1The Honorable Michael J. Melloy, United States District Judge for the

Northern District of Iowa, sitting by designation. 

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

 ___________

No. 99-1167/No. 99-1242 

 ___________

COMPUTROL, INC., *

*

Plaintiff - Appellant/ *

Cross-Appellee, *

* 

v. * Appeal from the United States

* District Court for the 

NEWTREND, L.P. and * Eastern District of Missouri.

CA NEWTREND, INC., * 

*

*

*

Defendants - Appellees/ *

Cross-Appellants. *

____________

Submitted: December 13, 1999 

 Filed: February 10, 2000 

____________

Before RICHARD S. ARNOLD and LOKEN, Circuit Judges, and

MELLOY,1 District Judge.

___________
2The Honorable Catherine D. Perry, United States District Judge for the

Eastern District of Missouri.

2

Melloy, District Judge. 

After a 34-day trial in the Eastern District of Missouri, a jury awarded

$2,663,000 to Appellant, Computrol, Inc., (“Computrol”) on a breach of contract

claim against Appellee Newtrend, L.P., and Appellee CA Newtrend, Inc.,

(collectively, “Newtrend”). The jury also decided against Newtrend and Newtrend

CEO Robert King, in his individual capacity, on three common law fraud claims. 

On post-trial motion, the district court2 ruled as a matter of law that a

contractual limitation of liability provision limited Computrol’s breach of contract

recovery to $469,206.88, and described Newtrend’s proof of damages in excess of

$469,206.88 as wholly speculative. The district court entered judgment in

Computrol’s favor in the amount of $469,206.88, plus $150,000 in attorneys fees. 

The district court also entered judgment as a matter of law against Computrol on the

fraud claims, and denied Computrol’s bill of costs. Computrol appealed the

decision, and Newtrend cross-appealed. For the following reasons, we affirm the

post-trial judgment of the district court. 

I

Computrol develops custom computer software for the financial services

industry, and Newtrend provides software and support services to financial
3Computrol was also responsible for installation, training, and technical

documentation related to the software. Additionally, the Agreement allowed

Computrol to generate additional revenue by performing annual maintenance

services and earn royalties from future INFOPOINT sales. 

3

institutions. On December 28, 1992, Computrol entered into a contract with

Newtrend to re-engineer a number of Newtrend’s INFOPOINT software

applications (“the Alliance Agreement”). INFOPOINT is a group of software

packages utilized by Newtrend’s banking customers. The Alliance Agreement

contemplated that Computrol would begin performance under the Agreement by reengineering Newtrend’s Integrated Commercial Loan Application (“ICL”). If

Newtrend successfully completed the initial re-engineering of the ICL, then

Computrol would re-engineer one additional software application per year. The

Agreement provided that Computrol would be paid $430,000 for re-engineering the

ICL.3

Although the terms of the Agreement required Computrol to complete the ICL

re-engineering project within 270 days of the date the Agreement was signed, the

project quickly ran into technical problems. Additionally, the parties disagreed as to

the specific terms of the Agreement. After extensive negotiations, the parties agreed

to modifications in the software requirements and to increase Computrol’s

compensation for the project. 

In May of 1993, the parties signed an addendum to the Agreement in which

Computrol agreed to re-engineer an additional software application, the Integrated

Installment Loan (“IIL”). The IIL project also encountered technical complications
4

and never progressed beyond the planning phase. 

The relationship between the parties subsequently deteriorated, with

Newtrend providing written notice of default to Computrol on January 6, 1994. The

notice stated, in pertinent part:

This letter is an official NOTICE OF DEFAULT pursuant to paragraph

11.2 of the . . . Alliance Agreement . . . as modified by Letter

Agreement of December 30, 1992 . . . . As evidenced by numerous

letters, phone calls, and meetings between our companies, the

Commercial Loan Project is months behind schedule, still significantly

incomplete and does not contain several promised features. This is a

material breach of the Agreement and grounds for termination. 

Technically, this contract gives you 90 days to cure the defaults, but it

will be difficult to cure late delivery when the date has already passed. 

I suggest that you immediately return the $182,860 paid to date. 

At the point Newtrend provided the written notice of default, Computrol had not

actually delivered the ICL in its re-engineered format. At trial, the parties disagreed

as to whether the ICL re-engineering project was substantially completed.

After Newtrend terminated the Agreement, Computrol filed the instant

lawsuit. In its complaint, Computrol alleged claims against both Newtrend and

Newtrend CEO King, in his individual capacity, for fraudulent misrepresentation

(Count I) and fraudulent concealment (Count II). Computrol also alleged claims

against only Newtrend for breach of contract (Count III), breach of fiduciary duty

(Count IV), indemnification (Count V), breach of the covenant of good faith and fair

dealing (Count VI), quantum meruit (Count VII), business defamation (Count VIII),
4The details of the corporate dispute and the structure of the joint venture

between Newtrend and the business affiliates are quite complex, but irrelevant to the

merits of this appeal. 

5

and injurious falsehood (Count IX). Newtrend counterclaimed for breach of

contract (Count I), indemnification (Count II), breach of the covenant of good faith

and fair dealing (Count III), and fraudulent inducement/fraudulent misrepresentation

(Count IV). 

At trial, Computrol advanced a theory it was an unwitting pawn in a larger

corporate dispute between King and Newtrend’s business affiliates.4 Computrol

introduced evidence that Newtrend actually terminated the Agreement because of

the corporate dispute, and not because of performance difficulties, delays, or any

other factor under Computrol’s control. Computrol also presented evidence that

Newtrend failed to comply with the termination provisions of the contract. The

Agreement allowed a party to terminate only in the event of material or repeated

breach and after the nonbreaching party provided the breaching party a detailed

notice of deficiencies and a ninety-day cure period for defaults other than payment. 

 

The district court submitted to the jury fraudulent misrepresentation and

fraudulent concealment against Newtrend and King, and breach of fiduciary duty

against Newtrend. The Court also submitted the breach of contract claim against

Newtrend. As to Newtrend’s counterclaims, the district court submitted breach of

contract and fraudulent misrepresentation. 

The jury returned a verdict in favor of Computrol and against Newtrend and
6

King on one count of fraudulent misrepresentation and two counts of fraudulent

concealment. The jury awarded $75,000 in damages on each fraud count against

Newtrend, and $35,000 in damages on each fraud count against King. The jury also

found in favor of Computrol on the breach of contract claim, and awarded

$2,663,000 in damages. The jury ruled in favor of Computrol on all of Newtrend’s

counterclaims. 

On post-trial motion, the district court ruled that Computrol’s fraud claims

and the breach of fiduciary duty claim failed as a matter of law. The district court

reduced Computrol’s breach of contract recovery from $2,663,000 to $469,206.88,

for two reasons. First, the district court stated that the limitation of liability clause

barred Computrol from recovering lost profits because “lost profits damages are

considered consequential damages.” The district court stated that since the parties

agreed in the contract that they would not seek consequential damages, Computrol

could not recover lost profits. Second, the district court concluded that Newtrend’s

proof of damages in excess of $469,206.88 was “wholly speculative.” 

Computrol timely filed a notice of appeal in the district court and raises two

distinct issues on appeal. First, Computrol alleges that the district court erred when

it reduced the jury’s breach of contract verdict from $2,663,000 to $469,206.88. 

Computrol maintains that the limitation of liability clause did not bar lost profits,

and that the proof of damages it offered at trial was sufficiently definite. Second,

Computrol asserts that the district court abused its discretion when it awarded only

$150,000 in attorney’s fees and denied its bill of costs. On cross-appeal, Newtrend

asserts that Computrol failed to make a submissible case for breach of contract. 
7

 

II

Initially, the Court turns to the merits of the breach of contract claim. In its

post-trial order, the district court ruled that Computrol submitted evidence from

which a reasonable juror could find that Computrol adequately performed its duties

under the contract. While Computrol did not complete the ICL in saleable form and

the program had fewer functions than originally required under the contract, the

district court ruled that Newtrend agreed to numerous extensions of time and to

proposed modifications of the ICL software. The district court also ruled that

Computrol presented sufficient evidence that Newtrend breached the termination for

cause provision by failing to specify sufficiently the reasons it was terminating the

Agreement and by failing to provide an adequate opportunity to cure. On appeal,

Newtrend maintains that the district court should not have allowed the contract

claim to go to the jury and should have ruled for Newtrend as a matter of law. 

 “Our review of a jury verdict is extremely deferential and we will not

reverse for insufficient evidence unless after viewing the evidence in the light most

favorable to the verdict, we conclude that no reasonable juror could have returned a

verdict for the non-moving party.” Morse v. Southern Union Co., 174 F.3d 917,

922 (8th Cir.), cert. denied, 120 S.Ct. 29 (1999) (internal quotations omitted). In

this case, there is sufficient evidence from which a reasonable juror could find that

Computrol performed its duties under the Agreement even if Computrol did not

complete the ICL within the 270-day time frame. Newtrend Vice President Jerry

Nissen testified that when Computrol programmers encountered outdated computer
8

code in the original ICL program, Newtrend authorized Computrol additional time

and compensation to rewrite the new program. Nissen stated that Newtrend

expected a delay after the company authorized the additional work. Computrol also

presented testimony that it did not compete the ICL within the 270-day limit at least

in part because Newtrend delayed approving the program design of the ICL for

more than ten weeks. Finally, testimony at trial reflected that Newtrend submitted a

number of change orders to the ICL program to include extra functions which

accounted for additional delays. In light of the dynamic nature of the contractual

relationship between Computrol and Newtrend, we find that a reasonable juror

could have determined that Computrol satisfied its contractual obligations under the

Agreement. 

Computrol also presented testimony at trial that Newtrend breached the

termination provision of the Agreement by failing to specify sufficiently its reasons

for terminating the Agreement and by failing to allow Computrol adequate

opportunity to cure. Newtrend witnesses admitted that Newtrend’s notice of default

letter failed to comply with the requirement that the party terminating the Agreement

describe the deficiencies in detail. Moreover, Newtrend failed to afford Computrol

the 90-day opportunity to cure that the Agreement provided. Accordingly, viewing

the evidence in a light most favorable to the verdict, we find that Computrol

presented a submissible case to the jury. 

We now turn to the district court’s decision to reduce Computrol’s breach of

contract jury award from $2,663,000 to $469,206.88. In its post-trial order

amending the judgment under Fed. R. Civ. P. 59(e), the district court ruled that the
9

provision in the Alliance Agreement which expressly barred consequential damages

precluded Computrol from recovering the lost profits it would have earned from reengineering the follow-on software applications, and from projected sales of the

software to other financial institutions. The limitation of liability provision states: 

In no event will either party be liable to the other for any special,

incidental or consequential damages arising out of this Alliance

Agreement. Except as otherwise expressly stated in this Alliance

Agreement, each party’s liability to the other for any cause whatsoever

and regardless of the form of action and whether in contract or tort, or

at law or equity shall in no event exceed the amounts actually paid to

the other under this Alliance Agreement.

The district court ruled that Computrol was only entitled to recover the modified

contract price of the ICL and for work performed on the IIL. Since the sum of the

modified contract price for the ICL project and the cost of the work performed on

the IIL only amounted to $469,206.88, the district court limited Computrol’s

recovery to that amount. As an alternative reason for reducing the award, the

district court stated that Computrol’s “value-added damage evidence [was] wholly

speculative, and should have never been presented to the jury.” On appeal,

Computrol maintains that it presented sufficient evidence to support the jury’s

verdict and its implicit factual finding that the Alliance Agreement permits

Computrol to recover lost profits.

The Court of Appeals reviews a district court's decision to grant a Rule 59(e)

motion to alter or amend a judgment for abuse of discretion. Perkins v. U.S. West

Comm., 138 F.3d 336, 340 (8th Cir. 1998). “Little turns, however, on whether we
10

label the review of this particular question abuse of discretion or de novo, for an

abuse of discretion standard does not mean a mistake of law is beyond appellate

correction.” Koon v. United States, 518 U.S. 81, 100 (1996). A district court by

definition abuses its discretion when it makes an error of law. Id. Accordingly, the

Court of Appeals will review de novo the language of the Alliance Agreement. See

Bourke v. Dun & Bradstreet Corp., 159 F.3d 1032, 1036 (7th Cir. 1998) (“The

district court's determination is reviewed de novo, ‘without giving any deference to

the interpretation by the first-line decider, here the district judge.’”). 

Computrol and Newtrend agree that Illinois law governs Computrol’s

contract claim. Illinois uses a “four corners” rule in the interpretation of contracts,

holding that “if the language of a contract appears to admit only one interpretation,

the case is indeed over.” AM Internat'l Inc. v. Graphic Management Assoc., Inc.,

44 F.3d 572, 574 (7th Cir. 1995). Contracts “must be construed to give effect to the

intention of the parties which, when there is no ambiguity in the terms of the

[contract], must be determined from the language of the [contract] alone.” Flora

Bank & Trust v. Czyzewski, 583 N.E.2d 720, 725 (Ill. App. Ct. 1991). “The terms

of an agreement, if not ambiguous, should be generally enforced as they appear, and

those terms will control the rights of the parties.” Dowd & Dowd, Ltd. v. Gleason,

693 N.E.2d 358, 368 (1998). 

Under the Illinois "four corners" rule, the threshold inquiry is whether the

contract is ambiguous. Ford v. Dovenmuehle Mortgage, Inc., 651 N.E.2d 751, 755

(Ill. App. Ct. 1995). "An instrument is ambiguous only if the language used is

reasonably or fairly susceptible to having more than one meaning, but it is not
11

ambiguous if a court can discover its meaning simply through knowledge of those

facts which give it meaning as gleaned from the general language of the contract. A

contract is not rendered ambiguous simply because the parties do not agree on the

meaning of its terms." Flora Bank & Trust, 583 N.E.2d at 725. 

Illinois law allows parties to limit remedies and damages for breach of

contract if no public policy bar exists. Rayner Covering Sys., Inc. v. Danvers

Farmers Elevator Co., 589 N.E.2d 1034, 1036 (Ill. App. Ct. 1992). While

exculpatory or limitation of damages clauses are not favored and must be strictly

construed against a benefitting party, id., the basis for their enforcement is the

strong public policy favoring freedom of contract. Liccardi v. Stolt Terminals, Inc.,

687 N.E.2d 968, 972-73 (Ill. 1997). 

We find that the district court was correct when it ruled post-trial that the

limitation of liability clause unambiguously precluded Computrol from recovering

the prospective lost profits it would have earned for re-engineering the additional

software applications. The limitation of liability provision in this case is fairly

straightforward. In addition to prohibiting “special, incidental, or consequential

damages,” the limitation of liability clause dictates that contract damages “shall in

no event exceed the amounts actually paid under the Agreement.” When the Court

considers both sentences of the limitation of liability provision in the context of the

entire Agreement, Trade Ctr., Inc. v. Dominick’s Finer Foods, Inc., 711 N.E.2d

333, 335 (Ill. App. Ct. 1999) (“We consider the contract as a whole in order to

ascertain the intent of the parties.”), we find that Computrol and Newtrend intended

to preclude liability in the form of prospective lost profits. 
5We are not convinced that the first sentence’s restriction on “special,

incidental, or consequential damages,” standing alone, precludes the recovery of lost

profits. The Seventh Circuit has unequivocally stated that “[l]ost profits are

considered to be general or direct damages in a breach of contract case, while they

are considered to be special or indirect damages in a tort case.” Moore v. Boating

Indus. Assoc., 754 F.2d 698, 717 (7th Cir.), vacated on other grounds, 474 U.S. 895

(1985) (applying Illinois law). Thus, it is incorrect to classify mechanically the

prospective lost profits portion of Computrol’s damage award as consequential

damages. However, both sentences of the clause together manifest an intent to

foreclose prospective lost profits.

6We would also note that this holding does not preclude Computrol from

recovering its past profits under the contract. The amount due and owing for past

work, that is the $469,206.88 awarded by the district court, includes a profit factor

in the contractual amount. Only future profits are foreclosed by the Agreement. 

12

While the first sentence of the limitation of liability provision precludes

“special, consequential, or incidental damages,” the second sentence of the

provision amplifies the limits on each party’s liability. Specifically, the second

sentence limits any contract recovery to past damages or “amounts already paid.” 

We believe that because the term “amounts actually paid” is phrased in the past

tense, the parties intended to foreclose all future damages, i.e., prospective lost

profits.5 Therefore, the district court was correct to reduce the judgment to

$469,206.88.6 

The district court articulated a second and alternative reason for reducing

Computrol’s breach of contact judgment: “[Computrol’s] value-added damage

evidence [was] wholly speculative, and should have never been presented to the

jury.” At oral argument, counsel for Computrol insisted that Computrol relied on

Newtrend’s profit projections and that numbers were “very do-able.” Newtrend
13

maintains that the district court was correct to bar the lost profit damage evidence as

unduly speculative. 

In Illinois as in most jurisdictions, the plaintiff must prove damages to a

reasonable degree of certainty and evidence cannot be remote, speculative, or

uncertain. Eddings v. Board of Educ. of City of Chicago, 712 N.E.2d 902, 908 (Ill.

App. Ct. 1999). Lost profits are generally unavailable for new and unproven

business ventures. See Stuart Park Assoc. Ltd. Partnership v. Ameritech Pension

Trust, 51 F.3d 1319, 1323 (7th Cir. 1995) (“A new business generally has no right to

recover lost profits.”) (applying Illinois law). 

We find no error in the district court’s decision to reduce the breach of

contract judgment because Computrol failed to prove its damages with sufficient

certainty. At trial, the principal evidence that Computrol offered to support its profit

projections for the subsequent INFOPOINT software applications was based on

unrelated software products. Computrol’s lost profits evidence stood in stark

contrast to the evidence presented of Computrol’s historical difficulty marketing its

loan products. Additionally, Computrol encountered a number of technical

problems in the first two software re-engineering projects. All of the profit numbers

that Computrol presented assumed that the re-engineering projects would be

completed on schedule and include the features that Newtrend and Computrol

included in the original contract and change orders. Accordingly, the district court

correctly limited Computrol’s recovery and restricted Computrol’s lost profits

damages.
14

III

At the completion of trial, Computrol moved for an award of $2,589,628.05

in attorneys’ fees, $303,333.62 in expenses, and more than $300,000 in costs. 

Citing Fed. R. Civ. P. 54(d) and a contractual provision allowing a prevailing party

to recover reasonable attorneys’ fees, the district court awarded Computrol

$150,000. On appeal, Computrol alleges that the district court improperly reduced

the fees, expenses, and costs.

“The amount of an award of attorneys’ fees rests within the sound discretion

of the court and we will not disturb it absent clear abuse of that discretion.” Walton

Gen. Contractors, Inc./Malco Steel, Inc. v. Chicago Forming, Inc., 111 F.3d 1376,

1385 (8th Cir. 1997); Raffel v. Medallion Kitchens of Minnesota, Inc., 139 F.3d

1142, 1146-47 (7th Cir. 1998) (applying Illinois law). Additionally, while there is “a

presumption that the prevailing party is entitled to costs,” Bathke v. Casey's

General Stores, Inc., 64 F.3d 340, 347 (8th Cir. 1995), the district court also has

substantial discretion in awarding costs. Greaser v. State, Dept. of Corrections,

145 F.3d 979, 985 (8th Cir.), cert. denied, 119 S.Ct. 620 (1998).

There is no dispute that Computrol is a prevailing party within the meaning of

Rule 54(d) and the Alliance Agreement. Computrol argues that its status as the

prevailing party entitles it to fees, expenses, and costs far in excess of the $150,000

figure awarded by the district court. However, Computrol ignores the fact that the

Agreement afforded only reasonable attorneys’ fees. Additionally, Rule 54(d) is

phrased in permissive terms and generally grants a federal court the discretion to
15

refuse to tax costs in favor of the prevailing party. Crawford Fitting Co. v. J.T.

Gibbons, Inc., 482 U.S. 437, 441-42 (1987). 

The district court characterized this case as a “relatively straightforward

breach of contract case” which was unduly protracted by Computrol’s painstakingly

slow and complicated presentation of the evidence. The district court is in a better

position than the Court of Appeals to assess the course of the litigation and the

quality of work performed by the attorneys. McNabola v. Chicago Transit Auth.,

10 F.3d 501, 519 (7th Cir. 1993). Accordingly, we are convinced that the district

court did not abuse its discretion when it awarded Computrol $150,000 in attorneys

fees, costs, and expenses under the circumstances of this case. 

 

The post-trial judgment of the district court is affirmed. 

 A true copy.

 Attest:

 CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.