Washington v. Kellwood Company
United States Appellate Court for the Second Circuit
714 Fed. Appx. 35 (2017)
Daryl Washington and Sunday Players, Inc. (SP) (plaintiffs) sued Kellwood Company (defendant) for failing to market and promote SP’s athletic compression-wear products in accordance with an exclusive licensing agreement. A small start-up company, SP lacked notable sales. To establish lost profits, SP hired an expert who testified that if Kellwood had reasonably marketed SP’s products, SP would have earned revenues comparable to half of those of market leader Under Armour. At the time, Under Armour sold $49.5 million to $195 million annually and controlled 80 percent of the compression-wear market. Although SP sold less than $200,000 total over the course of its existence, the expert testified that SP’s revenues were reasonably certain to expand to some $80 million in two years and that it lost $3.783 million because of Kellwood’s breach. The expert also claimed the business was worth $532,000 when Kellwood breached the contract, again based on a comparison using Under Armour’s revenues. Washington also testified that Kellwood had offered to buy SP but did not proffer any evidence of the price that Kellwood was willing to pay for it. The jury ultimately awarded SP $4.35 million, but the trial court entered judgment of $1 as a matter of law because SP did not prove its damages with reasonable certainty. Washington and SP appealed.
Rule of Law
Holding and Reasoning ()
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