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Felix von Meyerinck
Former Member
Title
Prof. Dr.
Last Name
von Meyerinck
First name
Felix
Phone
+41 71 224 7029
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Item type:Publication, Competition and the reputational costs of litigation(2025-03-14); ; We study the role of competition in customers’ reactions to litigation against firms, using anonymized mobile phone location data. A class action lawsuit filing is followed by a 4% average reduction in customer visits to target firms’ outlets in the following months. The effect strongly depends on competition. Outlets facing more competition experience significantly larger negative effects. Closer competition matters more, both in terms of geographic and industry proximity. Announcement returns and quarterly accounting revenues around lawsuit filings also strongly depend on competition. Our results suggest that competition is an important component in customers’ ability to discipline firms for misbehavior.Type:journal articleJournal:Journal of Financial and Quantitative AnalysisVolume:60Issue:7Scopus© Citations 2