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Ethnicity-Based 'Economic Loss' Testimony Unconstitutional

By Michael Hoenig
June 01, 2016

Two years ago,'a bombshell decision issued in the Eastern District of New York by Judge Jack B. Weinstein held that it is unconstitutional to use ethnicity-based statistics to calculate future economic loss in a tort case. In G.M.M. v. Kimpson, 2015 U.S. Dist. LEXIS 99715 (E.D.N.Y. July 30, 2013), an infant lead-poisoning claim against a defendant landlord that resulted in a two-week trial and a plaintiff's verdict of about $2 million, the judge ruled that the testimony of three economics experts (two for the plaintiff and one for defendant) could not rely on assumptions based on ethnicity ' in that case, the fact that the infant was Hispanic. The July 30 Memorandum and Order explained the trial ruling and the reasons that such testimony is unconstitutional. Judge Weinstein found that use of “ethnicity-based statistics” to obtain a reduced damage award in calculating future economic loss violates due process and equal protection.

Judge Weinstein's decision could have a profound impact on economic loss evidence in cases where consulting or testifying economists rely on assumptions and statistics based, in part, on ethnicity factors. For example, in personal injury cases involving youngsters, impairment of future earnings and earning capacity are often contested issues. Exaggerating to make a point, plaintiffs' lawyers might like to posit that a five-year-old claimant, were she not injured, would have become a neurosurgeon. The defense, however, might like to show that, based on ethnicity and economic strata data, the child likely would not have gone beyond a high school education, which translates into a lower range of earnings into the future.

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