Opinion ID: 736222
Heading Depth: 3
Heading Rank: 1

Heading: Were the damages speculative?

Text: 38 We examine the challenge that damages for lost profits are speculative to determine whether a reasonable person could find the profits were established with reasonable certainty, considering all evidence in the light most favorable to the plaintiffs. Thompson and Wallace v. Falconwood Corp., 100 F.3d 429, 435 (5th Cir.1996). 39 Under Texas law, evidence to establish profits must not be uncertain or speculative. Texas Instruments, Inc. v. Teletron Energy Management, Inc., 877 S.W.2d 276, 279 (Tex.1994), (quoting Southwest Battery Corp. v. Owen, 131 Tex. 423, 426, 115 S.W.2d 1097, 1098 (Tex.1938)). However, the requirement that damages be based on more than speculation is intended to be flexible enough to accommodate the myriad circumstances in which claims for lost profits arise. Texas Instruments, 877 S.W.2d at 279. [I]t is not necessary that recovery for future profits should be established by exact calculation, as it is enough to have data from which these profits may be ascertained with a reasonable degree of certainty and exactness. Fiberlok, Inc. v. LMS Enter., Inc., 976 F.2d 958, 962 (5th Cir.1992) (citing Copenhaver v. Berryman, 602 S.W.2d 540, 544 (Tex.Civ.App.1980)). 40 While SDV technology represents a new product the intensive market research DSC presented at trial, coupled with the known history of the telecommunications industry and the success of the Lightspan product, established with sufficient certainty that SDV technology is likely to generate significant profits. Even if a product is not yet fully developed, a plaintiff is not prevented from recovering future lost profits if it was hindered in developing that product, and the evidence shows the eventual completion and success of that product is probable. As well, DSC has traditionally been a leader in producing technology used in telecommunications. Its history of strong performance is indicative of the likely success of this revolutionary new product.B. Was Sears' methodology based on conjecture? 41 While damages may not be determined by mere speculation or guess, it will be enough if the evidence show[s] the extent of the damages as a matter of just and reasonable inference, although the result be only approximate. Terrell v. Household Goods Carriers' Bureau, 494 F.2d 16, 24 (5th Cir.1974), cert. dismissed, 419 U.S. 987, 95 S.Ct. 246, 42 L.Ed.2d 260 (1974) (quoting Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 563, 51 S.Ct. 248, 250-51, 75 L.Ed. 544 (1931)). We do not agree that Sears' methodology was based on conjecture. The assumptions Sears made about the availability of SDV access and the respective market percentages of DSC and Next Level are adequately supported. 42 It is true these predictions are not guaranteed. No one can definitively say what the future holds for SDV technology, or DSC and Next Level in particular. However, uncertainty surrounding precisely how the industry will evolve does not reduce all analysis about future developments to mere speculation. Sears based his predictions on data obtained from respected sources in the telecommunications market. The jury chose to believe his estimation of damages. There was sufficient evidence presented to support the jury's verdict. 43 C. Was the unitary damages figure impermissible? 44 The damage model Sears presented showed the total damages allocated to Next Level's alleged wrongful conduct. The jury then allocated damages to each different cause of action. DSC was not obligated to precisely apportion damages for each instance of wrongful conduct it alleged, as unitary damages models are permissible under Texas law. Bildon Farms, Inc. v. Ward County Water Improvement Dist. No. 2, 415 S.W.2d 890, 896 (Tex.1967). 45 The fact the jury found Eames and Keeler were not liable for soliciting key employees of DSC is irrelevant to our inquiry. First, the jury found Eames and Keeler were not liable for these acts in the context of the breach of contract claim. Damages for breach of contract were not included in the judgment entered by the district court, and are not appealed to this Court. Second, even if the jury's finding was relevant to the misappropriation of trade secrets damages, we may safely assume the jury did not award damages to DSC for conduct for which Eames and Keeler were not liable. 46 D. Should the punitive damages award be reversed? 47 Next Level argues that the punitive damage award must be vacated since DSC's compensatory damage award cannot stand. As we uphold the compensatory damage award, this argument fails.