Damages

Damages estimation is the calculation of gains and losses to market participants under alternative counterfactual scenarios. While simple in concept, it requires a fundamental understanding of the economics underlying a damages claims and a careful consideration of all relevant costs and benefits. Our extensive backgrounds in economics and finance and our experience with a wide range of markets and financial structures allows us to produce robust and insightful analysis while avoiding common pitfalls of damages estimation.

Selected Case Experience

Overdraft Fee Litigations

Class Actions Related to Overdraft Charges

Cambridge Finance Partners is involved in a number of overdraft fee litigations. These data-intensive cases require significant technical expertise as well as knowledge of bank data processing methods. We have the ability to manage vast amounts of customer transaction data, to re-post daily transactions for bank customers, and to estimate the impact of posting order on fees. We have developed the storage and computing capability to apply analytical tools for banks with millions of customers, years of data, and billions of transactions, and without the limitations of sampling. Our work in these matters is ongoing.

Enron Securities Litigation

Consulting Experts in Securities Class Action

In one of the largest securities cases in U.S. history, Cambridge Finance Partners provided consulting services to counsel for a top-10 international bank in addition to assisting a testifying expert. This multi-year litigation, with plaintiffs’ total damages claim nearing $50 billion, involved a wide array of finance and economic research efforts. Typical for a 10b(5) securities case, we conducted a day-by-day event study, constructed trading models in order to replicate and critique plaintiffs’ damages claims, and analyzed financial reports, analysts’ reports, stock, bond, and options trading data, and other public information in order to identify curative disclosure events. We developed indices of industry performance that transformed over time along with the firm’s underlying business segments. We constructed bottom-up measures of enterprise value. In addition to these analyses, we assisted counsel in a multi-defendant coordinated defense effort, and we provided analysis and explanation of several financial structures including securitizations, swaps, derivatives, and other complex structures.