Price Isn’t Right

Inside the Expert Battle Over Kroger’s Pharmacy Discounts

What does “usual and customary price” mean? How does a plaintiff challenge such a broad assertion in a class action? What will a defendant assert to discredit a plaintiff’s expert? This article discusses the Daubert motion brought forth in Kirkbride v. The Kroger Co. and provides notice to how a challenge may unfold in other class action suits that have a similar underlying claim(s).

In a closely watched ruling, a federal court allowed expert testimony to proceed against Kroger over claims it concealed lower prescription prices.

At the center of it is a deceptively simple term, “usual and customary price” (U&C), a metric that is supposed to reflect what pharmacies charge cash-paying customers. But what happens when that price is not so “usual” after all?

In Kirkbride v. The Kroger Co., a proposed class of consumers alleges that one of America’s largest supermarket chains used a membership discount program to obscure its real U&C pricing, resulting in inflated co-pays for insured customers. At the heart of this billion-dollar dispute is a forensic economist named Colin Weir, whose class-wide damages model has drawn both praise and sharp scrutiny.

Kroger tried to keep Weir’s testimony out of court, launching a full-blown Daubert challenge that questioned his qualifications, his assumptions, and the simplicity of his arithmetic. But a federal judge disagreed, firmly.

The plaintiffs, led by Judy Kirkbride and Beeta Lewis, allege that Kroger misrepresented the U&C prices of generic prescription drugs when processing insurance claims. The U&C price is a key benchmark used by Pharmacy Benefit Managers (PBMs) to calculate how much insurers—and patients—should pay. By allegedly excluding the discounted prices available through its Rx Savings Club from the U&C field, Kroger is accused of artificially inflating insured customers’ copays, effectively charging them more than uninsured cash-paying customers.

The Rx Savings Club, introduced by Kroger in 2018, offers deeply discounted prices on hundreds of generic medications in exchange for an annual membership fee. The plaintiffs argue that these prices were widely available to the public, and thus should have been reflected in the U&C pricing field submitted to PBMs.

The suit does not allege breach of contract between Kroger and insurers. Instead, it focuses on claims of:

• Fraud, under Ohio and Texas law
• Unjust enrichment
• Negligent misrepresentation, particularly in how copay amounts were communicated

The Plaintiff’s Economics Expert Witness

Colin Weir is not a pharmacist, a PBM executive, or a health economist by training. He is an expert in forensic economics and statistical modeling, with decades of experience quantifying harm and calculating damages in complex class actions. As the President of Economics and Technology, Inc., Weir turns dense transactional data into legally viable economic narratives. That is exactly what he was tasked with in this case.

He was retained by the plaintiffs to perform a damages analysis for a proposed class of consumers who allegedly overpaid for generic prescription drugs. His model was, at least on the surface, elegantly simple:

Damages = Price Paid – U&C Price (based on Rx Savings Club pricing)

Using a dataset of over 158 million pharmacy transactions from Kroger’s own records, Weir identified instances where insured consumers paid more than what cash-paying members of the Rx Savings Club would have paid for the exact same medication. He then calculated the overcharge across the class.

Crucially, Weir treated Kroger’s Savings Club prices as the appropriate U&C benchmark; an assumption at the heart of both the plaintiffs’ legal theory and Kroger’s opposition.

Weir’s work was central not just to the plaintiffs’ damages argument, but to their entire motion for class certification. Without a credible, class-wide method of quantifying harm, the case risked unraveling under Rule 23(b)’s predominance requirement.

Kroger, however, did not just disagree with Weir’s math. It sought to keep him off the witness stand entirely. What followed was a full-blown Daubert challenge; a critical juncture in any class action, where the court decides whether an expert’s methods are merely debatable or legally inadmissible.

The Daubert Challenge: Kroger’s Attempt to Exclude Weir

To discredit Colin Weir’s testimony, Kroger launched a full-throated Daubert challenge, arguing that his damages model failed the reliability and relevance tests under Rule 702. The company’s central claim was that Weir lacked the specialized expertise necessary for a case rooted in pharmaceutical pricing. As an economist with no background in pharmacy operations or insurance claims, they argued, he was unqualified to opine on damages involving the intricacies of PBM reimbursements, insurance design, and retail drug pricing

Kroger further criticized Weir’s damages model as overly simplistic, relying on a single formula: “Price Paid – U&C Price = Damages.” They contended that this calculation ignored critical variables such as deductibles, co-insurance limits, and Medicare Part D’s plan phases. The defense also objected to Weir’s assumption that Kroger’s Rx Savings Club prices constituted the U&C rate; an assumption drawn from plaintiffs’ legal theory rather than empirical validation.

Finally, Kroger claimed that Weir’s model was tainted by counsel-driven assumptions and failed to account for the real-world complexity of how insurance plans calculate patient responsibility. Their experts, including Jed Smith and Dr. James Hughes, asserted that Weir’s model would require a claim-by-claim re-adjudication to be credible. In short, Kroger argued that Weir’s conclusions were not only wrong, they were inadmissible; too speculative to meet the Daubert standard.

To bolster its Daubert challenge, Kroger enlisted two heavyweight experts: Jed Smith, a forensic accountant with extensive experience in healthcare damages, and Dr. James Hughes, an economist and former CVS executive with deep knowledge of pharmacy benefit systems. Their expert reports formed the technical backbone of Kroger’s case against Weir; and were aimed at showing that his methodology did no just lack nuance but was fundamentally unfit for the complexity of pharmacy pricing.

Smith focused on what he saw as a failure to adjust for key plan design elements in Weir’s model. He argued that without accounting for deductibles, out-of-pocket maximums, and Medicare’s tiered payment stages, Weir’s damage estimates were incomplete and potentially misleading. Smith also criticized Weir’s use of Rx Savings Club prices without apportioning the membership fee cost, claiming this exclusion distorted the true comparative price. In Smith’s view, a class-wide damages model could not be accurate without a claim-by-claim re-adjudication, which would defeat the efficiency of class certification entirely.

Hughes took aim at the economic assumptions underpinning Weir’s approach. He pointed out that pharmacy claims are influenced by dynamic, plan-specific formulas often defined by contracts between pharmacies and PBMs; contracts that may or may not require Kroger to use the Rx Savings Club price as the U&C benchmark. He also emphasized that not all consumers’ cost-sharing is tied to U&C prices, meaning Weir’s model could be calculating damages even where none existed. To Hughes, Weir’s approach oversimplified a highly complex, multi-party transaction system.

Why the Court Let Weir In: Daubert Denied

Despite Kroger’s aggressive push to disqualify Colin Weir’s testimony, the court rejected the motion to exclude, drawing a firm line between admissibility and credibility. The judge emphasized that Rule 702 and the Daubert standard are not about perfection, they are about whether an expert’s methods are grounded in accepted principles and whether the testimony will assist the trier of fact. On both counts, Weir passed.

The court acknowledged that Weir was not a specialist in pharmacy economics, but cited clear Sixth Circuit precedent: general economic expertise can be sufficient, even in niche contexts. The judge referred to cases like Surles v. Greyhound and Dilts v. United Group Services, where experts were admitted despite lacking subject-matter-specific backgrounds. What mattered was that Weir’s expertise in forensic economic modelling and class-wide damages calculations made him “well-positioned to assist the jury.”

As for Kroger’s critiques—about oversimplification, failure to account for deductibles, or reliance on assumptions—the court made a key distinction. These were questions of weight, not admissibility. Weir’s reliance on Kroger’s own data, his transparent methodology, and his adaptability to alternate inputs (like adjusting the U&C benchmark) demonstrated that the opinion rested on a reliable foundation, even if it could be challenged on cross-examination.

In short, the court found that Weir had done enough to get in the door. Whether his model got it right was a matter for trial, not a threshold bar to his testimony. The court’s decision reinforced a core principle of Daubert jurisprudence: “Rejection of expert testimony is the exception, not the rule.”

Class Certified: The Role of Expert Testimony in Clearing Rule 23

Once Colin Weir’s expert testimony survived Daubert scrutiny, the court turned to whether the plaintiffs met the standards for class certification under Rule 23. The plaintiffs sought to represent three subclasses of insured consumers who allegedly overpaid for prescriptions at Kroger because the company failed to report its lower Rx Savings Club prices as the U&C price.

Common Harm, Common Proof

The court found that the central question—whether Kroger was obligated to report its discounted Savings Club prices as U&C—was common to all class members. This pricing practice, the court held, could be challenged with class-wide evidence. Weir’s damages model, while simple, offered a plausible and adaptable framework for calculating overcharges across the entire class.

---

Ashish Arun is the founder and CEO of Exlitem, an AI-powered search engine helping attorneys find and engage expert witnesses. He also leads Expert Witness Profiler, a due diligence firm enabling attorneys to vet both their own and opposing expert witnesses.

Mr. Arun can be contacted at (866) 955-4836 or by e-mail to sales@exlitem.com.

A more detailed version of this article along with court filed documents such as the expert reports filed by the three expert witnesses, the complaint, the Daubert motion to exclude, deposition transcript excerpts, etc., are available to subscribers of the Expert Witness Weekly, a weekly deep dive publication by Exlitem that discusses a new case involving expert testimony every week. To access, visit exlitem.substack.com