Good grief, can stubbornness actual cost $7 million dollars?

An industry expert was asked to project sales for a prospective new branch in a distant market. The defendant had allegedly prevented the plaintiff from entering this market, and damages were to be assessed on the basis of lost profits. The industry expert prepared a report, containing the derivation of sales projections for the new branch.

The expert relied upon the historical sales of the home office as evidence of the capabilities of management and staff and the potential sales of the new branch. However, the historical evidence began with an 8-month fiscal year, continuing with a succession of 12-month fiscal years. In his calculation of the percentage change in sales from the initial period to the first full year, the expert failed to adjust the series for the beginning 8-month fiscal year. He projected the initial year’s growth for the new branch at 100% rather than the 39% that he should have used had he taken the short fiscal year into account.

Being shown the error through a written response by the defendant’s expert before trial, the expert refused to correct the mistake and argued that the 100% was based, not upon the historical record, but upon his “expert opinion and professional experience.” The court rejected the plaintiff’s entire damage calculations because there was no empirical support for his projections.

Had the mistake been corrected, it would have lowered the calculated damages by $2 million, but due to stubbornness the entire $7 million damage claim was thrown out.