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Economic Damages Related to False Advertising

Background

A pharmaceutical company was alleged to have misrepresented (false advertising) the medical and health benefits of over-the-counter multivitamin products and doing economic harm to consumers that purchased those products. The claimants sought to certify a class for affected consumers and initiate a class action complaint to recover class wide economic damages.


Our Analysis

Intensity was retained to determine an appropriate methodology for certifying the consumer class, and to perform economic analysis related to price premiums on products that were advertised with certain false claims. Intensity evaluated various methodologies for certifying the consumer class and proposed a methodology that was appropriate based on product sales data and consumer demographics.

Intensity also performed an analysis of damages relating to a class action complaint of unfair competition, violation of Consumer’s Legal Remedies Act, and false advertising relating to health products. Intensity estimated damages incurred based on an analysis of the economic effects of the alleged conduct on product sales and profitability.

Economic issues included class certification, price premiums, common class-wide impact, unfair competition, false advertising, and treble damages.