Bad post-injury assumptions in a personal injury case

In personal injury cases, it is frequently very difficult for the economist to determine how much of a loss in earnings capacity the injured person has suffered. For instance, a severely injured back would effect a construction worker a lot differently than a adminstrative assistant.

In a lot of situations, the economist will rely in part on the assessment of the vocational expert to help determine how much earnings capacity the individual has lost. In part is the key phrase. However, as Elcock v. Kmart Corp below points out, it is still crucial that the economist use sound judgement in determining the post-injury earnings capacity of the injured person. In this case, the economist simply assumed that the person would be 100% disabled even though at the time the economist performed the economic analysis, the injured person was still earning money from the labor market.

The case:

In Elcock v. Kmart Corp., 233 F.3d 734 (3d Cir. 2000).
the court found:

In sum, we believe that [the plaintiffs' experts] economic damages
model relied on several empirical assumptions that were
not supported by the record. Although [the plaintiffs' expert's] suggested
to the jury that it might discount the 100 percent disability
figure that he plugged into his economic model, this
suggestion is not sufficient to change the result.

In the absence of clearer instructions or emphasis by the witness
or the court, a jury is likely to adopt the gross figure
advanced by a witness who has been presented as an
expert. Accordingly, the District Court abused its discretion
in admitting [the plaintiffs' expert's] model as evidence. Cf. Benjamin,
820 F.2d at 643; Gumbs, 718 F.2d at 98. 13

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