Comcast Corp. v. Behrend ( 2013 )

(Slip Opinion) OCTOBER TERM, 2012 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
COMCAST CORP. ET AL. v. BEHREND ET AL.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE THIRD CIRCUIT
No. 11–864. Argued November 5, 2012—Decided March 27, 2013
Petitioners, Comcast Corporation and its subsidiaries, allegedly “clus-
ter” their cable television operations within a particular region by
swapping their systems outside the region for competitor systems in-
side the region. Respondents, named plaintiffs in this class-action
antitrust suit, claim that they and other Comcast subscribers in the
Philadelphia “cluster” are harmed because Comcast’s strategy lessens
competition and leads to supra-competitive prices. They sought class
certification under Federal Rule of Civil Procedure 23(b)(3), which
requires that “questions of law or fact common to class members pre-
dominate over any questions affecting only individual members.”
The District Court required them to show (1) that the “antitrust im-
pact” of the violation could be proved at trial through evidence com-
mon to the class and (2) that the damages were measurable on a
classwide basis through a “common methodology.” The court accept-
ed only one of respondents’ four proposed theories of antitrust impact:
that Comcast’s actions lessened competition from “overbuilders,” i.e.,
companies that build competing networks in areas where an incum-
bent cable company already operates. It then certified the class, find-
ing that the damages from overbuilder deterrence could be calculated
on a classwide basis, even though respondents’ expert acknowledged
that his regression model did not isolate damages resulting from any
one of respondents’ theories. In affirming, the Third Circuit refused
to consider petitioners’ argument that the model failed to attribute
damages to overbuilder deterrence because doing so would require
reaching the merits of respondents’ claims at the class certification
stage.
Held: Respondents’ class action was improperly certified under Rule
23(b)(3). Pp. 5–11.
2 COMCAST CORP. v. BEHREND
Syllabus
(a) A party seeking to maintain a class action must be prepared to
show that Rule 23(a)’s numerosity, commonality, typicality, and ade-
quacy-of-representation requirements have been met, Wal-Mart
Stores, Inc. v. Dukes, 564 U. S. ___, ___, and must satisfy through ev-
identiary proof at least one of Rule 23(b)’s provisions. The same ana-
lytical principles govern certification under both Rule 23(a) and Rule
23(b). Courts may have to “ ‘probe behind the pleadings before com-
ing to rest on the certification question,’ and [a] certification is proper
only if ‘the trial court is satisfied, after a rigorous analysis, that [Rule
23’s] prerequisites . . . have been satisfied.’ ” Ibid. The analysis will
frequently “overlap with the merits of the plaintiff ’s underlying
claim” because a “ ‘class determination generally involves considera-
tions that are enmeshed in the factual and legal issues comprising
the plaintiff ’s cause of action.’ ” Ibid. Pp. 5–6.
(b) The Third Circuit ran afoul of this Court’s precedents when it
refused to entertain arguments against respondents’ damages model
that bore on the propriety of class certification simply because they
would also be pertinent to the merits determination. If they prevail,
respondents would be entitled only to damages resulting from re-
duced overbuilder competition. A model that does not attempt to
measure only those damages attributable to that theory cannot estab-
lish that damages are susceptible of measurement across the entire
class for Rule 23(b)(3) purposes. The lower courts’ contrary reasoning
flatly contradicts this Court’s cases, which require a determination
that Rule 23 is satisfied, even when that requires inquiry into the
merits of the claim. Wal-Mart, supra, at ___, and n. 6. Pp. 6–8.
(c) Under the proper standard for evaluating certification, respond-
ents’ model falls far short of establishing that damages can be meas-
ured classwide. The figure respondents’ expert used was calculated
assuming the validity of all four theories of antitrust impact initially
advanced by respondents. Because the model cannot bridge the dif-
ferences between supra-competitive prices in general and supra-
competitive prices attributable to overbuilder deterrence, Rule
23(b)(3) cannot authorize treating subscribers in the Philadelphia
cluster as members of a single class. Pp. 8–11.
655 F. 3d 182, reversed.
SCALIA, J., delivered the opinion of the Court, in which ROBERTS,
C. J., and KENNEDY, THOMAS, and ALITO, JJ., joined. GINSBURG and
BREYER, JJ., filed a dissenting opinion, in which SOTOMAYOR and KA-
GAN, JJ., joined.
Cite as: 569 U. S. ____ (2013) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash­
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that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 11–864
_________________
COMCAST CORPORATION, ET AL., PETITIONERS v.
CAROLINE BEHREND ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE THIRD CIRCUIT
[March 27, 2013]
JUSTICE SCALIA delivered the opinion of the Court.
The District Court and the Court of Appeals approved
certification of a class of more than 2 million current
and former Comcast subscribers who seek damages for al-
leged violations of the federal antitrust laws. We consider
whether certification was appropriate under Federal Rule
of Civil Procedure 23(b)(3).
I
Comcast Corporation and its subsidiaries, petitioners
here, provide cable-television services to residential and
commercial customers. From 1998 to 2007, petitioners
engaged in a series of transactions that the parties have
described as “clustering,” a strategy of concentrating op-
erations within a particular region. The region at issue
here, which the parties have referred to as the Philadel-
phia “cluster” or the Philadelphia “Designated Market
Area” (DMA), includes 16 counties located in Pennsylvania,
Delaware, and New Jersey.1 Petitioners pursued their
——————
1 A “Designated Market Area” is a term used by Nielsen Media Re­
search to define a broadcast-television market. Strictly speaking, the
2 COMCAST CORP. v. BEHREND
Opinion of the Court
clustering strategy by acquiring competitor cable provid­
ers in the region and swapping their own systems outside
the region for competitor systems located in the region.
For instance, in 2001, petitioners obtained Adelphia Com-
munications’ cable systems in the Philadelphia DMA,
along with its 464,000 subscribers; in exchange, petition­
ers sold to Adelphia their systems in Palm Beach, Florida,
and Los Angeles, California. As a result of nine cluster-
ing transactions, petitioners’ share of subscribers in the re-
gion allegedly increased from 23.9 percent in 1998 to 69.5
percent in 2007. See 264 F. R. D. 150, 156, n. 8, 160 (ED
Pa. 2010).
The named plaintiffs, respondents here, are subscribers
to Comcast’s cable-television services. They filed a class­
action antitrust suit against petitioners, claiming that
petitioners entered into unlawful swap agreements, in
violation of §1 of the Sherman Act, and monopolized or at-
tempted to monopolize services in the cluster, in viola­
tion of §2. Ch. 647, 26 Stat. 209, as amended, 15 U. S. C.
§§1, 2. Petitioners’ clustering scheme, respondents con­
tended, harmed subscribers in the Philadelphia cluster by
eliminating competition and holding prices for cable ser­
vices above competitive levels.
Respondents sought to certify a class under Federal
Rule of Civil Procedure 23(b)(3). That provision permits
certification only if “the court finds that the questions of
law or fact common to class members predominate over
any questions affecting only individual members.” The
District Court held, and it is uncontested here, that to
meet the predominance requirement respondents had to
show (1) that the existence of individual injury resulting
from the alleged antitrust violation (referred to as “anti­
trust impact”) was “capable of proof at trial through
evidence that [was] common to the class rather than indi­
——————
Philadelphia DMA comprises 18 counties, not 16.
Cite as: 569 U. S. ____ (2013) 3
Opinion of the Court
vidual to its members”; and (2) that the damages resulting
from that injury were measurable “on a class-wide basis”
through use of a “common methodology.” 264 F. R. D., at
154.2
Respondents proposed four theories of antitrust impact:
First, Comcast’s clustering made it profitable for Comcast
to withhold local sports programming from its competi­
tors, resulting in decreased market penetration by direct
broadcast satellite providers. Second, Comcast’s activities
reduced the level of competition from “overbuilders,” com­
panies that build competing cable networks in areas
where an incumbent cable company already operates.
Third, Comcast reduced the level of “benchmark” competi­
tion on which cable customers rely to compare prices.
Fourth, clustering increased Comcast’s bargaining power
relative to content providers. Each of these forms of im­
pact, respondents alleged, increased cable subscription
rates throughout the Philadelphia DMA.
The District Court accepted the overbuilder theory of
antitrust impact as capable of classwide proof and rejected
the rest. Id., at 165, 174, 178, 181. Accordingly, in its
certification order, the District Court limited respondents’
“proof of antitrust impact” to “the theory that Comcast
engaged in anticompetitive clustering conduct, the effect of
which was to deter the entry of overbuilders in the Phila­
delphia DMA.” App. to Pet. for Cert. 192a–193a.3
——————
2 Respondents sought certification for the following class: “All cable
television customers who subscribe or subscribed at any times since
December 1, 1999, to the present to video programming services (other
than solely to basic cable services) from Comcast, or any of its subsidi­
aries or affiliates in Comcast’s Philadelphia cluster.” App. 35a.
3 The District Court did not hold that the three alternative theories of
liability failed to establish antitrust impact, but merely that those
theories could not be determined in a manner common to all the class
plaintiffs. The other theories of liability may well be available for
the plaintiffs to pursue as individual actions. Any contention that the
plaintiffs should be allowed to recover damages attributable to all four
4 COMCAST CORP. v. BEHREND
Opinion of the Court
The District Court further found that the damages
resulting from overbuilder-deterrence impact could be
calculated on a classwide basis. To establish such dam-
ages, respondents had relied solely on the testimony of Dr.
James McClave. Dr. McClave designed a regression model
comparing actual cable prices in the Philadelphia DMA
with hypothetical prices that would have prevailed but
for petitioners’ allegedly anticompetitive activities. The
model calculated damages of $875,576,662 for the entire
class. App. 1388a (sealed). As Dr. McClave acknowledged,
however, the model did not isolate damages resulting
from any one theory of antitrust impact. Id., at 189a–
190a. The District Court nevertheless certified the class.
A divided panel of the Court of Appeals affirmed. On
appeal, petitioners contended the class was improperly
certified because the model, among other shortcomings,
failed to attribute damages resulting from overbuilder
deterrence, the only theory of injury remaining in the case.
The court refused to consider the argument because, in its
view, such an “attac[k] on the merits of the methodology
[had] no place in the class certification inquiry.” 655 F. 3d
182, 207 (CA3 2011). The court emphasized that, “[a]t
the class certification stage,” respondents were not required
to “tie each theory of antitrust impact to an exact calcula­
tion of damages.” Id., at 206. According to the court, it
had “not reached the stage of determining on the merits
whether the methodology is a just and reasonable infer­
ence or speculative.” Ibid. Rather, the court said, re­
spondents must “assure us that if they can prove antitrust
impact, the resulting damages are capable of measure­
ment and will not require labyrinthine individual calcula­
——————
theories in this class action would erroneously suggest one of two
things—either that the plaintiffs may also recover such damages in
individual actions or that they are precluded from asserting those
theories in individual actions.
Cite as: 569 U. S. ____ (2013) 5
Opinion of the Court
tions.” Ibid. In the court’s view, that burden was met
because respondents’ model calculated “supra-competitive
prices regardless of the type of anticompetitive conduct.”
Id., at 205.
We granted certiorari. 567 U. S. ___ (2012).4
II
The class action is “an exception to the usual rule that
litigation is conducted by and on behalf of the individual
named parties only.” Califano v. Yamasaki, 442 U. S. 682,
700–701 (1979). To come within the exception, a party
seeking to maintain a class action “must affirmatively
demonstrate his compliance” with Rule 23. Wal-Mart
Stores, Inc. v. Dukes, 564 U. S. ___, ___ (2011) (slip op., at
10). The Rule “does not set forth a mere pleading stand­
ard.” Ibid. Rather, a party must not only “be prepared to
prove that there are in fact sufficiently numerous parties,
common questions of law or fact,” typicality of claims or
defenses, and adequacy of representation, as required by
Rule 23(a). Ibid. The party must also satisfy through
evidentiary proof at least one of the provisions of Rule
——————
4 The question presented reads: “Whether a district court may certify
a class action without resolving whether the plaintiff class had intro­
duced admissible evidence, including expert testimony, to show that the
case is susceptible to awarding damages on a class-wide basis.” 567
U. S., at ___. Respondents contend that petitioners forfeited their
ability to answer this question in the negative because they did not
make an objection to the admission of Dr. McClave’s testimony under
the Federal Rules of Evidence. See Daubert v. Merrell Dow Pharma-
ceuticals, Inc., 509 U. S. 579 (1993). Such a forfeit would make it
impossible for petitioners to argue that Dr. McClave’s testimony was
not “admissible evidence” under the Rules; but it does not make it
impossible for them to argue that the evidence failed “to show that the
case is susceptible to awarding damages on a class-wide basis.” Peti­
tioners argued below, and continue to argue here, that certification was
improper because respondents had failed to establish that damages
could be measured on a classwide basis. That is the question we
address here.
6 COMCAST CORP. v. BEHREND
Opinion of the Court
23(b). The provision at issue here is Rule 23(b)(3), which
requires a court to find that “the questions of law or fact
common to class members predominate over any questions
affecting only individual members.”
Repeatedly, we have emphasized that it “ ‘may be neces­
sary for the court to probe behind the pleadings before
coming to rest on the certification question,’ and that
certification is proper only if ‘the trial court is satisfied,
after a rigorous analysis, that the prerequisites of Rule
23(a) have been satisfied.’ ” Ibid. (quoting General Tele-
phone Co. of Southwest v. Falcon, 457 U. S. 147, 160–161
(1982)). Such an analysis will frequently entail “overlap
with the merits of the plaintiff ’s underlying claim.” 564
U. S., at ___ (slip op., at 10). That is so because the “ ‘class
determination generally involves considerations that are
enmeshed in the factual and legal issues comprising the
plaintiff ’s cause of action.’ ” Ibid. (quoting Falcon, supra,
at 160).
The same analytical principles govern Rule 23(b). If
anything, Rule 23(b)(3)’s predominance criterion is even
more demanding than Rule 23(a). Amchem Products, Inc.
v. Windsor, 521 U. S. 591, 623–624 (1997). Rule 23(b)(3),
as an “ ‘adventuresome innovation,’ ” is designed for situa­
tions “ ‘in which “class-action treatment is not as clearly
called for.” ’ ” Wal-Mart, supra, at ___ (slip op., at 22)
(quoting Amchem, 521 U. S., at 614–615). That explains
Congress’s addition of procedural safeguards for (b)(3)
class members beyond those provided for (b)(1) or (b)(2)
class members (e.g., an opportunity to opt out), and the
court’s duty to take a “ ‘close look’ ” at whether common
questions predominate over individual ones. Id., at 615.
III
Respondents’ class action was improperly certified un­
der Rule 23(b)(3). By refusing to entertain arguments
against respondents’ damages model that bore on the
Cite as: 569 U. S. ____ (2013) 7
Opinion of the Court
propriety of class certification, simply because those ar­
guments would also be pertinent to the merits determina­
tion, the Court of Appeals ran afoul of our precedents
requiring precisely that inquiry. And it is clear that,
under the proper standard for evaluating certification,
respondents’ model falls far short of establishing that
damages are capable of measurement on a classwide basis.
Without presenting another methodology, respondents
cannot show Rule 23(b)(3) predominance: Questions of
individual damage calculations will inevitably overwhelm
questions common to the class. This case thus turns on
the straightforward application of class-certification prin­
ciples; it provides no occasion for the dissent’s extended
discussion, post, at 5–11 (GINSBURG and BREYER, JJ.,
dissenting), of substantive antitrust law.
A
We start with an unremarkable premise. If respondents
prevail on their claims, they would be entitled only to
damages resulting from reduced overbuilder competition,
since that is the only theory of antitrust impact accepted
for class-action treatment by the District Court. It follows
that a model purporting to serve as evidence of damages in
this class action must measure only those damages at­
tributable to that theory. If the model does not even at­
tempt to do that, it cannot possibly establish that damages
are susceptible of measurement across the entire class for
purposes of Rule 23(b)(3). Calculations need not be exact,
see Story Parchment Co. v. Paterson Parchment Paper Co.,
282 U. S. 555, 563 (1931), but at the class-certification
stage (as at trial), any model supporting a “plaintiff ’s
damages case must be consistent with its liability case,
particularly with respect to the alleged anticompetitive
effect of the violation.” ABA Section of Antitrust Law,
Proving Antitrust Damages: Legal and Economic Issues
57, 62 (2d ed. 2010); see, e.g., Image Tech. Servs. v. East-
8 COMCAST CORP. v. BEHREND
Opinion of the Court
man Kodak Co., 125 F. 3d 1195, 1224 (CA9 1997). And for
purposes of Rule 23, courts must conduct a “ ‘rigorous
analysis’ ” to determine whether that is so. Wal-Mart,
supra, at ___ (slip op., at 10).
The District Court and the Court of Appeals saw no
need for respondents to “tie each theory of antitrust im­
pact” to a calculation of damages. 655 F. 3d, at 206. That,
they said, would involve consideration of the “merits”
having “no place in the class certification inquiry.” Id.,at 206–207. That reasoning flatly contradicts our cases
requiring a determination that Rule 23 is satisfied, even
when that requires inquiry into the merits of the claim.
Wal-Mart, supra, at ___, and n. 6 (slip op., at 10–11, and
n. 6). The Court of Appeals simply concluded that re­
spondents “provided a method to measure and quantify
damages on a classwide basis,” finding it unnecessary to
decide “whether the methodology [was] a just and reason­
able inference or speculative.” 655 F. 3d, at 206. Under
that logic, at the class-certification stage any method of
measurement is acceptable so long as it can be applied
classwide, no matter how arbitrary the measurements
may be. Such a proposition would reduce Rule 23(b)(3)’s
predominance requirement to a nullity.
B
There is no question that the model failed to measure
damages resulting from the particular antitrust injury
on which petitioners’ liability in this action is premised.5
——————
5 The dissent is of the view that what an econometric model proves is
a “question of fact” on which we will not “undertake to review concur­
rent findings . . . by two courts below in the absence of a very obvious
and exceptional showing of error.” Post, at 9 (quoting United States v.
Virginia, 518 U. S. 515, 589, n. 5 (1996) (SCALIA, J., dissenting) (inter­
nal quotation marks omitted)). To begin with, neither of the courts
below found that the model established damages attributable to over­
building alone. Second, while the data contained within an econometric
model may well be “questions of fact” in the relevant sense, what those
Cite as: 569 U. S. ____ (2013) 9
Opinion of the Court
The scheme devised by respondents’ expert, Dr. McClave,
sought to establish a “but for” baseline—a figure that
would show what the competitive prices would have been
if there had been no antitrust violations. Damages would
then be determined by comparing to that baseline what
the actual prices were during the charged period. The
“but for” figure was calculated, however, by assuming a
market that contained none of the four distortions that
respondents attributed to petitioners’ actions. In other
words, the model assumed the validity of all four theories
of antitrust impact initially advanced by respondents:
decreased penetration by satellite providers, overbuilder
deterrence, lack of benchmark competition, and increased
bargaining power. At the evidentiary hearing, Dr.
McClave expressly admitted that the model calculated
damages resulting from “the alleged anticompetitive
conduct as a whole” and did not attribute damages to
any one particular theory of anticompetitive impact. App.
189a–190a, 208a.
This methodology might have been sound, and might
have produced commonality of damages, if all four of those
alleged distortions remained in the case. But as Judge
Jordan’s partial dissent pointed out:
“[B]ecause the only surviving theory of antitrust im­
pact is that clustering reduced overbuilding, for Dr.
McClave’s comparison to be relevant, his benchmark
counties must reflect the conditions that would have
prevailed in the Philadelphia DMA but for the alleged
reduction in overbuilding. In all respects unrelated to
reduced overbuilding, the benchmark counties should
——————
data prove is no more a question of fact than what our opinions hold.
And finally, even if it were a question of fact, concluding that the model
here established damages attributable to overbuilding alone would be
“obvious[ly] and exceptional[ly]” erroneous.
10 COMCAST CORP. v. BEHREND
Opinion of the Court
reflect the actual conditions in the Philadelphia DMA,
or else the model will identify ‘damages’ that are not
the result of reduced overbuilding, or, in other words,
that are not the certain result of the wrong.” 655
F. 3d, at 216 (internal quotation marks omitted).
The majority’s only response to this was that “[a]t the
class certification stage we do not require that Plaintiffs
tie each theory of antitrust impact to an exact calculation
of damages, but instead that they assure us that if they
can prove antitrust impact, the resulting damages are
capable of measurement and will not require labyrinthine
individual calculations.” Id., at 206. But such assurance
is not provided by a methodology that identifies damages
that are not the result of the wrong. For all we know,
cable subscribers in Gloucester County may have been
overcharged because of petitioners’ alleged elimination of
satellite competition (a theory of liability that is not ca-
pable of classwide proof ); while subscribers in Camden
County may have paid elevated prices because of petitioners’
increased bargaining power vis-à-vis content providers
(another theory that is not capable of classwide proof );
while yet other subscribers in Montgomery County may
have paid rates produced by the combined effects of multi­
ple forms of alleged antitrust harm; and so on. The per­
mutations involving four theories of liability and 2 million
subscribers located in 16 counties are nearly endless.
In light of the model’s inability to bridge the differences
between supra-competitive prices in general and supra­
competitive prices attributable to the deterrence of over­
building, Rule 23(b)(3) cannot authorize treating subscrib­
ers within the Philadelphia cluster as members of a single
class.6 Prices whose level above what an expert deems
——————
6 We might add that even if the model had identified subscribers who
paid more solely because of the deterrence of overbuilding, it still would
not have established the requisite commonality of damages unless it
Cite as: 569 U. S. ____ (2013) 11
Opinion of the Court
“competitive” has been caused by factors unrelated to an
accepted theory of antitrust harm are not “anticompeti­
tive” in any sense relevant here. “The first step in a dam­
ages study is the translation of the legal theory of the
harmful event into an analysis of the economic impact of
that event.” Federal Judicial Center, Reference Manual on
Scientific Evidence 432 (3d ed. 2011) (emphasis added).
The District Court and the Court of Appeals ignored that
first step entirely.
The judgment of the Court of Appeals for the Third Cir­
cuit is reversed.
It is so ordered.
——————
plausibly showed that the extent of overbuilding (absent deterrence)
would have been the same in all counties, or that the extent is irrele­
vant to effect upon ability to charge supra-competitive prices.
Cite as: 569 U. S. ____ (2013) 1
GINSBURG and BREYER, JJ., dissenting
SUPREME COURT OF THE UNITED STATES
_________________
No. 11–864
_________________
COMCAST CORPORATION, ET AL., PETITIONERS v.
CAROLINE BEHREND ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE THIRD CIRCUIT
[March 27, 2013]
JUSTICE GINSBURG and JUSTICE BREYER, with whom
JUSTICE SOTOMAYOR and JUSTICE KAGAN join, dissenting.
Today the Court reaches out to decide a case hardly fit
for our consideration. On both procedural and substantive
grounds, we dissent.
I
This case comes to the Court infected by our misguided
reformulation of the question presented. For that reason
alone, we would dismiss the writ of certiorari as improvi­
dently granted.
Comcast sought review of the following question:
“[W]hether a district court may certify a class action with­
out resolving ‘merits arguments’ that bear on [Federal
Rule of Civil Procedure] 23’s prerequisites for certifica­
tion, including whether purportedly common issues pre­
dominate over individual ones under Rule 23(b)(3).” Pet.
for Cert. i. We granted review of a different question:
“Whether a district court may certify a class action with­
out resolving whether the plaintiff class has introduced
admissible evidence, including expert testimony, to show
that the case is susceptible to awarding damages on a
class-wide basis.” 567 U. S. ___ (2012) (emphasis added).
Our rephrasing shifted the focus of the dispute from the
District Court’s Rule 23(b)(3) analysis to its attention (or
2 COMCAST CORP. v. BEHREND
GINSBURG and BREYER, JJ., dissenting
lack thereof) to the admissibility of expert testimony. The
parties, responsively, devoted much of their briefing to the
question whether the standards for admissibility of expert
evidence set out in Federal Rule of Evidence 702 and
Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U. S.
579 (1993), apply in class certification proceedings. See
Brief for Petitioners 35–49; Brief for Respondents 24–37.
Indeed, respondents confirmed at oral argument that they
understood our rewritten question to center on admissibil­
ity, not Rule 23(b)(3). See, e.g., Tr. of Oral Arg. 25.
As it turns out, our reformulated question was inapt. To
preserve a claim of error in the admission of evidence, a
party must timely object to or move to strike the evidence.
Fed. Rule Evid. 103(a)(1). In the months preceding the
District Court’s class certification order, Comcast did not
object to the admission of Dr. McClave’s damages model
under Rule 702 or Daubert. Nor did Comcast move to
strike his testimony and expert report. Consequently,
Comcast forfeited any objection to the admission of Dr.
McClave’s model at the certification stage. At this late
date, Comcast may no longer argue that respondents’
damages evidence was inadmissible.
Comcast’s forfeiture of the question on which we granted
review is reason enough to dismiss the writ as improvi­
dently granted. See Rogers v. United States, 522 U. S.
252, 259 (1998) (O’Connor, J., concurring in result) (“[W]e
ought not to decide the question if it has not been cleanly
presented.”); The Monrosa v. Carbon Black Export, Inc.,
359 U. S. 180, 183 (1959) (dismissal appropriate in light
of “circumstances . . . not fully apprehended at the time
certiorari was granted” (internal quotation marks omit­
ted)). The Court, however, elects to evaluate whether re­
spondents “failed to show that the case is susceptible to
awarding damages on a class-wide basis.” Ante, at 5, n. 4
(internal quotation marks omitted). To justify this second
revision of the question presented, the Court observes that
Cite as: 569 U. S. ____ (2013) 3
GINSBURG and BREYER, JJ., dissenting
Comcast “argued below, and continue[s] to argue here,
that certification was improper because respondents had
failed to establish that damages could be measured on a
classwide basis.” Ibid. And so Comcast did, in addition to
endeavoring to address the question on which we granted
review. By treating the first part of our reformulated
question as though it did not exist, the Court is hardly fair
to respondents.
Abandoning the question we instructed the parties to
brief does “not reflect well on the processes of the Court.”
Redrup v. New York, 386 U. S. 767, 772 (1967) (Harlan, J.,
dissenting). Taking their cue from our order, respondents
did not train their energies on defending the District
Court’s finding of predominance in their briefing or at oral
argument. The Court’s newly revised question, focused on
predominance, phrased only after briefing was done, left
respondents without an unclouded opportunity to air the
issue the Court today decides against them. And by re­
solving a complex and fact-intensive question without the
benefit of full briefing, the Court invites the error into
which it has fallen. See infra, at 5–11.
II
While the Court’s decision to review the merits of the
District Court’s certification order is both unwise and un­
fair to respondents, the opinion breaks no new ground on
the standard for certifying a class action under Federal
Rule of Civil Procedure 23(b)(3). In particular, the deci­
sion should not be read to require, as a prerequisite to
certification, that damages attributable to a classwide
injury be measurable “ ‘on a class-wide basis.’ ” See ante,
at 2–3 (acknowledging Court’s dependence on the absence
of contest on the matter in this case); Tr. of Oral Arg. 41.
To gain class-action certification under Rule 23(b)(3),
the named plaintiff must demonstrate, and the District
Court must find, “that the questions of law or fact common
4 COMCAST CORP. v. BEHREND
GINSBURG and BREYER, JJ., dissenting
to class members predominate over any questions affect­
ing only individual members.” This predominance re­
quirement is meant to “tes[t] whether proposed classes are
sufficiently cohesive to warrant adjudication by represen­
tation,” Amchem Products, Inc. v. Windsor, 521 U. S. 591,
623 (1997), but it scarcely demands commonality as to all
questions. See 7AA C. Wright, A. Miller, & M. Kane,
Federal Practice and Procedure §1778, p. 121 (3d ed. 2005)
(hereinafter Wright, Miller, & Kane). In particular, when
adjudication of questions of liability common to the class
will achieve economies of time and expense, the predomi­
nance standard is generally satisfied even if damages are
not provable in the aggregate. See Advisory Committee’s
1966 Notes on Fed. Rule Civ. Proc. 23, 28 U. S. C. App.,
p. 141 (“[A] fraud perpetrated on numerous persons by
the use of similar misrepresentations may be an appealing
situation for a class action, and it may remain so despite
the need, if liability is found, for separate determination of
the damages suffered by individuals within the class.”);
7AA Wright, Miller, & Kane §1781, at 235–237.*
Recognition that individual damages calculations do not
preclude class certification under Rule 23(b)(3) is well nigh
universal. See 2 W. Rubenstein, Newberg on Class Ac­
tions §4:54, p. 205 (5th ed. 2012) (ordinarily, “individual
damage[s] calculations should not scuttle class certifica­
tion under Rule 23(b)(3)”). Legions of appellate decisions
across a range of substantive claims are illustrative. See,
e.g., Tardiff v. Knox County, 365 F. 3d 1, 6 (CA1 2004)
(Fourth Amendment); Chiang v. Veneman, 385 F. 3d 256,
273 (CA3 2004) (Equal Credit Opportunity Act); Bertulli v.
——————
* A class may be divided into subclasses for adjudication of damages.
Fed. Rule Civ. Proc. 23(c)(4)–(5). Or, at the outset, a class may be
certified for liability purposes only, leaving individual damages calcula­
tions to subsequent proceedings. See 2 W. Rubenstein, Newberg on
Class Actions §4:54, pp. 206–208 (5th ed. 2012). Further, a certification
order may be altered or amended as the case unfolds. Rule 23(c)(1)(C).
Cite as: 569 U. S. ____ (2013) 5
GINSBURG and BREYER, JJ., dissenting
Independent Assn. of Continental Pilots, 242 F. 3d 290,
298 (CA5 2001) (Labor-Management Reporting and Dis­
closure Act and Railway Labor Act); Beattie v. CenturyTel,
Inc., 511 F. 3d 554, 564–566 (CA6 2007) (Federal Commu­
nications Act); Arreola v. Godinez, 546 F. 3d 788, 801 (CA7
2008) (Eighth Amendment). Antitrust cases, which typi­
cally involve common allegations of antitrust violation,
antitrust impact, and the fact of damages, are classic
examples. See In re Visa Check/MasterMoney Antitrust
Litigation, 280 F. 3d 124, 139–140 (CA2 2001). See also
2A P. Areeda, H. Hovenkamp, R. Blair, & C. Durrance,
Antitrust Law ¶331, p. 56 (3d ed. 2007) (hereinafter
Areeda & Hovenkamp); 6 A. Conte & H. Newberg, New­
berg on Class Actions §18:27, p. 91 (4th ed. 2002). As
this Court has rightly observed, “[p]redominance is a test
readily met” in actions alleging “violations of the antitrust
laws.” Amchem, 521 U. S., at 625.
The oddity of this case, in which the need to prove
damages on a classwide basis through a common method­
ology was never challenged by respondents, see Brief for
Plaintiffs-Appellees in No. 10–2865 (CA3), pp. 39–40, is a
further reason to dismiss the writ as improvidently granted.
The Court’s ruling is good for this day and case only.
In the mine run of cases, it remains the “black letter rule”
that a class may obtain certification under Rule 23(b)(3)
when liability questions common to the class predominate
over damages questions unique to class members. 2 Ru­
benstein, supra, §4:54, at 208.
III
Incautiously entering the fray at this interlocutory
stage, the Court sets forth a profoundly mistaken view of
antitrust law. And in doing so, it relies on its own version
of the facts, a version inconsistent with factual findings
made by the District Court and affirmed by the Court of
Appeals.
6 COMCAST CORP. v. BEHREND
GINSBURG and BREYER, JJ., dissenting
A
To understand the antitrust problem, some (simplified)
background discussion is necessary. Plaintiffs below, re­
spondents here, alleged that Comcast violated §§1 and 2
of the Sherman Act. See 15 U. S. C. §§1, 2. For present
purposes, the §2 claim provides the better illustration. A
firm is guilty of monopolization under §2 if the plaintiff
proves (1) “the possession of monopoly power in the rele­
vant market” and (2) “the willful acquisition or mainte­
nance of that power[,] as distinguished from growth or
development as a consequence of a superior product, busi­
ness acumen, or historic accident.” United States v.
Grinnell Corp., 384 U. S. 563, 570–571 (1966). A private
plaintiff seeking damages must also show that (3) the
monopolization caused “injur[y].” 15 U. S. C. §15. We
have said that antitrust injuries must be “of the type the
antitrust laws were intended to prevent and that flo[w]
from that which makes defendants’ acts unlawful.” Atlan-
tic Richfield Co. v. USA Petroleum Co., 495 U. S. 328, 334
(1990) (quoting Brunswick Corp. v. Pueblo Bowl-O-Mat,
Inc., 429 U. S. 477, 489 (1977)). See 2A Areeda & Ho­
venkamp ¶391a, at 320 (To prove antitrust injury, “[a]
private plaintiff must identify the economic rationale for a
business practice’s illegality under the antitrust laws and
show that its harm flows from whatever it is that makes
the practice unlawful.”).
As plaintiffs below, respondents attempted to meet
these requirements by showing that (1) Comcast obtained
a 60% or greater share of the Philadelphia market, and
that its share provides it with monopoly power; (2) Com­
cast acquired its share through exclusionary conduct
consisting of a series of mergers with competitors and
“swaps” of customers and locations; and (3) Comcast con­
sequently injured respondents by charging them supra­
competitive prices.
If, as respondents contend, Philadelphia is a separate
Cite as: 569 U. S. ____ (2013) 7
GINSBURG and BREYER, JJ., dissenting
well-defined market, and the alleged exclusionary conduct
permitted Comcast to obtain a market share of at least
60%, then proving the §2 violation may not be arduous.
As a point of comparison, the government considers a
market shared by four firms, each of which has 25% mar­
ket share, to be “highly concentrated.” Dept. of Justice &
Federal Trade Commission, Horizontal Merger Guidelines
§5.3, p. 19 (2010). A market, such as the one alleged by
respondents, where one firm controls 60% is far worse.
See id., §5.3, at 18–19, and n. 9 (using a concentration
index that determines a market’s concentration level by
summing the squares of each firm’s market share, one
firm with 100% yielding 10,000, five firms with 20% each
yielding 2000, while a market where one firm accounts for
60% yields an index number of at least 3,600). The Guide­
lines, and any standard antitrust treatise, explain why
firms in highly concentrated markets normally have the
power to raise prices significantly above competitive lev­
els. See, e.g., 2B Areeda & Hovenkamp ¶503, at 115.
B
So far there is agreement. But consider the last matter
respondents must prove: Can they show that Comcast
injured them by charging higher prices? After all, a firm
with monopoly power will not necessarily exercise that
power by charging higher prices. It could instead act less
competitively in other ways, such as by leading the quiet
life. See J. Hicks, Annual Survey of Economic Theory: The
Theory of Monopoly, 3 Econometrica 1, 8 (1935) (“The best
of all monopoly profits is a quiet life.”).
It is at this point that Dr. McClave’s model enters the
scene. His model first selects a group of comparable
outside-Philadelphia “benchmark” counties, where Comcast
enjoyed a lower market share (and where satellite broad­
casting accounted for more of the local business). Using
multiple regression analysis, McClave’s model measures
8 COMCAST CORP. v. BEHREND
GINSBURG and BREYER, JJ., dissenting
the effect of the anticompetitive conduct by comparing
the class counties to the benchmark counties. The model
concludes that the prices Philadelphia area consumers
would have paid had the Philadelphia counties shared
the properties of the benchmark counties (including a
diminished Comcast market share), would have been
13.1% lower than those they actually paid. Thus, the model
provides evidence that Comcast’s anticompetitive conduct,
which led to a 60% market share, caused the class to
suffer injuriously higher prices.
C
1
The special antitrust-related difficulty present here
stems from the manner in which respondents attempted
to prove their antitrust injuries. They proffered four
“non-exclusive mechanisms” that allegedly “cause[d] the
high prices” in the Philadelphia area. App. 403a. Those four
theories posit that (1) due to Comcast’s acquisitions of
competitors, customers found it more difficult to compare
prices; (2) one set of potential competitors, namely Direct
Broadcast Satellite companies, found it more difficult to
obtain access to local sports broadcasts and consequently
decided not to enter the Philadelphia market; (3) Com­
cast’s ability to obtain programming material at lower
prices permitted it to raise prices; and (4) a number of
potential competitors (called “overbuilders”), whose pres­
ence in the market would have limited Comcast’s power to
raise prices, were ready to enter some parts of the market
but decided not to do so in light of Comcast’s anticompeti­
tive conduct. 264 F. R. D. 150, 161–162 (ED Pa. 2010).
For reasons not here relevant, the District Court found
the first three theories inapplicable and limited the
liability-phase proof to the “overbuilder” theory. See App.
to Pet. for Cert. 192a–193a. It then asked the parties to
brief whether doing so had any impact on the viability of
Cite as: 569 U. S. ____ (2013) 9
GINSBURG and BREYER, JJ., dissenting
McClave’s model as a measure of classwide damages. See
264 F. R. D., at 190. After considering the parties’ argu­
ments, the District Court found that striking the three
theories “does not impeach Dr. McClave’s damages model”
because “[a]ny anticompetitive conduct is reflected in the
[higher Philadelphia] price [which Dr. McClave’s model
determines], not in the [the model’s] selection of the
comparison counties, [i.e., the lower-price ‘benchmark
counties’ with which the Philadelphia area prices were
compared].” Id., at 190–191. The court explained that
“whether or not we accepted all [four] . . . theories . . . is
inapposite to Dr. McClave’s methods of choosing bench­
marks.” Ibid. On appeal, the Third Circuit held that this
finding was not an abuse of discretion. 655 F. 3d 182, 207
(2011).
2
The Court, however, concludes that “the model failed to
measure damages resulting from the particular antitrust
injury on which petitioners’ liability in this action is prem­
ised.” Ante, at 8. To reach this conclusion the Court must
consider fact-based matters, namely what this econometric
multiple-regression model is about, what it proves, and
how it does so. And it must overturn two lower courts’
related factual findings to the contrary.
We are normally “reluctant to disturb findings of fact in
which two courts below have concurred.” United States v.
Doe, 465 U. S. 605, 614 (1984). See also United States v.
Virginia, 518 U. S. 515, 589, n. 5 (1996) (SCALIA, J., dis­
senting) (noting “our well-settled rule that we will not
‘undertake to review concurrent findings of fact by two
courts below in the absence of a very obvious and excep­
tional showing of error’ ” (quoting Graver Tank & Mfg. Co.
v. Linde Air Products Co., 336 U. S. 271, 275 (1949))).
Here, the District Court found McClave’s econometric
model capable of measuring damages on a classwide basis,
10 COMCAST CORP. v. BEHREND
GINSBURG and BREYER, JJ., dissenting
even after striking three of the injury theories. 264
F. R. D., at 190–191. Contrary to the Court’s characteriza­
tion, see ante, at 8–9, n. 5, this was not a legal conclusion
about what the model proved; it was a factual finding
about how the model worked. Under our typical practice,
we should leave that finding alone.
In any event, as far as we can tell, the lower courts were
right. On the basis of the record as we understand it, the
District Court did not abuse its discretion in finding that
McClave’s model could measure damages suffered by the
class—even if the damages were limited to those caused by
deterred overbuilding. That is because respondents al­
leged that Comcast’s anticompetitive conduct increased
Comcast’s market share (and market power) by deterring
potential entrants, in particular, overbuilders, from enter­
ing the Philadelphia area market. See App. 43a–66a. By
showing that this was so, respondents’ proof tends to show
the same in respect to other entrants. The overbuilders’
failure to enter deprives the market of the price discipline
that their entry would have provided in other parts via
threat of the overbuilders’ expansion or that of others
potentially led on by their example. Indeed, in the District
Court, Comcast argued that the three other theories,
i.e., the three rejected theories, had no impact on prices.
See 264 F. R. D., at 166, 176, 180–181. If Comcast was
right, then the damages McClave’s model found must
have stemmed exclusively from conduct that deterred new
entry, say from “overbuilders.” Not surprisingly, the
Court offers no support at all for its contrary conclusion,
namely, that the District Court’s finding was “ ‘obvious[ly]
and exceptional[ly]’ erroneous.” Ante, at 8–9, n. 5 (quoting
Virginia, 518 U. S., at 589, n. 5 (SCALIA, J., dissenting)).
We are particularly concerned about the matter because
the Court, in reaching its contrary conclusion, makes
broad statements about antitrust law that it could not
mean to apply in other cases. The Court begins with what
Cite as: 569 U. S. ____ (2013) 11
GINSBURG and BREYER, JJ., dissenting
it calls an “unremarkable premise” that respondents could
be “entitled only to damages resulting from reduced over­
builder competition.” Ante, at 7. In most §2 cases, how­
ever, the Court’s starting place would seem remarkable, not
“unremarkable.”
Suppose in a different case a plaintiff were to prove that
Widget, Inc. has obtained, through anticompetitive means,
a 90% share of the California widget market. Suppose the
plaintiff also proves that the two small remaining firms—
one in Ukiah, the other in San Diego—lack the capacity to
expand their widget output to the point where that pos­
sibility could deter Widget, Inc. from raising its prices.
Suppose further that the plaintiff introduces a model that
shows California widget prices are now twice those in
every other State, which, the model concludes is (after
accounting for other possible reasons) the result of lack of
competition in the California widget market. Why would a
court hearing that case restrict damages solely to custom­
ers in the vicinity of Ukiah and San Diego?
Like the model in this example, Dr. McClave’s model
does not purport to show precisely how Comcast’s conduct
led to higher prices in the Philadelphia area. It simply
shows that Comcast’s conduct brought about higher prices.
And it measures the amount of subsequent harm.
* * *
Because the parties did not fully argue the question the
Court now answers, all Members of the Court may lack a
complete understanding of the model or the meaning of
related statements in the record. The need for focused
argument is particularly strong here where, as we have
said, the underlying considerations are detailed, technical,
and fact-based. The Court departs from our ordinary
practice, risks inaccurate judicial decisionmaking, and is
unfair to respondents and the courts below. For these rea­
sons, we would not disturb the Court of Appeals’ judgment
12 COMCAST CORP. v. BEHREND
GINSBURG and BREYER, JJ., dissenting
and, instead, would dismiss the writ as improvidently
granted.