Case Examples

Analysts at Cornerstone Research start contributing to casework upon their arrival. Therefore, it is important that candidates have skills that translate into strategic thinking and quality work product. Not only will the case interview provide you with awareness of our work, it is another tool that provides us with insight into your thought process, comprehension skills, and your ability to articulate ideas.

We know a case interview can be challenging, so here are some tips that we trust will provide valuable guidance for a strong performance on the case interview.

  • Break down questions into smaller parts to organize your thoughts.
  • Consider the issue from multiple perspectives.
  • During the interview, take notes and ask questions.
  • Express your thought process to the interviewer.
  • Finally, listen to your interviewers—they want to help you stay on track!

Intellectual Property

A federal court ruled that Duff Products Corporation* had, without permission, used manufacturing techniques patented by ACME Manufacturing Company.* ACME contended that the use of its techniques enabled Duff to steal customers, ultimately resulting in hundreds of millions of dollars in lost earning opportunities.

Attorneys for Duff retained Cornerstone Research in order to determine the extent to which ACME’s alleged lost profits resulted from unauthorized use of its manufacturing techniques. The Cornerstone Research team included a marketing professor supported by a senior analyst and an econometrician supported by a manager and an analyst.

The marketing professor and senior analyst examined the sales patterns of the two companies, seeking to determine whether Duff’s sales patterns resembled ACME’s. Working closely with Duff’s vice president of marketing, the senior analyst examined the firm’s sales efforts and reviewed information on its marketing programs. Analysis of a database of customer information revealed that ACME and Duff had sold products through different distribution channels to different customers. ACME sold directly to large institutions, while Duff sold primarily to retail chains patronized by individual consumers. In other words, the analysis showed that Duff grew largely as a result of expanding the market, rather than as a result of stealing customers from ACME.

The econometrician, manager, and analyst focused on identifying and quantifying the causes of ACME’s declining revenue during the period in question. A review of securities analyst reports and industry publications revealed that the primary challenge to ACME’s business had arisen from the introduction of a new technology that enabled other firms to provide institutional customers with better, cheaper products. ACME’s business suffered, not because of the actions cited in the lawsuit, but because ACME’s technology had become obsolete. An econometric analysis of ACME data confirmed these findings.

Having demonstrated that ACME lost little revenue as a result of Duff’s actions, the team brought on an accounting professor to develop a detailed model of the company’s cost structure, in order to quantify ACME’s lost profits. Deducting appropriate costs suggested that ACME had lost little profit. The court relied heavily on the testimony of Cornerstone Research’s experts in awarding ACME only a small portion of the originally claimed damages.


After five consecutive years of double-digit growth, Zilo Corporation,* a high-tech firm, completed its initial public offering at $20 per share. In less than a year, the stock traded in the mid-$60s. However, the company’s rapid growth left it too large for its existing management systems and unable to effectively compete with rivals. The stock became increasingly volatile, although most of its movement was downward. Then, Zilo lost its two largest customers, who together accounted for 40 percent of the firm’s sales. When this news became public, Zilo’s stock price plummeted to $16.

Subsequently, a group of Zilo’s shareholders filed a lawsuit against the firm’s officers and directors to recover losses on the stock. The suit alleged that Zilo managers knew that relations with key clients had collapsed months before they announced the collapse. If true, the charges would constitute a breach of the company’s fiduciary responsibilities to inform shareholders of any material changes in the firm’s business. The plaintiffs asked for a damage award based on a price decline of $40 per share.

Attorneys defending Zilo’s officers and directors asked Cornerstone Research to assist in preparing a finance professor to testify as an expert on the subject of valuation and its implications for shareholder damages. The case team consisted of an officer, an associate (who had recently graduated from business school), and an analyst.

First, the analyst examined daily stock price movements to determine how much of the $40 drop in share price owed to economy-wide and industry-wide news rather than to any alleged wrongdoing by the firm. Academic research indicates that the movements of broad stock market indexes tend to reflect economy-wide news. The analyst worked with the faculty expert to conduct a statistical analysis that quantified the relationship of Zilo’s stock price movements to economy-wide information. The results showed that economy-wide factors explained little about the decline in Zilo’s stock price.

In collaboration with the associate and the faculty expert, the analyst then identified a set of companies that shared industry attributes with Zilo. The analyst compiled this list of firms after in-depth review of industry publications, securities analyst reports, and internal company documents. Using statistical techniques, the analyst demonstrated that Zilo’s share price decline correlated closely with a similar decline in the value of the competitors’ stock prices. In other words, while economy-wide conditions explained little of the movement in Zilo’s stock price, industry factors, and not factors unique to Zilo, largely explained the fall of Zilo’s stock price.

After removing the effects of economy-wide and industry-wide developments, the case team undertook an “event study,” which matched the remaining statistically significant changes in Zilo’s stock price with news announcements and equity analyst reports released around the same time. This study showed that many of the significant stock price drops followed specific announcements. By eliminating stock price movements unrelated to the allegations in the case, the team concluded that only $3 of the price drop might relate to the allegations.

Based largely on the findings of the Cornerstone Research team, attorneys for the plaintiffs and defendants reached a settlement of the case.

*To preserve client confidentiality, the names Zilo Corporation, Duff Products Corporation, and ACME Manufacturing Company, and certain facts of these cases have been changed.