Introduction

In many class cases, class certification can hinge on whether the alleged conduct had a common impact across the proposed class. This is sometimes referred to as classwide impact. While courts may routinely accept that defendants engaged in common conduct, what they often scrutinize much more closely is whether that conduct produced injury that can be shown with common proof on a classwide basis.

That is where economic analysis becomes crucial. A well-developed common impact framework does more than support certification. It can shape how the entire case is understood. Conversely, a weak or misaligned analysis can derail certification even when the underlying allegations might appear strong.

For legal teams, the challenge is not just presenting an economic model, but ensuring that the model aligns with the theory of harm, the available data, and the legal standard under Rule 23 of the Federal Rules of Civil Procedure. The most effective economic experts approach common impact as a structured, step-by-step exercise that integrates economic theory, evidence produced in the case, facts of the industry, and empirical testing.

This article walks through that framework and highlights what courts may find persuasive and what could end up risking rejection.

What “Common Impact” Really Means in Practice

At a high level, common impact asks a straightforward question: can plaintiffs show that all or nearly all members of the proposed class were injured by the alleged conduct using common evidence?

In practice, that question is anything but simple and is one of the most contested points in any class case.

Courts distinguish between common conduct and common injury. A defendant may have engaged in a uniform policy or agreement, but if that conduct affected customers differently or not at all for some, you will risk not satisfying the requirement under Rule 23(b)(3).

This distinction is where many certification efforts break down. Plaintiffs may point to internal documents, industry structure, or anecdotal examples suggesting harm. But courts increasingly expect a rigorous analysis indicating the alleged harm operated through a mechanism capable of affecting the class in a consistent way.

At the same time, courts may not require perfect uniformity. Variation across class members is expected in markets. The key issue is whether that variation reflects noise around a common effect, or whether it demonstrates that impact must be assessed individually.

The Economist’s Role: Bridging Theory and Evidence

Economic experts sit at the important intersection of theory and proof. Their role is not just to work with data and run regressions, but to connect the alleged conduct to measurable outcomes in a way that can be tested across the class.

That process typically begins with understanding the legal facts of the case, while not rendering any legal opinions. If plaintiffs allege price-fixing, the economist might want to articulate how that conduct would be expected to raise prices. If the claim involves exclusionary conduct, the economist might want to explain how competition was reduced and how that reduction in competition affected pricing, output, and/or quality.

Much of the task of an economist is also empirical in nature. For example, does the data show evidence of the identified effects across the proposed class?

This is where experienced experts tend to differentiate themselves from those that are less experienced. The strongest analyses are not built around a single model introduced late in the case. They are developed iteratively, with the theory of harm, the structure of the market, and the available data informing each other from the outset. It is not uncommon for a model to start off in one place and end up in a completely different place at the end as more and more evidence is produced. 

The following steps provide a general foundation for an Economist on a class case.

Step 1: Defining a Coherent Theory of Harm

Everything in a common impact analysis flows from the legal  theory of harm. If that theory is vague, internally inconsistent, or not supported by evidence produced in the case, there is generally no amount of statistical work that can change that..

A coherent theory of harm answers three basic questions:

• • What conduct is alleged?
  • Through what mechanism does that conduct cause harm?
  • Who is affected, and how?

In price-fixing cases, the theory is often relatively straightforward: coordinated or collusive behavior tends to lead to higher prices than would have prevailed in a competitive (or but-for) market. But even in a seemingly clear example like that, details matter. Does the alleged conduct affect all products and customers equally? Are there contractual features that could dampen or amplify the economic effects?

In monopolization or exclusion cases, the mechanism can be more complex. The analysis may depend on how rivals were foreclosed, how that foreclosure affected competitive dynamics such as entry and success of rivals, and how those changes translated into outcomes for customers.

Courts pay close attention to whether the theory of harm is grounded in the facts of the industry. Produced internal documents, pricing practices, market structure, and market shares all play an important role. When the theory shifts over time or fails to account for key features of the market, it creates gaps that can undermine the entire analysis.

Step 2: Market Definition and Industry Context

Market definition falls more under the liability umbrella, but it plays an equally important role in common impact. It also happens to be a highly contested issue between experts similar to the class issue we have discussed.

A properly defined market helps establish who was exposed to the alleged conduct. If the proposed class includes customers who operated in meaningfully different markets, that can complicate the argument for common impact.

For example, customers with long-term fixed-price contracts may be affected differently than those purchasing on the spot market. Similarly, geographic differences can matter if competitive conditions vary across regions.

Economic experts typically examine substitutability, market entry, pricing behavior, and broader competitive dynamics to assess whether the proposed market is consistent with a common mechanism of harm. While this can contain a theoretical component in nature, it directly informs how the empirical analysis should be structured.

Step 3: Building a Reliable Data Foundation

Even the most well-conceived model will fail if the underlying data is not reliable.

Common impact analyses often rely on very large, transaction-level datasets with millions or billions of observations. These transactional datasets generally include pricing, quantities, rebates, product characteristics, customer attributes, costs, among other things. In practice, assembling and preparing these datasets is one of the most time-consuming and critical parts of the process. Hiring a team with data experts who have experience handling large volumes of data can be very beneficial for the case broadly.

Data rarely arrives in a clean, ready to use format. It’s not uncommon for it to come from multiple systems, reflect changes or edits over time, or contain inconsistencies that need to be resolved. Decisions about how to clean, normalize, and structure the data can materially affect the results.

Courts have become increasingly attentive to these issues and should be at the forefront of every expert’s work. Experts are expected to explain how the data was prepared and why those choices are appropriate. Additionally, experts are required to provide backup files which include the data, programs, and supporting files that contributed to the experts opinions. Transparency matters. So does consistency.

Step 4: Testing for Common Impact Using Econometrics

With a clear theory of harm and a complete dataset, the next step is to test whether the alleged conduct produced a common effect.

Regression analysis is often the most appropriate and most common tool for this purpose. While the specific econometric model depends on the facts of the case and the question being answered, the general goal is to estimate what prices (or other outcomes) would have prevailed in the absence of the alleged conduct and compare that benchmark to observed outcomes.

Different approaches may be used, including before-and-after comparisons, comparisons existing benchmark markets, or difference-in-differences frameworks. What matters most is not the label attached to the model, but whether it is consistent with the theory of harm and the structure of the data supports such a method.

Courts look for a clear connection between the model and the alleged mechanism of harm. They also evaluate whether the model is capable of detecting classwide effects, rather than simply producing an average that may mask meaningful variation across class members.

Robustness checks play an important role here and are something every economist should do. Testing alternative specifications, examining subsets of the data, and evaluating the sensitivity of results to key assumptions all help establish the reliability of the findings.

Step 5: Addressing Variation Across Class Members

No real-world market is perfectly uniform, and courts do not expect it to be. The presence of variation does not defeat common impact. With that being the case, the question becomes, what does that variation represent?

If most class members experienced a positive effect consistent with the theory of harm, and the variation reflects differences in magnitude rather than direction, courts are more likely to find that common issues predominate.

On the other hand, if a meaningful portion of the class appears uninjured, or if the model suggests that some members may have benefited, that raises more serious concerns.

Economists use a range of tools to evaluate these sorts of issues. Looking at distributions can show how estimated effects vary across observations. Subgroup analyses can examine whether results differ systematically across customer types or product categories.

The goal is not to eliminate variation, but to understand it. When variation is acknowledged and addressed directly, it tends to strengthen the credibility of the analysis. When it is ignored or obscured, it becomes a focal point for challenge.

Step 6: Aligning Impact with Damages

Courts often emphasize that the method used to establish impact should align with the method used to calculate damages. This does not mean the two analyses must be identical, but they should be grounded in the same underlying theory.

If the impact analysis relies on one mechanism of harm and the damages model relies on another, that disconnect can be problematic and should be considered by the expert. Similarly, if damages require highly individualized calculations, that may undercut the argument that common issues predominate.

A well-integrated approach ensures that the same framework used to demonstrate common impact can also support a classwide measure of damages.

Step 7: Presenting the Analysis to the Court

Even the most rigorous analysis must be communicated effectively. This is true in the economic reports experts prepare, but more importantly in a court room where you will surely have an audience that is not familiar with economic concepts.

Courts evaluating expert testimony under the Daubert standard focus on both reliability and fit. That includes the methods used, the assumptions made, and how well the analysis addresses the issues in the case.

Clarity is critical. Judges (and jurys) are not looking for unnecessary complexity; they are looking for a clear explanation of how the analysis works and what it shows.Experts who can explain a complicated analysis to a lay audience generally have much better success. 

Visuals or demonstratives can be helpful, particularly when presenting distributions of estimated effects or comparing observed and benchmark outcomes. But they need to be used carefully, with explanations that make their relevance clear.

Equally important is transparency. Explaining the limitations of the analysis does not weaken it. In many cases, it enhances credibility by showing that the expert has considered potential weaknesses and addressed them directly.

Common Pitfalls in Common Impact Analyses

The following issues arise repeatedly in class certification disputes:

• A theory of harm that is not clearly defined or does not match the evidence
• Models that rely on averages without examining variation across class members
• Failure to account for differences in contracts, products, or customer types
• Data preparation choices that are not documented or explained
• Analyses developed too late in the process, leading to misalignment with the case strategy

These pitfalls are often avoidable with early expert involvement and a disciplined approach to the analysis. Interacting with the expert regularly also helps as it aligns those focused on the legal issues with the expert who is working with the data and developing the model. Without consistent interaction, you risk a misunderstanding which could make or break a case.

What Legal Teams Should Look for in an Economic Expert

From a practical standpoint, legal teams evaluating experts should focus on more than technical credentials.

Experience matters, particularly in class certification settings where the legal standards are well developed and heavily litigated. So does the ability to work collaboratively, translating economic concepts into arguments that resonate with the court.

Strong experts tend to share a few important characteristics:

• They engage early and help shape the analytical framework from the outset
• They are comfortable working with complex, imperfect datasets
• They communicate clearly and frequently, both in writing and in testimony
• They anticipate challenges and address them proactively
• They bring up issues with the data or model early and often with counsel

Perhaps most importantly, they understand that the goal is not just to produce an analysis, but to support a persuasive, defensible narrative about how the alleged conduct affected the class.

Conclusion

Common impact is not a box to check. It is a central question that can determine the trajectory and success of a case.

A well-executed analysis brings together theory, data, and empirical testing in a way that aligns with the legal standard and withstands scrutiny. Done correctly, it provides a clear and coherent answer to the question courts care about most: whether injury can be shown with common proof.

For legal teams, the takeaway is clear: involving economic experts early helps ensure the analysis reflects both the case facts and underlying data realities which can potentially shape how the case is ultimately resolved.