Accounting Expert’s Price Erosion Damages Opinion Admitted
Posted on June 5, 2025 by Expert Witness Profiler
Plaintiffs Syntel Sterling Best Shores Mauritius Limited, and Syntel, Inc., (collectively, “Syntel”) initiated this action against The TriZetto Group, Inc. (“TriZetto”) and Cognizant Technology Solutions Corp. (“Cognizant,” and, collectively, “Defendants”), alleging breach of contract, intentional interference with contractual relations, and misappropriation of confidential information.
Syntel filed a motion to exclude the price erosion damages opinion of TriZetto’s expert, Thomas W. Britven.
Britven’s analysis proceeds in four steps: (1) estimating the average rates TriZetto would have charged absent Syntel’s challenged conduct, assuming annual increases in line with the Consumer Price Index based on Urban Consumers (“CPI”); (2) calculating the difference between projected revenue based on these rates and TriZetto’s actual revenue; (3) limiting the calculation to the six most impacted clients, and certain related clients, based on their share of revenue and (4) further narrowing the analysis work related to Facets, the product Syntel infringed, by applying the proportion of such work (70%) to TriZetto’s overall services.
Accounting Expert Witness
Thomas Britven has more than 30 years of experience as a financial damages consultant and trusted advisor specializing in intellectual property and complex commercial litigations. He has served as an expert in over 600 matters.
His long consulting career has allowed him to develop extensive expertise, including misappropriation of trade secrets, patent infringement, trademark, copyright, licensing disputes, complex financial damage analysis, breach of contract, business interruption, forensic accounting, and business valuation.
Britven is a Certified Licensing Professional, Certified Public Accountant, Certified Valuation Analyst, Chartered Global Management Accountant, and a Certified Fraud Examiner.
Discussion by the Court
Price Erosion
The Court held that Britven’s methodology for determining price erosion damages was not unreliable, finding that the analysis presented a reasonable approach to estimating the hypothetical pricing absent infringing competition. The Court noted that Britven applied a benchmark TriZetto itself used for pricing and confined the impact to relevant clients and services.
Syntel objected to Britven’s factual assumptions that (1) absent Syntel’s competition, TriZetto’s prices would have risen in tandem with the CPI and (2) 70% of TriZetto’s work is Facets-related. However, Britven based the assumptions on his interview of TriZetto’s Chief Executive Officer (“CEO”). TriZetto’s CEO stated, among other things, that (a) 70% of TriZetto’s total sales from TriZetto accounts [the parties dispute whether this is all accounts or only Facets accounts] comes from Facets services; (b) TriZetto increases its prices at the same rate as the CPI, but gave several major clients a three-year CPI holiday from annual price increases and (c) the rate reduction for major clients impacted the rest of the clientele. The Court held that the parties’ disagreement over factual assumptions “is precisely the role of cross-examination” not a basis for exclusion.
Price Elasticity
The Court added that Syntel’s additional criticism that Britven’s analysis failed to address price elasticity concerned the weight, not the admissibility, of the testimony.
Britven did address this issue by concluding, based on consumers’ past behavior, that the market was inelastic so long as TriZetto’s price increases continued to track the CPI.
Causation
Syntel further argued that Britven’s price erosion opinion omits any analysis of causation linking Syntel’s infringement with price erosion. However, Britven discussed the (1) the use of, and demand for the Facets platform by major healthcare players due to its complexity and customization; (2) the lack of acceptable alternatives to TriZetto before Syntel’s infringement; (3) TriZetto’s adequate staffing resources and (4) the quantified price erosion damages. Britven’s expert report explained that TriZetto and Syntel competed in a two-supplier market where one’s win is the other’s loss, which — if credited by the fact finder — established causation.
Held
The Court denied Syntel’s motion to exclude the price erosion theory presented by Thomas W. Britven.
Key Takeaway:
Although expert testimony should be excluded if it is speculative or conjectural, or if it is based on assumptions that are so unrealistic and contradictory as to suggest bad faith or to be in essence an apples and oranges comparison, other contentions that the assumptions are unfounded go to the weight, not the admissibility, of the testimony.
Case Details:
| Case Caption: | Syntel Sterling Best Shores Mauritius Limited V. The Trizetto Group, Inc. Et Al |
| Docket Number: | 1:15cv211 |
| Court Name: | United States District Court, New York Southern |
| Order Date: | June 2, 2025 |
