Opinion ID: 2979856
Heading Depth: 3
Heading Rank: 1

Heading: Former and Prospective Clients

Text: In its findings of fact and conclusions of law, the district court determined that defendants breached the SPA by failing to introduce established marketing relationships to E-V personnel, failing to maintain E-V marketing staff, closing E-V’s Columbus office, and eliminating the E-V brand. Acknowledging that the existence and amount of damage must be proven with “reasonable certainty,” the district court concluded that defendants’ “breach caused client attrition and prevented E-V from earning new clients[.]” This finding was reasonable and well-supported. First, the testimony elicited from numerous lay and expert witnesses indicated that marketing relationships and personnel, local presence, and branding were all significant factors affecting a TPA’s success. Moreover, defendants admitted that their actions caused the loss of former and prospective E-V clients. For example, Donald Baker, chairman, CEO, CFO, and treasurer of NABN, testified that defendants “killed off” the E-V brand and closed E-V’s Columbus office, causing the loss of existing E-V clients. Baker further acknowledged that defendants failed to commit the resources necessary to foster E-V’s growth. Accordingly, based upon the testimony elicited at trial and defendants’ admissions, the district court’s finding that the loss of former and prospective E-V clients was attributable to defendants’ breach was supported by sufficient evidence. Nevertheless, despite the above-referenced testimony, defendants contend that plaintiffs’ causation evidence was insufficient because they failed to obtain direct testimony from any former -9- Nos. 10-3223/10-3282 Eggert, et al. v. Meritain Health, Inc., et al. or prospective E-V client. Without such testimony, defendants assert that E-V’s business failures could be attributable to any number of factors unrelated to the breach.1 This argument misses the mark for two reasons. First, while the testimony of former and prospective E-V clients may have provided helpful information regarding the issue of causation, defendants cite to no Ohio authority, and we find none, requiring plaintiffs to provide such direct evidence to establish causation. Indeed, the Ohio Court of Appeals has sanctioned the use of circumstantial evidence, and the reasonable inferences drawn therefrom, in making causation findings. See, e.g., Roelle v. Orkin Exterminating Co., No. 00AP-14, 2000 WL 1664865, at  (Ohio Ct. App. Nov. 7, 2000) (noting that a court could reasonably infer, based upon timing, that a previous termite infestation did not cause the damages at issue); accord Shred-It USA, Inc. v. Mobile Data Shred, Inc., 238 F. Supp. 2d 604, 608 (S.D. N.Y. 2002) (noting that evidence was sufficient to establish that breach caused the loss of clients, even without direct client testimony). Second, in making its findings of fact regarding causation, the district court was in a position to weigh the evidence presented and give determinative credit to the evidence it found persuasive. See Westinghouse Elec. Corp. v. Dolly Madison Leasing & Furniture Corp., 326 N.E.2d 651, 656 (Ohio 1975) (“Defendants suggested that other causes of the fire were possible, such as spontaneous 1 To support this argument, defendants repeatedly cite to Telxon Corp. v. Smart Media of Delaware, Inc., Nos. 22098, 22099, 2005 WL 2292800 (Ohio Ct. App. Sept. 21, 2005). Telxon stands for the unremarkable principle that “damages must [be] directly caused by the wrongful breach, not by something else.” Id. at . Telxon does not hold that direct evidence is required to prove causation, or that every conceivable cause of loss must be ruled out before causation may be established by a preponderance of the evidence. - 10 - Nos. 10-3223/10-3282 Eggert, et al. v. Meritain Health, Inc., et al. combustion, arson, or sparks from a locomotive. However, all these possible causes were questions of fact for the jury[.]”). Plaintiffs were not required to affirmatively disprove all possible causes of E-V’s losses outside of breach. Indeed, the Supreme Court of Ohio has noted that such a requirement “would impose a burden of proof analogous to the burden in criminal cases of proof beyond a reasonable doubt.” Id. Instead, plaintiffs needed only to put forth enough evidence to prove, by a preponderance of the evidence, that defendants’ breach caused the loss of former and prospective E-V clients. The district court found that plaintiffs had met their burden, and the evidence was sufficient to support this finding.2