Court: United States District Court for the Eastern District of Missouri, Eastern Division
Case Name: Cramer v. Equifax Info. Servs.
Citation: 2019 U.S. Dist. LEXIS 161062
In this identity theft case, the plaintiff found delinquent accounts in her credit report and attempted to eliminate the false information. The plaintiff claimed she filed police complaints, contested debts with credit agencies, and appended fraud alerts to her credit report. The plaintiff also notified representatives of the defendant that she had been the victim of identity theft. The defendant allegedly persisted to contact the plaintiff to recover the debts incurred by the identity thief despite her efforts. The plaintiff retained an economics expert witness to discuss the ensuing damages.
The Economics Expert Witness
The plaintiff’s economics expert witness was the president of Smith Economics Group, Ltd., an economics litigation consultancy. He earned his Ph.D. in economics from the University of Chicago and was well-published on a variety of topics. The expert authored peer-reviewed articles and appeared as a forensic economics expert in numerous lawsuits. He also participated in national conferences on measuring credit damages and issues related to credit data furnishers.
The plaintiff presented the economics expert to discuss the cost of injuries sustained as a result of the defendant’s actions. Such damages included loss of expectancy of credit, the cost of time spent coping with the situation, and a decrease in the value of life, also known as loss of life enjoyment or hedonic damages. The defendant argued that the economics expert’s testimony should be excluded.
In the first instance, the defendant argued that the plaintiff refused to claim special, non-economic damages in her lawsuit. The defendant also alleged she failed to otherwise notify the defendant she had requested special damages before naming her experts. In reply, the plaintiff quoted her complaint, initial disclosures, and responses to interrogatories. The plaintiff alluded to her supposedly unique, non-economic damage, which included emotional distress. The plaintiff argued that the FCRA provides for the recovery of separate, non-economic damages as actual damages. She expressly asserted such damages against the defendant. As such, she presented testimony from her economics expert witness.
The defendant claimed the economics expert’s testimony concerning the loss of credit standards should be omitted. As far as the defendant was concerned, the economics expert was not qualified because his findings lacked evidentiary backing. The plaintiff could not recover these damages absent being refused credit due to an inaccurate credit report.
The defendant argued that the expert’s testimony quantifying the value of time spent should also be excluded. The defendant claimed the plaintiff was unable to recover value for time spent. In addition, even if such damages were recoverable, the value of time spent did not require expert testimony.
Moreover, the defendant argued against the economics expert’s testimony concerning loss of enjoyment of life (hedonic damages). The defendant argued this testimony should be excluded because there was no factual basis to support such damages. It was also alleged that the economics expert’s methodology based on the “willingness to pay model” was flawed.
The court found the economics expert to be qualified to testify about damages caused because of lost credit expectancy. The court noted that the facts relating to the plaintiff’s credit expectancy were technical and relevant. Furthermore, the plaintiff could lay the basis for expert conclusions and provide supporting evidence during trial or in dispositive motions.
The court noted there is, in fact, case law establishing that when calculating damages for a violation of the FCRA, “time spent trying to resolve problems with the credit reporting agency” may be considered support for claims of mental distress, citing Anastasion v. Credit Service of Logan.
As to the existence of hedonic damages, the court again cited Anastasion. “Hedonic damages are used to approximate the loss of the value of life. [They] therefore are used in cases involving death or injury.”
The defendant’s Daubert motion to exclude the plaintiff’s economics expert witness was denied.