The opinion of the court was delivered by: Magistrate Judge Geraldine Soat Brown
MEMORANDUM OPINION AND ORDER
Before the court is plaintiffs' Motion to Exclude the Report of Michael Vucurevich. [Dkt 271.] Defendants AppleIllinois, LLC, W. Curtis Smith, Jerry Kreger, and Doreen Borke as representative of the estate of James Borke and Archie Iodice (collectively, "defendants") have filed their opposition to the motion (Defs.' Resp.) [dkt 275], and plaintiffs have filed their reply (Pls.' Reply) [dkt 276]. For the reasons set forth below, the motion is granted in part and denied in part.
This class action case involves plaintiffs' claims against defendants under the Illinois Minimum Wage Law ("IMWL"), 820 Ill. Comp. Stat. 105/1, et seq., the Illinois Wage Payment and Collection Act ("IWPCA"), 820 Ill. Comp. Stat. 115/1. et seq., and the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201, et seq. (Third Am. Compl. ¶ 1.) [Dkt 141.] The named plaintiffs are five individuals who were formerly employed by AppleIllinois as servers and bartenders at an Applebee's restaurant in Ford City, Illinois. (Id. ¶ 2-6.) Generally, plaintiffs complain that when they worked for AppleIllinois, they failed to receive statutorily required minimum wages as the result of certain of defendants' practices. The following classes have been certified under Federal Rule of Civil Procedure 23 on plaintiffs' claims under the IMWL: (1) all AppleIllinois tipped employees who were not properly notified of defendants' practice with regard to tip credits; (2) all AppleIllinois tipped employees who were impermissibly paid a sub-minimum tip credit wage rate because AppleIllinois' tip sharing pool was unreasonable; and (3) all AppleIllinois tipped employees who were impermissibly paid a sub-minimum tip credit wage rate because they were required to perform duties unrelated to their tipped occupation for which they were not paid at the regular minimum wage rate. (Mem. Op. & Order, Mar. 2, 2010 at 46-47.) [Dkt 231.]
Pursuant to Federal Rule of Civil Procedure Rule 26(a)(2)(B), defendants disclosed the report of their proffered expert Michael Vucurevich. (Pls.' Mot., Ex. 1., Rpt. Michael Vucurevich.) Plaintiffs' present motion asks the court to strike the report and to bar Mr. Vucurevich from providing opinion testimony in this case.
After reviewing the parties' submissions and the transcript of Mr. Vucurevich's deposition, the court ordered a hearing pursuant to Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993) , which was held on July 7, 2011, and at which Mr. Vucurevich testified.*fn1
B. Mr. Vucurevich's report and opinions
Mr. Vucurevich proposes to testify to two opinions set out in his report. First, he opines that AppleIllinois' practice of requiring servers to contribute 2.5% of gross sales each day to a tip pool (a "2.5% tip pool contribution") is customary and reasonable within the casual dining segment of the restaurant industry. (Vucurevich Rpt. at 5.)*fn2 Second, he lists the duties that, in his opinion, are related to various tipped occupations. (Id. at 5-6, 11-18, 26-29.) This is offered in support of AppleIllinois' practice of having tipped employees perform some or all of those duties while being paid at the tip credit rate.
Mr. Vucurevich's opinions are based entirely on his experience working in the restaurant business, and not on any formal education or classroom training. (Hrg. 10:58:20.) In addition to his memory and general understanding of restaurant practices, Mr. Vucurevich was assisted by an employee, Megan McCrea, and by his business partner, Dan Simons, in compiling and drafting the report. (Defs.' Resp. Ex. 2, Dep. Michael Vucurevich at 77, 88; Hrg. 3:25:40.) Ms. McCrea also obtained information from contacts at nine restaurant chains in an attempt to determine if Mr. Vucurevich's experience was in line with wider industry practice. (Vucurevich Rpt. at 10; Vucurevich Dep. at 137.)
Federal Rule of Evidence 702, which governs the admission of expert witness testimony, provides:
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.
In Daubert, the Supreme Court emphasized the "gatekeeping" role of the federal trial judge in ensuring that expert testimony is both relevant and reliable. Daubert, 509 U.S. at 589, 597. To make this determination, courts consider: (1) whether the witness is qualified as an expert by knowledge, skill, experience, training, or education; (2) whether the testimony has a reliable basis in the knowledge and experience of the relevant discipline; and (3) whether the testimony will "assist the trier of fact to understand the evidence or to determine a fact in issue." See Myers v. Ill. C. R.R. Co., 629 F.3d 639, 644 (7th Cir. 2010) (quoting Ervin v. Johnson & Johnson, Inc., 492 F.3d 901, 904 (7th Cir. 2007)). "The proponent of the expert bears the burden of demonstrating that the expert's testimony would satisfy the Daubert standard." Lewis v. CITGO Petroleum Corp., 561 F.3d 698, 705 (7th Cir. 2009) (citing Fed. R. Evid. 702 advisory comm. nn. (2000 Amends.)).
Mr. Vucurevich based his opinions in this case on his experience in the restaurant industry. He is not an academic; he is a consultant and businessman. Except for Ms. McCrea's calls to others in the restaurant industry, Mr. Vucurevich conducted no research before preparing his report. Rule 702 permits testimony by an expert whose qualification is based on experience. Fed. R. Evid. 702 and advisory comm. nn. (2000 Amends.); Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999).
An expert's opinion based solely on experience, however, still must "be an expert opinion (that is, an opinion informed by the witness' expertise) rather than simply an opinion broached by a purported expert." Jones v. Lincoln Elec. Co., 188 F.3d 709, 723 (7th Cir. 1999); accord Metavante Corp. v. Emigrant Savings Bank, 619 F.3d 748, 761 (7th Cir. 2010). The expert must "explain the 'methodologies and principles' that support his opinion; he cannot simply assert 'a bottom line.'" Metavante, 619 F.3d at 761 (quotation omitted). "If the witness is relying solely or primarily on experience, then the witness must explain how that experience leads to the conclusion reached, why that experience is a sufficient basis for the opinion, and how that experience is reliably applied to the facts. The trial court's gatekeeping function requires more than simply 'taking the expert's word for it.'" Fed. R. Evid. 702 advisory comm. nn. (2000 Amends.) (quoting Daubert v. Merrell Dow Pharmaceuticals, Inc., 43 F.3d 1311, 1319 (9th Cir. 1995); accord Gen. Elec. Co. v. Joiner, 522 U.S. 136, 146 (1997); Metavante, 619 F.3d at 761. The court must "make certain that an expert, whether basing testimony upon professional studies or personal experience, employs in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field." Kumho Tire, 526 U.S. at 152.
Plaintiffs object that Mr. Vucurevich's opinions are neither relevant nor reliable. (Pls.' Mot. Exclude at 2.) They argue that Mr. Vucurevich's opinions impermissibly draw legal conclusions and that evidence as to industry standards and customs is inadmissible in FLSA cases. (Id.; Pls.' Reply at 2.) Plaintiffs also argue that the report lacks well-grounded reasoning or methodology, and that Mr. Vucurevich lacks specialized knowledge or sufficient qualifications to opine on practices across the casual dining segment of the restaurant industry. ...