This allowed him to make what it would be charitable to call a
rough estimate of GE's U.S. sales of all categories of
industrial diamonds for each year of the class period. But he
wanted a figure for the U.S. sales of GE and De Beers combined
and he had no data on sales by De Beers. Plaintiffs had obtained
a GE estimate of De Beers' share of the worldwide market in
industrial diamonds in 1990-1991. Dr. Keeley made the improbable
assumption that GE and De Beers had the same relative shares of
the U.S. market that they had in the worldwide market, despite
the fact that GE's headquarters and focus of operations are in
the U.S. while De Beers has no offices or employees here but an
extensive presence elsewhere in the world. Dr. Keeley made the
further improbable assumption that the two companies had these
same relative shares not only in 1990-1991 but throughout the
entire 19881993 class period, despite the fact that there were
significant changes in the types of industrial diamonds they
marketed during that period. Then Dr. Keeley added his estimate
of U.S. sales by De Beers to his estimate of U.S. sales by GE to
determine their total U.S. sales for each year, which he
multiplied by his figure for the average percentage of price
inflation that year to arrive at his determination of the
damages sustained by plaintiffs.
This convoluted and artificial process of determining the U.S.
sales of industrial diamonds by defendants, involving improbable
assumptions based on other improbable assumptions, was utterly
unnecessary because, mirabile dictu, hard data on such sales
were available merely for the asking.
a. From GE Itself
It is astonishing that, in all of plaintiffs' extensive
discovery, they never got around to asking GE about the dollar
volume of its U.S. sales of each category of industrial diamonds
each year during the class period. GE is a corporation whose
securities are publicly traded and it therefore must publish its
financial statements. If GE nevertheless takes the position that
the volume of its U.S. sales of industrial diamonds is a
business secret, the disclosure of such data to plaintiffs would
have been protected under the secrecy order already in effect
and it could have been filed under seal.
b. From Purchasers
If, for some unforeseen reason, plaintiffs could not get the
sales information they wanted from GE, they had another source.
They already had a list of all the U.S. purchasers of GE
industrial diamond products and had communicated with them on
two occasions — first, to inform them that they were putative
members of the plaintiff class certified by the Court and of
their right to opt out of the class and, again, to notify them
of the settlement with GE and of the upcoming fairness hearing.
There was no reason plaintiffs could not have contacted them
again to inquire about their purchases of industrial diamonds
from GE during the class period. Indeed, if and when the time
comes to distribute to the class members the net proceeds of any
recovery against De Beers, each of the them will have to file a
claim with proof of its volume of such purchases. There is no
reason to believe that they would not eagerly supply that same
information for use at an inquest.
With such ready availability of accurate data as to GE's U.S.
sales of industrial diamonds during the class period, we can
divine no reason why plaintiffs resorted to the circuitous and
speculative methodology employed by Dr. Keeley other than a
desire to magnify their damages. That, of course, is what
plaintiffs' counsel naturally try to do, but it is the duty of
the court, even where a defaulting defendant has not appeared at
the inquest to challenge the plaintiffs' computation of damages,
to protect the interest of the absent defendant and insure that
justice is done to all parties, even foreign corporations who
are reputedly members of powerful cartels.
Because of the serious errors in the opinion of Dr. Keeley,
which was the only evidence submitted by plaintiffs to establish
the amount of the damages to be assessed against De Beers, the
Court is unable to make any finding respecting such damages at
this time. Plaintiffs are directed to appear before the Court at
11:00 a.m. on Friday, December 1, 2000 and show cause why the
Court should conduct a second inquest to determine the amount of
such damages. This showing must include a summary of the proof
which plaintiffs would offer at such an inquest. Any written
submissions which plaintiffs choose to make to the Court in
advance of the hearing should be delivered to the Court no later
than noon on Wednesday, November 29, 2000.
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