by info-services@infotechinc.com | Oct 31, 2020 | Case Updates
Infotech houses two distinct operating businesses, Systems and Consulting. However, both businesses were born out of one request by the Florida Attorney General 42 years ago: can computerized statistical techniques be developed to detect bid rigging in public procurement? The answer was yes, and Systems has been working with individual states ever since to make the highway construction industry more efficient and competitive while Consulting has been successfully helping states estimate damages when bid rigging is detected. This collaboration between businesses is still making an impact today, most recently in West Virginia.
In 2014, the Assistant Director of the West Virginia Department of Highways felt there were significant issues in their bidding process. After a preliminary analysis in 2015, Infotech began a thorough analysis of West Virginia AASHTOWare Project BAMS/DSS™ data going back to 1996. Infotech also obtained comparison data with cooperation from surrounding states including Ohio, Kentucky, Virginia, Pennsylvania and Maryland.
Data revealed that certain parts of the state were not competitive and, as a result, the West Virginia Attorney General and the Department of Transportation filed suit in 2017 against big name asphalt companies. Defendants attacked the reliability of the BAMS/DSS data and the subsequent analysis, but expert statistical consultant and Infotech co-founder Dr. Jim McClave, and Jeff Derrer, Infotech Senior Business Analyst, vigorously defended the data through multiple depositions and held steadfast in their knowledge that the data could only be explained by collusive behavior. After years of litigation, the case settled for $103,500,000, the largest antitrust settlement in West Virginia history. This was a victory for West Virginia and for both businesses of Infotech.
State of West Virginia, ex rel. Patrick Morrisey, Attorney General and Paul A. Mattox, Jr. in his Official Capacity as Secretary of Transportation and Commissioner of Highways, West Virginia Department of Transportation, v. CRH Plc, Oldcastle Inc, et al. Case No. 17-C-41, Cir. Ct of Kanawha County, WV (2017)
by info-services@infotechinc.com | Jul 1, 2020 | Case Updates
Infotech Consulting’s Expert Economist Dr. Rob Kneuper was hired by counsel for the Defendant, Southeast Petro, a gasoline distributor for Motiva Enterprises, a Shell affiliate, to evaluate the damages methodology and estimates produced by the Plaintiff’s expert. Plaintiff LLB Convenience and Gas, Inc. brought suit against Southeast Petro in the U.S. District for the Middle District of Florida, claiming a violation of the Petroleum Marketing Practices Act and a breach of contract.
Dr. Kneuper and the Infotech Consulting team reviewed the damages analysis put forth and conducted their own detailed econometric analyses using the Plaintiff’s financials. Through a report and deposition in fall 2019 and testimony at trial in February 2020, Dr. Kneuper identified substantial flaws in the work of the Plaintiff’s expert. In June 2020, District Court Judge Paul G. Byron ruled in favor of Southeast Petro, echoing Dr. Kneuper’s findings that the Plaintiff’s expert’s methodology was unreliable.
LLB Convenience & Gas, Inc. v. Southeast Petro Distributors, Inc., In the United States District Court for the Middle District of Florida, Case No.: 6:18-cv-00914-PGBTBS
by info-services@infotechinc.com | May 27, 2020 | Case Updates
Infotech Consulting was retained on behalf of Beazer Homes in a class action suit filed by Heritage Commons Townhome Association alleging breach of implied warranty, violation of Florida building codes, and negligence in construction of an 89-unit townhome project in Seminole County, Florida. Plaintiffs maintained that defects observed in their homes’ exteriors, windows, and architectural elements were due to systematic issues in the original design and construction of the buildings. The class claimed that as a direct and proximate result of Beazer’s negligence, large sums of money would be required to repair the defects and deficiencies and to maintain the property and buildings going forward.
The Plaintiffs retained a statistical expert who collected the results from the destructive testing performed on the buildings in the townhome project, then designed a sampling methodology and performed analyses intended to determine the likelihood of systemic defects contributing to the observed defects, as well as the need for repair or replacement. Dr. Jamie McClave Baldwin was hired by the Defendant to evaluate the methodology employed and conclusions drawn by the Plaintiff’s expert. Dr. McClave Baldwin conducted a rigorous review of the opposing expert’s sampling methods and thoroughly evaluated the data used in his calculations of confidence intervals and estimated defect rates. Infotech Consulting’s attention to statistical standards of reproducibility and reliability demonstrated that the Plaintiffs’ expert analyses were biased and not based on sound statistical principles, thus rendering his conclusions unreliable. The case was settled in a manner favorable to defendants in February 2020 for an undisclosed amount.
Heritage Commons Townhome Association, Inc v. Beazer Homes Corp., No. 2016-CA-002447-11E-W (Circuit Court for the Eighteenth Judicial Circuit in and For Seminole County, Florida)
by info-services@infotechinc.com | Apr 6, 2020 | Case Updates
In a breach of contract suit filed by authorized dealers of Fiat Chrysler Automobiles (FCA), dealers alleged that FCA falsified sales figures to artificially inflate the value of the company’s shares with the purpose of supporting their claim of unbroken year-to-year sales streak. FCA allegedly offered discriminatory allocations to dealers in return for their agreements to report unsold vehicles as sold to help inflate monthly sales figures. This action in essence “stacked the deck” against plaintiff dealers. The false sales figures were used to subsidize dealers that were in competition with plaintiffs. Infotech Consulting was hired by plaintiffs to perform a damages analysis to determine whether FCA’s system of allocation unfairly discriminated against plaintiffs in favor of competitor dealers, and, if so, the loss of sales resulting from this behavior. Infotech Consulting obtained data from 62 FCA dealers on vehicle sales, planning potential, discretionary allocation, and regular allocation. Our expert analysis determined that there was, in fact, discrimination that resulted in lost sales and commensurate lost profits to select FCA dealers. With help from Infotech Consulting, plaintiffs were able to secure a favorable undisclosed settlement.
Napleton’s Arlington Heights Motors, Inc., et al. v. FCA US, LLC, et al., Case No. 1:16-cv-0403 (US District Court for the N.D. of Illinois)
by info-services@infotechinc.com | Sep 5, 2018 | Case Updates
The country’s biggest dental supply distributors reached an $80 million settlement agreement with dentists and dental laboratories in a proposed class action case. Distributors Henry Schein, Inc., Patterson Cos. Inc. and Benco Dental Supply Co. Inc. were accused of artificially inflating prices on dental supplies and equipment. Products at issue included supplies such as adhesives, implants, tooth brushes, pins and posts all the way to equipment such as imaging devices and dental chairs. Although there are hundreds of distributors and manufacturers of dental supplies and equipment, Defendants controlled approximately 80% of the market share.
Info tech, Inc was hired to calculate damages to plaintiffs due to the alleged conspiratorial conduct. In formalizing a damage analysis, Infotech Consulting scrutinized over 400 million transactions that occurred between January 2009 and March 2016. After a thorough econometric analysis, Dr. McClave opined that prices were in fact elevated during the conspiracy period. Minutes before a scheduled Daubert hearing, defendants agreed to a settlement figure bringing the case to closure.
by info-services@infotechinc.com | Apr 6, 2018 | Case Updates
The Michael Titze Company purchased an outparcel in front of a shopping mall in Pensacola, Florida. Unbeknownst to Titze, this property was subject to restrictive covenants that required Titze to obtain permission from Simon (owner of the shopping mall) for any construction or improvement to the property and restricted Titze from improving the property in any manner that would conflict with the interests of or detract from the shopping mall. In 2003, Titze leased a portion of the property to Lamar to install a billboard, without seeking approval from Simon. Simon wrote Titze a letter stating that the proposed billboard violated the operating agreement. Titze then requested Lamar not to proceed with the billboard installation, thereby cancelling their agreement. A few months later Simon and Lamar executed subleases for Lamar to install billboards on all Simon’s Properties. Titze filed suit against Simon and Lamar on seven grounds, including breach of contract and tortious interference.
Infotech was hired by Defendant, Simon Property Group, Inc to calculate any economic damages arising from the alleged wrongdoing of the Defendants. Using standard econometric methods, Infotech Consulting and Dr. McClave analyzed historical billboard placements in addition to the contractual agreement between Titze and Lamar. Dr. McClave’s analysis was used to rebut Plaintiff’s expert’s damage analysis. Infotech’s client never had to pay damages in this suit as Defendant’s were granted summary judgement which was affirmed on appeal.
The Michael Titze Company Inc. v. Simon Property Group, Inc., et al, No. 10-12742 (11th Cir. 2010)
