GoMirror v. Brockstar
Filed 11/6/13 GoMirror v. Brockstar CA4/3
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b). This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.
IN THE COURT OF
APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE
DISTRICT
DIVISION THREE
GOMIRROR, LLC,
Plaintiff and
Respondent,
v.
BROCKSTAR, LTD. et al.,
Defendants and
Appellants.
G047862
(Super. Ct.
No. 30-2011-00457099)
O P I N I O
N
Appeal from a judgment of the Superior
Court of
County, David R. Chaffee, Judge. Affirmed.
Raymond
N. Haynes for Defendants and Appellants.
Marianne
Milligan for Plaintiff and Respondent.
* * *
Brockstar
Ltd., Brockstar Groups of Companies, Brockstar Financial Services, Inc., and
Brian N. Willis (collectively, Brockstar) appeal from a judgment on breach of
contract and fraud causes of action in favor of GoMirror, LLC, for falsely
inducing GoMirror to provide successively greater sums of earnest money and
then reneging on its promise to obtain financing for GoMirror to bring its
novel women’s cosmetics accessory to market.
Brockstar contends GoMirror, a Texas
corporation, lacked capacity to sue because it failed to register as a company
conducting business in California. Brockstar also asserts “[p]laintiff’s claim
for lost profits was too speculative to receive such an award as a
lost profits awarded was not supported by substantial evidence†because
“[t]here is simply no evidentiary support for how the court made [its]
determination.†As we explain, Brockstar’s
challenges are without merit, and we therefore we affirm the judgment.
I
FACTUAL
AND PROCEDURAL BACKGROUND
Consistent
with the standard of review, we set out the facts in the light most favorable
to the judgment. (See, e.g.,
36 Cal.4th 224, 229.) Christian von
Glasow, owner and chief executive of GoMirror and a former marketing specialist
for Proctor & Gamble and other companies developing women’s cosmetic
products or targeting female consumers, conceived in 1998 the idea for a
cosmetic compact mirror with a flexible, portable mount. Believing it was ideal for use “on the go,†including
in automobiles, he patented the product in 2001, but put its further
development on hold through divorce proceedings in 2002 and 2003. He eventually returned to his GoMirror
project in 2008 when he met with consultants in the field of direct response
television (DRTV) about marketing and selling the GoMirror compact through a
television sales campaign. The DRTV
campaign would cost $1.4 million, not including expenses for an initial
run of at least 3500 units of the GoMirror product. Von Glasow obtained $150,000 in funding for
the necessary tools and molds to produce the first 5,000 GoMirror units, which
he stored in San Bernardino County,
distributing approximately 500 units in product placements and online sales
overseas.
Through
a mutual friend, von Glasow turned to Willis and his Brockstar companies to
finance the DRTV campaign. Von Glasow
met with Willis in California in
September 2009, demonstrated the product and discussed his business plan, which
gained Willis as an enthusiastic supporter.
Willis expressed his confidence the campaign would be very
profitable. In subsequent discussions,
Willis agreed Brockstar would fund a $1.4 million loan for the DRTV
campaign, contingent on GoMirror paying Brockstar $20,000 in “bank fees†and
other costs.
Von
Glasow turned to a friend in England, John Milman, for the $20,000, which
Willis accepted, cautioning that the financing would be arranged in a
“piggyback[]†fashion on other Brockstar transactions, implying there might be
some delay. Milman traveled to California
to deposit the $20,000 and meet with Willis, who confirmed “he thought the
business plan was good.†Six weeks
later, Willis demanded an additional $40,000 to obtain the financing, which
Milman again provided, and periodically thereafter Willis required additional
funds of $25,000 and $65,000, bringing the total Milman gave Willis on
GoMirror’s behalf to $150,000. In each
“Commitment Letter†memorializing each of Milman’s deposits for GoMirror,
Brockstar acknowledged: “All deposits
are corporately guaranteed and to be considered fully refundable in case of
nonperformance by the lender, for any reason, in delivery of the loan.†Each commitment letter also contained a
confidentiality provision preventing GoMirror from seeking alternate funding, effectively
giving Brockstar exclusive funding rights under the loan contract.
After
the delays stretched into June 2010 with no funding near at hand,
von Glasow asked Willis to return the $150,000. Willis responded that because Milman had
deposited the funds, he would only refund them to Milman, but he similarly
rebuffed Milman in an e-mail, writing:
“Dear John, my apologies for not responding to your last
communication. Although I greatly appreciate
your concerns, your deal is by and between GoMirror and [von Glasow], not
between Brockstar or myself.†To
eliminate any possible confusion, Milman executed an assignment of the $150,000
to GoMirror, which he provided to Willis to no avail, who refused to return the
funds.
In
March 2011, GoMirror filed this lawsuit and, after a three-day court trial
that included ample evidence of GoMirror’s lost profits based on Brockstar’s
failure to fund GoMirror’s planned launch, the trial court ruled in favor of
GoMirror on its fraud and breach of contract causes of action. The court summarized Brockstar’s conduct in keeping
GoMirror’s $150,000 and failing to provide the promised funding as “a classic
case of a con game.†The trial court
awarded GoMirror over $800,000 in damages, which included the $150,000 deposit
plus almost $40,000 in interest on that sum, $600,000 in lost profits, and
around $50,000 in other damages.
Brockstar now appeals.
II
DISCUSSION
A. Capacity to Sue
Brockstar
contends the trial court erred by rejecting its request to dismiss GoMirror’s
lawsuit because GoMirror failed to register with the Secretary of State to
conduct business in California. (Corp. Code, § 2203, subd. (c) [foreign
corporation that “transacts intrastate business without†the requisite
registration “shall not maintain any action or proceeding upon any intrastate
business so transactedâ€]; see, e.g., The
Capital Gold Group, Inc. v. Nortier (2009) 176 Cal.App.4th 1119,
1132.) The litigation bar arises when
the foreign corporation engages in “repeated and successive transactions of its
business in this state†without registering, but the bar does not apply to
“interstate or foreign commerce†consummated outside California. (Corp. Code, § 191, subd. (a);
(1960) 180 Cal.App.2d 89.)
The
Legislature has identified some activities that do not amount to transacting
intrastate business and therefore do not trigger the litigation ban, including
for example: (1) the mere act of
filing suit or defending any action or proceeding; (2) internal affairs
including board or shareholder meetings; (3) maintaining bank accounts;
(4) maintaining offices for securities transactions; (5) conducting
sales through independent contractors; (6) soliciting or procuring orders; (7) creating
evidence of debt or mortgages, liens or security interests on real or personal
property; and (8) conducting isolated transactions. (Corp. Code, § 191, subd. (c).)
A
defendant seeking dismissal bears the burden to establish the plaintiff’s lack
of capacity to sue based on a failure to register, corporate suspension, or
other defects. (Color-Vue, Inc. v. Abrams (1996) 44 Cal.App.4th 1599, 1604 (
deferential substantial evidence standard.
(See, e.g., Hurst v. Buczek
Enterprises, LLC (N.D. Cal. 2012) 870 F.Supp.2d 810, 819 (
intrastate business is “committed to the ‘peculiar facts’ of each caseâ€].)
Defendant’s
challenge fails for several reasons.
First, unlike lack of standing, a plaintiff’s incapacity to sue is not an
incurably fatal defect that may be raised at any time. (Color-Vue,
supra, 44 Cal.App.4th at
pp. 1603-1604; see United Medical
Management Ltd. v. Gatto (1996) 49 Cal.App.4th 1732, 1740 [defendant
successfully asserting incapacity only gains stay “to permit the foreign
corporation to comply†and, if it does not, dismissal is “without
prejudiceâ€].) As an affirmative defense,
incapacity requires a plea in abatement that “‘must be raised at the earliest
opportunity or it is waived. . . . The proper time to raise a plea in abatement
is in the original answer or by demurrer at the time of the answer.†(Color-Vue,
at p. 1604, original ellipsis.)
Once forfeited, the defense does not revive except, for example,
“[w]here . . . the [corporate] suspension occurred after the time to
demur or answer had passed†(id. at
p. 1604, fn. 5), or in “unusual circumstance[s]†such as a suspended
corporation “announc[ing] that it does not intend to pay its delinquent taxes
. . . .†(
Here,
Brockstar did not challenge GoMirror’s capacity to sue until far too late, long
after it filed its answer without any abatement plea. Brockstar pointed to no unusual circumstances
warranting forfeiture relief: Willis of
course knew of his California interactions with GoMirror, a Texas corporation,
but failed to file a demurrer or answer pleading abatement for lack of
registration or any other reason. Brockstar
did not raise the capacity issue until the first day of trial, well after ample
opportunity in discovery to investigate whether GoMirror engaged in intrastate
commerce. Forfeiture therefore precludes
Brockstar’s belated capacity challenge.
Second,
Brockstar also forfeits the issue on appeal by failing to provide or explain
any factual basis for his incapacity claim.
Brockstar simply asserts GoMirror “was definitely transacting business in California†(italics added), but
does not say how. Brockstar complains
that the trial court required it “to provide evidence that GoMirror was doing
business in California†to meet Brockstar’s burden as the party seeking
dismissal, “and then, when such evidence
was provided, simply ignored it, and allowed the case to go forward.†(Italics added.) But Brockstar makes no
effort to identify the evidence it claimed would satisfy its burden. Brockstar cites, without summary or
explanation, a range of pages in the record, but it is not our responsibility
to develop from a bare record reference a reasoned argument for reversal. To the contrary, we presume the judgment was
correct (Denham v. Superior Court (1970) 2 Cal.3d 557, 566 (
appellant’s burden to demonstrate error (Boyle
v. CertainTeed Corp. (2006) 137 Cal.App.4th 645, 649-650 (
specific headings marshalling specific facts (Cal. Rules of Court, rule
8.204(a)(1)(B) & (C)).
In
any event, even disregarding Brockstar’s forfeiture in the trial court and on
appeal, its challenge also fails on the merits.
The closest Brockstar comes on appeal to identifying GoMirror’s alleged
pattern of intrastate business activity necessitating registration is to
observe that “this whole transaction . . . occurred in
California.†But a single instance of
transacting business is not enough.
(Corp. Code, §§ 191, subd. (a), 192, subd. (b)(8); see, e.g.,
(1918) 38 Cal.App. 535 [acting as trustee in one instance is not “carrying
on business†in the state].) Moreover,
one continuing attempt to secure funding from Brockstar did not demonstrate
GoMirror’s everyday “ordinary business†consisted of transacting loans,
requiring registration to engage in that activity. (W.W.
Kimball Co. v. Read (1919) 43 Cal.App. 342, 345 [taking assignment of
a single piano sales contract did not require Illinois piano company to
register as intrastate financier]; see also West
Publishing Co. v. Superior Court (1942) 20 Cal.2d 720, 731 [isolated
business transaction and mere solicitation of business, including advertising
and demonstrating products, does not amount to “doing businessâ€].) Accordingly, GoMirror’s lone agreement with
Brockstar, which Brockstar failed to fulfill, did not require GoMirror to
register in California or face dismissal of its lawsuit, thereby inoculating
Brockstar for its breach of contract. For
all the foregoing reasons, the trial court did not err in rejecting Brockstar’s
request for dismissal.
B. Lost
Profits
Brockstar
challenges the lost profit damages the trial court assessed after concluding Brockstar
reneged on its promise to finance GoMirror’s product launch. Brockstar identifies in the subheadings of
its opening brief two specific challenges.
First, Brockstar claims that lost profits for a new business are too
speculative as a matter of law and therefore could not be awarded for
GoMirror’s fledgling business. As
Brockstar phrases it: “Plaintiff’s claim
for lost profits was too speculative to receive such an award as a matter of
law.†Second, Brockstar contends no
evidence supported the manner in which
the trial court calculated $600,000 as the appropriate sum compensating
GoMirror for lost profits. Specifically,
Brockstar asserts “[t]he amount of lost profits awarded was not supported by substantial
evidence†because “[t]here is simply no evidentiary support for how the court
made [its] determination.†These
challenges fail.
First,
to the extent Brockstar suggests new businesses may never be awarded lost
profits, Brockstar is wrong on the law.
Brockstar asserts that because “GoMirror did not prove that it ever
tried to begin selling the product
for which it sought financing from Brockstar†(italics added), California law
therefore precluded GoMirror as a “new business†from recovering lost profits.
misconstrues the authority on which it relies.
Specifically,
Brockstar miscites a passage in Resort
Video for the sweeping proposition that “‘if a business is new, it is
improper to award damages for loss of profits because the absence of income and
expense experience renders anticipated profits too speculative to meet the
legal standard of reasonable certainty necessary to support an award of such
damage. [Citations.]’†(Resort
Video, supra, 35 Cal.App.4th
at p. 1698.) Brockstar neglects to mention, however, that in the same
paragraph Resort Video acknowledges exceptions
exist in which “[u]nestablished businesses†may recover lost profits. (Ibid.) Indeed, contrary to Brockstar’s argument that
“for years, case law has held that damages for ‘lost profit’ are too
speculative†for new businesses to recover, the law has recognized for decades
that a new business robbed of success may recover lost profit damages and that
the prospects of success are a fact question.
(S. Jon Kreedman & Co. v.
Meyers Bros. Parking-Western Corp. (1976) 58 Cal.App.3d 173, 185 (
award for unfinished commercial garage, noting appellants’ “dissatisfactionâ€
with the expert’s projected profit calculations “were obviously fact questions
resolved against [them] by the trial courtâ€].)
Brockstar’s de novo challenge based on its misapprehension and
misquotation of law therefore fails.
Similarly,
Brockstar’s jaundiced view of the evidence affords no basis to overturn the
lost profits award. Brockstar cites and
discusses only facts supporting its position, without citing or disputing any
of the facts supporting the trial court’s award. But “as with any challenge to the sufficiency
of the evidence, it is the appellant’s burden to set forth not just the facts
in its favor, but all material evidence on the point. ‘“Unless this is done the [claimed] error is
deemed to be waived.â€â€™ [Citation.]†(Stewart
v. Union Carbide Corp. (2010) 190 Cal.App.4th 23, 34.)
Even
overlooking Brockstar’s waiver, substantial evidence supports the trial court’s
decision to award lost profits. The
reviewing court must “view the evidence in the light most favorable to†the
prevailing party. (Kids' Universe v. In2Labs (2002) 95 Cal.App.4th 870, 886.) Brockstar asserts the GoMirror product
“offered little or no added ‘benefit’ to the consumer that other cosmetic
mirrors, much cheaper in price, already offered,†but substantial evidence
demonstrated GoMirror’s market viability.
Von Glasow earned a patent for his unique design, and independent market
research showed consumer demand as high as 87 percent in the target demographic. “‘[I]f the business is a new one or if it is
a speculative one . . . , damages may be established with
reasonable certainty with the aid of expert testimony, economic and financial
data, market surveys and analyses, business records of similar enterprises, and
the like.’†(Ibid.) With ample experience
evaluating new business opportunities and their pitfalls, GoMirror’s accounting
expert explained in testimony backed by numerous exhibits that the company’s
business plan, contingency plans, product pricing, market analysis,
distribution strategy, and cost estimates were reasonable and supported a “very
conservative†three-year profit total of $4 million.
Brockstar
emphasizes von Glasow “had not sold those few products†he manufactured in an
initial production of 5,000 units, but where a defendant “made it impossibleâ€
to realize sales, “it cannot complain†if the product’s success and
profitability “are of necessity estimated.â€
(Natural Soda Prod. Co. v. City of
L.A. (1943) 23 Cal.2d 193, 200 (Natural
Soda).) Moreover, Brockstar
overlooks that the initial run was made for product placement and as a DRTV
“proof of concept†requirement to demonstrate manufacturing capability. Indeed, the units were not created for
piecemeal sale, but rather for mass distribution in the DRTV campaign Brockstar
foiled with its funding breach.
Brockstar
also suggests von Glasow “had never manufactured any products, [nor] marketed
cosmetics or cosmetic accessories,†but the evidence showed otherwise. Von Glasow’s self-financed initial production
run demonstrated he could manufacture the GoMirror product, and he also had experience
overseeing manufacturing of promotional products in his marketing work for major
companies selling cosmetics and “a lot of female products,†including Proctor
& Gamble and Johnson & Johnson. As he explained in his testimony, after
earning his master’s degree and Ph.D. in business administration, his responsibilities for these companies
included “creating products, testing products in terms of their viability or
nonviability, also manufacture of products, also sales of products via direct
marketing, direct selling [and] retail selling.†Additionally, GoMirror’s expert testified he
conducted high-level executive interviews in the cosmetics industry to confirm
the price point and market viability of the GoMirror product. In view of the foregoing and the standard of
review, substantial evidence supports the trial court’s decision to include
lost profits in the judgment. (See
p. 185 [“The trial court could have believed [appellant’s] version of
profitability; it chose not to do soâ€].)
Brockstar’s
challenge to the sufficiency of the evidence supporting the
award also fails. Brockstar repeats its
mistake of failing to view the record in the light most favorable to the verdict. More fundamentally, Brockstar ignores the
cardinal rule that litigants must “bring ambiguities and omissions in the
statement of decision’s factual findings to the trial court’s attention — or
suffer the consequences.†(
(2007) 150 Cal.App.4th 42, 59 (Fladeboe).) Specifically, “the reviewing court will infer
the trial court made every implied factual finding necessary to uphold its
decision, even on issues not addressed in the statement of decision.†(Id.
at p. 48.) “The appellate court
then reviews the implied factual findings under the substantial evidence
standard.†(Id. at p. 60.)
Brockstar
complains that in reducing the $4 million in lost profits established by the testimony
of GoMirror’s expert to $600,000, “there is absolutely no evidence in the
record to support the trial court’s calculation.†The trial court explained its lost profits
award rather opaquely in a sentence fragment and two sentences in the statement
of decision, as follows: “Twenty-six (26)
months of delayed income from Plaintiff’s income stream resulting in damages of
$600,000.00. The [c]ourt determined this
amount from the loss of the income stream that GoMirror would [have] derived
from the sale of GoMirror’s units during time [sic] from the date when the loans were promised and not delivered
to 26 months thereafter. Based upon the
$4,000,000.00 estimate of GoMirror’s expert, Mr. Querry, the court rules
that GoMirror was damage[d] by ten percent over the extended period of time, an
amount of $600,000.â€
Brockstar
complains on appeal that “[t]here is simply no evidentiary support for
of lost profit damages in the statement of decision. (Italics added.) But because Brockstar failed to object to or
seek clarification of the statement of decision, any ambiguities or omissions in
the statement of decision provide no basis for reversal. (Fladeboe,
supra, 150 Cal.App.4th at
p. 59.) Simply put, an appellant
may not on appeal complain the trial court failed to detail in its statement of
decision the factual basis for an award when the appellant made no objection
below. (See, e.g., Sammis v. Stafford (1996) 48 Cal.App.4th 1935, 1942 [“[The
appellant] did not raise any objections to the statement of decision. We therefore are required to presume the
trial court made all findings necessary to support the judgmentâ€].)
Implied findings support the trial court’s
lost profits determination. Based on the
overwhelming popularity of the product in market surveys, the trial court
apparently viewed most of the sales GoMirror estimated it lost in a three-year
period as only temporarily lost. In
other words, the women who would have bought the product during the expert’s
initial three-year estimate would do so later given the chance, and therefore
those sales, at $40 each, were only delayed.
Consequently, the trial court decided it would award only a
the interim time-value of the delayed profits.
As the trial court phrased it, GoMirror’s actual loss consisted of a
lost “income stream derived from the
loss of income, i.e., the four million dollars that Mr. Querry suggested
was the lost income†(italics added), and therefore applying a percentage to
that figure was appropriate. The trial
court mentioned 10 percent as a potential rate of return on the lost
income, which mirrors the statutory rate of prejudgment interest dating to the
contract breach (Civ. Code, § 3289, subd. (b)), and Brockstar did not
and does not challenge the statutory rate.
Brockstar
complains it remains unclear how the trial court settled upon $600,000 in lost
profit damages as the “income stream derived from†a loss of
$4 million in income. Brockstar
asserts the ambiguity is fatal because $4 million at a flat 10 percent rate of return yields only $400,000. But as Brockstar acknowledges, the trial
court did not specify the manner in which it calculated the $600,000, including
variables like whether it accrued at a flat or compound rate of interest. Brockstar may not rely on an ambiguity in the
statement of decision to challenge the judgment when Brockstar did not object
or seek clarification of the statement of decision below. As we explained in Fladeboe, if a party fails to bring omissions or ambiguities to the
trial court’s attention, “then ‘that party waives the right to claim on appeal
that the statement was deficient in these regards,’ and the appellate court
will infer the trial court made implied factual findings to support the
judgment.†(Fladeboe, supra,
150 Cal.App.4th at p. 59.)
We
note a plaintiff is “not required to establish the amount of its damages with
absolute precision†(S. C. Anderson, Inc.
v. Bank of America (1994) 24 Cal.App.4th 529, 537-538), and when a
defendant “ma[kes] it impossible for plaintiff to realize any profits, it
cannot complain if the probable profits are of necessity estimated.†(Natural
Soda, supra, 23 Cal.2d at
200.) Put another way: “Where the promisor, by his willful breach of
contract, has given rise to the difficulty of proving the amount of loss of
profits, it is proper to require of the promise only that he show the amount of
damages with ‘reasonable certainty’ and to resolve uncertainties against the
promisor.†(Steelduct Co. v. Henger Seltzer Co. (1945) 26 Cal.2d 634,
651.) Consequently, where substantial
evidence supported the expert’s calculation of $4 million in lost profits, substantial
evidence also supported the $600,000 the trial court awarded. As another court explained long ago, “Since
the evidence with respect to loss of profits would have supported a larger
award than was actually given, defendants cannot, on review, complain of the
award or a supposed lack of evidence to sustain it.†(Tomlinson
v. Wander Seed & Bulb Co. (1960) 177 Cal.App.2d 462, 476.)
Moreover,
Brockstar overlooks that GoMirror’s lost income would have accrued on a rolling
basis and that the trial court’s calculation of an “income stream derived from
the lost income†at a 10 percent rate of return would necessarily have a
compounding effect as the income accrued.
Thus, the implied findings supporting the judgment include the enhanced
effect of compound interest.
Additionally, we note the trial court reasonably could infer that not
because of Brockstar’s breach would do so later, whether because they died,
could no longer afford it, or other circumstances. Accordingly, those sales at full net profit per unit (instead of one-tenth that amount in a
derived income stream) were truly lost forever and justified an award
significantly higher than $400,000 at the flat 10 percent rate, which also
did not include compound interest. Brockstar’s
challenge is without merit.
C.
GoMirror
argues in its respondent’s brief and in a motion and revised motion for
sanctions that Brockstar’s misstatements of the record, misapprehensions of
law, and “‘unsubstantiated potshot[s]’†against respondent in characterizing
the record or in purportedly deducing “facts†from the record call for the
conclusion Brockstar waived its challenges to the judgment and for $78,400 in attorney
fee sanctions.
As
discussed, we agree that some of Brockstar’s appellate challenges are forfeited
for failure to timely raise them or properly present them. Sanctions are tempting, for like other
courts, we tire of the wearisome slog through briefs that misconceive appeal as
a retrial opportunity to better spin favorable facts and discount others as
unsubstantiated. But “[w]ith rhythmic
regularity it is necessary for us to say that where the findings are attacked
for insufficiency of the evidence, our power begins and ends with a
determination as to whether there is . . . substantial evidence to
support them; that we have no power to judge of the effect or value of the
evidence, to weigh the evidence, to consider the credibility of the witnesses,
or to resolve conflicts in the evidence or in the reasonable inferences that
may be drawn therefrom. No one seems to
listen.†(Overton v. Vita-Food Corp. (1949) 94 Cal.App.2d 367, 370.)
Accordingly,
we share GoMirror’s exasperation. But
Brockstar’s missteps on the law and facts do not appear to include intentional
misstatements of the record or the law, nor malicious personal attacks on
respondent. They seem instead to stem
from Brockstar’s poor grasp of appellate advocacy in which it reargued the case
in the light most favorable to its position.
Shading the record in this manner, with correspondingly loose record and
case law citations, contravenes the standard
of review, destroys the appellant’s credibility, and dims or extinguishes
any chance of success on appeal.
Forfeiture is itself a dire, entirely apt consequence. Tainted by its bad facts, Brockstar’s legal
analysis also necessarily goes astray.
But we conclude these faults do not rise to the level of sanctionable
conduct here. It always remains the
appellant’s prerogative to challenge the sufficiency of the evidence on appeal,
and the adversarial process by nature engenders widely divergent views of both
the record and the law applicable to those facts, so the standard for sanctions
must remain very high. Although the
issue is close, that standard is not met here.
Consequently, we deny the monetary sanctions request.
III
DISPOSITION
The
judgment is affirmed. Respondent is
entitled to its costs on appeal.
ARONSON,
ACTING P. J.
WE CONCUR:
FYBEL, J.
IKOLA, J.
name="_ftn1" title=""> [1] At oral argument, Brockstar denied
it claimed a new business could never recover lost profits, but its brief
painted a different picture, asserting GoMirror fell into “the classic example
of a new business seeking damages for its lost profit when, for years, case law
has held that damages for ‘lost profit’ are too speculative for recovery [citations].†Brockstar then quoted an excerpt from a case
(Resort Video, Ltd. v. Laser Video, Inc.
(1995) 35 Cal.App.4th 1679, 1698 (Resort
Video)), purporting to suggest a categorical rule that “‘if a business is
new, it is improper to award damages for loss of profits
. . . .’â€
