Measuring Business Interruption Losses and Other Commercial Damages, 3rd Edition

CHAPTER 1Introduction

This book is designed to provide a methodological framework for how lost profits should be measured in business interruption litigation. Such a framework is provided so that a standard approach can be followed in the measurement of such damages.

In following the discussion, readers will notice the interdisciplinary nature of commercial damages analysis. Depending on the type of case, the expert who seeks to measure a plaintiff’s lost profits needs to possess a well‐rounded knowledge of the research and practices in various areas of expertise. In some cases, the issues are more limited and defined. Other cases are complex and require broad areas of expertise. These may include certain major subfields of economics (macroeconomics, microeconomics, econometrics, and forensic economics), several subfields of finance (investment analysis, capital market theory, and corporate finance), and accounting. Given the broad range of expertise that ultimately may be needed and that few individuals would be experts in all of these fields, a team of experts, such as economists working with accountants, is often the optimal solution for complex cases.

While we recognize, and we will elaborate on, that a reliable economic loss analysis may require expertise of experts from disciplines (such as economics, finance, and accounting), this edition will endeavour to focus more on the important economic issues that are relevant to so many different types of cases.

This book is ...