Lost profits damages are measured at the incremental contribution margin the plaintiff would have earned on the lost sales — not at gross revenue. We separate fixed and variable costs from the plaintiff's actual cost structure and apply variable costs to the lost revenue stream.
Methodology
Lost Profits & Incremental Margin (2026)
Incremental margin methodology for lost profits damages.
Frequently Asked
Frequently Asked
How are fixed costs treated?
Fixed costs are excluded from the loss calculation because they were incurred regardless of whether the lost sales occurred. Only avoidable variable costs are netted against lost revenue.
Considering Dr. Pettingill on your matter?
A brief inquiry starts the scope conversation and conflicts check.