On August 9, 2017, the Honorable John A. Kronstadt, United States District Judge in the United States District Court, Central District Of California, released a ruling on Defendants’ Motion To Decertify The Rule 23 Damages Class in the case Oula Zakaria v. Gerber Products Co. Case No. LA CV15-00200 JAK (Ex).
The Defendant, Gerber Products Co., argued that the results of the conjoint analysis survey submitted could not be used to calculate a monetary remedy by determining the price premium that Defendant charged for a part of the label which made a claim that was untrue. Instead, Defendant contended that the conjoint study only evaluated consumers’ subjective willingness to pay as an abstract concept. Defendant argued that because the study did not measure the actual price premium paid, it could be used as an accurate measure of damages.
The judge then discussed several cases which were examples of unsuccessful and successful efforts to use conjoint analysis in litigation to calculate the actual price premium paid. One of the conjoint studies cited as successful was a conjoint study for a class action study regarding Lenovo laptop computers, which was conducted by Steven P. Gaskin, a conjoint analysis expert of Applied Marketing Science, Inc., Waltham, MA.
Here is the paragraph from page 26 of the ruling which made favorable mention of the conjoint analysis in the Lenovo adware case:
“Some of the cases that have accepted the use of conjoint analysis explained that the specific, proposed analysis considered market factors. For this reason, it could reasonably be used to assess the actual value of the mislabeled product in the actual market, rather than in an abstract study environment. For example, In re: Lenovo Adware Litig., No. 15-MD-02624-RMW, 2016 WL 6277245 (N.D. Cal. Oct. 27, 2016), relied on a conjoint analysis model of damages in certifying a class of purchasers of Lenovo laptop computers that allegedly contained faulty software. It distinguished NJOY and Saavedra because the expert in Lenovo “consulted pricing of the Lenovo models at issue, as well as comparable PC laptops” to ensure that the results would “reflect the market.” Id. at *21. The conjoint analysis expert also “addressed ‘the supply side’ of the market, determining that it was not at issue ‘because all sales of the laptop models at issue have occurred in the past.’” Id.”
Over the last few years, Conjoint Analysis has been utilized as a basis for damages calculations in Class Action matters. In our recent webinar on demand, Steve Gaskin and Amanda Ford describe the conjoint analysis methodology and give several examples of how it has been successfully used.