Opinion ID: 488109
Heading Depth: 3
Heading Rank: 1

Heading: Damage Base.

Text: 41 Although the district court felt that substantial evidence supported the jury's award of damages, in that the jury could properly base its calculation on Chicago Metallic's $1.6 million purchase order, we have already discussed the fact that the order was irrelevant to Universal's damages under its requirements contract. See Part B, supra. Only the amount actually required by Godfather's during the period in question--the $911,000 worth of goods supplied by Chicago Metallic, and the $400,000 worth of goods supplied by Universal post-breach--is relevant to Universal's damages. Because Universal already received its profits on the $400,000 worth of goods, however, it is not entitled to double recovery on this amount. 42 Nevertheless, Universal contends that the jury's damage award can be sustained on another basis. It maintains that if the $911,000 figure is applicable, so also should be the additional $411,000 Godfather's paid Chicago Metallic in settlement of the guaranty agreement between those parties, i.e., had Godfather's not breached the contract, it may have ordered $1.6 million worth of goods from Universal, and would have paid Universal a similar amount for not fulfilling the purchase order. Universal notes that the total damage base would be $1.3 million, which, when multiplied by the 31.4% profit margin, still supports the jury's verdict of $400,000. 43 Godfather's payment to Chicago Metallic, however, is irrelevant to Universal's damages. That payment was not made under a requirements contract, but under a firm contract, i.e., a purchase order for a specific amount of goods. In contrast, Universal had a requirements contract, under which if not breached, Godfather's would have ordered only the amount of goods it needed. Obviously, any guaranty payment based on Chicago Metallic's firm order is therefore irrelevant to Universal's damages under its requirements contract. 44 In summary, we conclude that the proper damage base for Universal's lost profits consists solely of the amount of goods Godfather's would have required from Universal had it not breached the contract, which is represented by the amount of $911,927.35, the goods actually paid for and supplied by Chicago Metallic. 45