Opinion ID: 2630381
Heading Depth: 2
Heading Rank: 1

Heading: Did the District Court Abuse Its Discretion in Granting the Motion in Limine Prohibiting Sullivan Construction from Presenting Any Evidence of Its Lost Profits?

Text: On November 27, 2006, Todd and Petersen filed a motion in limine to exclude Sullivan Construction from presenting any evidence of lost profits on the ground that it could not prove that portion of its claim. To prevail on their motion, Todd and Petersen had the burden of showing that Sullivan Construction could not prove any amount of its claimed lost profits. They contended that Sullivan Construction could not do so because it has not disclosed any expert witness who could provide an opinion on the amount of lost profits Sullivan Construction, LLC suffered, if any, as a result of others performing work for Petra, Inc. Sullivan Construction claimed damages in the total sum of $145,000 for the tortious interference with its prospective economic advantage with Petra, Inc. Although the calculation of all of those damages is not disclosed in the record on appeal, the claimed damages included the profits lost on the jobs done by Todd and Petersen for Petra, Inc., during the period from April 5 to 22, 2005. The district court held that because Sullivan Construction had not disclosed in discovery that it would call any witness who would offer an opinion regarding its lost profits, it could not prove its lost profits. The court, in essence, ruled that under no circumstances can lost profits be proved without opinion testimony. In so ruling, the court erred. Compensatory damages for lost profits and future earnings must be shown with a reasonable certainty. Damage awards based upon speculation and conjecture will not be allowed. Inland Group Cos., Inc. v. Providence Washington Ins. Co., 133 Idaho 249, 257, 985 P.2d 674, 682 (1999) (citations omitted). A portion of Sullivan Construction's claimed damages included the profits it would have made on the jobs performed for Petra, Inc., during the period from April 5 to 22, 2005. During argument on the motion, Sullivan Construction's counsel stated that he would attempt to prove damages by using documents obtained during discovery, including documents from Petra, Inc., and the testimony of Todd and of Petersen. There is nothing in the record indicating that opinion testimony would be necessary to prove the profits lost by Sullivan Construction due to Todd and Petersen's conduct in diverting those jobs to themselves. Although Todd and Petersen argued that Sullivan Construction had not identified any expert who could testify as to lost profits, they did not show that Sullivan Construction could not prove the portion of its claimed lost profits relating to the Petra, Inc., jobs without opinion testimony. Sullivan Construction contended the determination of those lost profits would be a simple arithmetic calculation based upon the amount received from Petra, Inc., and the cost of labor and materials to perform the jobs. In the instant case, Todd and Petersen wrongfully diverted jobs from Sullivan Construction and used Sullivan Construction employees and equipment to perform those jobs. They then diverted the income received from those jobs to themselves. The district court did not rule that Sullivan Construction had failed to offer sufficient evidence to prove its lost profits, at least with respect to these jobs. Rather, it ruled that Sullivan Construction could not prove any lost profits without opinion testimony. Thus, we do not know what evidence Sullivan Construction would have offered had it been given the opportunity to do so. Although Sullivan Construction may have needed opinion testimony to establish the amount of any future earnings it claimed to have lost, there is nothing indicating that it would have needed opinion testimony to prove its lost profits with respect to the jobs performed for Petra, Inc., from April 5 to 22, 2005. Compensatory damages for lost profits and future earnings must be shown with a reasonable certainty. Inland Group Cos., 133 Idaho at 257, 985 P.2d at 682. Reasonable certainty requires neither absolute assurance nor mathematical exactitude; rather, the evidence need only be sufficient to remove the existence of damages from the realm of speculation. Griffith v. Clear Lakes Trout Co., Inc., 143 Idaho 733, 740, 152 P.3d 604, 611 (2007). Neither the trial court nor Todd and Petersen have pointed to any authority supporting the proposition that lost profits can never be proved without opinion testimony. Relying upon Trilogy Network Systems, Inc. v. Johnson, 144 Idaho 844, 172 P.3d 1119 (2007), Todd and Petersen argued on appeal that proof of their profits on the Petra, Inc., jobs would not prove the amount that Sullivan Construction was entitled to recover in damages. They rely upon the statement in that opinion that [t]he measure of damages for the breach of an anti-competition clause is the amount that the plaintiff lost by reason of the breach, not the amount of profits made by the defendant. 144 Idaho at 846, 172 P.3d at 1121. The holding in Trilogy has no application to the present case. One of Trilogy's former employees violated a noncompetition agreement by successfully outbidding Trilogy to obtain a contract with one of Trilogy's customers. In Trilogy's subsequent lawsuit against its former employee, the trial court held that Trilogy had failed to provide sufficient evidence to prove its damages for breach of the noncompetition agreement. Trilogy simply offered conclusory statements that its profit would have been very similar to the profit earned by the former employee, without showing the amount of its bid and without providing any comparison between its costs to perform the contract and the costs actually incurred by its former employee. In this case, we do not know the evidence that Sullivan Construction would have presented because of the district court's granting of the motion in limine. The district court's ruling that lost profits can never, under any circumstances, be proved without opinion testimony is not consistent with legal standards. The district court therefore abused its discretion in granting the motion in limine. We vacate the damages portion of the judgment and remand for a new trial on damages as to both Todd and Petersen.