Either damages analysts or lawyers do not generally appreciate the notion of compensation forfeiture—but it could apply in many cases, according to attorney George Roach. It is not difficult or expensive to prove, and it can be piled on top of other remedies, he said during a recent webinar, Measuring Unjust Enrichment. He also pointed out that, in some cases, compensation forfeiture may end up being the only form of damages that can be proven with reasonable certainty.
Unfaithful servant: Compensation forfeiture is based on the doctrine that dishonest or disloyal employees or agents should not be compensated for any service after the wrongdoing first occurs. This is generally true even though the individual was not 100% corrupt. Any benefits the wrongdoer’s service triggered generally do not offset the amount of compensation to be disgorged. In other words, there’s no credit for any good deeds. However, the treatment of this matter varies by jurisdiction. In any event, Roach says it “represents an opportunity for a damages analyst sometimes to suggest an enhancement to the client’s claims that can be made at a small increase in professional fees.”
Extra: Roach contributed three chapters to the newest edition of The Comprehensive Guide to Economic Damages, available here.
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