1The evidence revealed that Cajun typically ordered limestone from its suppliers by the ton. 

Both parties introduced evidence of the appropriate conversion by which the tonnages could be

converted to cubic yards. These conversion factors ranged from approximately 1.2 to 1.5 tons

per cubic yard. 

United States Court of Appeals,

Fifth Circuit.

No. 93-5552.

MOBIL EXPLORATION AND PRODUCING U.S., INC., Plaintiff-Appellant,

v.

CAJUN CONSTRUCTION SERVICES, INC., Defendant-Appellee.

Feb. 17, 1995.

Appeal from the United States District Court for the Western District of Louisiana.

Before REYNALDO G. GARZA, WIENER, and EMILIO M. GARZA, Circuit Judges.

EMILIO M. GARZA, Circuit Judge:

MobilExplorationand ProducingU.S.,Inc.("Mobil"),suedCajunConstruction Services, Inc.

("Cajun"), to recover money paid to Cajun for deliveries of limestone, alleging that Cajun had

short-loaded those deliveries. After a bench trial, the district court found in favor of Cajun and

dismissed Mobil's suit with prejudice. Mobil appeals the judgment, and we reverse and remand.

I

Forseven years, Cajun suppliedMobilwith limestone for its operationsin southernLouisiana.

Mobil ordered the limestone in fourteen-cubic-yard or twenty-four-cubic-yard loads.1 Cajun billed

Mobil by the yard, and Mobil paid Cajun's bills.

Mobil later received information suggesting that Cajun had loaded the deliveries of limestone

short, and Mobil then conducted an audit of Cajun's records to determine whether Cajun had

delivered the proper quantities of limestone. Mobil discovered that Cajun had discarded all the

primary documents that identified specifically each load delivered to Mobil; only the records of

Cajun's purchases from its own suppliers were available. Mobil analyzed those supplier records,

determined the weights and corresponding cubic yardages of Cajun's purchases, and also attempted
 

2Cajun used two sizes of trucks for its limestone deliveries. It used its smaller trucks for the

"fourteen-yard" deliveries and its larger trucks for the "twenty-four-yard" deliveries. The parties

disagreed as to what were the actual and utilized capacities of those trucks. 

 

3Mobil also introduced evidence suggesting that Cajun's trucks either physically could not

carry a fourteen- or twenty-four-yard load, or if physically possible, did not because the truck

would have grossly violated state motor vehicle weight restrictions. Further, Mobil presented

evidence that the "3-yard bucket" with which Cajun loaded its own trucks had a maximum

capacity of only 2.3 yards. 

 

4As the basis for its correlation, Mobil relied on the records of Cajun's purchases from the

third-party suppliers. 

to correlate those purchases from suppliers with deliveries to Mobil. Based on this analysis, Mobil

concluded that Cajun had short-loaded its deliveries to Mobil, and, when Cajun did not refund the

value of the claimed shortfall, Mobil sued Cajun for the alleged overpayments.

At trial, Mobil introduced evidence that it ordered limestone from Cajun in either

fourteen-yard or twenty-four-yard quantities.2 Mobil then introduced evidence of over 3400 loads

of limestone that Cajun had obtained at third-party suppliers both for its own uses and for deliveries

to customers. That evidence included scale tickets indicating the actual weight of the limestone that

Cajun had loaded into itstrucks. The evidence also suggested that the average load for Cajun's large

trucks used for deliveriesto Mobil and other Cajun customers waslessthan twenty-four cubic yards,

and that the average load for Cajun's small trucks was less than fourteen cubic yards. Mobil also

introduced evidence that Cajun loaded its trucks at its own yards in the same manner that it loaded

itstrucks at the third-party suppliers. In response, Cajun introduced evidence that it routinely loaded

its trucks by using a front-end loader with a "3-yard bucket" and counted the number of buckets to

ensure proper loading.3

Rather than relying solely on its proffered evidence of Cajun's routine practice of loading its

trucks short, Mobil further attempted to prove by correlation that Cajun had directly delivered to

Mobil from the third-party suppliers.4 In response, Cajun offered testimony to show that it routinely

delivered from its own yards to its customers and not from third-party suppliers. Further, Tommy

Angelle, Cajun's co-owner, attempted to show by correlation that the third-party loads which Mobil
 

5Angelle also used the records of Cajun's purchases from its third-party suppliers. Because

Cajun had discarded its records of its deliveries to Mobil, neither party could show direct

documentary evidence of the deliveries to Mobil. 

 

6Accord Tyler v. Insurance Co. of N. Am., 539 F.2d 1072, 1074 (5th Cir.1976) ("Any fact

findings based on an erroneous legal standard cannot be credited."); Fulton Nat'l Bank v. Tate,

363 F.2d 562, 567 (5th Cir.1966) ("If erroneous, this [legal] conclusion would taint the crucial

findings of fact, for as we have often held, "findings induced by or resulting from, a

misapprehension of controlling substantive principles lose the insulation of F.R.Civ.P. 52(a) and a

judgment based thereon cannot stand.' ") (quoting Davis v. Parkhill-Goodloe Co., 302 F.2d 489,

491 (5th Cir.1962)). 

believed it had received had actually gone to other Cajun customers.5 Cajun also offered testimony

from its own truck drivers and a Mobil contractor suggesting that Cajun typically loaded the

deliveries for Mobil properly from its own yards. Because Cajun had discarded its records of the

individual loads, neither Mobil nor Cajun could show directly which loads went to Mobil sites and

how much those loads had contained.

After the bench trial, the district court concluded that Mobil had not proven that Cajun had

short-loaded deliveries oflimestone to Mobilsites. Consequently, the district court dismissed Mobil's

suit with prejudice. Mobil appeals, arguing that the district court erred by 1) refusing to consider its

proffered evidence of the manner in which Cajun routinely loaded its trucks, and 2) holding Mobil

to an improperly high standard in its proof of its entitlement to and amount of damages.

II

Mobil argues that the district court erred in its analysis of the law applicable to its suit. First,

Mobil contends that the district court failed to consider evidence, as required by Federal Rule of

Evidence 406, of Cajun's routine practice of loading its trucks in a particular manner. Next, Mobil

asserts that the district court imposed an improperly high standard for Mobil's proof of damages.

Mobil argues that the district court'sfinding that Cajun had not short-loaded its deliveries of

limestone to Mobil is legally erroneous. Although we ordinarily review the trial court's findings of

fact for clear error, Anderson v. City of Bessemer City, 470 U.S. 564, 573-75, 105 S.Ct. 1504, 1511-

12, 84 L.Ed.2d 518 (1985), a judgment based on a factual finding derived from an incorrect

understanding of substantive law must be reversed. Fuji Photo Film Co. v. Shinohara Shoji

Kabushiki Kaisha, 754 F.2d 591, 597 (1985).6
 

7

See Jones v. Southern Pac. R., 962 F.2d 447, 449 (5th Cir.1992) ("Habit evidence is superior

to character evidence because the uniformity of one's response to habit is far greater than the

consistency with which one's conduct conforms to character."); Loughan v. Firestone Tire &

Rubber Co., 749 F.2d 1519, 1524 (11th Cir.1985) ("Habit evidence is considered to be highly

probative...."); Reyes, 589 F.2d at 794 (same). 

 

8

See also United States v. Newman, 982 F.2d 665, 668 (1st Cir.1992) (" "numerous enough to

[support] an inference of systematic conduct' " (quoting Wilson v. Volkswagen of Am., Inc., 561

F.2d 494, 511 (4th Cir.1977))), cert. denied, --- U.S. ----, 114 S.Ct. 59, 126 L.Ed.2d 28 (1993); 

Simplex, Inc. v. Diversified Energy Sys., Inc., 847 F.2d 1290, 1293 (7th Cir.1988) (requiring

demonstration of "frequency of uniform response" for Rule 406 inquiry). 

Mobilfirst assertsthat the trial court erred in refusing to consider its proof of Cajun'sroutine

practice of loading its trucks in a particular manner. Habit evidence is relevant to prove that a

business acted in a certain way. Fed.R.Evid. 406.

Evidence of the habit of a person or of the routine practice of an organization, whether

corroborated or not and regardless of the presence of eyewitnesses, is relevant to prove that

the conduct ofthe person or organization on a particular occasion wasin conformity with the

habit or routine practice.

Id.; see also McCormick on Evidence § 195, at 351 (John W. Strong ed., 4th ed. 1992) (explaining

that habit or routine practice "denotes one's regular response to a repeated situation"). "Rule 406

allowsthe introduction of evidence ofthe habit of a person for the purpose of proving that the person

acted in conformity with his habit on a particular occasion." Reyes v. Missouri Pac. R. Co., 589 F.2d

791, 794 (5th Cir.1979) (footnote omitted). Moreover, evidence of a routine practice is highly

probative,7and persuasive. Loughan, 749 F.2d at 1524. It is particularly persuasive in the business

context because "the need for regularity in business and the organizationalsanctions which may exist

when employees deviate from the established procedures give extra guarantees that the questioned

activity followed the usual custom." McCormick on Evidence § 195, at 351.

To obtain a Rule 406 inference of the routine practice of a business, a plaintiff must show a

sufficient number ofspecific instances of conduct to support that inference. Reyes, 589 F.2d at 795

("Although a precise formula cannot be proposed for determining when the behavior may become so

consistent as to rise to the level of habit, "adequacy of sampling and uniformity of response' are

controlling considerations." (quoting Fed.R.Evid. 406 adv. comm. notes)).8 Evidence of the
 

9

See United States v. West, 22 F.3d 586, 592 (5th Cir.1994) (rejecting Rule 406 argument

because offered evidence not numerous enough in relation to thousands of other dealings of

defendant), cert. denied, --- U.S. ----, 115 S.Ct. 584, 130 L.Ed.2d 498 (1994); G.M. Brod & Co.

v. U.S. Home Corp., 759 F.2d 1526, 1533 (11th Cir.1985) (explaining that experience of one

single contractor not sufficient evidence of routine practice habit in light of different experiences

of thousands of other contractors who had dealt with same party). 

 

10See West, 22 F.3d at 592 (requiring comparison of the number of allegedly deficient

transactions with the total number of nondeficient transactions); Rosenburg v. Lincoln Am. Life

Ins. Co., 883 F.2d 1328, 1336 (7th Cir.1989) (holding that party's identical behavior with 29

applicants was "sufficient evidence of such a routine practice"); Simplex, 847 F.2d at 1294

(requiring plaintiff to acknowledge and compare all of the defendant's contracts in order to

establish habit). 

 

11Using the same average conversion factors as did the district court, these typical loads would

convert as follows:

14 tons/1.42 tons per cubic yard = 9.86 cubic yards

25 tons/1.42 tons per cubic yard = 17.61 cubic yards 

 

12Mr. Angelle testified:

Q: Let's talk in terms of a twenty-four (24) yard load. Tell me whether you know

whether that load level looks different when it's loaded in your yard versus

when it's loaded at a third-party yard.

A: No, sir. Twenty-four (24) yards is twenty-four (24) yards.

Q: Are you telling me that you think the load would look the same it if was

twenty-four (24) yards loaded in your yard or twenty-four (24) yards

loaded in a third-party yard?

A: They would look the same, yeah.

defendant's actions on only a few occasions or only in relation to the plaintiff are not enough;9 the

plaintiff must show regularity over substantially all occasions or with substantially all other parties

with whom the defendant has had similar business transactions.10

In this case, Mobil provided invoices for over 3400 of Cajun's loads of limestone obtained

fromthird-partysuppliers. Mobil introduced evidence to show that Cajun invariably loaded its trucks

in the same manner and to the same level when Cajun obtained limestone from a third-party supplier.

Mobil provided weight scale tickets showing that Cajun typically loaded either approximately

fourteen-ton or twenty-five-ton loads at third-party suppliers.11 Cajun's own witnesses testified that

they loaded their trucks to the same level at Cajun's own yards as they did at the third-party yards.12
Mr. Miller, representing all of Cajun's truckdrivers, testified:

Q: Is it your testimony that the loads in the trucks looked the same to you when

you loaded them in Cajun's yards as well as when you loaded them in

third-party yards?

A: Yes, sir. 

 

13For example, when Mobil explained that "[t]he purpose of all of this evidence is that

regardless of whether Cajun was delivering to Mobil or someone else, Cajun's practice routinely

was to pick up in these weight ranges ...," the district court replied, "I don't follow that

reasoning.... [T]his doesn't say anything, does it, about that [referring to Cajun's routine practice

of loading all deliveries short]." 

 

14It is this inference which Rule 406 explicitly allows and which the district court explicitly

refused to consider. 

Mobil offered this evidence to show that, if Cajun always loaded its trucks in the same manner, and

the third-party loads always held less than fourteen yards or twenty-four yards, then the loads from

Cajun's yards must also have held lessthan fourteen or twenty-four yards, depending on the size load

ordered. Yet the district court refused to consider this evidence in determining whether Cajun had

short-loaded its trucks when it made deliveries to Mobil. When Mobil presented its evidence and

attempted to explain the purpose and function of habit evidence, the district court responded:

The court can't render a judgment, Mr. Arceneaux [Mobil's attorney], against somebody for

a sum certain of money based on something that is predicated upon a habit.

Other statements by the district court similarly indicate that the district court would not accept

evidence of routine practice as support for Mobil's allegations.13 The district court refused to

consider the inference properly raised by Mobil that, if Cajun routinely loaded all of its deliveries

short, Cajun must also have short-loaded its deliveries to Mobil. Instead, the district court allowed

Mobil to use its evidence of routine practice only "to show what the average small truckload or the

average large truckload used by Cajun was, how many yards it contained." What the district court

did not allow Mobil to use its evidence to prove was that because those average small and large

truckloads were lessthan fourteen or twenty-four cubic yards, respectively, thenCajun in compliance

with its routine practice must have loaded less than fourteen or twenty-four cubic yards when it

delivered to Mobil.14 Moreover, instead of allowing Mobil to satisfy the Rule 406 requirement that

Mobil demonstrate Cajun's routine practice with evidence of loads to all destinations, not merely
 

15For example:

THE COURT: What is the purpose of documents showing sales to, for instance,

Acadiana Shell? It has nothing to do with this case.

MR. ARCENEAUX: Well, Your Honor, they are documents—they are sales from

Acadiana Shell to Cajun. Now, a number of those have been related

further to transactions to Mobil. But as I was explaining this morning,

they're also introduced to establish the truck sizes that Cajun was routinely

running.

THE COURT: Sales from Acadiana Shell to Cajun that had nothing to do with

this case, what's the purpose of putting them in here? And why should the

Court have to consider those things?

Later, when Mobil attempted to again explain the purpose of evidence of routine practice:

MR. ARCENEAUX: That's the point of the records. We're working from what

we know the trucks had in them.

THE COURT: Well, what do you know they had in them? You don't know what

the trucks that went to Mobil had in them.

Well, let's stick to those that you know went to Mobil. I think that what

went to anybody else is irrelevant. If you have a practice you can show

they loaded Mobil's trucks, fine. If you can't, I don't know what relevance

it has to this case. I simply don't see it. 

 

16Indeed, although the district court did not consider Mobil's evidence of a routine practice of

Cajun, the district court did consider Cajun's evidence of its own routine practice of loading its

trucks at its own yards. Because Mr. Angelle's testimony that Cajun routinely delivered from its

own yards was based only upon inferences derived from third-party-supplier documentation and

not his independent recollection of any individual deliveries to Mobil, concluding that Cajun must

have delivered to Mobil from its own yards required a Rule 406 inference. 

 

17Mobil also contends that the district court erred in concluding that Cajun had properly loaded

the trucks. In its judgment memorandum, the district court stated that Cajun's witnesses had

testified "that the trucks were loaded with a 3 cubic yard front end loader and the number of

bucketloads was counted to insure that Mobil obtained the yardage that it had ordered." It is not

clear, however, whether the district court addressed the evidence, both documentary and

testimonial, showing that the front-end loader actually used by Cajun had a maximum capacity of

those to Mobil, the district court held that evidence of transactions not positively traceable as being

deliveries to Mobil wasirrelevant.15 Accordingly, because the district court failed to apply Rule 406

properly,16 we must reverse. On remand, the district court should consider Mobil's evidence under

Rule 406 and determine, in light of all the evidence, including Mobil's Rule 406 evidence, whether

Mobil has established Cajun'sroutine practice for loading itstrucks, and, ifso, what implicationsthat

determination creates for the ultimate fact issues.17
only 2.3 cubic yards. It is also unclear whether the district court addressed the documentary and

testimonial evidence showing that at least some of Cajun's trucks were physically incapable of

holding a proper load of limestone as ordered by Mobil. Given that we are remanding to the

district court to consider all the evidence, including Mobil's evidence of routine practice, we do

not address this contention. 

 

18Nat Harrison Assocs. v. Gulf States Utils. Co., 491 F.2d 578, 587 (5th Cir.1974) ("Actual

damages must be proven; they cannot be merely speculative or conjectural. While the breaching

party should not escape liability because of difficulty in finding a perfect measure of damages, the

evidence must furnish data for a reasonably accurate estimate of the amount of damages." 

(citations omitted)); see also Hall v. Arkansas-Louisiana Gas Co., 368 So.2d 984, 991

(La.1979) ("Actual damages arising from a breach of contract must be proven; they cannot be

merely speculative or conjectural."), modified on other grounds, 453 U.S. 571, 101 S.Ct. 2925,

69 L.Ed.2d 856 (1981). 

 

19Under Louisiana law,

It must appear reasonably certain that the amount of damages rests upon a certain

basis. Such proof need only be a preponderance of the evidence; proof by direct

or circumstantial evidence is sufficient to constitute a preponderance when, taking

the evidence as a whole such proof shows that the facts or causation sought to be

proved is more probable than not.

Hall, 368 So.2d at 991; Graham v. Edwards, 614 So.2d 811, 819 (La.Ct.App.1993) ("

"[L]oss of profits or income must be proved with reasonable certainty, i.e., by the more

probable than not standard....' ") (quoting Clark v. Ark-La-Tex Auction, Inc., 593 So.2d

870, 878-79 (La.Ct.App.1992)), writ denied, 619 So.2d 547 (La.1993).

Accordingly, we reject Cajun's argument that Mobil must "prove its case by direct

proof, and to legal certainty, both the fact and amount of its losses." The cases cited by

Cajun do not support its argument, and the applicable law clearly allows for circumstantial

Mobilfurther contendsthat the district court erred in deciding that, because Mobil could not

prove by direct evidence that loads to Mobil had been short-loaded, Mobil could not sufficiently

prove any damages. The district court stated in its decision that "[t]he documentation simply is not

there for Mobil to rebut the testimony of Mr. Angelle, Cajun's truckdrivers, and Mr. Lamy" who

testified that, because Cajun used a front-end loader with a "3-yard bucket" and routinely delivered

from its own yards to its customers, it must have used the "3-yard bucket" method and delivered to

Mobil from its own yards. The district court held that even if Mobil demonstrated how Cajun

routinely loaded limestone irrespective of who the final customer was, Mobilmust "furthershow that

they did the same thing when they delivered to Mobil." Under Louisiana law, the plaintiff must prove

damages with reasonable certainty,18 but this merely means that the plaintiffmust prove damages by

a preponderance ofthe evidence asin other civil contexts.19 A plaintiff may prove a business' conduct
evidence. 

 

20We also note that, during a discussion with counsel, the court stated:

"Do you think that this is going to prove that on certain days, on a certain sale

made by Cajun to Mobil, they sent a truck over there loaded with so many tons,

that I'm going to take an average? I don't think that's possible. You can't take an

average."

It is unclear whether the district court was refusing to allow Mobil to prove Cajun's

routine practice with average loads or whether the district court was refusing to assess

damages based on an average shortfall calculated over all loads to Mobil. Our analysis of

Rule 406 has addressed the first issue, and we note that, if Mobil proves by Rule 406

evidence that Cajun routinely short-loaded its trucks, the district court may use averages

and formulas to assess damages. Although the burden is on the plaintiff to prove

damages, Borden, Inc. v. Howard Trucking Co., 454 So.2d 1081, 1092 (La.1983), once

the plaintiff establishes a legal right to recover, the court may not reject the claim for lack

of an exact measure. See Austin v. Parker, 672 F.2d 508, 522 (5th Cir.1982) (approving

old rule that " "[i]t is sufficient that there be proved a reasonable basis of computation,

although the result may be only approximate.' " (quoting Rynveld v. Dupuis, 39 F.2d 399,

400 (5th Cir.1930) (emphasis omitted))); Nat Harrison Assocs., 491 F.2d at 588 ("We do

not imply that in considering the measure of damages absolute accuracy is a precondition

to ... recovery."); see also Guillory v. Terra Int'l, Inc., 613 So.2d 1084, 1090

(La.Ct.App.1993) ("The law, however, is also well settled that when there is a legal right

to recover damages, but the amount cannot be exactly estimated, the courts have

reasonable discretion to assess damages based upon all of the facts and circumstances of

the particular case. A plaintiff's demand should not be rejected merely because he cannot

establish, with precision, the amount of damages suffered."), writ denied, 619 So.2d 1063

(La.1993). The court has discretion to assess damages, See La.Civ.Code Ann. art. 1999

(West 1987) ("When damages are insusceptible of precise measurement, much discretion

shall be left to the court for the reasonable amount of the damages."); Jordan v. Travelers

with habit evidence alone; direct evidence is not necessarily required. Loughan v. Firestone Tire &

Rubber Co., 749 F.2d 1519, 1523 (11th Cir.1985) ("Evidence of habit or routine is to be weighed

and considered by the trier of fact in the same manner as any other type of direct or circumstantial

evidence."). "[S]uch [habit] evidence, when substantial, allows the trier of facts to infer that the habit

was conformed with on a particular occasion." Id. Accordingly, if the district court determines on

remand that Mobil has proven that Cajun had a routine practice of short-loading its trucks at both

third-party suppliers and its own yards by a preponderance of the evidence, the district court can

infer, without any additional evidence, that Cajun loaded its deliveries to Mobil according to that

routine practice. If the district court determines further that the routine practice resulted in short

loads, the district court can infer additionally the extent to which the loads delivered to Mobil by

Cajun were short.20
Ins. Co., 257 La. 995, 245 So.2d 151, 155 (1971) ("Where there is a legal right to

recovery but the damages cannot be exactly estimated, the courts have reasonable

discretion to assess same based upon all the facts and circumstances of the case."); and it

should determine each case on its own facts and circumstances. Nat Harrison Assocs.,

491 F.2d at 587; see also Hall, 368 So.2d at 991 ("The sufficiency of proof of damages

must be determined in relation to the particular contract at issue and the circumstances

surrounding its breach. The question of the certainty of proof of damages becomes a

matter for decision in each individual case."). Moreover, courts often use averages or

formulas to estimate damages. See, e.g., Austin, 672 F.2d at 521 (using formula to assess

damages); see also, e.g., Borden, 454 So.2d at 1093 (using formula and estimates to

calculate quantum of damages once plaintiff had proven entitlement to damages); 

Guillory, 613 So.2d at 1090-91 (using formula and average crop yields to assess

damages); Moore, 524 So.2d at 831-32 (choosing one of several potential formulas and

calculating damages from averages proven); LeBlanc v. Gibbens Pools, Inc., 447 So.2d

1195, 1197 (La.Ct.App.1984) (using "two different but substantiated estimates" to assess

damages), writ denied, 450 So.2d 958 (La.1984). 

 

21See also Nat Harrison Assocs., 491 F.2d at 587 (refusing to affirm damages because of

inclusion of losses to third parties). 

Cajun argues t hat Mobil's proffered basis for damages is insufficient under Martin v. T.L.

James & Co., 237 La. 633, 112 So.2d 86 (1959). We disagree. In Martin, the Louisiana Supreme

Court rejected an attempt to prove shortages in deliveries because:

The method employed by the defendant in arriving at the amounts of the claimed shortages

is simply to take the total figures supplied to it by the Department of Highways of materials

used in the road project, and deduct the amount of materials bought from and supplied by a

number of other suppliers, and then by a complicated system of allowances for moisture

content, stockpile losses, recoveries from a cave in, it comes up with a figure which

represents the amount of material supplied by [the plaintiff], and thereby determines his

shortage.... [T]here is nothing to convince this Court that the measurements of material

supplied by such parties were any more accurate than those made by [the plaintiff].

Id. 112 So.2d at 94. Thus, the court in Martin ruled that the defendant had not proven entitlement

to damages because it failed to take into account that other suppliers could have caused the alleged

shortages.21 In this case, Cajun was Mobil's only limestone supplier. Therefore, if Mobil has proven

shortages in Cajun's limestone deliveries, Cajun can be the only supplier responsible, and Martin is

distinguishable on itsfacts. Moreover, Martin has no bearing on the issue of whether a party can use

evidence of a routine practice to establish under Rule 406 an entitlement to damages because the

method of proof offered in Martin did not involve Rule 406 evidence and was substantially different

from that offered in this case. As explained above, a party can use Rule 406 evidence to establish

damages, and Martin does not alter that rule. Consequently, Martin does not control the outcome
 

22Cajun also contends that we should sanction Mobil for filing a frivolous appeal. Given that

we hold the Mobil's appeal is meritorious, we deny Cajun's motion for sanctions. 

of this issue, and Cajun's argument has no merit.22

III

For the foregoing reasons, we REVERSE the judgment of the district court and REMAND

for further consideration consistent with this opinion.

 . . . . .