NERA Plays Important Role in Precedent-Setting Class Certification Ruling

15 January 2009

15 January/New York -- Analyses prepared by NERA Economic Consulting were an important factor underlying a recent precedent-setting ruling by the US Circuit Court of Appeals for the Third Circuit requiring lower courts to conduct a rigorous analysis of all relevant evidence and arguments before certifying a class. The ruling reversed an earlier decision by the US District Court for the Eastern District of Pennsylvania granting class certification in a suit alleging price fixing in the market for hydrogen peroxide. NERA was retained by Buchanan Ingersoll & Rooney, the law firm for Arkema, Inc. and Arkema France, defendants in the case.

Stating that "expert opinion with respect to class certification...calls for rigorous analysis," the appeals court ruled that the lower court erred when it declined to weigh the relative merits of plaintiff and defendant expert arguments when it decided to certify the class. The lower court had accepted the arguments of the plaintiffs' economic expert without taking into account the defendant's expert testimony, which raised substantial doubts about whether class certification was appropriate.

A team of NERA economists directed by Senior Vice President Todd Morrison have consulted on this litigation with Arkema's counsel since 2005. NERA Vice President John Johnson, Mr. Morrison, and staff worked closely with attorneys from Buchanan Ingersoll & Rooney to develop the arguments that served as the basis for Arkema's successful appeal of the class certification ruling.

"I am pleased that NERA was involved in this groundbreaking case," said Gary Dorman, Senior Vice President and Chair of NERA's Global Antitrust Practice. "It is gratifying to see such a successful outcome. As economists, we are pleased by the court's emphasis on rigorous economic analysis."

The Court of Appeals ruling returns the case to the US District Court judge, who will apply the rigorous new standards in reconsidering whether a class should be certified.

About NERA

NERA Economic Consulting (www.nera.com) is a global firm of experts dedicated to applying economic, finance, and quantitative principles to complex business and legal challenges. For over half a century, NERA's economists have been creating strategies, studies, reports, expert testimony, and policy recommendations for government authorities and the world's leading law firms and corporations. We bring academic rigor, objectivity, and real world industry experience to bear on issues arising from competition, regulation, public policy, strategy, finance, and litigation.

NERA's clients value our ability to apply and communicate state-of-the-art approaches clearly and convincingly, our commitment to deliver unbiased findings, and our reputation for quality and independence. Our clients rely on the integrity and skills of our unparalleled team of economists and other experts backed by the resources and reliability of one of the world's largest economic consultancies. With its main office in New York City, NERA serves clients from more than 25 offices across North America, Europe, and Asia Pacific.