Lightning Litho v. Danka Industries

Lightning Litho (Litho) (plaintiff) was a small printing company owned by Thomas Haab. Danka Industries (Danka) (defendant) was a supplier and servicer of office equipment manufactured by others. Danka had repeatedly tried to lease a high-volume Kodak copier to Litho that could produce up to one million copies a month, but Litho declined because it already had a copier that met its needs of producing a maximum of 20,000 copies a month. At one point, one of Danka’s salesmen promised Haab that if Litho leased the Kodak copier for 60 months at $755 per month, Danka would give Haab a business account that generated six million copies and $50,000 in profit a year. Haab was initially skeptical, but a Danka manager gave oral assurances that the “account goes with the machine.” Litho signed a lease contract and proceeded to make lease payments for two years. Danka was never able to secure an account for Litho. Litho sued Danka alleging fraud in the inducement, among other claims, and seeking rescission. Following initial motion practice, Litho filed an amended complaint that abandoned its request for rescission and sought a jury trial and contract damages instead. Litho presented its case in chief, including testimony from Haab regarding the facts surrounding Danka’s fraudulent inducement and Haab’s wish to undo the lease and recoup lease payments. Litho produced evidence of its lease payments. Danka moved for judgment on the evidence, arguing that Litho had failed to present evidence of damages and instead had only submitted evidence to support rescission. The trial court granted the motion, and Litho appealed.