Reprinted with permission.
IMS ExpertServices periodically sends me e-mails that highlight
recent key court cases that can significantly affect the effectiveness of expert
testimony, both for the plaintiff and for the defendant.
This article by Joshua Fruchter, writing for
IMS ExpertServices, tells an interesting tale of what can happen
when a powerful megacorporation, in this case Apple Computer, decides to match wits
with a 10-year-old child prodigy who, by no coincidence, was named Dilbert by his
adoring engineer father. The few minutes it will take you to read will leave you
with a sense that yes, there is still a bit of sanity remaining in today's court
Daubert v. Merrell Dow Pharmaceuticals, for the uninitiated,
is a landmark legal decision regarding expert testimony in damage liability litigation.
Joshua Fruchter, Esq. is the principal of
eLawMarketing, a leading provider since 2002 of website development, email marketing,
blogging, search engine optimization (SEO), and social media services to law firms
of all sizes. Joshua is a graduate of NYU School of Law, a member of the New York
Bar Association, and a former attorney at a large NYC firm. Joshua combines his
legal background and marketing technology expertise to help law firms generate leads
and business from Internet marketing. Joshua has published articles on legal marketing
technologies in numerous law-related periodicals, and has presented on legal marketing
technologies before various bar and legal marketing associations. Joshua is also
the editor of LawyerCasting, a blog covering "best practices" in online marketing
for lawyers and law firms.
Joshua Fruchter, Esq.
April 01, 2014
Expert Testimony Central to Coffee Class Decision
September 01, 2014
If you love coffee (or loved the
in which Kramer sues Java World), then this case is for you – a 7th Circuit
decision reversing a denial of class certification in an action by coffee drinkers
against a manufacturer that allegedly violated consumer protection laws in its efforts
to gain a foothold in the K-Cup market. Suchanek v. Sturm Foods, Inc., 2014 WL 4116493
(10th Cir., August 22, 2014).
As readers are undoubtedly aware, K-Cups are pods filled with coffee grounds
that can be dropped into Keurig coffee machines to quickly produce a high quality
cup of fresh-brewed coffee. For many years, Keurig held a patent over the filtering
technology used in K-Cups, thereby barring competitors from selling their own Keurig-compatible
pods. Anticipating the expiration of Keurig's K-Cup patents in 2012, the defendants
hatched a plan to gain first mover advantage in the post-patent K-Cup market.
The centerpiece of the strategy was a pod (branded "Grove Square Coffee" or "GSC")
introduced by the defendants in 2010 that mimicked the K-Cup design. Except that
to avoid infringing Keurig's still-valid patent, the GSC pods lacked a filter, thereby
making the use of fresh coffee grounds impossible. Instead, the defendants filled
their pods primarily with "instant" coffee (for readers unfamiliar with the difference
between "instant" coffee and coffee grounds, the former quickly dissolves in hot
water (and costs less), while the latter must be "brewed" (and costs more due to
perceptions of higher quality);
for further details).
Defendants' packaging glossed over the crucial distinction between the innards
of their GSC pods versus Keurig's pods, featuring images of K-Cups and fresh roasted
coffee beans, and stating that the GSC pods contained "naturally roasted soluble
and microground Arabica coffee." What the packaging didn't explain is that "soluble
coffee" is "instant coffee," and that the amount of coffee grounds in the pods was
trivial (added primarily to dust the chunks of instant coffee).
Defendants hoped consumers wouldn't notice the difference, but that expectation
did not come to pass. Within days after the launch of the GSC pods, complaints started
rolling in with one retailer calling GSC the "poorest performing introductory product
that we have had in our 12 year history." Several angry consumers subsequently filed
class action lawsuits charging defendants with violations of state consumer protection
laws prohibiting deceptive advertising and marketing.
The district court denied class certification on the ground, among others, that
there were no questions common to the class, as required under Rule 23(a)(2) of
the Federal Rules of Civil Procedure to maintain a class action in federal court.
The 10th Circuit disagreed, ruling that whether the GSC packaging was likely to
mislead a reasonable consumer was a question common to the claims of all putative
class members. In support, the 10th Circuit referenced three expert surveys in the
record – all of which concluded that few consumers understood the true nature of
the GSC product. One survey, conducted by the plaintiffs' expert, found that only
14% of respondents understood that the GSC product contained primarily instant coffee.
A second survey by defendants' expert found that only one out of 151 respondents
equated "soluble coffee" with "instant coffee." Finally, a third expert found that
nearly all GSC pod purchasers expected the product to yield filtered ground coffee,
and almost none of those purchasers expected the product to contain instant coffee.
The district also denied class certification on the ground that individual issues
related to causation would predominate over common questions of law or fact, in
violation of Federal Rule 23(b)(3). Again, the 10th Circuit reversed, observing
that "[e]very consumer fraud case involves individual elements of reliance or causation."
Instead, the 10th Circuit instructed that the appropriate initial inquiry is whether
class damages can be accurately measured. On this point, the Court cited the report
of plaintiffs' expert suggesting that "damages might be computed by taking the difference
between the actual value of the package [plaintiffs] purchased (instant coffee)
and the inflated price [plaintiffs] paid (thinking the pods contained real coffee
Based on its analysis, the 10th Circuit vacated the lower court's denial of class
certification and remanded for further proceedings consistent with its opinion.
Clearly, trouble is brewing for the defendants.
Rather than seeking commentary on the Court's legal analysis, we're actually
curious, how many of you are coffee drinkers? For those who are, how many of you
were "victims" of the GSC pods masquerading as fresh coffee grounds?
This article was originally published in
BullsEye, a newsletter distributed by
IMS Expert Services is the premier expert witness search firm in the legal industry, focused
exclusively on providing custom expert witness searches to attorneys. To read this
and other legal industry
BullsEye publications, please visit IMS Expert Services' recent
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Posted September 9, 2014