New cases added to BVLaw this week...
Here's a sampling of some recent cases where the courts have evaluated the testimony of financial experts to arrive at their final conclusions. As always, BVLaw digests, and the court documents, are available at BVLaw.
Factory Mutual Insurance Co. v. Alon USA, 2013 U.S. App. LEXIS 1481 (Jan. 23, 2013)
Fifth Circuit affirms lower court’s use of adjusted replacement cost as measure of damages where parties disagreed on how to calculate fair market value (FMV) of destroyed business; no market for the unique used facility exists and the value of used components does not fully capture the value of the complete operational plant, court states.
Experts: Leslie H. Miles (plaintiff); Dean Harris (defendants)
Judge: Prado
State/Jurisdiction: Federal/Texas
Court: Court of Appeals for the Fifth Circuit
Type of case: Damages
SIC code: 8731-11 Environmental & Ecological Services
Edgewater Growth Capital Partners, L.P. v. H.I.G. Capital, Inc., 2013 Del. Ch. LEXIS 54 (Feb. 28, 2013)
Delaware Court of Chancery decides foreclosure sale of company to debt purchaser’s affiliate is commercially reasonable as to process and price under the UCC; plaintiff expert’s DCF analysis used “stale” and “unrealistic” data and his guideline company analysis failed to use the relevant basis of comparison for selecting public companies, the court finds.
Experts: Roy D’Souza (plaintiffs); David Clarke (defendants)
Judge: Strine
State/Jurisdiction: Delaware
Court: Delaware Court of Chancery
Type of case: Miscellaneous
SIC code: 5049 Professional Equipment and Supplies
Russell v. Russell, 2013 Ark. App. LEXIS 151 (Feb. 27, 2013)
Court of Appeals rejects husband’s claim that trial court erred in valuing interest in family business based on wife’s expert’s computation, which deviated from industry standards and included discounts (DLOM, DLOC, personal goodwill) based on expert’s agreement with the wife.
Experts: Joe Webb (wife); David Potts (husband)
Judge: Brown
State/Jurisdiction: Arkansas
Court: Court of Appeals
Type of case: Marital Dissolution
SIC code: 7389 Repossessing Service
Liberty Media Corp. v. Vivendi Universal, S.A., 2013 U.S. Dist. LEXIS 19485 (Feb. 12, 2013)
In securities case, the federal court denies the defendants’ post-trial motion to upset the jury’s $765 million verdict, finding the plaintiffs’ expert’s loss causation and damages analysis was not defective; taking an “aggressively skeptical view” of the significance of nonfraud-related news does not invalidate the expert’s disaggregation analysis, the court says.
Experts: Dr. Blaine Nye (plaintiffs); Dr. William Silber (defendants)
Judge: Scheindlin
State/Jurisdiction: Federal/New York
Court: United States District Court
Type of case: Securities
SIC code: 4813 Telephone Communications, Except Radiotelephone
Assured Guaranty Municipal Corp. v. Flagstar Bank, FSB, 2013 U.S. Dist. LEXIS 16682 (Feb. 6, 2013)
In breach of contract action involving loan pools, federal court rejects Daubert challenge to expert’s calculation of damages based on statistical sampling.
Experts: Mason (plaintiffs); none (defendants)
Judge: Rakoff
State/Jurisdiction: Federal/New York
Court: United States District Court
Type of case: Contract
SIC code: 6331 Mortgage Guaranty Insurance Carriers
Hark’n Technologies, Inc. v. Crossover Symmetry, 2013 U.S. Dist. LEXIS 24644 (Feb. 21, 2013)
In trade dress infringement suit, although court finds expert’s computation of the incremental profit percentage figure based on the plaintiff’s entire product line, rather than the products at issue, “troubling,” it concludes damages formula is admissible under Daubert.
Experts: Mark E. Elwood (plaintiff); unknown (defendants)
Judge: Stewart
State/Jurisdiction: Federal/Utah
Court: United States District Court
Type of case: Intellectual Property
SIC code: 5941 Sporting Goods
Brighton Collectibles, Inc. v. RK Texas Leather Mfg., 2013 U.S. Dist. LEXIS 24644 (Feb. 12, 2013)
In trade dress infringement suit, federal court excludes expert testimony on actual damages under Daubert where expert proposed to base lost profits solely on defendants’ profits, assuming one infringing sale correlated to one lost transaction for the plaintiff and one lost transaction meant lost sales of 2.06 products; the theory lacked support in the facts and failed to “articulate a reliable principle or method.”
Experts: Robert Wunderlich (plaintiff); unknown (defendants)
Judge: Curiel
State/Jurisdiction: Federal/California
Court: United States District Court
Type of case: Intellectual Property
SIC code: 3171 Women’s Handbags and Purses