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Lost profits are an element of damages available in many lawsuits. In general, lost net profits are calculated by first determining the gross revenue on sales that the party lost due to the wrongful conduct of the other party. The lost gross revenue is then reduced by the normal costs related to providing the goods or services. The result of this calculation is the net profits that would have been earned if the sales had not been lost.

Patent law[]

Lost profits are a measure of damages and are generally tied to the profits that could have been made by the patentee but for the infringement.