Opinion
11-P-0649
01-18-2012
HARVEY ALBERT v. ALBERT P. ZABIN & others.
NOTICE: Decisions issued by the Appeals Court pursuant to its rule 1:28 are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
In this malpractice and negligence action, the plaintiff, Harvey Albert, appeals from the allowance of summary judgment in favor of his former attorneys and an economic expert (Brandwein) hired to testify in the underlying litigation. The underlying case was dismissed due to a failure of proof as to damages. Albert v. Warner Lambert Co., 234 F. Supp. 2d 101, 105 (D. Mass. 2002). In this subsequent action, the lower court similarly determined that Albert could not prove his lost profit damages to a reasonable degree of certainty and also concluded that no fiduciary relationship existed between Albert and Brandwein to sustain any claim of negligence. We affirm.
2 This case was previously before this court and was remanded. See Albert v. Zabin, 74 Mass. App. Ct. 1124 (2009).
Albert argues that the court erred in its determination that he was unable to prove lost profit damages, which would have been the amount of his recovery in the underlying litigation.
Lost profits are recoverable when they are proven to a reasonable certainty; there is no recovery when such profits are 'uncertain, contingent, or speculative.' Steele v. Kelley, 46 Mass. App. Ct. 712, 741 n.28 (1999), quoting from John Hetherington & Sons, Ltd. v. William Firth Co., 210 Mass. 8, 21-22 (1911). 'The evidentiary burden on the fact of damages requires a more stringent degree of certainty.' O'Brien v. Pearson, 449 Mass. 377, 388 n.9 (2007), citing Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 562-566 (1931). A plaintiff must show that the loss is attributable to the defendant's misconduct, BFF, Inc. v. Germanium Power Devices Corp., 13 Mass. App. Ct. 166, 176-177 (1982), and any such determination must be supported by the underlying evidence, Lowrie v. Castle, 225 Mass. 37, 51-52 (1916).
Here, the lower court, properly in our view, determined that Albert's claim depended on evidence that was too speculative for three reasons: (1) the proposed fifteen percent profit margin had no basis in the evidence; (2) no evidence was offered of a proposed business structure; and (3) the offered evidence of lost profits was internally inconsistent.
Albert failed to show lost profits with the reasonable certainty necessary to justify damages. While 'mathematical accuracy of proof is not required' to determine damages, Rombola v. Cosindas, 351 Mass. 382, 385 (1966), a plaintiff must provide, at a minimum, some workable framework for a court to make a determination.
It is recognized that 'concept surveys' are a common industry practice. See Albert v. Warner Lambert Co., 234 F. Supp. 2d at 105. However, insufficient evidence supported the concept survey with a fifteen percent profit margin in this case. Albert also provided no information as to any overhead or other infrastructure of his prospective business. He never formed a corporation; it was impossible to discern what percentage of profits, if any, Albert would have been entitled to if a business scheme had moved forward. Finally, the evidence Albert did offer of lost profits was internally inconsistent. The judge observed that '[t]he estimates concerning the cost of production per unit for the product varied between $0.06 and $0.21. Predictions of Albert's short-term profit were similarly inconsistent . . . .' Even using, as we must, the summary judgment standard, lost profits could not reliably be demonstrated. ,
3 We note that Albert's attorneys had warned him of the weaknesses on this aspect of the case. Zabin wrote Albert and stated, in part, 'Harvey, I hope that it is clear to you that in my opinion our case on damages is mostly smoke and mirrors. I do not think it is likely the jury will be so angry at the way the Warner Lambert people treated you that they could in good conscience completely ignore the glaring substantive weaknesses in the case for damages. I urge you to let me try to settle this case for around $250,000.' Albert later rejected a settlement offer of $150,000.
4 Given our decision, it follows that the case against Brandwein also fails.
Judgment affirmed.
By the Court (Kantrowitz, Rubin & Agnes, JJ.),