Expert’s Use of Wrong Damages Methodology Results in ‘Grossly Inflated’ Damages

BVLaw
Court Case Digests
November 26, 2018

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economic damages & lost profits
breach of contract, expert testimony, mergers and acquisitions (M&A), multiple, earnings before interest, taxes, depreciation, amortization (EBITDA), diminution in value, purchase price, expectancy, revenue
Zayo Group v. Latisys Holdings, LLC
2018 Del. Ch. LEXIS 540
US
State Court
Delaware
Court of Chancery
Kyle Anne Midkiff (plaintiff); Gary Kleinrichert (defendant)
Slights

Summary

In contract dispute, Chancery rejects plaintiff’s damages analysis, noting expert lacked valuation experience and chose a methodology (EBITDA multiple) that did not fit facts of case; court says there was no evidence that the alleged breach permanently diminished value of the acquired company.

See Also

Zayo Group v. Latisys Holdings, LLC

Full Text of Court Cases
November 26, 2018

In contract dispute, Chancery rejects plaintiff’s damages analysis, noting expert lacked valuation experience and chose a methodology (EBITDA multiple) that did not fit facts of case; court says there was no evidence that the alleged breach permanently diminished value of the acquired company.

This article also appears in:
The Comprehensive Guide to Economic Damages, Seventh Edition