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How to calculate lost earnings from a theft?

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sdlegal

Member
What is the name of your state (only U.S. law)? CA

A break-in occurred at my business and the thief was caught. In addition to restitution for stolen property, the court is asking me to calculate lost earnings, which is very hard to do because so much is based on potential word-of-mouth. I need to testify in court but I'm not sure how to calculate this. Could a sample equation be:

Number of customers (both directly and indirectly) affected x an estimated 10 customers lost for each affected customer = Total number of customers potentially affected

Then I could estimate average profit on each customer to give a number?

Also, our service level went down as a direct result of having to deal with the damage caused by the theft, thus there are a number of customers whose property was not stolen but were affected because we could not provide the service.

I also had to work up to 100 hours a week as I lost two employees shortly after the incident (thought I can't say it was directly related, it was a factor). Would this scenario also factor in? Are there any other factors I am not considering, such as long-term damage due to bad reviews online?

Thanks for you help - I want to give a reasonable number but no guidelines from the court have been given on how to calculate!
 
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single317dad

Senior Member
A quick Google search revealed a multitude of law firms in Southern CA who specialize in victim/business restitution. A consultation may be your best bet. Good luck.
 

sdlegal

Member
Thanks. I'm actually searching for this (in San Diego) but am unable to find any. What search term are you using?
 

quincy

Senior Member
The standard of proof for victims' restitution is a "preponderance of the evidence." You are responsible for showing that the losses you are claiming you suffered were, more likely than not, the direct result of the acts and actions of the defendant.

If you have documents to demonstrate these losses, great. If you do not, you can support your claims with an explanation only of how you arrived at the figures you are presenting to the court. Any and all claims you make, however, can be challenged by the defendant. The more you have in the way of documentary support, therefore, the better.

I agree with single317dad that, if you suffered substantial losses, a consultation with a lawyer in your area would be smart. When you meet with the lawyer, you should take with you your business records from a year prior to the incident along your business records from the date of the incident to the present - for a compare and contrast. These records could/should show how the incident economically affected your business. You should also take with you any additional documents you might want to use to support your claim, including the negative reviews your business received, if you believe these are the direct result of the incident. Again, the more legitimate proof you have to support your claims, the more likely the amount you claim will be awarded.

What is nice about the criminal restitution available to you is that it can eliminate your need for a civil action.
 
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quincy

Senior Member
I'm sorry, I don't understand this, can you please explain in more detail?
Ha. No. I absolutely can't explain it. My entire post apparently disappeared.

I will try to fix up my previous post but, in the meantime, you can put into your search bar "victim restitution and compensation, San Diego" and you will come up with local resources.
 

justalayman

Senior Member
Number of customers (both directly and indirectly) affected x an estimated 10 customers lost for each affected customer = Total number of customers potentially affected
how does the break in cause you losses such as you are suggesting?

Then I could estimate average profit on each customer to give a number?
how did the break in cause you to lose customers or for your profit per customer to be reduced?

Also, our service level went down as a direct result of having to deal with the damage caused by the theft, thus there are a number of customers whose property was not stolen but were affected because we could not provide the service.
how did your service level go down due to the theft? If you are talking about something like some equipment was stolen, you would be expected to replace the equipment. How soon did you replace the equipment if this is what happened.

I also had to work up to 100 hours a week as I lost two employees shortly after the incident (thought I can't say it was directly related, it was a factor). Would this scenario also factor in?
how is that a loss and why haven't you replaced them?

Are there any other factors I am not considering, such as long-term damage due to bad reviews online?
how does a theft cause you to receive bad reviews?
 

quincy

Senior Member
Your business was insured, correct?

As to the negative reviews, reputational injury can be difficult to prove but a Harvard study showed that, for every negative review posted about a business, the business experienced a slight economic loss. If I locate the link to the study, I can post back with it but, again, having an attorney in your area help you figure this all out is what I recommend.
 

justalayman

Senior Member
:eek: Travesty!

I'd file a Formal Complaint with the Formal Complaint Department. But that's just me. You seem to be more mellow.


:)p:D)
so you're the formal complaint department? Now I know who to send my complaints to.

you must be one heck of a person to be able to handle all the complaints with you being the only employee of the formal complaint department. With all the whining around here it must really keep you busy.
 

Silverplum

Senior Member
so you're the formal complaint department? Now I know who to send my complaints to.

you must be one heck of a person to be able to handle all the complaints with you being the only employee of the formal complaint department. With all the whining around here it must really keep you busy.
:eek::eek::eek::eek:

NO!! NOT ME!!!

:eek::eek::eek::eek:


*flings self toward exit, runs for her sanity, is not seen till tomorrow or later*
 

justalayman

Senior Member
:eek::eek::eek::eek:

NO!! NOT ME!!!

:eek::eek::eek::eek:


*flings self toward exit, runs for her sanity, is not seen till tomorrow or later*
but you said:


I'd file a Formal Complaint with the Formal Complaint Department. But that's just me.
I took it that you are being overwhelmed so you cautioned quincy that as far as the formal complaint department, it's just you suggesting his complaint may not receive prompt attention. Now, I could have read it differently but so often I have been admonished for thinking to far into a statement so I just took your statement at face value.:D
 

dave33

Senior Member
Your business was insured, correct?

As to the negative reviews, reputational injury can be difficult to prove but a Harvard study showed that, for every negative review posted about a business, the business experienced a slight economic loss. If I locate the link to the study, I can post back with it but, again, having an attorney in your area help you figure this all out is what I recommend.
Respectfully I disagree. In criminal restitution cases, many times the person ends up getting next to nothing. Even if they do end up getting a few bucks, it will most likely be in small increments. Usually when a person is involved in these kind of crimes, making a timely substantial restitution payment is not high on their list. Retaining a lawyer may very well cost you more than you end up getting.
 

justalayman

Senior Member
Respectfully I disagree. In criminal restitution cases, many times the person ends up getting next to nothing. Even if they do end up getting a few bucks, it will most likely be in small increments. Usually when a person is involved in these kind of crimes, making a timely substantial restitution payment is not high on their list. Retaining a lawyer may very well cost you more than you end up getting.
in a true court ordered restitution case the victim should not need an attorney. The courts mandate the repayment as part of the sentence. In some cases failure to pay the restitution can prolong being released from probation or even cause them to be incarcerated.
 

quincy

Senior Member
Respectfully I disagree. In criminal restitution cases, many times the person ends up getting next to nothing. Even if they do end up getting a few bucks, it will most likely be in small increments. Usually when a person is involved in these kind of crimes, making a timely substantial restitution payment is not high on their list. Retaining a lawyer may very well cost you more than you end up getting.
I don't see exactly what I said that you are disagreeing with, dave33. Consulting with an attorney?

While in reality restitution may not cover all losses or the payments may be made in small increments paid out over a long period of time, theoretically and according to what I read, the amounts that can be claimed and awarded as restitution are quite high. Damages awarded in civil actions can likewise be difficult to collect but that does not mean someone who has suffered losses should not attempt to collect from the person responsible.

Because collection from the thief can be a problem, sdlegal with luck had his business insured.

The pros of consulting with an attorney, so sdlegal can go to court properly prepared, will need to be weighed by sdlegal against the con of spending money for an attorney, but I still recommend he seek assistance from an attorney in his area. He might be able to find free or low cost legal help, if cost is a concern.

Here, by the way, are the links I earlier mentioned, to the Harvard studies by Michael Luca on negative reviews (available for download):

"Reviews, Reputation, and Revenue: The Case of Yelp.com:" http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1928601

"Fake It Till You Make It: Reputation, Competition, and Yelp Review Fraud:" http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2293164

The Luca papers make for an interesting read, if one likes this sort of thing. :)
 

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