Lost Profits Damages Calculations in Commercial Litigation: Fundamentals and Key Considerations
Quantifying lost profits in commercial litigation is a complex exercise fraught with significant risks and potential pitfalls. Recent court opinions continue to alter the methodologies and parameters of acceptable lost profits claims.
A sound lost profits claim must adhere to the appropriate legal principles; identify a sufficient causal nexus; and employ an appropriate, well-supported methodology to reach a reasonably certain quantification.
In this LIVE webcast, a panel of distinguished professionals and thought leaders assembled by The Knowledge Group will help companies and litigators better understand the fundamentals and key considerations involved in calculating lost profits in commercial litigation. Speakers will discuss acceptable methodologies for analyzing and quantifying lost profits and will provide real-world examples of how such methodologies are applied. They will also provide insight into important considerations when claiming or defending against a claim for lost profits.
Key topics include:
- Legal Framework: An Overview
- Fundamentals and Key Considerations in Calculating Damages
- Lost Profits Damages Calculations in 2019: What to Expect
- Measurement and Projection of Lost Profits
- Defending Against Lost Profits Damages Claims
- Recent Court Opinions Impacting Lost Profits
James L. McGovern, Founding Partner
McGovern & Greene LLP
- Only damages that would not have been incurred “but for” the actions of the defendant, are recoverable;
- Two common methodologies for calculating lost profits are the “Before and After Method” and the “Yardstick Approach”;
- The general framework for assessing lost profits includes: (a) Establishing the loss period, (b) analysis of macroeconomic conditions, (c) analysis of industry conditions, (d) entity specific analysis, (e) measurement of lost profits, and (f) adjustment to present value;
- It is critical to identify and account for the impact of non-claim related issues that may have contributed to a plaintiff’s losses;
- In most cases, the proper measure of damage is the amount of “incremental profits” lost which requires careful analysis of fixed and variable costs associated with the impacted revenue stream.
Niall MacMenamin, Vice President
Analysis Group, Inc.
- Economic causation is a critical issue for counsel and damages experts for successful lost profits damages testimony
- Expert testimony that fails to address economic causation may lack credibility and be excluded
- Experts apply established frameworks such as Panduit Factors, analysis and economic reasoning to address causation
- Among analytical techniques, statistical analysis, experiments, and surveys are frequently employed to establish economic causation
- Each of the various techniques have challenges and limitations to consider
Barry L. Bell, Managing Director
- An Overview of Lost Profits as a Remedy
- The Reasonable Certainty Standard
- Key Inputs for a Lost Profits Determination
- Practical Considerations in Establishing Reasonable Certainty
- Claiming Foreign Lost Profits Related to Patent Infringement
Who Should Attend:
- Litigation Attorneys
- In-House Counsel
- Litigation Officers
- Financial Executives/Officers
- Forensic Accountants
- Top Level Executives
- Private and Public Companies
- Other Related and Interested Professionals
Niall MacMenamin, an economist specializing in finance and statistics, has consulted on multiple securities, intellectual property, commercial litigation, and valuation matters. His experience includes developing financial models and market research studies, testifying as an expert witness, and providing consulting services to attorneys. Mr. MacMenamin has calculated damages, including lost profits, on behalf of plaintiffs and defendants in a variety of matters. In intellectual property, he has conducted lost profits analyses to determine damages in cases involving consumer products, internet properties, and microchip manufacturers. In particular, he has used surveys to measure consumer confusion and the value of patented features. Mr. MacMenamin’s finance and securities case experience includes examining allegations of securities fraud, estimating securities class action settlements, analyzing mortgage-backed securities, assessing loan underwriting and appraisal deficiencies, evaluating mutual fund fees, and assessing investment suitability. He has been involved in valuations of privately held companies, securitizations, and construction costs. Mr. MacMenamin has also assisted clients in several cases involving accounting matters.
Niall MacMenamin, an economist specializing in finance and statistics, has consulted on multiple securities, intellectual property, commercial litigation, and valuation …
For more than 25 years, Barry Bell has focused primarily on the analysis and quantification of damages in commercial litigation matters. He is experienced in analyzing complex matters; identifying relevant issues, information and approaches, and cogently communicating, via expert reports and testimony, the resulting opinions to interested parties.
Mr. Bell has extensive experience in analyzing damages in a wide variety of actions, including breach of contract, breach of fiduciary duty, fraud, and intellectual property infringement/misappropriation, among others, across a broad industry spectrum. Mr. Bell frequently provides expert witness testimony related to damages in complex commercial and intellectual property-related disputes.
For more than 25 years, Barry Bell has focused primarily on the analysis and quantification of damages in commercial litigation …
James McGovern is a founding partner of McGovern & Greene LLP (www.mcgoverngreene.com) a forensic accounting and litigation services consulting firm. He is a CPA, Certified in Financial Forensics and a Certified Valuation Analyst. He works as a consultant and expert witness on matters involving complex financial and economic damage issues, including those stemming from contract disputes, intellectual property infringement, construction claims, business interruption or devastation, shareholder/partnership disputes, and lost personal earnings. James is a member of the Intellectual Property Owners Association Damages and Injunctions Committee, a Past President of the National Contract Management Association, and an arbitrator for the AAA in cases involving complex financial issues. .
James’ expert witness experience includes testifying at deposition and/or trial in more than 70 cases. He has testified before federal and state courts, arbitration panels, and boards of contract appeals throughout the country.
James McGovern is a founding partner of McGovern & Greene LLP (www.mcgoverngreene.com) a forensic accounting and litigation services consulting firm. …
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Method Of Presentation:
On-demand Webcast; Group-Internet Based
General knowledge in commercial litigation
NASBA Field of Study:
Business Law –Technical
NY Category of CLE Credit:
1.5 CLE; 1.5 NASBA-CPE
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About Analysis Group, Inc.
Analysis Group is one of the largest economics consulting firms, with more than 850 professionals across 14 offices in North America, Europe, and Asia. Since 1981, we have provided expertise in economics, finance, health care analytics, and strategy to top law firms, Fortune Global 500 companies, and government agencies worldwide. Our internal experts, together with our network of affiliated experts from academia, industry, and government, offer our clients exceptional breadth and depth of expertise.
About Echelon Analytics
Echelon Analytics is a nationally recognized firm comprised of proven leaders in the areas of economic and financial analysis, financial and forensic investigation, and expert witness services. We assist clients involved in commercial disputes and high-stakes litigation, as well as those needing help assessing value and risk in the context of pre-litigation, mergers and acquisitions, joint ventures, licensing and sales.
About McGovern & Greene LLP
McGovern & Greene LLP is a Forensic Accounting, Consulting and Investigative firm committed to helping our clients preserve, protect and recoup their most valuable assets. Our experienced team of CPAs, Investigators and Fraud Examiners provides pragmatic solutions to complex challenges and opportunities. We provide expertise in forensic accounting, economic damage analysis, fraud examinations, internal investigations, corporate risk and compliance assessments, financial due diligence, and government contract accounting to law firms, corporations, government agencies and law enforcement. Our experts provide exceptional depth of experience and are frequently called to serve as expert witnesses in high-stakes litigation.