Thursday, July 12, 2012

“Revealed Preference” Theory of Lost Profits Not Inherently Unreliable

The court denied defendant's motion in limine to exclude the testimony of plaintiff's damages expert as to the "revealed preference" theory of lost profits. "[Defendant] moved to exclude [the testimony of plaintiff's damages expert] on the ground that the 'revealed preference' theory is unreliable when calculating lost profits in this case. [Defendant] claims [plaintiff's expert] has conducted no market surveys to support his view that customers who use arm-mounted scanners do not consider non-arm-mounted scanners as a close substitute. . . . While the record is not well-developed, the 'revealed preference' theory appears to be an economic principle cited in the literature. [Defendant] has not demonstrated that revealed preference is an unreliable methodology in the patent context that should be excluded under Fed. R. Evid. 702."

Metris USA, Inc., et. al. v. Faro Technologies Inc., 1-08-cv-11187 (MAD July 10, 2012, Order) (Saris, J.).

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