Executive Summary

Mr. Mull T. Plex, owner of the Royal Theatre, has hired our firm to seek both our legal and statistical analysis for a potential class action lawsuit leaded by a patron, Tommy, regarding the amount of commercials shown before the start of a movie. Mr. Plex and his competitors, who may also be named in the potential lawsuit, have formed a consortium in case the suit transpires. The consortium is requesting a survey to be conducted to observe if other patrons agree with Tommy’s dissatisfaction.

Tommy claims he purchased a ticket for an advertised showing for 1 p.m. at the Royal Theatre where he was subjective to 20 minutes of commercials before the commencement of the movie. Displeased with the movie and the amount of commercials he was exposed to, Tommy walked out in the middle of the movie demanding a full refund from the manager on duty. The manager denied Tommy’s request since it is against Mr. Plex policy to provide a refund to moviegoers. Outraged by the denial, Tommy decided to seek recourse by threatening a class action lawsuit.

Our legal analysis concluded that the Royal Theatre did meet all four elements of fraudulent misrepresentation. Mr. Plex falsely advertised the showing time for 1 p.m. in the local newspaper, the marquee on the theatre and on the ticket stub Tommy purchased. The movie Tommy attended actually began at 1:20p.m., after the presentations of commercials.

The consortium has set constraints to the statistical analysis. They decided the following: If the sampled patrons who agree with Tommy are 10% or above, they will negotiate a settlement. If it is below 10% the consortium will defend the case.

According to our statistical analysis, Mr. Mull T. Plex should defend his potential suit. We have taken two sample surveys: 1) sample of 100 patrons and 2) sample of 300 patrons. Both tests indicated an identical conclusion of 6% of patrons agrees with Tommy’s discontent with the amount of commercials shown before the beginning of a...