NOTICE: NOT FOR OFFICIAL PUBLICATION.

UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL

AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE

ARIZONA COURT OF APPEALS

DIVISION ONE

GREEN CROSS MEDICAL, INC., an Arizona non-profit corporation, 

Plaintiff/Appellee,

v.

CARYN MANGISI, Trustee of the John V. Gally Family Protective Trust, 

dated January 11, 1993, Defendant/Appellant.

No. 1 CA-CV 23-0692 

Appeal from the Superior Court in Navajo County

No. S0900CV201200208

The Honorable Joseph Samuel Clark, Judge

AFFIRMED

COUNSEL

Aspey Watkins & Diesel, PLLC, Flagstaff

By Whitney Cunningham, Caitlin Rynn

Counsel for Plaintiff/Appellee

Hunter, Humphrey & Yavitz, PLC, Phoenix

By Randall S. Yavitz, Isabel M. Humphrey

Counsel for Defendant/Appellant

FILED 10-08-2024
GREEN CROSS v. MANGISI

Decision of the Court

2

MEMORANDUM DECISION

Judge Cynthia J. Bailey delivered the decision of the Court, in which 

Presiding Judge Paul J. McMurdie and Judge Maria Elena Cruz joined.

B A I L E Y, Judge:

¶1 Caryn Mangisi, Trustee of the John V. Gally Family Protective 

Trust, dated January 11, 1993 (“the Trust”), appeals the superior court’s 

judgment awarding $3,565,000 in damages, along with attorneys’ and 

expert witness fees and accruing interest, to Green Cross Medical, Inc. 

(“Green Cross”). We affirm.

FACTS AND PROCEDURAL HISTORY1

¶2 In April 2012, John Gally, in his capacity at the time as Trustee 

of the Trust, entered a lease agreement to allow Green Cross to cultivate

and dispense medical marijuana on commercial property held by the Trust 

in Winslow, Arizona (“the Property”). The lease allowed Green Cross to 

lease the Property until it obtained a dispensary operating license from the 

Arizona Department of Health Services (“ADHS”). After issuance of the 

license, the lease provided for a three-year term and an additional threeyear tenant’s renewal option.

¶3 The Property was one of only two parcels within the Winslow 

Community Health Analysis Area (“CHAA”) appropriately zoned for a 

medical marijuana dispensary. Another entity seeking an operating license 

from ADHS, The Medicine Room (“TMR”), obtained permission from the 

owner of the other property. A few weeks after entering the lease

agreement, Green Cross received a letter from Gally, through Gally’s 

attorney, Kathryne Ward, stating that Gally and the Trust were unilaterally 

revoking the lease. The Property’s locks were changed, and from then on, 

Green Cross could not access the Property.

1 We take portions of the facts and procedural history from this court’s prior 

memorandum decision and opinion involving the parties. See Green Cross 

Med., Inc. v. Gally (“Green Cross I”), 1 CA–CV 12–0610, 2013 WL 5435817 

(Ariz. App. Sept. 26, 2013) (mem. decision); Green Cross Med., Inc. v. Gally

(“Green Cross II”), 242 Ariz. 293 (App. 2017) (review denied Sept. 12, 2017).
GREEN CROSS v. MANGISI

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3

¶4 Green Cross filed a complaint against Gally, as Trustee of the 

Trust, for breach of contract and motions for a temporary restraining order 

(“TRO”) and preliminary injunction. Gally argued he was required to 

revoke the lease because a prior month-to-month lessee—a sister company 

to Compassionate Care Dispensary (“CCD”), which also wanted to operate 

a medical marijuana dispensary on the Property—allegedly had a superior 

interest in the form of an option to purchase the Property.2 The superior 

court issued the TRO and later the preliminary injunction, barring Gally 

and the Trust from revoking the lease and taking possession of the Property 

pending final determination of the action. Gally did not restore Green 

Cross’s possession of the Property, however, and in July 2012, he appealed

the preliminary injunction.

¶5 Green Cross had applied with ADHS to be awarded the single 

Winslow dispensary license, but given its limited funds and the uncertainty

over the lease’s status, Green Cross instructed ADHS to assign its sole

$150,000 “proof of deposit” to the Kingman dispensary lottery—a lottery 

with more contestants and a significantly smaller chance of winning—

instead of the Winslow lottery.

¶6 In August 2012, the ADHS dispensary bingo-ball lottery 

drawings took place. TMR won the Winslow dispensary lottery over CCD. 

Green Cross did not win the Kingman dispensary lottery.

¶7 In September 2013, this court affirmed the preliminary 

injunction in favor of Green Cross. See Green Cross I, 1 CA–CV 12–0610, at 

*3, ¶¶ 13, 15.

¶8 On remand, the superior court granted Ward’s motion to 

withdraw as counsel for Gally and the Trust, and the parties cross-moved

for summary judgment. Green Cross sought partial summary judgment on 

liability for possible damages for the lease revocation; Gally and the Trust 

argued the lease was illegal and therefore unenforceable under the Arizona 

Medical Marijuana Act (“AMMA”), see Ariz. Rev. Stat. (“A.R.S.”) §§ 36–

2801 to –2822, and the federal Controlled Substances Act, see 21 U.S.C. §§ 

801 to 904. The superior court denied Green Cross’s motion and granted 

Gally and the Trust’s motion, holding the lease violated both state and 

federal law and was therefore void for illegality.

2 Ward, the attorney for Gally and the Trust, was stepmother of a 

principal/owner of CCD.
GREEN CROSS v. MANGISI

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¶9 Green Cross appealed, and this court held the lease was not 

void, either for being contrary to the AMMA or for being contrary to the 

Controlled Substances Act, and “was enforceable at least for purposes of a 

damages action for its breach.” Green Cross II, 242 Ariz. at 298, 300-01, ¶¶

15, 25, 29. We reversed and remanded for consideration of Green Cross’s 

damages claim. Id. at 300-01, ¶¶ 25, 30

¶10 In May 2018, Gally and the Trust filed their answer, denying 

Ward ever acted as their agent and positing she had “used” them “as an 

unwitting tool” to further her family’s interests. They later moved for 

summary judgment, arguing Green Cross could not show damages from 

breach of the lease because Green Cross’s lottery ball would likely have 

replaced CCD’s losing lottery ball in the Winslow drawing. Green Cross

responded that even had its application “replaced” CCD’s, the lottery ball 

assignment was not guaranteed to be identical because ADHS randomized 

their assignment to qualified dispensary applicants via a computer 

program before the lottery. Thus, it was not a foregone conclusion Green 

Cross would have been assigned the same lottery ball as CCD. Green Cross 

also noted the Trust’s argument assumed CCD would not have been 

included in the Winslow lottery absent the breach, despite what it termed a 

“likelihood” it would have been. Finally, Green Cross argued the Trust’s 

argument ignored the opinions of the parties’ experts, both of whom had 

employed—at least in part—an ex-ante framework in calculating or 

critiquing lost profit damages. This approach considered only information 

known or knowable on the date of the breach and excluded subsequent 

events, such as the lottery drawing, from the calculation. After oral 

argument, at which the Trust’s attorney “agreed that either Ball ‘A’ or Ball 

‘B’ could have been assigned to [Green Cross],” the court denied the 

motion.

¶11 The superior court also denied the Trust’s subsequent motion

to exclude Green Cross’s claimed lost profits damages as speculative. In 

2021, Gally passed away, and his daughter, Mangisi, replaced him as 

Trustee.

¶12 In February 2022, the superior court conducted a two-day 

bench trial on the damages issue. The court heard testimony from William 

Brothers, Green Cross’s founder and principal owner; Mangisi; Dwight 

Duncan, CFA, Green Cross’s expert witness on damages; and Timothy 

Tribe, CPA/CFF, CFE, CICA, the Trust’s expert witness on damages. 

¶13 In July 2022, the superior court issued a ruling supported by 

findings of fact and conclusions of law—as requested by the Trust—
GREEN CROSS v. MANGISI

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awarding damages in favor of Green Cross and against the Trust for

$3,565,000. The court later entered judgment under Rule 54(c), Ariz. R. Civ. 

P., in favor of Green Cross and against the Trust, awarding the above

damages, $95,024.87 in attorneys’ fees, and $49,866.25 in expert witness 

fees, along with accruing interest. The court denied the Trust’s motion for 

a partial new trial,3 and we have jurisdiction over the Trust’s timely appeal 

under A.R.S. § 12-2101(A)(1).

DISCUSSION

I. The Trust’s Opening Brief

¶14 Green Cross argues that portions of the Trust’s opening brief 

do not comply with Rule 13, ARCAP, because the Trust makes numerous

“uncited, and incorrect factual assertions” and engages in “editorializing 

amounting to argument” in its introduction and statement of the case. See

ARCAP 13(a)(3)-(4). We agree with Green Cross’s characterization of the 

Trust’s brief but decline to reject the Trust’s appeal on this basis, see Clemens 

v. Clark, 101 Ariz. 413, 414 (1966); Lederman v. Phelps Dodge Corp., 19 Ariz.

App. 107, 108 (1973), and we rely on our record review for the necessary 

facts, see Sholes v. Fernando, 228 Ariz. 455, 457, ¶ 2 n.2 (App. 2011); State Farm 

Mut. Auto. Ins. Co. v. Arrington, 192 Ariz. 255, 257 n.1 (App. 1998).

II. Causation

¶15 The Trust argues Green Cross’s exclusion from the Winslow 

lottery and its subsequent lost expectancy damages were not caused by its 

breach of the lease but by subsequent independent acts of others—

including Ward and her family’s business interests, including CCD, and 

Green Cross itself. In its opening brief, however, the Trust abandons any 

argument concerning anyone except Ward, who the Trust characterizes as 

having a “blatant conflict of interest.” The Trust concedes, as it must, that 

an agency relationship existed between it and Ward but argues the court 

erred in failing to recognize she was not only the attorney for Gally and the

Trust, but also the attorney for her family’s entities, including CCD.

3 The motion alleged Green Cross had improperly withheld disclosure 

regarding Mr. Duncan. In its reply, the Trust abandoned that argument

and argued Green Cross’s expert witness testimony on damages was 

inadmissible. After finding the Trust had filed “no motions, either before 

or during trial, arguing [Green Cross’s] expert’s opinion on calculation of 

damages should be excluded—except an argument it was speculative,” the 

court denied the motion.
GREEN CROSS v. MANGISI

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¶16 We review findings of fact for clear error and conclusions of 

law de novo. DeLuna v. Petitto, 247 Ariz. 420, 423, ¶ 9 (App. 2019). A superior 

court’s findings of fact are binding on this court if supported by credible 

evidence, and our inquiry is whether the court had before it evidence 

reasonably supporting its action viewed in the light most favorable to 

sustaining the findings; we will not reweigh conflicting evidence on appeal. 

Imperial Litho/Graphics v. M.J. Enters., 152 Ariz. 68, 72 (App. 1986).

¶17 The Trust acknowledges that “[g]enerally, whether agency 

exists is a question of fact” but argues that “when the material facts are not 

in dispute, the existence of such a relationship is a question of law for the 

court to decide.” Escareno v. Kindred Nursing Ctrs. W., L.L.C., 239 Ariz. 126, 

129, ¶ 6 (App. 2016) (citations omitted). Here, however, the argument is 

unavailing, as the Trust seeks to characterize factual disputes as legal ones, 

to introduce numerous contested “additional facts developed at trial,” and 

to make other factual assertions that in some cases are simply arguments 

couched as “facts” not accepted by the superior court.

¶18 The record contradicts the Trust’s attempt to paint itself as an 

innocent victim. Gally was an experienced landlord and his previously 

sworn testimony before the superior court was “intentionally very evasive 

on cross-examination” due to his economic interests. See Green Cross I, 1 

CA–CV 12–0610, at *2, ¶ 11. The record is clear that, after entering the lease 

with Green Cross, Gally revoked it without cause and did so through his

attorney, Ward, who was acting in her capacity representing Gally and the 

Trust. Then, one day before the TRO hearing, the Trust, through Gally, 

signed an affidavit—later submitted to ADHS—declaring the Trust was 

selling the Property to Ward’s company, Western Surety, and that the only 

entity with rights to the Property was CCD, the company owned by Ward’s 

stepson. The affidavit noted that permission for any other applicant—

Green Cross—“has been withdrawn.”

¶19 On June 28, 2012, the sale of the Property to Western Surety 

closed. Purportedly, the sale was for $225,000, of which $220,000 was 

carried as a loan from the Trust to Western Surety. Despite the sale being 

subject to the rights of Green Cross under the lease, Western Surety notified 

ADHS on July 18 that Green Cross lacked “landlord permission” to operate 

a dispensary on the Property. That same day, ADHS notified Green Cross 

its Winslow application was incomplete, partly because it did not have a 

Documentation of Property Ownership form signed by Western Surety. 
GREEN CROSS v. MANGISI

Decision of the Court

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¶20 Although the Trust suggests its liability ended with the sale 

to Western Surety,4 Gally knew Green Cross and CCD intended to operate 

medical marijuana dispensaries on the Property and knew of Ward’s 

connections to CCD. It was foreseeable and predictable that Ward would 

seek to oust Green Cross from the Property and use it for CCD, and Gally 

helped achieve this result by selling the Property to a sister company of 

CCD and signing documentation declaring that only CCD had the right to 

use the Property as a dispensary. At no time before the lottery drawing did 

Gally or the Trust disavow Ward as their agent, advise Green Cross they 

had told her to “stand down,” or claim her interests were in any way at 

odds with theirs. Further, Ward continued to represent them until April 

2014, about twenty months after the lottery drawing and seven months after 

this court affirmed the superior court’s preliminary injunction. A 

reasonable trier of fact could infer Gally and the Trust were not taken 

advantage of by Ward or CCD, as they claim, but were cooperating with 

them. And the superior court found, “In the end, it was the specific actions 

of the Trust and of it[s] attorney while acting for the Trust . . . that resulted 

in ADHS’s rejection of [Green Cross’s] application in Winslow.” Gally and 

the Trust’s acts prevented Green Cross from participating in the August 

2012 Winslow dispensary lottery and directly caused Green Cross’s lost 

expectancy damages.

III. Effect of the Actual Lottery Result

¶21 At trial, Green Cross argued that breach of the lease caused 

both the improper inclusion of CCD in the Winslow lottery and its 

exclusion from the Winslow lottery. Couching its argument as a legal 

argument, the Trust argues that, as a matter of law, Green Cross cannot 

recover “uncertain result” damages for a hypothetical two-ball drawing 

involving Green Cross and TMR, because a two-ball drawing involving 

CCD and TMR occurred, and the result is known—TMR won. The Trust 

maintains the only effect of the breach is “that CCD’s application number, 

rather than Green Cross’s application number, was associated on a 

spreadsheet with the ultimately losing ping-pong ball.”5

4 The Trust later retrieved the Property through foreclosure after Western 

Surety failed to pay the mortgage.

5 We disagree with Green Cross that the issue was not preserved for appeal. 

The issue was raised before trial in the Trust’s motion for summary 

judgment, in the Joint Pretrial Statement, and in the Trust’s post-trial 

Proposed Findings of Fact and Conclusions of Law.
GREEN CROSS v. MANGISI

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¶22 Whether the superior court applied the correct measure of 

damages is a mixed question of fact and law, which we review de novo. SDR

Assocs. v. ARG Enters., 170 Ariz. 1, 2 (App. 1991). Although a damages 

expert may explain the factors they relied on and the methodology they 

used as an adjunct to the factfinder, the superior court should not determine 

an applicable legal standard through expert testimony. See generally Ryan 

v. Napier, 245 Ariz. 54, 66, ¶¶ 51-52 (2018). The Trust, however, fails to 

support its legal argument by citing any Arizona authority precluding the 

methodology used by Green Cross’s damages expert, Mr. Duncan, and 

adopted by the superior court, and we are aware of none.

¶23 “[D]amages are measured as of the date of the breach.” SDR, 

170 Ariz. at 3 (citation omitted). “If a breach is of a promise conditioned on 

a fortuitous event and it is uncertain whether the event would have 

occurred had there been no breach, the injured party may recover damages 

based on the value of the conditional right at the time of breach.” 

Restatement (Second) of Contracts § 348(3) (1981).

¶24 Here, ADHS randomized not only the ultimate selection of 

lottery winners but also the assignment of the lottery balls to qualified 

dispensary applicants in each CHAA via a computer program before the 

lottery. Thus, the lottery was not guaranteed to be identical, and it was not 

a foregone conclusion that Green Cross would have been assigned the same 

lottery ball as CCD. Accordingly, the superior court correctly found Green 

Cross could have been assigned the winning ball had it participated in the 

Winslow lottery.

¶25 Furthermore, the Trust’s “losing lottery ball” argument 

ignores the opinion reports and testimony of both parties’ experts, who 

agreed on the appropriate damages methodology to be applied in a case 

such as this, which involves a lost opportunity. Mr. Duncan presented an 

ex ante damages analysis as of the date of the breach based on what was 

known or knowable at the time. Under an ex ante analysis, as Mr. Duncan 

testified, the relevant information is “only what was known or knowable as 

of the date of the bad act.” Thus, even a stolen losing lottery ticket is still 

worth its expectation value—the probability of winning at the time of the 

theft times the jackpot amount. The Trust’s expert, Mr. Tribe, agreed with 

Mr. Duncan that an ex ante approach is a “commonly accepted”

methodology for determining damages that is “widely accepted in various 
GREEN CROSS v. MANGISI

Decision of the Court

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courts”6 and that a probability adjustment is an appropriate way to 

calculate damages in this case.

¶26 The Trust’s “losing lottery ball” argument is not supported by 

applicable law, is inconsistent with how the dispensary certificate lottery 

was conducted, is not supported by trial testimony, and contradicts its own 

expert’s admissions.

IV. “Speculative” Lost Profits

¶27 The Trust argues Green Cross did not demonstrate its claimed 

lost profits with “reasonable certainty.” We disagree.

¶28 We will not set aside findings of fact unless they are clearly 

erroneous, and we give due regard to the superior court’s opportunity to 

judge the credibility of witnesses. Ariz. R. Civ. P. 52(a)(6). When it aids in 

understanding evidence or determining a fact in issue, a party may 

generally present testimony by a qualified expert witness. See Ariz. R. Evid. 

702. If substantial evidence supports a finding of fact, that finding is not 

clearly erroneous, even if conflicting evidence exists. Castro v. BallesterosSuarez, 222 Ariz. 48, 51-52, ¶ 11 (App. 2009). We do not reweigh the 

evidence or substitute our evaluation of the facts, but review de novo the 

superior court’s legal conclusions. See id. at 52, ¶¶ 11-12; Grubb & Ellis 

Mgmt. Servs., Inc. v. 407417 B.C., L.L.C., 213 Ariz. 83, 86, ¶ 12 (App. 2006). 

The legal sufficiency of evidence is a question of law we review de novo. See 

McBride v. Kieckhefer Assocs., 228 Ariz. 262, 265, ¶ 10 (App. 2011).

¶29 To recover damages for lost profits, Green Cross had to prove 

(1) “[t]hat it is reasonably probable that the profits would have been earned 

except for the breach,” (2) “[t]hat the loss of profits is the direct and natural 

consequence of the breach,” and (3) that “[t]he amount of lost profits can be 

shown with reasonable certainty.” RAJI (Civil) 7th Contract 19. “If future 

lost profits are reasonably certain, any reasonable basis for determining the 

amount of the probable profits lost is acceptable. However, the amount of 

lost profits cannot be based on conjecture or speculation.” Id. “[D]oubts as 

to the extent of the injury should be resolved in favor of the innocent 

plaintiff and against the wrongdoer.” Gilmore v. Cohen, 95 Ariz. 34, 36 

(1963). Moreover, “[o]nce the fact of lost profits is established . . . our courts 

have not been as strict about the amount.” Felder v. Physiotherapy Assocs., 

215 Ariz. 154, 164, ¶ 47 (App. 2007); see also Earle M. Jorgensen Co. v. Tesmer 

6 See SDR, 170 Ariz. at 3; Shah v. Skillz Inc., 320 Cal. Rptr. 3d 175, 196-97 (Cal. 

Ct. App. 2024); Duncan v. TheraTx, Inc., 775 A.2d 1019, 1022 (Del. 2001).
GREEN CROSS v. MANGISI

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Mfg. Co., 10 Ariz. App. 445, 450 (1969) (citing cases). Thus, disputes over 

“the evidence used to establish the amount of damages will go to the 

‘weight of the evidence.’” Felder, 215 Ariz. at 164, ¶ 47 (citations omitted).

¶30 A new business is not precluded from recovering an award 

for lost future profits. Rancho Pescado, Inc. v. Nw. Mut. Life Ins. Co., 140 Ariz. 

174, 183-84 (App. 1984). “The evidence required to prove loss of future 

profits depends on the individual circumstances of each case . . . .” Id. at 

184. But the proponent must establish a “reasonable basis in the evidence 

for the trier of fact.” Id.

¶31 Our review confirms that substantial evidence supports the 

superior court’s lost profits damages award. The Trust’s assertions that 

Green Cross lacked plans, experience, and financing are contradicted by the 

record. The court’s findings of fact and conclusions of law discuss Green 

Cross’s business plans, the experience of its principals, and its access to 

cash, citing the record.

¶32 As to the expert testimony, the superior court found that “Mr. 

Duncan reviewed pleadings, interviewed [Green Cross’s] principal, Bill 

Brothers (placing his notes into his file), industry texts, scholarly articles, 

qualified patient information within CHAA designations, trends from 

mature markets in California and Colorado, medical marijuana published 

data including studies of marijuana crop yields, and NAICS codes for 

industry risk, among other data sources.” The court also found, “Relying 

on his experience and research, Mr. Duncan evaluated service areas, 

observed distances customers drive in other markets, calculated qualified 

patients as percentage of population, deduced average spend by patients 

and product pricing, summarized operating expense ratios, and performed 

risk adjustments, including company specific risk adjustments.” The 

record supports the court’s findings.

¶33 Additionally, Mr. Tribe endorsed Mr. Duncan’s principles 

and methods and testified about the information and data that would 

produce reliable expert testimony in determining Green Cross’s damages. 

These included publications of technical, financial and industry data; 

interviews with management; the expert’s own experience specific to the 

business and the industry; and examination of mature markets like 

California and Colorado, including consumption or usage data and pricing 

data—the very things Mr. Duncan relied on in forming his opinions.

¶34 Also, in performing his work, Mr. Duncan determined a 

discount rate he applied to his damages calculation—a rate meant to factor 
GREEN CROSS v. MANGISI

Decision of the Court

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in various risks, including industry risks and company-specific risks. Mr. 

Tribe made no changes to Mr. Duncan’s proposed discount rate, while 

indicating he thought it was unnecessary. Within the damages framework 

accepted by both parties, Green Cross presented substantial evidence, 

mostly without any rebuttal from Mr. Tribe or the Trust. On this record, 

Green Cross presented substantial evidence to prove its claimed lost profits 

with “reasonable certainty.”7

V. Failure to Subtract Management Fees From “Profits”

¶35 The Trust argues the superior court erred in awarding lost 

profits damages to Green Cross because Mr. Duncan admitted “essentially 

all” profits would have been paid as management expenses and thus 

“agreed” that such expenses should not be awarded as damages. We 

discern no error.

¶36 The AMMA requires registered medical marijuana 

dispensaries to be non-profit entities. See AOW Mgmt. LLC v. Scythian Sols. 

LLC, 1 CA-CV 20-0699, 2022 WL 2813523, at *3, ¶ 16 (Ariz. App. July 19, 

2022) (mem. decision) (citing A.R.S. § 36-2806). ADHS required certificate 

applicants to submit proposed bylaws (including, inter alia, provisions for 

operating the dispensary on a non-profit basis) and a proposed business 

plan reflecting revenues not exceeding expenditures. 

¶37 That said, a non-profit medical marijuana dispensary can be 

a lucrative enterprise, but as a non-profit, it is distinguished from a forprofit business corporation “primarily by the absence of stock or other 

indicia of ownership that give their owners a simultaneous share in both 

profits and control.” Id. at ¶ 14 (citation omitted). Receipts or profits 

greater than operating expenses and applicable costs must be reinvested 

back into the non-profit or donated to other charitable causes. Id. at ¶ 17.

¶38 The Trust’s argument appears to be based on conjecture about 

how Green Cross would use and distribute its excess receipts or “profits.”

The Trust asserts Mr. Duncan “admitted” that profits for a non-profit 

7 In denying the Trust’s pretrial motion to exclude Green Cross’s claimed 

lost profits damages as speculative, the superior court advised, “If, after 

[Green Cross] has been fully heard on the issue of lost profit damages, the 

evidence is such that a reasonable jury could not have a legally sufficient 

evidentiary basis to find lost profit damages, then [the Trust] can make a 

Rule 50 motion for judgment as a matter of law.” The record does not 

indicate the Trust made such a motion.
GREEN CROSS v. MANGISI

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Arizona medical marijuana dispensary are normally paid out as 

management expenses to a management company—and thus cannot be 

counted as profit. However, although Mr. Duncan testified that he was 

aware of business models in which non-profits paid “essentially all the 

profits” to a separate management company, he also made clear he was not 

necessarily speaking about Green Cross, and he was aware of other 

business models. Mr. Tribe, the Trust’s expert, testified that a profits 

calculation for a non-profit would be “functionally” the same as for any 

other entity. And Mr. Duncan’s damages calculation factored in expected 

revenues and deducted both the cost of goods sold and operating expenses. 

The remainder counted as “profit,” which the court awarded in this case.

The Trust’s argument does not challenge Mr. Duncan’s methodology or Mr. 

Tribe’s testimony.

¶39 Further, although the Trust concedes non-profit entities can 

prove lost profits, its argument suggests any profits should not inure to 

Green Cross, a non-profit corporation. But when asked about this at trial, 

counsel for the Trust conceded it was not “fair game to breach non-profit 

contracts” and disputed any claim that Green Cross should be denied lost 

profits damages because it is a non-profit corporation. Although nonprofits are limited as to how they may pay a separate management 

company or allocate distributions, they may still create “profits.”

VI. Attorneys’ Fees and Costs on Appeal

¶40 Both sides request costs and attorneys’ fees on appeal under 

A.R.S. § 12-341.01. The Trust is not the successful party, and we deny its 

request. Green Cross is the successful party, and we grant its request for 

taxable costs and attorneys’ fees in an amount to be determined upon 

compliance with ARCAP 21.

CONCLUSION

¶41 The superior court’s judgment is affirmed.