KW Economics supports both plaintiff and defense counsel. The three narratives below are anonymized composites that show how a damages figure is grounded, structured, and tested in three common contexts. They describe method, not specific cases or outcomes.
Our work is retained by plaintiff attorneys, defense attorneys, insurers, and businesses. We do not advocate for either side - our role is to apply accepted economic methods to the records in the case and produce an analysis that can be examined figure by figure. The narratives below are illustrative and contain no client-identifying details; any resemblance to a particular matter is coincidental.
Built to be defensible
Whatever the loss, the analysis is held to the same standard - so each figure holds up under examination, not just on paper.
Same method, either side. The methodology is identical whether plaintiff or defense commissions the work. An analysis that only holds up for the retaining party does not survive cross-examination.
Records, assumptions, arithmetic. Every figure traces to a record in the case or a published data source, states the assumption behind it, and can be recomputed by the other side from the report alone.
Conflict-checked and confidential. Every matter opens with a conflict check. Pre-retention communications are handled confidentially; whether they are protected as consulting-expert work product depends on the terms of the retention and the rules of the forum, which counsel confirms at engagement.
Lost Earnings in a Traumatic Brain Injury Matter
Context
A skilled tradesperson in mid-career sustained a traumatic brain injury in a motor vehicle collision. After rehabilitation the person returned to part-time work in a lower-paid position, and the treating record and a vocational opinion agreed that a return to the prior trade was not expected.
Approach
Earnings base established from several years of tax returns, W-2 forms, and union wage and benefit records, with overtime and shift differentials examined separately rather than averaged in
But-for earnings projected over the person's statistical worklife with wage growth drawn from published government series for the occupation and region, and employer-paid benefits valued as a share of wages
Post-injury earnings path built from the actual part-time wage and the vocational opinion on the person's remaining capacity, then offset against the but-for stream year by year
Future net losses discounted to present value under the discount rate convention that applies in the venue, with a sensitivity table showing the effect of alternative worklife and growth assumptions
What the analysis delivered
The report gave counsel a schedule in which every year's loss traced to a stated earnings base, growth rate, and post-injury wage, so a mediator could see exactly what moved the number. Because the sensitivity table had already bracketed the worklife and growth assumptions, a critique of the report has to engage a specific input rather than the method.
A regional distributor claimed that a supplier's early termination of an exclusive supply agreement caused lost profits over the remaining contract term. The distributor had several years of financial statements before the termination and a partial recovery from substitute suppliers afterward.
Approach
But-for revenue projected from the distributor's own pre-termination sales history and the volume commitments in the agreement, tested against the growth of the market over the same period
Avoided costs identified from the general ledger so that only the incremental costs the distributor no longer incurred were deducted, leaving lost profit rather than lost revenue
Mitigation credited from the actual substitute-supplier results, with the transition costs of establishing those relationships treated as part of the loss
Losses over the remaining term discounted to the date of breach and reconciled to the financial statements the parties had exchanged in discovery
What the analysis delivered
The analysis tied every figure to the distributor's own records and the contract, addressed causation and mitigation directly, and separated lost profit from lost revenue. Counsel could present a number whose foundation was visible on the face of the report, and any challenge had to be directed at a stated assumption, such as the growth rate, rather than at an undisclosed method.
A minority shareholder in a closely held professional services company sought a buyout after a dispute with the majority owners. The company had stable revenue, an owner-heavy cost structure, and no prior transactions in its shares.
Approach
Financial statements normalized for owner compensation above market, personal expenses run through the business, and non-recurring items, so that the earnings stream reflected what a buyer would expect to receive
Income approach applied to the normalized cash flow with a capitalization rate built up from published risk data, cross-checked against a market approach using transactions in comparable private companies
The standard of value that applies to a buyout under the state's law identified with counsel before the analysis, so that discounts for lack of control and marketability were addressed under that standard rather than assumed
Value reported as of the date the parties agreed on, with a reconciliation of the approaches and a sensitivity analysis on the capitalization rate and the owner compensation adjustment
What the analysis delivered
The report gave the parties a documented value with each normalization adjustment explained and the discount question framed under the governing standard of value rather than left to argument. Both sides had a common basis from which to negotiate, and the reconciliation showed how much of the range came from each approach.