Erick C. West, M.A.


(509) 747-5850

ewest@econexpert.com

 

Let Our Specialization Help You Gain the Leading Edge
 

What is the Role of a Forensic Economist?

 

Forensic economics focuses on the quantification of a person’s (or company’s) income producing ability before and after some adverse event, such as an injury, termination, death, business interruption, etc.  The difference between the before and after income projections is then discounted to a single present value number, which represents the economic expert’s opinion of loss.


Personal and commercial economic damage cases can vary dramatically depending on the interpretation of actual data and the assumptions made by your expert.  An effective economic expert will be able to clearly communicate and support his or her damage opinions and be well prepared for cross-examination and critiques from opposing experts. 

 

What Economic Elements Should be Considered?


The elements of loss, such as wages and fringe benefits, are seemingly straightforward.  This however, is not usually the case.  An effective economic expert must be able to account for several potential factors, which may have a profound impact on the overall damage conclusion and the expert’s ability to withstand rigorous cross-examination.  These factors may include:


  • Plaintiff's Historical Labor Force Participation

  • Plaintiff's Demonstrated Past Earnings

  • Sustainability of Overtime

  • Advancement Opportunities

  • Tenure with Current Employer

  • Bonuses & Commission Income

  • Stock Options

  • Valuing Employer Paid Health Benefits

  • Pension Plan Valuations

  • Out-of-Pocket Employee Expenses

  • Seasonality of Work

  • Economy and Industry Considerations

  • Missing or Incomplete Documentation

  • Job Demand in the Local Labor Market

  • Determination of a Reasonable Mitigation Plan

  • Identifying and Quantifying Lost Household Services

  • Estimating Personal Expenses (wrongful death)

  • Identification of Non-Operating Business Expenses & Normalized Income

  • Accounting for Unrelated Factors that Adversely Impacted Income

  • Determination of a Reasonable Loss Period (worklife expectancy)

  • Determination of Reasonable Growth Rates & Discount Rates

How Do You Know if Your Expert Has the Right Answer?


You can increase the probability of a successful resolution by selecting an economic expert with as many of the following attributes as possible:


  • Independence and Objectivity

  • Extensive Trial Experience

  • Ability to Communicate in Non-Technical Terms

  • Familiarity with Applicable Case Law

  • Ability to Identify the Key Issues

  • Critical/Strategic Thinker

  • Well Prepared to Handle Cross-Examination

  • Knowledge of Generally Accepted Methods & Data Sources

  • Understanding of the Methods Used by Opposing Experts in Prior Cases

    When Should an Economic Expert be Retained?


    In order to maximize the value that an economic expert can potentially add to your case, the expert should be retained as early as possible.  The benefits of retaining an expert early in the case include, but are not limited to, the following:   


    • Provide a Preliminary Estimate of the Economic Damages

    • Assist with a Settlement Demand Letter

    • Identify the Strengths & Weaknesses of the Damage Claim

    • Recommend if Other Experts (i.e. Vocational Expert) Should also be Retained

    • Assist with Negotiating a Reasonable Settlement while Avoiding a Costly Trial

    • Identify Key Documents to Request Before any Discovery Deadlines

    • Provide You with Deposition Questions Relevant to the Damage Claim

    • Allow You to Focus More on the Liability Side of the Case