Month: August 2013

Is a Damages Expert Required?

Standard

Damages experts are a routine part of litigation, as the issue of financial losses is often complicated. A variety of subject matter experts and financial experts are a standard feature in litigation to sort out the issues and help judges and juries understand the numbers. But what if there is no damages expert? Can a proper award of damages be made?

In an opinion issued this spring, a judge in federal court in the District of New Jersey granted defendant’s motion for summary judgment on plaintiff’s claim for damages.

Unicom Monitoring, LLC was granted summary judgment its patent infringement claims against Cencom, Inc.  The plaintiff alleged that it could prove the revenue and profits earned by Cencom related to the infringement, and the reasonable royalty that Unicom was entitled to because of the infringement. Continue reading

Mind the Expectation Gap (Guest Post at FEI Financial Reporting Blog)

Standard

auditor-expectation-gapYesterday Financial Executives International (FEI) ran a guest post by me on their Financial Reporting Blog. The introduction is below, and you can read the entire article about the expectation gap between auditors and the users of financial statements here.

One of the greatest problems with the process of traditional financial statement audits is the expectation gap, which is commonly defined as the difference between what auditors do and what the clients, investors or the public expects.  There are also gaps in understanding as to the role of other parties in the financial reporting supply chain, including financial executives, internal auditors, and audit committee members, and how those parties interact with auditors and each other, and the public’s expectations thereof.

[snip]

Let’s look at the first part of the Expectation Gap,  that between auditors and their clients. The audit engagement letter and other pieces of correspondence from the auditors to the client state that the company is responsible for preventing and detecting fraud. In spite of this, management often points the finger at the auditors for failing to uncover a fraud scheme. Continue reading

Divorce Investigations: Finding Income and Assets in an Income Tax Return

Standard

tax amnesty programThis article was originally printed in the ABA Section of Family Law eNewsletter, July 2013.

While consumers generally hate income tax returns because of their complexity, they can be invaluable sources of information in divorce proceedings. Not only do they provide insight into prior years’ earnings, they can also point to assets and sources of income. They may be used to unearth financial information that a spouse omitted from the financial disclosures, and can hold subtle clues to otherwise unknown financial details.

For example, assets are sometimes sold by the spouses to generate cash. Many times this may be a taxable transaction reported by the purchaser to the taxing authorities. Therefore, such a transaction will be required to be reported on the income tax return, and this may help unearth a hidden asset or provide clues to concealed cash. Continue reading

Xyngular v Innutra Lawsuit

Standard

Xyngular Corporation recently sued Innutra LLC, a company that appears to be founded by a number of former Xyngers. You may recognize Xyngular as the company for which serial scammer Jennifer McKinney shills. Both companies are multi-level marketing companies that use “nutritional supplements” as the front for their recruiting schemes.

Xyngular is upset because the people who started Innutra (James Ayres, Cindy Hansen, Glen Oliver, Cecily Karst, and Chris Hummell) allegedly used distributor lists and other proprietary information to get people to join Innutra (in violation of agreements made with Xyngular). Continue reading