Landmark Settlements in Global Capacitors Price-Fixing Case Secured

Landmark Settlements in Global Capacitors Price-Fixing Case Secured

by | Jan 20, 2022 | Case Updates

Just before the holidays, Infotech Consulting and its clients celebrated the successful conclusion to the sprawling In Re Capacitors Litigation, with the parties announcing a final settlement had been reached with Nippon Chemi-Con (“NCC”). This was the last of more than 20 defendants accused of participating in a global conspiracy to fix the prices of capacitors. Plaintiffs alleged that price-fixing in this multibillion-dollar market began as far back as 2002 and continued for over a decade. The conspiracy spanned hundreds of thousands of capacitor products of various size, capacitance, and materials. Even before the NCC settlements, other defendants had agreed to settlements totaling $439.6 million. With the NCC settlements, all defendants have agreed to refund over $600 million in overcharges.

So, what exactly is a capacitor? Well, you’ve likely relied on them every day without ever noticing it (including right now as you read this on your computer or phone). A capacitor is a device that stores electrical energy in an electric field. They range in size from miniscule (fitting into a phone) to extremely large (think jet engines). They are essential components of electrical systems like TVs, smart phones, cameras, appliances, cars, medical devices, lighting, computers, and so much more. And yes – there are numerous capacitors in one product. Trillions of them are manufactured each year.

The rigorous statistical basis for the damages and impact analysis resulting in the extraordinary settlements came from Dr. Jim McClave, Dr. Jamie McClave Baldwin, Dr. Allison Zhou and the work of the entire Infotech Consulting team, backed by extensive research, data analysis, consulting, and expert testimony spanning a period of over seven years. These efforts culminated in multiple expert reports, two depositions, and expert testimony in both a concurrent expert witness proceeding (“hot tub”) and, finally, at trial. “Hot tubbing” is a process that some courts are adopting in which judges hear sworn testimony from opposing experts simultaneously (think live debate), rather than the traditional direct and cross examination of each expert separately.

The trial was originally scheduled for March 2020, but was suspended due to the emerging pandemic. Fast forward 20 months later, and the parties were back in the courtroom for trial. Dr. Jamie McClave Baldwin worked tirelessly alongside our clients during the (over two week) trial, providing expertise, research and support at every turn and twist of the trial proceedings.

In announcing the landmark settlements reached, representatives from Joseph Saveri Law Firm stated, “We strongly believe these ground-breaking settlements will deter this type of collusive behavior in the future, to the benefit of us all.”

Infotech Consulting celebrates this win, not only for our clients but for the numerous consumers affected by the global conspiracy of manufacturers to fix, raise, and maintain prices of capacitors at an elevated level.

“This win represents what our team does best – use our expertise, knowledge, and passion to fight for what is right,” shared Dr. Jamie McClave Baldwin, Expert and President of Infotech Consulting. “We are proud to have been involved in this case from the beginning of discovery, through class certification and both trials – over seven years of work. Other firms came and went, but our team never backed down from the challenge. It was this dedication and effort that helped produce outstanding results for our extraordinarily talented clients and the class of direct purchasers.”

Re Capacitor Antitrust Litigation (2017) Case No. 3:17-md-02801, U.S. Dist. Ct. N. Dist. California.

Infotech Consulting’s Expert Analysis helps Geico Insurance battle Auto Glass Shops

by | Sep 30, 2021 | Case Updates

Florida has a unique auto insurance law that allows those insured to have the windshield of their vehicle repaired or replaced without triggering their deductible.  In other words, insured drivers can get their windshield replaced with no out of pocket cost. There are only four other states with this unique provision: Arizona, Kentucky, Massachusetts and South Carolina. This has created a unique market whereby those insured are not involved financially in the transaction, leaving just the insurance company and the auto glass shop.  Auto glass shops have the insured assign their benefits to the glass shop upon completion of the installation or repair, which allows the auto glass shop to pursue any litigation against the insurance company without involving the insured.

Why is that important?  Why would the auto glass shop need to litigate against the insurance company over a windshield replacement?  Because auto glass shops in Florida are claiming insurance companies are not paying the full amount on the invoice.  Suit after suit by auto glass shops allege that insurance companies, like GEICO, are underpaying on the invoices for windshield replacements by relying on a reduced retail rate.  This issue has increased dramatically with about 400 Assignment of Benefit (AOB) lawsuits filed against multiple auto insurers statewide in 2006 to a peak of about 24,000 in 2017.  There was a reduction in the number of cases filed in 2018 and 2019 – with around 17,000 filed each year – but that is still quadruple the number filed a few years back.  

In 2018, Infotech was hired by GEICO to analyze GEICO’s windshield replacement prices throughout the state of Florida to determine if GEICO was paying auto glass shops the prevailing competitive price. In GEICO’s auto insurance agreements, there is a limit of liability provision stating, “Although you have the right to choose any repair facility or location, the limit of liability for repair or replacement of such property is the prevailing competitive price, which is the price we can secure from a competent and conveniently located repair facility.” Over the last five years, Dr. Jim McClave has testified in numerous cases that the GEICO transaction data show GEICO was regularly able to secure its price from glass shops throughout Florida.  

The crux of these cases come down to whether GEICO pays a prevailing competitive rate for windshield replacement or whether the invoice amount from the glass shops represent the prevailing competitive price.  Infotech analyzed over 140,000 GEICO windshield replacement transactions between 2013-2018 involving over 1,200 auto glass shops in Florida. After analyzing the data, Dr. McClave and the Infotech Consulting team determined the claims data reveal GEICO’s payments for windshield replacements are consistent with prevailing competitive prices.  In every year of analysis, a majority of glass shops are commonly charging a rate at or near the agreed-upon GEICO price.

Dr. McClave has offered his expert opinion in nearly 100 cases on this issue.  In each instance thus far, Dr. McClave and his team have analyzed the invoiced prices submitted by the glass companies for the claims at issue and found that they were out of line with the prevailing competitive price charged in the market.  He has testified in multiple depositions and several trials, with the most recent trials last spring.  In fact, the GEICO trials in April 2021 represented Infotech’s return from a year-long hiatus of trial appearances due to Covid-19.  In the trial on April 13th and 14th of 2021, Superior Auto Glass argued that GEICO did not fully pay Superior’s invoiced amount for a windshield replaced on an insured car in 2015.  The jury returned a verdict in favor of the Defense, finding that GEICO paid a prevailing competitive price and that the auto shop had knowledge of the GEICO rate before accepting the work and invoicing GEICO far in excess of that rate. 

As Infotech Consulting President Dr. Jamie McClave Baldwin recently said, “When the jury came back with a finding in favor of our client, it confirmed the effectiveness and irreplaceable value of in-person court appearances. How gratifying it was to see our client get a favorable result in a case that has been litigated since 2016 and has gone up and down the appeals circuit.”

Until there is Florida legislative action or higher court authority on this matter, the Infotech Consulting team will continue to provide statistical analysis to this evolving market of litigation.

1 Florida Statute §627.7288 (2021)

Infotech Supports Largest Single-State Antitrust Settlement in West Virginia’s History

by | Nov 23, 2020 | Press

Infotech Systems and Infotech Consulting Support the Recovery of $101.35 Million

GAINESVILLE, Fla.–(BUSINESS WIRE)–Infotech, a leader in infrastructure construction software solutions and expert statistical and econometric consulting services, announced today that its two businesses supported a record-breaking antitrust settlement in West Virginia which recovered taxpayer dollars totaling $101.35 million.

In the late 1970s, Infotech developed computerized techniques to assess fairness in competitive markets. These same techniques were used to support the West Virginia Department of Transportation (WVDOT) to assess bidding activity among a small group of contractors when price fixing was suspected. Through Infotech’s DOT agency services and Infotech Consulting’s expert statistical analysis, the company was able to support the state of West Virginia in reaching this settlement, which was the largest single-state antitrust settlement in West Virginia history.

“Price fixing raises prices at the taxpayer’s expense; discovering and proving this activity is at our core,” Will McClave said, Infotech Systems President. “Infotech has been building and using software to detect collusion since our first major antitrust case in 1981, which resulted in a then-record $30 million in settlements for a bid-rigging case. Throughout our history, our goal has been to pursue truth in the data and ensure taxpayer dollars are spent responsibly.”

One way state agencies can support a fair bidding process is through electronic bidding. WVDOT adopted Infotech’s secure online bidding service, Bidx.com®, in 2009.

“Many of you may remember back in 2013 when I instituted the state’s new competitive bidding policy for how outside counsel are paid,” West Virginia Attorney General Patrick Morrisey said. “Well, we now have saved over $30 million through that policy. Why? Because the state gets the benefit of competitive bidding. Over $20 million saved on this case alone. That’s an awesome thing. That means we have good government, we have competition and we’re actually saving taxpayer money.”

“Our settlement will go a long way to restore competition and recoup road funds to the benefit of every taxpayer who pays for and drives West Virginia’s roads,” Morrisey continued. “We can never afford to allow an unlawful monopoly to victimize West Virginia and maximize its profits on the backs of state taxpayers, especially when every dollar is needed to pave our roads and compete effectively with other states for business and tourism.”

To learn more about Infotech’s online bidding platforms, visit https://www.infotechinc.com/bidding. To learn more about Infotech Consulting’s expert statistical and econometric consulting services, visit infotechconsulting.com. To learn more about the settlement, visit the official West Virginia announcement.

About Infotech

Info Tech, Inc., DBA Infotech (Infotech) bridges innovation and integrity by developing cutting-edge digital solutions for the infrastructure construction industry and providing expert statistical and econometric consulting services across multiple industries. Infotech’s two core businesses, Infotech Systems and Infotech Consulting, use technology and data to bring transparency, integrity and efficiency to the people we serve. Informed by DOT relationships and decades of experience, Infotech Systems develops software solutions that bridge the gaps between owners, consultants, contractors, and other project stakeholders. Infotech is the developer of Appia®, Bid Express®, and Doc Express®, as well as the official contractor for AASHTOWare Project™. For more information on our SaaS offerings, visit infotechinc.com. For more information about our expert consulting services, visit infotechconsulting.com.

Contacts

Lacey Jones
Director, Marketing & Communications
Infotech
lacey.jones@infotechinc.com

Infotech Consulting Upholds Statistical Standards in Construction Defects Sampling

Infotech Consulting Upholds Statistical Standards in Construction Defects Sampling

by | 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)

Falsely Claimed Sales Streak Broken After Infotech Consulting Analysis

by | 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)