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The Comprehensive Guide to Lost Profits Damages for Experts & Attorneys, 2011 Edition
Edited by Nancy Fannon, ASA, MCBA, CPA, ABV

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In the 2011 edition, business valuation expert Nancy Fannon brings together the comprehensive body of knowledge on lost profits damages and delivers the definitive resource for attorneys. Fannon and other leading experts provide thorough analysis of current case law and valuation methodology related to the calculation of damages.

Highlights of the new edition include: 

• Discussion of methodology used to determine lost profits damages, including what evidence is required to support the damage claim.
• Expert analysis of relevant case law provides guidance and insight to methods, lost business vs. lost profits, length of damage claim, discount rates, and a host of other issues that surround lost profits calculations
• Daubert and other motions to exclude financial experts in lost profits cases outlined by federal jurisdiction and by state – extremely valuable for attorneys and experts
• An overview of the U.S. Court system that tracks a claim from initiation through discovery and appeal
• New Chapters: Calculating Damages for Start-up or Early Stage Companies; Application of Statistics to the Measurement of Damages for Lost Profits; Electronic Discovery; Benefit of the Bargain Damages; Reasonable Royalty; and Lost Profits for Insured Claims

Table of Contents

• About the Editor
• Acknowledgments
• Foreword

Section A: Context of Lost Profits Litigation

• Chapter 1: Context of the Lost Profits Damages Claim
  Jonathan M. Dunitz, Esq.
• Common Elements of Lost Profits Damages Cases
• Chapter 2: Professional Standards for Experts
  Michael Crain
• Certified Public Accountants
• Economists and Other Financial Experts (Non-CPAs)
• Conclusion
• Appendix A: Links to ethical guidelines published by member organizations
• Appendix B: Links to requirements for certifications, by organization . 20
• Appendix C: Decision Tree to Determine the Application of Professional Standards
• Appendix D: Comparison of AICPA Professional Standards and Federal Rule of Evidence 702
• Chapter 3: The Process: A Brief Introduction to the U.S. Court Systems from Filing to Appeal
  Jonathan M. Dunitz, Esq.
• Discovery
• The Rules of Evidence
• Appendix A: Federal Rules of Evidence Pertaining to Expert Testimony
• Appendix B: Federal Rules of Civil Procedure Pertaining to Expert Testimony
• Appendix C
• Chapter 4: Spoliation of Evidence
  Jonathan M. Dunitz, Esq.
• Experts and Spoliation
• Draft Reports
• Electronically Stored Information
• Summary
• Chapter 5: A Guide to Electronic Discovery and Evidence
  Daniel K. Gelb, Esq. and Richard M. Gelb, Esq.
• What is ESI and where does it reside?
• Under what circumstances must ESI be preserved and what protocol should be followed for doing so?
• How should ESI be produced?
• How should ESI be managed during litigation?
• What is required for ESI to be admitted into evidence at trial?
• How can financial experts assist with e-discovery?
• Chapter 6: Selecting and Working with Financial Experts
  William J. Marsden Jr., Esq. and Timothy Devlin, Esq.
• Selecting an expert
• Preparing your expert
• Using your expert at trial
• Opposing experts
• Chapter 7: Motions to Exclude Financial Experts
  Jonathan M. Dunitz, Esq.
• Factors to Consider
• Exclusion of Experts by Jurisdiction
  Chapter 8: Motions to Exclude Expert Testimony
  Robert M. Lloyd, Esq.
• Expert Qualifications
• Methodology
• The Data
• Assumptions
• Failure to Deal with Inconsistent Facts
• Conclusion
• Appendix A: Anchoring and the Expert Witness Testimony:
• Do Countervailing Forces Offset Anchoring Effects of Expert Witness Testimony?
• Appendix B: Excerpts from the Reference Manual on Scientific Evidence

Section B: Lost Profits Calculations and Issues

• Chapter 9: Lost Profits Calculations—Methods and Procedures
  James O’Brien and Robert P. Gray
• Lost Profits - Defined
• General Issues
• Reasonable Certainty Standard
• Reasonableness of expert input and assumptions
• Causation, Burden of Proof, and Other Possible Causes of the Loss
• Limitations on the Period of Recovery
• Damages Calculation
• Sample Lost Profits Analyses
• Lost Profit Calculations in a “But-For” World
• Consideration of Mitigation
• Summary
• Chapter 10: The Reasonable Certainty Requirement in Lost Profits Litigation: What It Really Means
  Robert M. Lloyd, Esq.
• Balancing the competing concerns
• The factors courts consider
• Replacing Rules with a Standard
• Chapter 11: Calculating Damages for Early-Stage Companies
  Neil J. Beaton and Tyler L. Farmer
• Legal requirements: the basic parameters
• Methods for proving lost profits for new businesses
• Chapter 12: Establishing Evidence in Lost Profits Cases
  Tom Burrage
• Establishing a Reliable Foundation for the Claim
• Data and Information Generally Available From the Parties
• Market and Demand for Plaintiff’s Product
• Industry and Economic Data
• Adequate Consideration of all Available Data
• Chapter 13: Use of Forensic Evidence in a Lost Profits Case
  Michael Kaplan and Rebekah A. Smith
• Indicators that Forensic Evidence is Needed
• Admissibility of Forensic Evidence
• Cases Demonstrating the Use of Forensic Evidence
• Chapter 14: Lost Profit versus Lost Business
  Thomas Burrage
• Considerations in Making the Claim for Lost Business or Lost Profits
• Comparison of Lost Profits versus the Lost Value of a Business
• Can Plaintiffs Recover both Lost Profits and Lost Value?
• Comparative Summary of Lost Profits vs. Lost Business Claims
• Chapter 15: Discounting Lost Profits in Damage Measurements
  By Michael A. Crain
• Objective of Compensatory Damages: Making the Plaintiff Whole
• Interest rates, Rates of Return, and Discount Rates
• Conclusion
• Chapter 16: Discounting Damages: Case Law
  Robert M. Lloyd, Esq.
• Cases Allowing a Risk-Free Rate
• Cases Requiring a Risk-Adjusted Rate
• Cases Allowing a Reinvestment Rate
• Other Opinions Discussing the Discount Rate
• Alternatives to Challenging the Discount Rate
• Conclusion
• Chapter 17: Issues and Controversies in Lost Profits Damages
  Nancy J. Fannon
• Lost Profits Damages 101
• Issues and controversies in damage claims
• Summary

Section C: Special Topics

• Chapter 18: Intellectual Property Overview
  Michael Crain
• Overview: Comparing IP valuation to IP damages measurements
• Summary
• Chapter 19: Patent Infringement Damages: Lost Profits and Royalties
  Richard F. Bero
• Federal Law Governing Patent Infringement
• The Patented Technology at Issue
• Lost Profits in Patent Infringement Cases
• The “but for” causation
• The Panduit factors
• The two-supplier market
• Panduit factor 1: demand
• The entire market value rule – lost profits
• Panduit factor 2: acceptable non-infringing substitutes
• Panduit factor 3: capacity
• Panduit factor 4: calculating the amount of lost profits
• Market Share Damages
• Price Erosion
• Convoyed Sales
• Other lost profits concepts
• Royalty Damages
• Established royalties
• Reasonable Royalties
• The hypothetical negotiation
• Form of the reasonable royalty
• The entire market value rule - royalties
• The Georgia-Pacific factors
• The quantitative Georgia-Pacific factors
• The qualitative Georgia-Pacific factors
• Post-Verdict Royalties
• Limitations on Damages
• Damages Against the U.S. Government Under §1498
• Prejudgment Interest
• Chapter 20: Successfully Using Experts in Patent Infringement Cases
  William J. Marsden Jr., Esq. and Timothy Devlin, Esq.
• A primer for attorneys on patent damages
• Reasonable royalty damages
• Ongoing royalties and mandatory licenses
• Additional types of damages and limitations
• Recent updates
• Case-based examples
• Conclusion
• Chapter 21: Lost Profits in Trademark and Copyright Cases
  By Rick Hoffman
• Trademark Litigation and Damages Measurement
• Calculating Damages in Trademark Cases
• Chapter 22: Lost Profits for Physician Practices
  By Mark Dietrich
• Basic Factors to Consider
• In-depth Look at Special Issues in Identifying Damages
• Conclusion
• Glossary of Terms
• Chapter 23: Lost Profits Issues Unique to the Government Contracts Industry
  By Patrick A. McGeehin and Daniel E. Johnson, Esq.
• Government Contracting Types
• Government Contract Cost Analysis
• Application of Government Contract principles to Lost Profits Disputes
• Conclusion
• Chapter 24: Lost Profits for Automobile Dealerships
  By Timothy W. York
• Franchise Relationships
• Lost Profits Considerations
• Understanding the Dealership Business
• Relevant Resources
• General bibliography
• Chapter 25: Construction Claims
  Colin A. Johns and Greg A. McKinnon
• Claim Pricing Methodologies
• Claims for Delay
• Disruption
• Acceleration
• Typical Causes of Construction Claims
• Summary
• Chapter 26: Benefit of the Bargain Damages
  By Jeff Litvak, Kenneth Mathieu, and Kevin Shannon, Esq.
• Post-Closing Adjustments to the Purchase Price
• Determination of Damages
• Pitfalls to Avoid in Assessing Damages
• Process for Resolving Disputes
• Case Study
• Insights and Observations regarding Merger and Acquisition Disputes
• Conclusion
• Appendix: Case Law Abstracts