A compensatory damages award seeks to return the injured plaintiff to the position the plaintiff would have been but for the actions of the defendant. Measurement of damages can be complex. Accounting and financial models are employed to show which sales were impacted and which costs were increased. These models can be used to estimate how long profits were affected and the impact of plaintiff’s mitigation (or failure to mitigate) on damages. In some instances, valuation models are used to quantify the harm done by the defendant’s actions.
Product defect cases present similar issues. Suppose a product is alleged to fail prematurely because of design defect. What is the nature of the harm to consumers, and how can it be quantified? In a product defect class action, are all, or only some, consumers injured?