Three Types of Business Damages/Lost Profits

Lost profits tend to focus on a lost stream of economic income. The question is, did the wrongdoing permanently diminish the future earnings capacity of the business.

Was the business permanently impaired for the foreseeable future, or will it recover?

Damages can exceed business value when the lost business value is combined with lost profits. For example, for a business that was impaired and had six months of losses and then went out of business, these damages would exceed Lost business value.

A permanently impaired business that eventually goes out of business can have two types of damages:

1. Lost Profits
2. Lost Business Value

Measurement of Damages

Three types of business damages/lost profits: