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Court Upholds Use of Conjoint Analysis for Calculating Classwide Damages

The Ninth Circuit recently upheld the certification of a consumer class alleging that “all natural” labels on ConAgra's Wesson cooking oil misled customers who were concerned about genetically modified organisms. The case is Robert Briseno v. Conagra Foods, Inc. In appeal, ConAgra argued that the court had made a mistake in certifying the class because “individual issues predominate over common questions with respect to both materiality and damages.” With respect to damages, ConAgra claimed that the Plaintiffs did not offer a sufficient method for calculating classwide damages under Comcast Corp. v. Behrend.

The Plaintiffs proposed to measure the classwide price premium attributable to their theory of liability using two steps: first, hedonic regression analysis to calculate the price premium attributable to the “100% Natural” label; second, a consumer survey using conjoint analysis to segregate the portion of that premium attributable to a “no-GMO” understanding of the label. Conjoint analysis is a statistical technique used to measure consumer preferences for various features that factor into buying decisions. The Plaintiffs claimed that the conjoint analysis would assess the percentage of the “100% Natural” claim that is attributable to the absence of GMOs as opposed to other “non-natural” aspects of the Wesson Oils.

ConAgra challenged the reliability and soundness of this approach, but the court disagreed. Citing the use of “two well-established damages models”, the court stated that it was not an abuse of discretion to conclude that Plaintiff’s proposed model tracked their theory of liability and was therefore sufficient to survey class certification.

Class Action/Class Certification, Conjoint Analysis