In Section 10(b), Section 11, and related securities matters, damages generally turn on the amount by which the alleged misstatements or omissions inflated the security's price during the relevant period. Measuring this inflation, and translating it into damages, requires combining the event-study results with an analysis of the alleged corrective disclosures and the trading at issue.
We have the expertise and experience to measure price inflation and the resulting damages. We use the statistically significant abnormal returns on corrective-disclosure dates to estimate the inflation per share over the relevant period, adjusting for any confounding information; where the matter involves a multi-item accounting restatement, we partition the inflation across the individual restatement items by analyzing the underlying entries. We then develop a trading model, appropriate to institutional and to individual investors, to translate per-share inflation into aggregate damages, accounting for the offsetting of gains and losses, the statutory 90-day look-back, and the requirements of class certification. Our work is based on widely-accepted and standard methodologies, frameworks, and analyses and we have been engaged by both plaintiffs and defendants in a wide range of industries in such matters.