Strategies, Challenges, and Answers

Computation Of Damages

Nevada’s Rule of Civil Procedure 16.1(a)(1)(C) and Federal Rule of Civil Procedure 26(a)(1)(A)(iii) require the claimant to serve a “computation of any category of damages claimed by the disclosing party”.  This Computation of Damages is supposed to be served with the initial disclosures and must be provided “without awaiting a discovery request.”

In the case of Design Strategy, Inc. v. Davis, 469 F3d 284 (2d Cir. 2006), the court had to decide whether a Plaintiff, who had failed to disclose a certain category of damages (lost profits) would be allowed to add that claim at the last minute.  The court explained the three-fold purpose behind the rule.  It said that the rule was intended to:

(1)     accelerate the exchange of basic information needed to prepare for trial;
(2)     focus and prioritize discovery; and,
(3)     aid the parties in making informed decisions about settlement.

Computation of Damages in Nevada, Nevada Insurance Law, Mills & Associates Nevada Insurance and Coverage Lawyers 702-240-6060
The court found that in order to avoid the sanction of striking that line item of damages, that Plaintiff would have the burden of demonstrating that its late produced computation would not prejudice the Defendant.  Id  at 298.

There have been a number of other cases where the courts have refused to allow evidence to be introduced where there has been a failure to comply with the Computation of Damages rule.  See Gilvin v. Fire, 2002 U.S. Dist. Lexis 15249 (D.D.C.2002), American Realty Trust, Inc. v. Matisse Partners, L.L.C., 2002 WL 1489543 (N.D.Tx.2002), Midwest Grain Products, Inc. v. Envirofuels Marketing, Inc., 1996 WL 445070 (D.Kan.1996) and Colombini v. Members of the Board of Dirs. of the Empire College School of Law, 2001 WL 1006785, 2001 U.S. Dist. Lexis 13405 (N.D.Cal.2001).

In Nevada’s District Courts, the benefits that could be had by enforcing the rule are rarely realized.  At the outset of litigation, Plaintiffs generally disclose only the past special damages such as medical bills, property damage and lost wages.  Usually, they omit calculations of future damages in the same categories, and they never include calculations as to general damages.  It is our experience that District Courts are rarely willing to enforce the rule and chop out a section of Plaintiff’s damages that were withheld until the last minute.  That fact is regretful because if that sanction were imposed even once, Plaintiffs attorneys would learn quickly to be more forthcoming with a full Computation of Damages.

At Mills and Associates we have found that although the Courts are unwilling to sanction the Plaintiffs for their delays in setting out the damages, some of them will push the Plaintiffs to provide a complete Computation of Damages.  Having at least a list of the categories of damages early in the litigation may be helpful to open the doors to discuss settlement.  Mills and Associates believes that the more you know about the Plaintiff’s claims the better you can talk settlement or if necessary defend the case.  We will continue to advocate for full disclosure of a Computation of Damages relative to each claimed category of damages as early in the litigation as possible.

Mills & Associates Nevada Insurance Lawyers 702-240-6060

About Michael Mills

Mr. Mills practices in the area of civil litigation and appeals, with particular experience in matters involving trucking liability, insurance defense, insurance coverage, premises liability, products liability and defense of personal injury. Mr. Mills is a member of the Trucking Insurance Defense Association, the Defense Research Institute Trucking Committee and the Nevada Motor Transport Association. Mr. Mills is licensed to practice before the Nevada Supreme Court and the Utah Supreme Court. He is also licensed to appear before the United States Supreme Court, the U.S. District Courts for the Districts of Nevada and Utah, as well as the U.S. Court of Appeals for the Ninth Circuit. Mr. Mills has created 3 Blogs for the benefit of the insurance industry. He serves as editor and publisher of the Nevada Insurance Law Blog, the Nevada Coverage and Bad Faith Blog and the Nevada Trucking Law Blog.

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