Our Experience

Industries Petroleum Natural Gas Chemicals Electronics Pharmaceuticals, Medical Devices, & Biotech Retail/Consumer Goods Technology Transportation Local/State Government School Districts Other Industries

Functional Areas Antitrust & Competition Analysis of Damages Forensic Economics Intangibles/IP Labor Economics Regulatory Economics & Finance Transfer Pricing Taxation Valuation Fiscal Impact Analysis Demographic Analysis Public Policy Analysis

 

Forensic Economics

IIC, Inc. utilizes its expertise in economics and finance as applied to the field of forensic economics to evaluate various issues that require reconstruction of prior decisions and the evaluation of the causes of such decisions. Our work in this area spans a variety of areas from lost profits analysis and lost earnings computations to the explanation and documentation of complex business transactions. We are noted for our work in developing large databases which enable us to analyze large numbers of transactions in various industries including the petroleum industry. Clients use our work in both litigation and non-litigation settings to develop a complete understanding of the impact of such transactions on pricing, valuation, and decision-making.

Crude Oil Valuation

In a large, complex matter involving the valuation of crude oil produced at the lease, IIC, Inc. reviewed and analyzed thousands of transactions involving the purchase, sale and exchange of crude oil. Relevant data from these transactions were input into a database that was used to analyze the value received and paid for a variety of crude oils in these transactions covering a 10 year period. This database was ultimately used as the basis for determining the value of these crude oils at the lease, and served as the basis for a very favorable settlement for our client.

Development of Transaction Database

IIC, Inc. has developed a proprietary transactions database used to record pertinent data and information on various types of transactions that may be used in pricing and valuation matters. This database permits us to calculate the actual value received or paid across many transactions after accounting for various terms of trade related to the transaction such as volume, quality, transportation, discounts, premia, etc. We have used this database successfully in several different engagements for a variety of clients.

Computation of Lost Earnings Capacity in Personal Injury and Wrongful Death Lawsuits

IIC, Inc. has often been asked to determine the economic value of an individual’s earnings potential in the context of lawsuits involving personal injury and wrongful death. IIC, Inc. has provided expert testimony and damage calculations related to such claims for both plaintiffs and defendants in numerous lawsuits. In such cases, IIC, Inc. has evaluated the data related to the work life expectancy of an individual worker, based on characteristics such as age, educational level, and occupation, and determined for how many years the individual would have likely worked without the accident or discharge that ended his career. Also in the case of an injured individual, we are required to evaluate alternative occupations (including their wage and benefits) to determine how much the individual is likely to earn in his lifetime following the injury. We also evaluate the work of forensic economists who are arguing for the opposite viewpoint.

The computation of lost earnings capacity frequently rests on projections of wages and benefits as well as anticipated retirement benefits and consideration of differences between the but for and residual occupations, and earnings rates related to each. IIC, Inc. has worked on hundreds of such cases, providing economic counsel and testimony for both plaintiffs and defendants. Our work has frequently served as the basis for settlement and mediation, and we have an excellent track record in litigatory proceedings.

In a recent matter, IIC, Inc. was called upon to testify regarding the lost earnings capacity of an entrepreneur who had suffered a hand injury and claimed an inability to continue working. We analyzed the historical earnings and profitability of the entrepreneur’s ventures, and also analyzed the extent to which this person had been able to continue working after sustaining the injury. We showed that earnings capacity in the “but for” world was not as great as claimed and that residual; earnings capacity was significantly greater than claimed in large part due to the entrepreneur’s ability to continue working after sustaining the injury.

For the owner/operator of a gasoline service station, we estimated the lost business profits and the lost earnings capacity suffered by the plaintiff as a result of injuries sustained in a severe automobile accident. IIC, Inc. provided expert testimony demonstrating the value of these losses and critiqued the conclusions of the opposing expert.

We analyzed the value of the earnings capacity of computer software entrepreneur “but for” certain claimed injuries that he claimed affected his earnings capacity shortly after he had sold off his interest in his company. We analyzed the difference in his but for and residual earnings as well as how the value of the company might have been affected by the claimed injuries to demonstrate the extent of his lost earnings capacity.

For several fishermen who sustained injuries while on board various vessels, we have analyzed the employment prospects for fishermen in New England over the next 20 years to demonstrate that the “but for” future earnings capacity may not be based solely on the analysis of historical earnings.