## Bottom line **Helix should appeal Issues A and B together and omit Issue C.** - **Issues A + B** fit exactly within the **$150,000** incremental appellate briefing budget. - Their combined expected incremental client value is **$1,092,500**. - **Issue C** has a **negative** expected incremental value relative to keeping the existing **$2.1 million** judgment: **−$260,000**. - Omitting Issue C preserves the collectible $2.1 million judgment while allowing Helix to pursue the two positive-value incremental issues. --- # 1. Baseline and method The starting point is the status quo: - Helix has a collectible **$2.1 million** judgment. - Interest and timing are excluded. - The board’s budget is limited to **$150,000 in incremental appellate briefing costs**. - The supplied probabilities are used as given; no additional premiums are added. For Issues A and B, the current judgment is not at risk. Their expected incremental value is: \[ EV = -\text{appellate briefing cost} + P(\text{reversal}) \left[ P(\text{ultimately recover} \mid \text{reversal}) \times \text{recovery} - \text{remand cost} \right] \] For Issue C, the current $2.1 million judgment is at risk. The relevant comparison is: \[ EV_C = \text{expected value of appealing C} - \text{value of keeping the existing } \$2.1M \] Equivalently: \[ EV_C = -\text{appellate briefing cost} + P(\text{reversal}) \left[ P(\text{win at retrial}) \times \text{retrian recovery} - \text{retrial cost} - \text{existing judgment} \right] \] I treat the supplied **$3,000,000** as the remand recovery if Helix wins at retrial because no separate remand fault allocation is supplied. If the $3,000,000 were only gross damages subject to further comparative-fault reduction, Issue C’s value would be even lower. --- # 2. Review standard and consequence of reversal | Issue | Standard of review | Consequence if reversed | Does it put the current $2.1M judgment at risk? | |---|---|---|---| | **A: dismissed rebate claim** | De novo review of summary judgment | The claim is restored for further proceedings. Reversal does **not** establish liability or damages unless the record permits only one result. Helix still must prevail on remand. | **No** | | **B: excluded lost-profits expert** | Abuse of discretion, plus prejudice / probable effect on judgment | The exclusion is reversed and the lost-profits damages claim goes forward on remand. Reversal does **not** guarantee the $4,000,000; Helix still must ultimately recover on remand. | **No** | | **C: comparative-fault instruction** | De novo review of the instruction error, then harmfulness | Reversal vacates the entire current $2.1 million judgment and requires a full retrial on liability and damages. Helix must win the retrial to recover. | **Yes** | The key structural difference is that **A and B are incremental upside**, while **C is a replacement gamble on the existing judgment**. --- # 3. Expected incremental value of Issue A ## Issue A inputs - Probability of appellate reversal: **70%** - If reversed, probability of ultimately recovering on remand: **60%** - Recovery if successful: **$2,000,000** - Remand litigation cost if reversal occurs: **$300,000** - Incremental appellate briefing cost: **$90,000** ## Step-by-step calculation ### 1. Expected recovery \[ P(\text{reversal}) \times P(\text{success on remand}) \times \text{recovery} \] \[ 0.70 \times 0.60 \times \$2{,}000{,}000 = \$840{,}000 \] ### 2. Expected remand cost The remand cost is incurred whenever reversal occurs, regardless of whether Helix ultimately recovers. \[ P(\text{reversal}) \times \text{remand cost} \] \[ 0.70 \times \$300{,}000 = \$210{,}000 \] ### 3. Appellate briefing cost \[ \$90{,}000 \] ### 4. Net expected incremental value \[ \$840{,}000 - \$210{,}000 - \$90{,}000 = \boxed{\$540{,}000} \] **Issue A expected incremental value: +$540,000.** --- # 4. Expected incremental value of Issue B ## Issue B inputs - Probability of appellate reversal: **35%** - If reversed, probability of ultimately recovering on remand: **55%** - Recovery if successful: **$4,000,000** - Remand litigation cost if reversal occurs: **$450,000** - Incremental appellate briefing cost: **$60,000** ## Step-by-step calculation ### 1. Expected recovery \[ 0.35 \times 0.55 \times \$4{,}000{,}000 = \$770{,}000 \] ### 2. Expected remand cost \[ 0.35 \times \$450{,}000 = \$157{,}500 \] ### 3. Appellate briefing cost \[ \$60{,}000 \] ### 4. Net expected incremental value \[ \$770{,}000 - \$157{,}500 - \$60{,}000 = \boxed{\$552{,}500} \] **Issue B expected incremental value: +$552,500.** --- # 5. Expected incremental value of Issue C relative to keeping the $2.1 million judgment ## Issue C inputs - Probability of appellate reversal: **60%** - If reversed, the current **$2,100,000** judgment is vacated. - At retrial, probability Helix wins: **75%** - Expected gross damages if Helix wins: **$3,000,000** - Retrial cost if reversal occurs: **$500,000** - Incremental appellate briefing cost: **$50,000** ## Method If Helix does **not** appeal Issue C, the value is simply: \[ \$2{,}100{,}000 \] If Helix does appeal Issue C, there are three possible paths: 1. **No reversal**: current judgment stays. 2. **Reversal and win at retrial**: current judgment is lost, but Helix obtains the retrial recovery. 3. **Reversal and loss at retrial**: current judgment is lost and Helix obtains no retrial recovery. The appellate briefing cost is incurred in all cases. ## Step 1: Expected value if no reversal Probability: **40%** \[ 0.40 \times \$2{,}100{,}000 = \$840{,}000 \] ## Step 2: Expected value if reversal occurs Probability of reversal: **60%** If reversed: - Probability of winning at retrial: **75%** - Recovery if win: **$3,000,000** - Expected retrial recovery before retrial cost: \[ 0.75 \times \$3{,}000{,}000 = \$2{,}250{,}000 \] Subtract retrial cost: \[ \$2{,}250{,}000 - \$500{,}000 = \$1{,}750{,}000 \] Weight by reversal probability: \[ 0.60 \times \$1{,}750{,}000 = \$1{,}050{,}000 \] ## Step 3: Expected total value before appellate briefing cost \[ \$840{,}000 + \$1{,}050{,}000 = \$1{,}890{,}000 \] ## Step 4: Subtract appellate briefing cost \[ \$1{,}890{,}000 - \$50{,}000 = \$1{,}840{,}000 \] ## Step 5: Compare to keeping the existing judgment \[ \$1{,}840{,}000 - \$2{,}100{,}000 = \boxed{-\$260{,}000} \] **Issue C expected incremental value relative to keeping the judgment: −$260,000.** --- # 6. Why reversal probability alone does not determine priority The board chair’s preference for Issue C rests on its **60% reversal probability** and the fact that “the jury already gave us three million.” That reasoning is insufficient under the board’s stated expected-value criterion. ## A. Reversal is not recovery For Issues A and B, reversal only restores the claim or damages theory. Helix still must prove its case on remand. - Issue A has a **70% reversal probability**, but only a **60% chance of ultimately recovering** after reversal. - Issue B has a lower **35% reversal probability**, but a much larger potential recovery and lower expected cost. - Issue C has a **60% reversal probability**, but if reversed, Helix loses the existing $2.1 million judgment and must win a full retrial. So the economically relevant probabilities are not just reversal probabilities, but the full chain: \[ P(\text{reversal}) \times P(\text{ultimately recover} \mid \text{reversal}) \] ## B. Issue A has the highest reversal probability, yet is not the highest-value single issue - Issue A reversal probability: **70%** - Issue C reversal probability: **60%** - Issue B reversal probability: **35%** Yet: - Issue B expected incremental value: **$552,500** - Issue A expected incremental value: **$540,000** - Issue C expected incremental value: **−$260,000** Thus, even among single issues, reversal probability does not match expected client value. ## C. Issue C puts the existing judgment at risk The “jury already gave us three million” statement is misleading because the current collectible judgment is **$2.1 million**, not $3 million. The $3 million was the gross jury figure before the 30% comparative-fault reduction. Appealing C creates the following expected value structure: | Path | Probability | Economic result | |---|---:|---| | No reversal | 40% | Keep $2.1M | | Reversal and win at retrial | 45% | Get $3M | | Reversal and lose at retrial | 15% | Get $0 | Before retrial and appellate costs, the expected change from appealing C is only: \[ (0.45 \times \$900{,}000) - (0.15 \times \$2{,}100{,}000) = \$405{,}000 - \$315{,}000 = \$90{,}000 \] Then expected costs are: \[ 0.60 \times \$500{,}000 + \$50{,}000 = \$300{,}000 + \$50{,}000 = \$350{,}000 \] So: \[ \$90{,}000 - \$350{,}000 = \boxed{-\$260{,}000} \] The $3 million is not an assured upside. It is a possible retrial outcome, and appealing C risks the existing $2.1 million judgment. --- # 7. Ranking of the three issues by expected client value ## Individual issue ranking | Rank | Issue | Briefing cost | Expected incremental value | |---:|---|---:|---:| | 1 | **B** | $60,000 | **+$552,500** | | 2 | **A** | $90,000 | **+$540,000** | | 3 | **C** | $50,000 | **−$260,000** | If the board were limited to a single issue, **Issue B** would be the best choice, with Issue A a very close second. --- # 8. Which issues fit within the $150,000 appellate budget? The budget applies to **incremental appellate briefing costs**. | Strategy | Briefing cost | Fits within $150,000? | Expected incremental value, using standalone figures | |---|---:|---|---:| | A only | $90,000 | Yes | +$540,000 | | B only | $60,000 | Yes | +$552,500 | | C only | $50,000 | Yes | −$260,000 | | A + B | $150,000 | Yes | **+$1,092,500** | | A + C | $140,000 | Yes | +$280,000 | | B + C | $110,000 | Yes | +$292,500 | | A + B + C | $200,000 | No | Not feasible under the stated cap | Using the supplied standalone values, **A + B** is the best feasible combination. Adding Issue C to either positive issue lowers the package value because C has negative expected incremental value: - A + B: **+$1,092,500** - B + C: **+$292,500** - A + C: **+$280,000** Thus, even if the board insists on including C, the best C-included package would still be far below A + B and would still expose the $2.1 million judgment to retrial risk. --- # 9. Concrete appeal recommendation to the board ## Recommendation **Helix should appeal Issues A and B together and omit Issue C.** ## Why 1. **A and B have positive expected incremental value.** - Issue A: **+$540,000** - Issue B: **+$552,500** - Combined: **+$1,092,500** 2. **A and B fit exactly within the authorized appellate briefing budget.** - $90,000 + $60,000 = **$150,000** 3. **A and B do not put the existing $2.1 million judgment at risk.** - The current judgment remains collectible and intact. - Helix preserves the win while seeking additional incremental recovery. 4. **Issue C has negative expected value.** - Expected incremental value relative to keeping the judgment: **−$260,000**. - It creates a 60% chance of vacating the $2.1 million judgment. - It creates a 15% chance that Helix ends with zero judgment recovery before costs. - It requires a $500,000 retrial if reversed. - The $3 million jury figure is not the correct benchmark; the safe, collectible judgment is $2.1 million. 5. **Omitting C does not waive the judgment Helix already won.** - Under the stated appellate framework, Helix may omit an issue without losing the existing judgment. - Omitting C is therefore the value-maximizing way to protect the $2.1 million judgment. ## Final answer to the board **Pursue Issues A and B. Omit Issue C.** This gives the highest expected incremental client value within the $150,000 cap: \[ \boxed{+$1,092,500} \] while preserving the existing $2.1 million judgment.