On February 22, 1990 a fire completely destroyed the leased premises and the entire inventory of a privately held high-end Canadian retailer, Le Beau Footwear. The insurer delayed paying the full settlement rendered by the court due to the suspicion of arson. The court finally ordered annual settlement payments to be made over a four-year period, 1994–1998. Ongoing litigation by the insurer created uncertainty about Le Beau's ability to receive and keep the insurance payments, prevented the company from resuming business in an orderly and prompt manner, and caused the company's eventual shut down in 1998.
Le Beau sued the insurer for the monetary losses resulting from its inability to operate during the period June 1994 to June 1998. Le Beau's financial expert, Able Forensics (Able), provided the court with estimates of Le Beau's lost profits from multi-disciplinary perspectives. Using the comparable earnings approach, accounting data from the footwear industry...