* This order and judgment is not binding precedent, e xcept under the

doctrines of law of the case, res judicata, and col lateral estoppel. The court generally disfavors the citation of orders and judg ments; nevertheless, an order and judgment may be cited under the terms and condi tions of 10th Cir. R. 36.3. 

## F I L E D United States Court of Appeals Tenth Circuit 

### DEC 3 2004 

### PATRICK FISHER Clerk UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT

ELIZABETH MOLLINGERWILSON; ROBERT E. WILSON, Lt. Colonel, USMC-Ret.,

Plaintiffs-Appellants,

v. QUIZNO’S FRANCHISE COMPANY,

Defendant-Appellee. No. 04-1131 (D.C. No. 02-N-436 (OES)) (D. Colo.)

ORDER AND JUDGMENT *

Before LUCERO , McKAY , and PORFILIO , Circuit Judges.

After examining the briefs and appellate record, th is panel has determined unanimously that oral argument would not materiallyassist the determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). T he case is therefore ordered submitted without oral argument.-2-

Pro se plaintiffs Elizabeth Mollinger-Wilson and he r husband Robert E. Wilson appeal the decision of the district court to grant them partial summary judgment and nominal damages in their breach of contract claim against defendant Quizno’s Franchise Company (Quizno’s). I n the district court, plaintiffs had moved for summary judgment, and defe ndant had filed a cross-motion for summary judgment on damages. Plai ntiffs’ motion was granted in part and denied in part; defendant’s motion was granted. Additionally, plaintiffs appeal the district court’s decision in the same document to deny their motion to compel discovery and to deny them leave t o amend their complaint five months after they had filed for summary judgment. The federal district court heard this case under di versity jurisdiction, 28 U.S.C. § 1332(a)(1), and plaintiffs’ breach of c ontract claim was controlled by Colorado law. We exercise jurisdiction over the fi nal order of the district court pursuant to 28 U.S.C. § 1291, and we affirm all of the decision but how the district court calculated nominal damages under Col orado law.-3-

Background Because the critical issue in this case was plainti ffs’ lack of proof on damages, we need describe the extensive factual bac kground of the case only briefly. Plaintiffs represented Quizno’s in specif ic parts of the Rocky Mountain region. In January 2000, Quizno’s terminated its c ontract with the plaintiffs. Plaintiffs brought suit against Quizno’s, and as part of that settlement, Quizno’s agreed that As consideration for [plaintiffs] relinquishing [th eir] rights . . ., [Quizno’s] shall pay [plaintiffs] the amount of $57 ,859, payable within three (3) business days from the date the [T ermination] Agreement is fully executed by the Parties, plus on e (1) franchise agreement, substantially equal to [Quizno’s] present form franchise agreement and valid for 40 months from the effectiv e date of the [Termination] Agreement, which the [plaintiffs] mayuse in the Territory or which the [plaintiffs] may sell to a t hird-party, subject to Quizno’s approval of the third-party as a qualifiedQuizno’s franchisee . . . . The Parties hereby agree that p ayment of the Termination Fee constitutes payment in full of any amounts owed to [plaintiffs] by [Quizno’s] in connection with the T erritory. R. Vol. I, Doc. 1, Ex. 1 at 1 [hereinafter Terminat ion Agreement]. The parties signed the Termination Agreement on February 28, 20 00. Although Quizno’s paid plaintiffs the sum that theywere owed within three days, plaintiffs requested delivery of the promisedfranchise agreement on March 15, 2000, and Quizno’s did not deliver that a greement until January 5, 2001. Plaintiffs subsequently brought this suit fo r breach of the Termination Agreement. Plaintiffs argue that, under the wordin g of the contract, they were-4-

due delivery of the franchise agreement within thre e days of when the Termination Agreement was signed, or, in the altern ative, within a reasonable time afterwards. Quizno’s disputes plaintiffs’ int erpretation of the Termination Agreement, asserting that the three-day period appl ied only to the delivery of the money, and not to the delivery of the franchise agr eement. In the alternative, Quizno’s asserts that it complied with the Terminat ion Agreement by delivering the “substantially equal” franchise agreement withi n a reasonable period of time. See id. The district court referred the case to a magistrat e judge under 28 U.S.C. § 636(b)(1)(B). The magistrate judge found that, under a plain reading of the Termination Agreement, the three-day requirement fo r delivery applied only to the sum Quizno’s was to pay plaintiffs, and not to the franchise agreement. The Termination Agreement was thus ambiguous about whenthe franchise agreement was to be delivered, and Colorado law implied that Quizno’s had a “reasonable time” to perform. R. Vol. III, Doc. 119 at 7 (citing Colo-Tex Leasing, Inc. v.
Neitzert , 746 P.2d 972, 975 (Colo. Ct. App. 1987)). Becaus e the franchise agreement was to be valid for forty months after th e date of the Termination Agreement, the magistrate judge concluded that it w as unreasonable for Quizno’s to have delayed eleven months to deliver the agreem ent.1 Plaintiffs appear not to have repeated their argume nts on appeal that they

incurred damages from the taxes they paid on the su m conveyed in the Termination Agreement, and that they lost additiona l revenue in developing their territory for Quizno’s under their original agreement with the company. See generally Aplt. Br. The magistrate judge explained in his r eport and recommendation that taxes paid on settlements do no t naturally follow from the breach of settlement contracts under the law, R. Vo l. III, Doc. 119 at 14 (citing Western Union Telegraph Co. v. Trinidad Bean & Elevator Co. , 267 P. 1068, 1069 (Colo. 1928)), and that the language of the Te rmination Agreement had specifically provided that neither party could have “any further obligation or duties, however characterized or described, with re spect to each other for obligations related to the Territory, except as setforth in this [Termination] Agreement.” R. Vol. III, Doc. 119 at 14 (quoting t he Termination Agreement); see also Termination Agreement, R. Vol. I, Doc. 1, Ex. 1 at1. -5- Although the magistrate judge determined that there had been a breach of contract, he found that plaintiffs had not produced sufficient evidence of damages as a result of a breach. Plaintiffs made several a rguments to establish damages, and the following they reassert, inter alia , on appeal. 1 We describe those claims here and adopt by incorporation the magistrate judg e’s accurate responses to them. First, plaintiffs claimed that they had to f orego other business opportunities to work with Quizno’s. They submitte d declining income tax returns from 1995 through 2000 to illustrate their losses. But, as the magistrate judge found, nothing in the record tied plaintiffs’ declining income to Quizno’s failure timely to deliver the franchise agreement a fter February 28, 2000. Second, plaintiffs claimed that they had lost profits that should be generally based on the average unit volume for the operation of Quizno’s r estaurants. But lost profit-6-

awards are not permitted under Colorado law if “either the amount of the profits that would have been earned or the fact that the pl aintiff would have earned them is too speculative to determine.” R. Vol. III, Doc. 119 at 18 (quoting Republic Nat’l Life Ins. Co. v. Red Lion Homes, Inc. , 704 F.2d 484, 489 (10th Cir. 1983)). And, as the magistrate judge explained, lost profit s from a business that was contemplated but never established would be particu larly remote and speculative. Id. (citing King v. United States , 292 F. Supp. 767, 776 (D. Colo. 1968)). Third, plaintiffs argued that they lost the franchise agre ement itself as an investment valued between $250,000 to $350,000, but set forth no factual basis for this evaluation of its value. Accordingly, the magistrate judge recommended award ing partial summary judgment to plaintiffs, but granting them only nomi nal damages. He noted that, as part of the record, plaintiffs had been willing to sell the franchise agreement to a third party for $15,000. The magistrate judge th erefore recommended that the calculation of nominal damages be interest on the $ 15,000 from the time that plaintiffs requested the franchise agreement from Q uizno’s on March 15, 2000, to when Quizno’s delivered the agreement on January 5, 2001. The district court adopted the magistrate judge’s report and recommend ation, and it entered judgment for $969.86, which represented the legal r ate of interest on $15,000 for that period of time.-7-

Additionally, the district court denied plaintiffs’ motion to compel discovery and leave to amend their complaint. Rega rding plaintiffs’ motion to compel, the district court held that plaintiffs’ re quest to take additional depositions was untimely because the deadline for d iscovery had expired, that plaintiffs had not employed previous opportunities to take depositions, and that plaintiffs had presented inadequate proof that addi tional depositions were necessary. Regarding plaintiffs’ motion for leave to amend their complaint, the district court found that plaintiffs had failed to show good cause for amendment, that plaintiffs’ proposed amendment had failed to c onform to the evidence presented as they asserted, and that there would be significant prejudice to defendant in permitting amendment at the eleventh h our.

Standard of Review We review a district court’s decision regarding summary judgment de novo , applying the same standard as the district court. Hollingsworth v. Hill , 110 F.3d 733, 737 (10th Cir. 1997). We view the evidence an d any inferences therefrom in the light most favorable to the non-moving party, J.B. v. Washington County , 127 F.3d 919, 923 (10th Cir. 1997); and we will affirm a grant of summary judgment when “the pleadings, depositions, answers to interr ogatories, and admissions on file, together with the affidavits, if any, show th at there is no genuine issue as to-8-

any material fact and that the moving party is enti tled to judgment as a matter of law,” id. (quoting Fed. R. Civ. P. 56(c)). We review decisions regarding leave to amend pleadi ngs for abuse of discretion. Foman v. Davis , 371 U.S. 178, 182 (1962); Calderon v. Kan. Dep’t of Soc. & Rehab. Servs. , 181 F.3d 1180, 1187 (10th Cir. 1999). And we hav e generally held that decisions regarding discovery are within the sound discretion of the district court. Motley v. Marathon Oil Co. , 71 F.3d 1547, 1550 (10th Cir. 1995) (evaluating motion to compel); GWN Petroleum Corp. v. OK-Tex Oil & Gas, Inc. , 998 F.2d 853, 858 (10th Cir. 1993) (articulating the general standard).

Discussion On appeal, plaintiffs argue (1) that “common sense” suggests that their damages from the late delivery of the franchise agr eement exceed the district court’s award of $969.86; (2) that the franchise ag reement should have been delivered within three days of when they signed the Termination Agreement; (3) that the franchise agreement that they received was not, as the Termination Agreement required, “substantially equal” to Quizno ’s form franchise agreement at the time the Termination Agreement was signed; ( 4) that they should not bear the burden of proving their own damages even with the arguments they had asserted; (5) that they should be entitled to trial on the issue of damages; (6) that-9-

the magistrate judge and district court improperly calculated nominal damages by looking beyond the four corners of the Termination Agreement to find evidence that plaintiffs were willing to sell their franchis e to a third party for $15,000; and (7) that the district court should have granted the ir motions to compel additional discovery from Quizno’s and to amend their complaint because they were pro se litigants. Although plaintiffs are pro se and we construe thei r pleadings liberally, Hunt v. Uphoff , 199 F.3d 1220, 1223 (10th Cir. 1999), we will notconstruct legal theories on their behalf, Whitney v. New Mexico , 113 F.3d 1170, 1173-74 (10th Cir. 1997). We thus do not develop plaintiffs’ fir st objection that “common sense” suggests that their damages exceeded the amo unt awarded by the district

court. Plaintiffs’ second objection is without merit becau se we hold that the magistrate judge and district court properly read the plain language of the Termination Agreement not to require delivery of th e franchise agreement within three days. According to the Termination Agreement , Quizno’s owed “[plaintiffs] the amount of $57,859, payable within three (3) bus iness days from the date the [Termination] Agreement is fully executed by the Parties, plus one (1) franchise agreement, substantially equal to [Quizno’s] present form franchise agreement and valid for 40 months from the effective date of the [Termination] Agreement-10-

. . . .” R. Vol. I, Doc. 1, Ex. 1 at 1. The langu age of the Termination Agreement makes clear that it is “the amount of $57,859” thatwas to be “payable within three (3) business days.” Id. Delivery of the franchise agreement was promised, but the Termination Agreement did not specify the t ime frame in which it had to be delivered. Plaintiffs’ third objection is that the franchise a greement they received from Quizno’s was not “substantially equal” to the form franchise agreement in effect at the time the parties executed the Termination Agreement. Plaintiffs’ arguments center on whether four changes (differentprovisions regarding sublease guarantees and advertising cooperatives, the fact that the agreement reflects Quizno’s change from a private to a public company, and a transfer fee) are material distinctions from the form of the fran chise agreement available at the time the Termination Agreement was signed. The mag istrate judge reviewed each of plaintiffs’ arguments to find that the franchise agreement delivered substantially complied with the requirements of the Termination Agreement, and the district court agreed. The district court, though, focused more on the fac t that there had been a breach—and we would add that it matters not whetherthe breach was the result of the franchise agreement’s untimely delivery or of t he substantive content of the-11-

document delivered—and noted that plaintiffs had fa iled to establish damages. In the words of the district court:

Although the magistrate judge suggests a finding th at defendant breached a promise to furnish a franchise agreement within a reasonable time, plaintiffs are not satisfied. F irst they repeat their contention that the agreement required defendant to furnish the franchise materials within three days. They also i mply that this erroneous interpretation somehow affects the scope of their damages. Second, they argue that the franchise agreement ten dered was not [in] the form contemplated by the parties’ contract. Th ird, they insist that they were not required to pay the transfer fee whic h defendant demanded. This is a matter of looking at the writt en contracts, which the court has done. The court agrees with the magi strate judge concerning interpretation of the contracts. By ope ration of law, defendant was obliged to tender a franchise agreeme nt within a reasonable time, and it breached that promise. In considering the question of damages . . . , [how ever, plaintiffs are] obliged to establish, by competent proof under applicable legal standards, that there is genuine d ispute of material fact which must be resolved at trial . . . . The c ourt has conducted the requisite de novo review of plaintiffs’ allegations and evidence, their objections, the issues, and the recommendatio n. Based on this review, I have concluded that the recommendation [o f the magistrate judge] is a correct application of the facts and th e law. Accordingly, . . . [t]he recommendation is . . . ACCEPTED. R. Vol. III, Doc. 124 at 6-7. We agree with the di strict court’s focus on the fact that there was a breach and that there should then be an examination of damages. We decline to examine the differences between the v ersions of franchise agreements available because that discussion would do little to advance resolution of this case, but instead we follow by asking the d ispositive question whether plaintiffs have proven damages from any breach of c ontract.-12-

Summary judgment may be granted when “the pleadings , depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56

. Here, according to the Colorado Supreme Court: It has long been the law in Colorado that a party attempting to recover on a claim for breach of contract must prov e the following elements: (1) the existence of a contract; (2) per formance by the plaintiff or some justification for nonperformance; (3) failure to perform the contract by the defendant; and (4) resu lting damages to the plaintiff. W. Distrib. Co. v. Diodosio , 841 P.2d 1053, 1058 (Colo. 1992) (internal citati ons omitted). Because plaintiffs are the party attempting to reco ver on a claim for breach of contract, they have the burden to prove the elements of their claim. See id. This disposes of plaintiffs’ fourth objection that they should not bear the burden of proving their own damages. And, upon de novo re view, we hold that plaintiffs have failed to carry their burden to prove that the y incurred damages as a result of either the untimely delivery, or arguably the unsub stantially equal content, of the franchise agreement. We have reviewed the record a nd evaluated all the evidence presented. The magistrate judge and the district c ourt have accurately and thoroughly explained why plaintiffs have failed to establish proof of damages. None of plaintiffs arguments challenge that basic f inding, and we incorporate the-13-

magistrate judge and district court’s explanations by reference here. Plaintiffs’ objection to the form of the contract presented is therefore not relevant; and plaintiffs’ fifth objection that summary judgment w as not appropriate and that they should have been entitled to go to trial is wi thout merit. Plaintiffs’ sixth objection, that the magistrate ju dge and the district court improperly calculated the amount of nominal damages by looking beyond the four corners of the Termination Agreement to note eviden ce in the record that plaintiffs were willing to sell their franchise for$15,000, is interesting because it reopens the issue of how nominal damages should be awarded under Colorado law. Colorado is specific that nominal damages are $1—no t more, not less. The Colorado courts have stated that “one dollar is nom inal damages, as a matter of law.” Colo. Inv. Servs., Inc. v. Hager , 685 P. 2d 1371, 1375 (Colo. Ct. App. 1984) (quotation omitted); see also id. (“If you find in favor of the plaintiff, but do not find any actual damages, you shall nonethele ss award him nominal damages in the sum of one dollar .”) (quotation and citation omitted) (emphasis in quotation). And those courts have remanded for a trial court that had awarded more in nominal damages “to modify the award of nom inal damages to the trivial sum of one dollar.” See, e.g. , id. (quotation omitted) ; accord 6 Colo. Prac., Civil Trial Practice § 12.10 (2d ed.) (West Supp. 2004) (“Where the non -breaching-14-

party . . . fails to prove the amount of the loss, the non-breaching party may still recover nominal damages . . . [in the amount of] $1.00.”); id. (“[T]he amount of nominal damages which can be recovered is $1.00.”). We recognize irony in the result that plaintiffs sh ould challenge the calculation of nominal damages as too low, and we r emand for the district court to reduce the award to $1. But that is the correctway to have awarded nominal damages under Colorado law, and plaintiffs asked us specifically to examine the issue of how those damages were calculated. Accord ingly, we remand for the district court to modify its award of nominal damag es to comport with Colorado’s requirement that nominal damages be one dollar. Finally, plaintiffs’ seventh objection, that the di strict court should have granted their motions to compel additional discovery from Quizno’s and to amend their complaint because, as pro se litigants, they should be given another chance to comply with judicial requirements, is without merit. “[ P ] ro se status does not excuse the obligation of any litigant to comply wit h the fundamental requirements of the Federal Rules of Civil and Appellate Procedure.” Ogden v. San Juan County , 32 F.3d 452, 455 (10th Cir. 1994). The district court explained the basis of its decision in its opinion, and plaintiffs do n ot challenge the court’s fundamental reasoning. We hold that the district c ourt did not abuse its discretion in making those decisions.-15-

Conclusion We AFFIRM the judgment of the district court in all respects except for its calculation of nominal damages. On this point, we REVERSE the judgment of the district court, and we REMAND for modification of nominal damages to the amount of one dollar. All other motions are DENIED as moot.

Entered for the Court

John C. Porfilio Circuit Judge