Cargotec Corp., MacGregor USA, Lnc. and Cargotec USA, Inc. v. Logan Industries

Reversed and Rendered and Majority and Concurring Opinions filed
December 20, 2018.
In The
Fourteenth Court of Appeals
NO. 14-17-00213-CV
CARGOTEC CORP., MACGREGOR USA, LNC. AND CARGOTEC USA,
INC., Appellants
V.
LOGAN INDUSTRIES, Appellee
On Appeal from the 506th Judicial District Court
Waller County, Texas
Trial Court Cause No. 12-12-21726
CONCURRING OPINION
I write separately to address damages. I agree with the majority that Logan
failed to present evidence that its damages were caused by Cargotec. I do not agree
that Logan’s expert, Robert Hancock, failed to present evidence to support his
opinions as to Logan’s lost profits.
The majority states that “[b]ecause Hancock’s calculations are predicated on
speculative and unsupported gross profit goals contained in Logan’s business plan,”
Hancock’s testimony is unreliable and no evidence of damages. I disagree with
Cargotec’s characterization that Hancock’s opinions “rested entirely” on Logan’s
gross profit goals. I similarly disagree with the weight given by the majority to the
gross profit goals.
Hancock testified that the scope of his review included, in addition to the
business plan, Logan’s tax returns, hundreds, if not thousands, of pages of financial
statements, the employee roster, and historical records. Hancock also interviewed
Logan’s management team and conducted outside economic and industry research.
As to the business valuation, Hancock testified that he did not look at projections
exclusively. He also looked at current financial conditions. He also testified that
there is nothing wrong with using management projections of future profits if they
can be substantiated: “You just don’t blindly take [management projections] and say,
(snaps fingers), ‘Here you are.’ That’s just math. There’s a thought process that goes
behind that, the math.” See VingCard A.S. v. Merrimac Hosp. Sys., Inc., 59 S.W.3d
847, 863-64 (Tex. App.—Fort Worth 2001, pet. denied) (holding expert’s
projections were not speculative because they were based on objective facts, figures,
and data in light of expert’s many years of experience and plaintiff’s customer base
and marketing capabilities). In response to the question “Did you, in this case, just
blindly take management projections in reaching your opinions concerning lost
profits and lost business value?” he answered, “No.”
Based on Hancock’s testimony presented at trial, I cannot join the majority in
concluding that Hancock’s lost profit damages valuation is predicated entirely on
bare assumptions of projected profits in Logan’s business plan. I would conclude
that Hancock’s testimony provides some evidence that would support a jury finding
of lost profits. See ERI Consulting Eng’rs, Inc. v. Swinnea, 318 S.W.3d 867, 877
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(Tex. 2010) (“[U]ncertainty as to the fact of legal damages is fatal to recovery, but
uncertainty as to the amount will not defeat recovery.”) (quoting Sw. Battery Corp.
v. Owen, 131 Tex. 423, 428, 115 S.W.2d 1097, 1099 (1938)). For this reason, I
concur.
/s/ Martha Hill Jamison
Justice
Panel consists of Justices Jamison, Wise, and Jewell (Wise, J., majority).
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