Page 44 - Calculating Lost Profits

 Do slight changes in key assumptions result in large increases in lost revenues (for example, a
0.1% change in a growth rate yields 10% more lost revenues)?

 Does the company at issue have a track record of achieving the results reached by the practition-
er?

The practitioner should consider such questions while developing the damages model to anticipate po-
tential critiques of the analysis (for example, by the opposing expert). In this way, the practitioner will
be more likely to develop a credible estimation of lost revenues.

Scenarios

For some cases and analyses, the practitioner may develop a forecast range or provide alternative scenar-
ios. These might be "high," "medium," and "low," or more or fewer scenarios. Although this approach
may be appropriate in some cases, it may expose the analysis to critique regarding whether the opinion
can be expressed with reasonable certainty or whether it is sufficiently helpful to the trier of fact. This
critique is more likely when the practitioner offers a wide range of scenarios, with minimal insight into
which of the scenarios is more or less likely. Lacking testimony on what would determine where in the
range the but-for revenues would have landed, it leaves a projection with scenarios or a range subject to
criticism that the testimony is not sufficiently helpful to the jury or trier of fact. fn 4

fn 4 See, for example, Sargon Enterprises v. University of Southern California, 288 P.3d 1237 (Cal. 2012).

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