Page 38 - Economic Damages Calculation

For example, if a plaintiff was injured and the claim for damages hinged solely upon a medical progno-
sis, there would typically be no expectation that the damages expert would offer causation testimony.

In contrast, there are other circumstances in which the damages expert will also be engaged to opine di-
rectly on causation. If the damages expert is asked by counsel to assume the existence of causation as to
damages, then does the expert need to consider this issue any further? The answer to this seemingly
simple question is not always clear. Some argue that in this situation, the damages expert has no obliga-
tion to undertake further analysis of the causation issue. But when taking this approach, damages experts
should be aware of the attendant risks. Specifically, the acceptability of the expert’s assumption on cau-
sation becomes less clear when it may be argued that the damages are attributable to factors having
nothing to do with the purported bad acts. Consider the following example:

The defendant was accused of tortious interference after hiring the plaintiff’s top salesperson. In
the year following the loss of this employee, the plaintiff’s sales declined by 30 percent. Plain-
tiff’s counsel retained a damages expert and instructed the expert to assume that this decline in
sales was caused by the loss of the salesperson.

The fact pattern makes intuitive sense: the plaintiff could have experienced a loss associated with the
departure of this individual. From the expert’s perspective, is this enough? Because the facts are rarely
this clear, assume further that

as depositions were taken, it becomes apparent that a patent on the plaintiff’s most popular prod-
uct had expired around the time of the salesperson’s departure. The related product accounted for
nearly 35 percent of the plaintiff’s annual sales. The market was subsequently flooded with ge-
neric alternatives. The plaintiff argued that it had countered the effect of this technology change
when it developed, patented, and introduced a new and improved product that, but for the de-
fendant’s theft of its key salesperson, would have more than offset any reduction in sales.

At a hearing to exclude the expert testimony, the plaintiff’s expert acknowledged that she had not inves-
tigated or performed any analysis of these issues, as counsel instructed her that it was not her responsi-
bility to prove or establish causation. The defendant argued that the plaintiff’s expert should be excluded
because she had simply assumed causation even though other factors were present that demonstrated
reasons for the sales decline.

Ask the following questions in these modified circumstances:

• Is it likely that the plaintiff’s damages expert would be excluded for not considering causation?

• Would it matter if the plaintiff offered the testimony of its director of marketing to address how
the introduction of its newly patented product would have impacted sales?

• Would it make a difference if the plaintiff retained an industry expert to directly address these
causation issues?

• In the event that plaintiff’s damages expert is excluded by the court because the plaintiff failed to
establish causation, should this be cause for any personal concern to the excluded damages ex-
pert?

As reflected in the following case research, depending upon the jurisdiction and (in some cases) the
judge assigned to the case, the outcome of this challenge to exclude the plaintiff’s expert could vary. In

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