Opinion ID: 409686
Heading Depth: 2
Heading Rank: 2

Heading: The Sufficiency of the Damage Evidence

Text: 112 Defendants urge that the jury awards of $2,499,009 on the antitrust and tortious inducement of Yoder's breach of contract counts are not supported by the evidence. They make a similar-but more cursory-argument about the $15,000 awarded on Counts IV and V (Regal's interference with the Independence-Deere relationship and Regal's commercial defamation.) 36 We find the proof adequate to support both awards. 113 We note at the outset that there is a limit to the exactness the defendants can demand. Not only are reasonable projections and estimates generally acceptable, as indicated above, but a defendant whose actions contribute to the difficulties of accurate measurement is in a poor position to demand precision. Instead the fact-finder may act on probability and inference. See Trabert & Hoeffer, Inc. v. Piaget Watch Corp., 633 F.2d 477, 484 (7th Cir. 1980) and Locklin v. Day-Glo Color Corp., 429 F.2d 873, 880 (7th Cir. 1970), certiorari denied, 400 U.S. 1020, 91 S.Ct. 582, 27 L.Ed.2d 632, both cases in which we followed the Supreme Court's lead. 37 As already mentioned, Judge Will was more cautious in instructing the jury, however (Indep. Br. 87). 114 Defendants' attack on the expertise of Independence's chief damages witness is misguided. At the time he testified Albert Madansky was a professor at the University of Chicago Business School, specializing in econometrics, statistics and marketing. His curriculum vitae fills four pages of the record (App. 704-707) and documents his extensive academic and business experience and his familiarity with the use of statistical methods to analyze business problems. Indeed he has appeared as an expert witness in other Sherman Act cases. Defendants' only definite objection to Dr. Madansky is that he is not an economist, but his methodology and its critical assumptions were supported by just the sort of expert defendants desiderate: Dennis Carlton, a professor on the economics faculty at the University of Chicago. 115 Dr. Madansky used a pull-back analysis. First he examined actual demand, price, and cost of manufacture in the steel tubing market in the damages period. Then he worked out Independence's actual growth and market share in the first two years of its operation and compared it to the industry situation in the damage period to establish what Independence's performance would have been had its entry into the market not been delayed. This methodology has been endorsed by the Supreme Court (note 37 supra ) and by us in Trabert & Hoeffer, Inc., and Locklin, supra. The Fifth Circuit in Copper Liquor, Inc. v. Adolph Coors Co., 624 F.2d 575, 580-581 (1980) concurs. Even defendants acknowledge the general acceptance of the theory (Br. 69). 116 The defendants' main argument is that there were drastically different market conditions in the steel tubing market in the base period and the projection period. The only such difference they identify, however, is a shortage of steel in 1974. That was addressed in the evidence: Regal's purchasing agent testified that it was able to obtain 70% of its steel needs in 1974; the vice president of Welded Tube Company said his company got 80% of its requirements; and Bureau of Census information and defendants' own expert estimated that the industry as a whole operated at 85-89% of capacity (Indep. Br. 82). Furthermore, allocations during the shortage were based on prior purchases. Independence showed that it had had an offer for 2,000-3,000 tons per month from the fall of 1973 through the end of 1974-which the loss of the Yoder mill forced it to forego (id.). It also showed that U.S. Steel, which handled Independence's account once it began production, had an abundance of steel in 1973 (id. at 83). There is nothing in this evidence that is inconsistent with Dr. Madansky's assumption that Independence could have obtained 50,000 tons of steel in 1974 (Def. Br. 71). 117 Defendants also argue that Independence's calculations improperly assumed Independence could charge premium prices during 1974. On the contrary the price data used were Independence's actual prices for the last two quarters of 1974 and figures based on government and private sources for earlier quarters, with appropriate seasonal adjustments in both cases. Both the extrapolated and the actual prices were significantly below prevailing industry prices. (Indep. Br. 83). 118 The defendants object to the assumption that Independence could have produced 264 tons of steel tubing in December 1973 and that it could have operated at 70% of capacity within five months of starting production. There was evidence to support both propositions. Yoder's delivery of the mill could not be later than December 1973 without exposing Yoder to a $250,000 penalty. In fact just before Yoder's final cancellation, the mill was two to three months ahead of schedule. (Indep. Br. 80). The tonnage figure was based on Independence's actual experience in the first month (September 1974) it installed and used the Abbey Etna mill. The five-month figure was a conservative estimate: Independence's actual start-up time with the Abbey Etna mill was only three months. Both assumptions are therefore supported by Independence's records and Grohne's testimony. 38 The 70% figure is also borne out by Independence's performance and by the evidence about the capacity of industry in general and Independence's competitors in particular (pp. 330-331 supra ). 119 Defendants' final sally is that the overall evidence in this case was as inadequate as the evidence in Pacific Mailing Equipment Corp. v. Pitney Bowes, Inc., 499 F.Supp. 108 (N.D.Cal.1980). The situations are not at all parallel. There the plaintiff sought to present lost profits evidence based on pro forma profit and loss statements, entirely unannotated and totally failing to reflect their source or the underlying computations (499 F.Supp. at 118), and on wholly hypothetical assumptions that (1) in an unrestrained market 50% of the mailing machines sold would be used machines, (2) plaintiff would have a 25% share of the used-machine market, (3) Pitney Bowes would not try to sell used machines, (4) Pitney Bowes' overall market share would decline from 90% to 50%, and (5) all this change would be accomplished without affecting price. Id. at 119, 120 n.3. Independence's damage case, including the testimony of Grohne, was wholly different. It involved exactly the supporting studies, analyses, comparisons, (and) other factual, objective, observed or verifiable data that the Pacific Mailing court lacked but would have found sufficient, id. at 119. 120 There is one last, but important, point overlooked by defendants. Independence's damage evidence was offered in support of lost profits totalling $8,298,245. The jury awarded less than a third of that amount ($2,499,099). That suggests that the defendants have already had the benefit of whichever of their contentions the jury found convincing. The defendants have not differentiated between the sufficiency of the evidence to support the damages as sought and its sufficiency to support the damages as found. We think the conservatism of the jury's verdict and the quantity and quality of the proof would make any such attempted distinction fruitless. 121 The judgments appealed from are affirmed in their entirety. Costs to appellees.