Five questions to ask in damages claims resulting from non-disclosure during due diligence

In their presentation "Pitfalls to avoid when assessing damages in M&A; disputes" Jeff Litvak and William Kennedy gave an example of a target company that lost a significant customer just prior to the deal closing and did not disclose this loss to the buyer.  The impact on purchase price or - to more broadly apply the framework - on overall value, " depends on the characteristic of the customer,” Jeff affirmed.  “Was it normal customer attrition, or not?"  

Here is the 5 point plan they laid out yesterday at the AICPA National BV Conference to help determine the severity of the customer loss:
    1. What is the value of the customer to the business (ie contribution margin, operating profit, or customer EBITDA)?
    2. What is the subject company's (in this case, the target company) customer turnover rate?
    3. Can the customer be replaced?
    4. What's the impact on long term capital structure?
    5. Will the damage affect only a few periods or continue into perpetuity?