Damage Claims

Damage claims must be front and center of sound litigation strategy for plaintiffs or defendants.

Carmen D. Caruso Law Firm has substantial successful experience in developing substantial damage claims, including claims for lost profits in franchising cases, and defending against inflated damages claims brought against franchisees or dealers.

  • In a recent arbitration in Wisconsin on behalf of Illinois franchisees that de-branded because they could not profitably operate, the franchisor presented an expert witness to support its claim for lost future royalties that would continue to accrue for the duration of the franchise term, plus past due royalties, plus damages for trademark infringement due to incomplete de-branding. On the fourth day of the arbitration, after Carmen cross-examined the franchisor’s expert witness and established his non-compliance with Daubert standards as adopted by the Wisconsin Supreme Court, and after Carmen cross-examined the franchisor’s president to establish that the franchisor had no plans to do any more business in Illinois, the case settled on terms that allowed his clients to re-enter the franchise system, but on much better terms than had existed before, and with a substantial reduction of the past due unpaid royalties.
  • In a recent federal court trial, Carmen D. Caruso Law Firm made new law: that “reasonable certainty” for the recovery of lost profits is established by a preponderance of evidence; and successful franchising programs can supply sufficient evidence to support lost profit claims for unbuilt units of the successful brand.
  • In defending a substantial international franchisor from a claim for damages by a terminated uniform supplier, Carmen developed proof that the supplier’s claim for damages for “custom programming” of new inventory management software was grossly inflated as there were existing programs available that would have supplied the same functionality at a fraction of the costs.
  • In defending a substantial international franchisor from a claim for damages by a disappointed supplier of oven technology, Carmen developed proof that the claimed trade secrets in the new oven had no value because they had been publicly disclosed at international trade shows.
  • Carmen D. Caruso Law Firm has successfully reduced or eliminated many claims against franchisees for liquidated damages upon termination, particularly in the hotel industry, on proof that the liquidated damages would be an unenforceable penalty, or that the franchisor’s breaches preclude its recovery.
  • In a successful state court lawsuit, Carmen prevailed at the summary judgment stage in establishing that representations made to dealers on the status of the defendant’s development of its retailing program and its earnings projections were causes of the plaintiffs’ claimed losses (overcoming a “lack of loss causation” argument).
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