Lost Profits

Allied Business Group provides economic damages and valuation related ligitation services and expert testimony for lost profit cases. We are experienced in highly complex litigation matters where time is of the essence.Our valuation professionals have testified in court as an expert witness regarding matters of economic damages and business valuation concerns.

Hypothetical scenarios that require a business valuation expert

• An attorney has a client who is suing a supplier for breach of contract. The attorney's client is claiming lost profits from the breach of contract. It is critical that the attorney and their client obtain a business valuation expert to assess what they should claim as lost profits.
  
  
• A business owner is being sued for lost profits by a former business partner. The business owner does not believe that he did anything illegal or would cause his former business partner to lose profits. In this case, the business owner would need to obtain a qualified business valuation professional to scrutinze the former business partner's calculation of lost profits and to provide the business owner with a defensible report determing what the appropriate lost profits were.

Special considerations for lost profits:

The calculation of lost profits is similar in approach to the valuation of a business for other purposes. In the case of lost profits, the business appraiser compares two scenarios: first, what would the profits of the damaged party been but for the damaging event, and second, what profits did the damaged party actually have during the period in which the damaging event took place. According to the courts, lost profits must be determined with reasonable certainty. In addition, the damaged party has a duty to mitigate the damages from the damaging event. These are all factors that an appraiser must take into consideration when determining lost profits.