Loss of Future Profits Recoverable for Breach of Contract
The Eleventh Circuit Court of Appeals recently allowed a claim for loss of future profits due to a breach of contract for the sale of goods. The Court remanded and instructed the district court to "determine, to a reasonable certainty," the profits that the plaintiff would have made from the re-sale of the goods. The Court suggested this could be accomplished by looking to the average profits made by other companies in the same industry selling the same goods (in this case, Microsoft software licenses). Then, the defendant could reduce the plaintiff's total award by proving that the plaintiff could have reasonably taken steps to cover its losses. The Court, then, treated the failure to cover or mitigate as an affirmative defense.
Interesting opinion. It is clear opinions like this that many economists and financial experts use to help support their calculations. Thanks for pointing this one out. Lost profits is a particularly tough area with a significant amount of grey area.
The economists
www.lostcompensation.com