Karma International v. Indianapolis Motor Speedway

Indianapolis Motor Speedway (the speedway) (defendant) organized the Indianapolis 500, an annual motorsports race. Karma International (Karma) (plaintiff), an event-planning company that promoted Maxim, a men’s magazine, negotiated with the speedway in 2016 to host a Maxim-branded party during the race weekend. Karma claimed the speedway offered to promote the party through its email database and projected that this would result in at least 1,500 ticket sales, generating around $1 million in revenue. Karma and the speedway entered into a contract stating the speedway would provide marketing support for the party through its social channels and by sending dedicated emails to its database. In May 2016, the speedway sent four emails promoting the party: (1) a dedicated email to 334 sponsors and suite ticketholders on May 9, (2) a dedicated email to 13,824 fans on May 20, (3) a cross-promotional email to 89,979 fans on May 21, and (4) a dedicated email to 149,430 newsletter subscribers on May 25. The May 27 Maxim party was attended by 1,787 total guests. However, most guests received free tickets, and many others paid reduced prices. Karma sold only 92 full-price tickets. Karma spent $635,855.71 on the party and received a total gross revenue of just $215,690.39, incurring a significant loss. Karma sued the speedway, alleging it had breached the contract by not emailing the party information to every person in its database. Karma claimed this failure caused it to lose the expected $1 million in revenue. Karma provided no evidence or expert testimony that sending emails to more people would have resulted in more ticket sales, let alone how many more. Karma pointed to a more successful Super Bowl party it had recently hosted but gave no evidence of how that party was marketed. The trial court found that Karma had provided only bare assertions and speculative claims that the speedway’s alleged breach had caused any damages. Because Karma had not met its burden of proving the necessary damages element of its breach-of-contract claim, the trial court dismissed the claim. Karma appealed.