This matter involves a dispute between a leading television and internet seller of jewelry and a software company.
Accumyn was asked to review and opine on the damages suffered by the jewelry seller as a result of the failed software implementation. Accumyn determined the jewelry seller’s out-of-pocket costs and extra-expenses incurred as a result of failed software implementation. This included payments to the software company, as well to the other third-party vendors. This involved a determination of the value of the benefit received, if any, for each of these payments. Accumyn also determined the internal labor costs incurred by the jewelry seller in order to ameliorate the damage from the failed software implementation.
The assignment also involved the preparation of five lost profit models to determine the damages suffered by the jewelry seller as a result of various delays in obtaining functionalities that had been promised by the software company. Five additional lost profit models were prepared to determine the damages suffered by the jewelry seller as a result of internal projects that were also delayed as a result of the failed software implementation. These analyses involved determination of the expected incremental profits the jewelry seller would have experienced, if not for these delay periods.
Scott Bayley provided two expert reports and trial testimony in support of his opinions.
This matter involves a dispute between a high-end credit card company that provides co-branded marketing services and a global payment processing company.
Accumyn was asked to review and opine on the damages suffered by the credit card company based on claims that the payment processing company breached its contractual and common-law obligations and interfered with the credit card company’s business operations.
Accumyn determined the credit card company’s lost profits as a result of the payment processing company’s actions. This analysis was based on offsetting the credit card company’s expected program revenues by expected incremental program acquisition and variable carrying costs to derive future profit projections. These revenues and expenses were determined based on the credit company’s historical operating results, as well as the typical operating margins in the credit card industry.
Accumyn then calculated the credit card company’s out-of-pocket costs and extra-expenses incurred as a result of the payment processing company’s actions. This included costs incurred by the credit card company in the process of re-branding its product, retaining its customers, and converting to a new payment network.
Accumyn also determined the internal labor costs incurred by the credit card company in order to ameliorate the damage from the actions of the payment processing company.
Additional analysis included a critique of the opposing experts’ damage calculations
Scott Bayley provided two expert reports and deposition testimony in support of his opinions.
Accumyn’s team of economists and valuation professionals valued a successful haute couture fashion company. A start-up designer teamed up with a pair of Houston-based investors and fashion industry experts to secure funding. In the first year, sales to retail stores reached seven figures. However, as soon as orders for the second season were booked, the designer no longer wanted the involvement of her Houston partners. The designer backed away from her commitments to them, cutting off further involvement and breaking away to form a separate company that continues to flourish, with worldwide sales of eight figures.
On behalf of the Houston partners, who wished to realize the full value of their ownership interest, Accumyn prepared a detailed valuation analysis of the original company, as of the time the designer broke away. Using a Fair Value standard, the amount that compensates an owner involuntarily deprived of property, and presuming that the company had gone forward with the involvement of the Houston partners as intended, Accumyn reached a conclusion on the value of the company, under both an income approach and a market approach.
Accumyn’s expert provided testimony refuting a claim for over $60 Million in lost profits and value arising from potential hedging of natural gas production sales as part of a contemplated debt financing. The enterprise would have hedged natural gas price risk by means of forward fixed price sales of physical natural gas or swaps that would have extended over a multi-year period. Accumyn addressed the plausibility of the claimed economic damages in the context of actual forward market conditions at the time the alleged damages occurred. Accumyn discovered that the cost of unwinding underwater positions associated with existing forward physical natural gas sales was disguised. Accumyn showed that cash or credit was generated by selling gas based on the lower of the first of the month or the monthly average indices, at the option of the buyer and that these imbedded ‘lower of’ options as well as additional forward fixed price sales were in violation of a temporary restraining order.
Failure to timely exercise a Termination Agreement providing for the contemplated separation and distribution of assets from an existing natural gas exploration and production joint business venture agreement allegedly prevented both the funding of bank debt financing of plaintiff’s prospective remaining business interests as well as any allegedly prospective forward hedging of any related natural gas production. Accumyn reviewed standard terms and conditions required by bank lenders to oil and gas production companies and analyzed forward fixed price sales (i.e., hedging), including terms and condition, required credit support, and previous hedging patterns.
Accumyn prepared a detailed analysis of the deteriorating capital markets during the 2007 financial and credit meltdown and the impending sub-prime mortgage crisis to derive a but-for calculation that would represent what could have been done by a shopping center developer had they been informed in March 2007 of their anchor tenant’s intent not to lease. This analysis included a comparison of the value of the center based on spring 2007 market conditions and conditions at the time of trial in late 2009.
The shopping center developer initiated a project in The Woodlands, Texas, to build a Class-A center under the assumption that the anchor tenant, a high-end organic grocery store, would be occupying the most visible space to attract customer traffic and enhance its appeal to other tenants and institutional investors. However, the grocery tenant allegedly decided to terminate its lease several months before disclosing to the developer. The alleged misrepresentation coincided with the 2007 financial and credit meltdown and the impending sub-prime mortgage crisis. Due to the anchor tenant’s delayed notification, the developer experienced difficulty in filling the remaining space and subsequently had to develop the center in a market characterized by scarcity of credit funds, higher required rate of returns from equity investors, and a poor overall prospect of the U.S. economy; this resulted in higher capitalization rates and a lower market value of the center. The Accumyn team assisted the developer by preparing analysis of various budgets based on different development scenarios, including net rentable square footage, lease rates, capitalization rates, and discounts rates in various timeframes.