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FEATURED CASE

ECONOMIST "PRESENT VALUES" 30+ YEAR OLD DIVESTED ASSETS; JURY AWARDS $21 MILLION IN PUNITIVE DAMAGES


James Mills, a Robert W. Johnson & Associates (RWJA) testifying economist, was retained to provide economic testimony on the financial condition (economic health, wealth & status) and ability to pay punitive damages for Kaiser Gypsum Co., Inc.

Location: San Francisco, California

Case: John Casey and Patricia Casey v. Kaiser Gypsum Co., Inc.

Court: Superior Court of the State of California for the County of San Francisco, No. CGC-10-275517.

Plaintiff’s Attorneys: Gilbert Purcell, Novato, California.

Judge: The Honorable Donald Sullivan.

Case Synopsis: The plaintiff, John Casey, worked for 40 years as a plumber. In January of 2010 Mr. Casey was diagnosed with mesothelioma.

In the first phase of the trial, the jury awarded Mr. and Mrs. Casey a total of  $21,273,421 in compensatory damages including $1,273,421 in economic damages, $15 Million in non-economic damages and $5 Million in loss of consortium damages. The jury also found that the threshold for deciding punitive damages had been met and additional testimony on Kaiser Gypsum’s financial condition would be required.


For More Information....

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  • Mesothelioma Trial Results in $13.2 Million Award, Including $6 Million in Punitive Damages. Read More...
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  • Economist Quantifies Damages to Homemaker in Tobacco Case. Read More...
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Expert Consultation: Mr. Mills testified not only to Kaiser Gypsum’s current financial health, wealth and economic status, but also to the history of their financial condition and, specifically, the current value of the assets the company had divested 30-40 years earlier (1970s and 1980s).

Pre-trial documentation illustrated that:

  • Kaiser Cement & Gypsum received net cash of $28 Million in 1978 for the sale of “almost all of its gypsum assets…”, and had an after-tax gain of $7.8 Million.
  • Also in 1978, Kaiser Gypsum Co., Inc. sold its St. Helens, WA plant to Owens-Corning Fiberglass for $6 Million.
  • Kaiser Gypsum Co, Inc. sold its Delanco, NJ plant to U.S. Gypsum Co. in 1981 for over $4 Million.

Mr. Mills calculated and determined the current present value of the proceeds from each of these transactions, assuming that they had been invested in either

  • U.S. Government Treasurys,
  • The stock market (Dow Jones Index), or in
  • Investments that mirrored inflation.

The result of these calculations illustrated that the current present value of the combined assets was between $124.3 Million and $492.4 Million.

This was critical to the jury’s understanding of the defendant’s financial condition because the defendant claimed that it had no ability to pay punitive damages. In fact, the testimony and declarations of the defendant, reviewed by Mr. Mills, indicated that the representatives of the company couldn’t explain the entries in the company’s current financial statements, which reflected a net worth of $17.4 Million. However, Mr. Mills was able to point out to the jury that the defendant’s past management and recordkeeping made it hard to believe that the company now had no idea what its assets were.

Result: The jury ordered $20 Million in punitive damages against Kaiser Gypsum.

Attorney's Comments: "Mr. Mills was instrumental in helping the jury understand the true financial condition of the defendant. The incomplete and murky financial statements produced by the defendant did not reflect all of their assets. Mr. Mills was able to examine historical documents, including old news releases, and explain to the jury in clear and understandable terms how that information revealed the defendant’s actual financial condition. During his re-direct, Mr. Mills was able to take the confusing, contradictory defense testimony and clarify it in a way that supported RWJA’s financial analysis presented earlier in the trial. When it comes to navigating through complex, contradictory and formidable financial documents, with the goal of being clear, concise and understandable, we consider Jamie and those at Robert W. Johnson and Associates to be the metric against which all others are measured.”