A practitioner guide walks through one damages question from the economist's standpoint: what the claim consists of, which records drive it, how the number is built, and where it is tested at deposition and trial. The guides below cover lost earnings, wrongful death, household services, present value, expert disclosure, business valuation, lost profits, transfer pricing disputes, patent and trade secret damages, and rebutting an opposing report, for attorneys on either side of the claim.
All guides
What Is a Forensic Economist? - A forensic economist measures economic losses for litigation: lost earnings and benefits, household services, support to survivors, the present value of future care, lost profits, and business…
How Lost Earnings Are Calculated - Lost earnings are the difference between two projected streams: the earnings and benefits a person would have received but for the event, and the earnings and benefits the person can now expect…
Wrongful Death Damages, Explained - In a wrongful death matter the economic loss belongs to the survivors, and the question is what the decedent would have contributed to the household over an expected life. The analysis projects…
Household Services in Personal Injury Claims - Household services are the unpaid work an injured person can no longer perform at home. The loss is measured as the hours no longer performed, established from the household's account and time-use…
Present Value, Explained for Attorneys - Present value is the single sum that, invested today at a stated rate, would replace a stream of future losses as they come due. The result depends on the loss stream, the growth rate applied to it…
Expert Witness Disclosure: A Practitioner Overview - Pre-trial expert disclosure typically requires a written statement of the expert's identity, opinions, the bases for those opinions, the facts or data considered, qualifications, prior testimony…
Daubert vs. Frye: Admissibility in Federal and State Court - Federal courts apply the Daubert framework, a reliability-based gatekeeping test that considers testability, peer review, error rate, controlling standards, and general acceptance. State courts…
When Do You Need an Economic Expert? - An economic expert is warranted whenever a claim includes a loss that runs over time: earnings, benefits, household services, support to survivors, future care costs, lost profits, or the value of a…
The Collateral Source Rule, Explained - The collateral source rule governs whether payments the plaintiff received from insurance, public benefits, or other third parties reduce the defendant's liability for damages. Some jurisdictions…
Business Valuation in Litigation - A litigation valuation begins with four decisions the governing framework shapes: the interest being valued, the valuation date, the standard of value, and the premise of value. The valuator then…
Lost Profits vs. Lost Business Value - Lost profits measure what a continuing business would have earned but for the wrongful act over a defined loss period. Lost business value measures what the business or the owner's interest was…
Income Determination in Divorce - Support in a divorce depends on each spouse's income, and for a business owner or a high earner the tax return rarely tells the whole story. The economist determines income from cash flow rather…
How to Rebut an Economic Damages Report - A rebuttal tests an opposing economic report input by input against the record: the records considered and the assumptions adopted, the earnings base and growth rate, the worklife and life…
How Worklife Expectancy Is Chosen in a Lost Earnings Claim - Worklife expectancy is the number of years a person is expected to remain in the labor force from a given age, and it sets the horizon of a lost earnings projection. The economist reads it from…
Fringe Benefits in a Lost Earnings Claim - Compensation is wages plus the benefits the employer pays for, and a lost earnings claim that stops at wages understates the loss. Fringe benefits are the employer's cost of health coverage…
Personal Consumption in a Wrongful Death Claim - A wrongful death claim compensates the survivors for the support they lost, not for everything the decedent would have earned, and part of every earner's income goes to the earner's own needs. The…
Valuing a Homemaker's Services in an Economic Damages Claim - A person whose work was the household rather than the labor market has an economic loss when an injury or a death ends that work, and the loss is measured the same way an employer's payroll is: by…
Mitigation in Employment Cases: How the Economist Measures It - Mitigation in an employment case is the principle that a terminated or demoted employee's damages are reduced by what the employee earned, or with reasonable effort could have earned, after the…
Front Pay vs. Reinstatement: What the Economist Calculates - When an employee wins an employment claim, the future loss can be remedied by putting the employee back in the position, by ordering front pay in its place, or by neither. Reinstatement ends the…
Lost Profits for a New Business: How the Claim Is Built - A new or unestablished business can claim lost profits, but it cannot prove them from its own past results, because it has few or none. The economist builds the but-for projection from other…
Goodwill in a Divorce Valuation: Enterprise and Personal - Goodwill is the part of a business's value that exceeds the value of its identifiable tangible and intangible assets, and in a divorce involving a closely held business it is often the largest and…
Discounts for Lack of Marketability in a Litigation Valuation - A discount for lack of marketability reduces the indicated value of an ownership interest to reflect that it cannot be converted to cash quickly, at a known price, through an established market…
Tracing Commingled Funds: How the Analysis Is Built - Tracing is the reconstruction of where identified money came from and where it went, through every account it passed, from the bank, brokerage, and accounting records that recorded each movement…
How to Read an Opposing Economist's Report - Reading an opposing economist's report is a different task from rebutting it. The reading comes first, it is done by counsel or by the retained economist, and its product is a short list: the inputs…
What an Economic Damages Report Costs and Why - An economic damages report is priced by the time it takes a qualified economist to build it, and that time is set by three things: the condition of the records, the number of loss components the…
When to Retain an Economist in a Medical Malpractice Case - The economist in a medical malpractice case measures the earnings, benefits, household services, and care costs the injury added to the outcome the patient would have had with proper care, and the…
Economic Damages for a Minor Plaintiff - A minor plaintiff's economic claim is built without the record that anchors every adult claim, the earnings history, so the economist projects what the child would likely have earned from the…
Economic Damages for an Undocumented Worker - An undocumented worker's economic claim is built from the same components as any other injury or death claim, lost earnings and earning capacity, fringe benefits, household services, and future…
Economic Damages for a Self-Employed Plaintiff - A self-employed plaintiff's economic claim starts from a figure that is not earnings at all. The net income on a sole proprietor's schedule, or the distributions from a closely held company, combine…