D. at 1. According to the EEOC, O'Neill is not an expert
regarding gender stereotyping, and is not competent to rebut
Bielby's opinions, id. at 2; her statistical analysis is not
reliably applied to the facts of the case, id. at 10; her
opinions critiquing Bloch's methodology are based on
"hypothetical conjecture," and are insufficient to rebut his
analyses, id. at 12-15; and her limited review of IED employees
is not scientific, likely to mislead the jury, and prejudicial.
Id. at 2. Morgan Stanley responds by asserting that O'Neill is qualified,
and that her methodology is widely accepted. Morgan Stanley's
Mem. Opposing Excluding O'Neill at 1. It also states that her
critiques of Bielby and Bloch, and her statistical and cohort
studies, satisfy the requirements of Rule 702 and Daubert.
Id. Morgan Stanley claims that O'Neill's opinions regarding
women's roles in the workplace and the concept that "choice is a
legitimate explanation for differences observed in the workplace"
are relevant and do not promote stereotypes. Id. at 10-11.
The Court agrees with the EEOC in that it finds that the
majority of O'Neill's proposed testimony and opinions are not
relevant to the claims in this case. Her overview of women's
status in the workforce, her focus on gender disparities in the
securities and financial markets and at the IED, and her
statistical analysis of gender differences in occupations might
be relevant if there were a discriminatory hiring claim in this
case. These aspects of her testimony and opinions do not provide
support for pay or promotion analyses, however.
O'Neill's critiques of Bloch's methodology and her limited
cohort study based upon IED compensation data, on the other hand,
are relevant to the claims in this case, will be helpful to the
trier of fact in evaluating the weight of the parties'
methodologies, and are admissible. As a result, the EEOC's motion
to exclude O'Neill is GRANTED, IN PART, and DENIED, IN PART.
5. Christopher Winship
Morgan Stanley proffers Winship, a social science
methodologist, to assert that Bielby did not use valid scientific
methodology in his report. Morgan Stanley's Memorandum in
Opposition to EEOC's Motion in Limine to Exclude Testimony and
Opinions of Christopher Winship, Ph.D. ("Morgan Stanley's Mem.
Opposing Excluding Winship") at 2. Among other things, Winship critiques Bielby's use of social science
literature, and points out flaws chiefly of omission in
Bielby's analyses regarding the IED and Schieffelin's case. See
Declaration of Michael Ranis in Support of EEOC's Motion in
Limine to Exclude the Opinions and Testimony of Dr. Christopher
Winship, Exhibit 1 (Expert Report of Christopher Winship, Ph.D.)
("Winship Report") at 3-10.
The EEOC claims that Winship does not have expertise in
Bielby's areas of specialty, and is improperly being used for
rebuttal purposes. EEOC's Memorandum of Law in Support of Its
Motion in Limine to Exclude Testimony and Opinions of Christopher
Winship, Ph.D. at 1. It characterizes Winship as an "expert at
inferring `degrees of confidence' from research and drawing
inferences from randomized experimentation." Id. at 2. Because
he does not have expertise regarding the particular issues at
trial, the EEOC maintains that his discussion will not assist the
jury. Id. at 2-3. For similar reasons, the EEOC also objects to
Winship's positive assessment of the pay and promotion system at
Morgan Stanley; his discussions of complaint procedures at Morgan
Stanley, and the effect of sex stereotyping on Schieffelin.
Plaintiff EEOC's Reply Memorandum in Support of EEOC's Motion in
Limine to Exclude the Testimony and Opinions of Christopher
Winship, Ph.D. at 4-6.
Morgan Stanley argues, however, that Winship is qualified to
discuss the methodology used by Bielby, even if he is not an
expert in the substantive area. Morgan Stanley's Mem. Opposing
Excluding Winship at 2. Indeed, Morgan Stanley notes that Winship
admits that he does not attempt "to make a substantive judgment
about what's true at Morgan Stanley." Id. at 7 (quoting
Declaration of Helen E. Witt in Support of Morgan Stanley's
Memorandum in Opposition to EEOC's Motion in Limine to Exclude
Testimony and Opinions of Christopher Winship, Exhibit B.
(Winship Deposition, February 16, 2004), at 146). The Court finds that Winship is qualified, and that his
testimony and opinions are reliable and relevant from a
threshold, admissibility standpoint. From the Court's review of
Winship's 2002 Report, his affidavit dated March 24, 2004, and
his deposition testimony, there are no serious evidentiary
shortcomings with the basic sufficiency of his data, his
principles or methods, or their applications to the facts of this
case. Further evaluations of methodology should properly be
assigned to the trier of fact, who should determine what weight
to ascribe to Winship's statements.
Winship's positive assertions regarding Morgan Stanley's pay
and promotion procedures ("Although I am not an expert in human
resources, after reading of [sic] the deposition testimony and an
interview with Bruce Cohen and others on 12/19/02, I concluded
that this was the most rigorous, thorough, and extensive
evaluation process that I had heard of." Winship Report at 38),
however, are outside the realm of his expertise as a social
science methodologist. Winship's affirmative statements regarding
Morgan Stanley's pay and promotion process are thus inadmissible.
Winship's critiques of Bielby's analyses of complaint procedures
and Schieffelin's exposure to sex stereotyping, on the other
hand, do not cross over into positive assertions and are
therefore permissible. As a result, EEOC's motion to exclude is
DENIED, IN PART, and GRANTED, IN PART.
D. OTHER EXPERTS
1. Roger Blanc
Morgan Stanley intends to have Roger Blanc ("Blanc") testify
that defendants did not engage in a securities violation called
"parking," or "prearranged sham transactions where no market risk
was being transferred." Morgan Stanley's Memorandum in Opposition
to Allison Schieffelin's Motion to Exclude Expert Testimony from
Roger Blanc ("Morgan Stanley Mem. Opposing Excluding Blanc") at 1. Morgan Stanley states that
Blanc's testimony is necessary to respond to Schieffelin's charge
that, as part of Morgan Stanley's retaliation against her for
filing a complaint regarding gender discrimination, she was
reassigned from a client when, in fact, Morgan Stanley was
engaging in illegal parking with that client. See id. at 1-3.
Schieffelin objects to Blanc's testimony because she claims
that Blanc, an attorney, is not qualified as an expert in
securities and securities markets, but only about securities law.
Memorandum of Law of Allison Schieffelin in Support of Motion to
Exclude Expert Testimony from Roger Blanc at 1, 4-6. In addition,
his testimony will consist of legal conclusions, which are an
improper area of opinion testimony. Id. at 7-9. Finally,
Schieffelin claims that Blanc's testimony will not be helpful to
the jury because it only addresses whether Morgan Stanley engaged
in "parking," and does not respond to Schieffelin's broader
allegations that the disputed transactions were illegal and
guaranteed no loss to the client. Id. at 10-15.
Morgan Stanley, in its opposition, asserts that the jury should
not be charged with the question of whether Morgan Stanley
engaged in illegal parking because of its collateral nature to
the dispute, but that if it is required to respond to this
argument, it should be permitted to present evidence to refute
the allegation. Morgan Stanley Mem. Opposing Excluding Blanc at
1, 14-15. Morgan Stanley agrees that opinion testimony stated as
legal conclusions are not permitted. Id. at 8. It asserts,
however, that Blanc's testimony is "more similar to factual
conclusions that embrace an ultimate issue than an ultimate legal
conclusion" and thus is admissible. Id. at 12 (quoting SEC
v. U.S. Environmental Inc., 2002 WL 31323832, at *4 (S.D.N.Y.
Oct. 16, 2002)). In particular, it notes that Blanc bases his
conclusions on the facts that he has analyzed, and refrains from
stating his opinions in judicial terminology. See id. at
12-13. In addition, Morgan Stanley states that legal testimony
may be more readily admitted when it is regarding a collateral, complex issue, and that the trial court may "polic[e]
the fine line between admissible and inadmissible testimony
during trial." Id. at 13. Finally, it claims that Schieffelin
is now attempting to "run away from her parking allegations,"
which were the specific accusations of illegality that she made
in her charge of discrimination with the EEOC. See id. at
14-15. Morgan Stanley asserts that "[t]he jury in this case will
not be asked whether the disputed transactions were unlawful;
rather, the jury will be asked whether they believe Morgan
Stanley's reason for Schieffelin's reassignment" from the client
account in question. Id. at 15.
Blanc's testimony regarding Schieffelin's allegations of
"parking" or broader securities violations by Morgan Stanley may
be relevant and helpful to the jury to properly assess her claim
of retaliation. Blanc's opinions expressed in his expert report
and deposition testimony are overly couched in legal language and
reach legal conclusions, however. See United States v.
Duncan, 42 F.3d 97, 101 (2d Cir. 1994); United States v. Scop,
846 F.2d 135, 140 (2d Cir. 1988). His arguments would be more
appropriate when presented by defense counsel themselves, rather
than by an expert. Moreover, Blanc's opinions would provide only
a partial response to Schieffelin's allegation of illegality, as
"parking" is only one specified activity. In addition, Blanc's
testimony does not address whether Schieffelin's managers
believed the activities were illegal. It appears, however, that
Schieffelin may not be competent to express a legal opinion on
Morgan Stanley's activities. It would probably be appropriate to
eliminate testimony on this issue altogether. Schieffelin's
motion to exclude Blanc is GRANTED.
2. Sheldon Wishnick
Schieffelin intends to have Sheldon Wishnick ("Wishnick"), an
actuary, present his estimates of her lost earnings and employee
benefits for purposes of determining damages in her individual
case. Memorandum of Law of Allison Schieffelin in Opposition to
Motion to Exclude Expert Testimony from Sheldon Wishnick ("Schieffelin's Mem.
Opposing Excluding Wishnick") at 1. Wishnick posits calculations
for Schieffelin based on three different scenarios: 1)
termination in October 2000 from her position as an Executive
Director; 2) not being promoted to Managing Director in 2000; and
3) not being promoted to Managing Director in 1997. Id. at 1-2.
Schieffelin asserts that these calculations are based on the
"conservative assumption" about her income stream that she will
retire completely by age 49, in 2010. Id. at 2. Wishnick
subtracts from these damages Schieffelin's anticipated earnings
from the date of her termination. Id. at 2. Schieffelin claims
that these earnings will be modest because she has not been able
to find comparable work and is seeking to enter another field by
completing a master's degree in Interactive Technology. Id. at
2-3. Including lost income, the value of her pension, and
forfeited stocks and options, Wishnick estimates Schieffelin's
loss in the three scenarios noted above to be: (1) $32,995,837;
(2) $63,485,408; and (3) $72,153,790. Declaration of Scott A.
Moss in Opposition to Motion to Exclude Expert Testimony from
Sheldon Wishnick, Exhibit A (Actuarial Report and Analysis: Lost
Earnings and Employee Benefits for Allison Schieffelin by Sheldon
Wishnick) at 1.
Morgan Stanley objects to Wishnick's testimony, claiming that
it is based on unsupported, unreliable, and irrelevant
assumptions. Morgan Stanley's Memorandum in Support of its Motion
to Exclude the Testimony of Sheldon Wishnick at 1, 13. It
questions Wishnick's assumptions that Schieffelin would not be
able to find suitable employment for six years after her
termination, and that her income when she does begin to work will
be "less than 5% of the amount Wishnick claims she would have
made at Morgan Stanley." See id. at 1. Morgan Stanley also
alleges that Wishnick uses comparators supplied to him by
Schieffelin's counsel without evaluating whether they are the
proper ones. Id. Finally, it questions Wishnick's assumption that Schieffelin would have remained at the Executive
Director or Managing Director level with increases in income for
the ten years between her termination and her anticipated
retirement. Id. at 1-2. It states that, in fact, "[m]ost
Executive and Managing Directors do not stay at Morgan Stanley
for ten years, and there is no basis for Wishnick to assume
Schieffelin's compensation levels would have continued to grow
rapidly forever with no risk of that compensation diminishing."
Id. at 2.
Schieffelin, in her opposition, counters that Wishnick's
assumptions are reasonable and well-founded. Schieffelin's Mem.
Opposing Excluding Wishnick at 13. She argues that Wishnick
estimated her compensation growth and career length properly,
id. at 16-22, and appropriately determined mitigation data.
Id. at 23-24. In addition, she asserts that the burden of
uncertainty regarding her career growth and length after a
finding of liability should rest with the defendants, not the
plaintiff. Id. at 25-27. In general, she states that Morgan
Stanley's disputes with Wishnick are not regarding admissibility,
but rather concern substantive matters that should be resolved
through summary judgment or trial proceedings. Id. at 3-4.
Morgan Stanley's issues with Wishnick's assumptions, from the
amount of Schieffelin's projected income to the appropriate
comparators to be used, are the types of issues that should be
decided by the jury and tested through cross-examination. Morgan
Stanley's motion to exclude Wishnick is DENIED. IV. CONCLUSION
For the reasons discussed above, the parties' motions to
exclude expert testimony are DENIED, IN PART, AND GRANTED, IN