Unpublished Disposition, 921 F.2d 279 (9th Cir. 1990)

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US Court of Appeals for the Ninth Circuit - 921 F.2d 279 (9th Cir. 1990)

FONTANA PIPE AND FABRICATION, INC., a wholly-ownedsubsidiary of Northwest Pipe & Casing Co., anOregon corporation, Plaintiff-Appellant,v.AMERON, INC., a California corporation, Defendant-Appellee.

No. 89-35864.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Sept. 10, 1990.Decided Dec. 18, 1990.

Before CANBY and TROTT, Circuit Judges, and LEGGE, District Judge.* 


Fontana Pipe and Fabrication, Inc. ("FPF") appeals the Magistrate's directed verdict in favor of Ameron, Inc. ("Ameron"). The Magistrate found FPF had failed sufficiently to demonstrate its damages under federal antitrust law and state tort law. FPF contends the Magistrate applied the wrong standard of proof in both instances. We hold the Magistrate applied the correct standard for measuring tort damages, but the incorrect standard for measuring antitrust damages.


Antitrust Damages

The Magistrate assumed FPF had suffered an antitrust injury. We have not been asked to disturb this finding. The Magistrate based his directed verdict on FPF's supposed failure to specify its antitrust damages. He stated:

In this case Fontana has alleged that Ameron violated antitrust laws and wrongfully interfered with Fontana's business relationships and a contract. A common element in each of those claims is that Fontana seeks relief through an award of damages. For the jury to be able to award damages, the damages must be calculated with reasonable certainty. Although the calculation need not be made with absolute exactness, a jury may not engage in guesswork or speculation. Fontana produced a lot of talk regarding damages. Nevertheless, there remains an absence of evidence sufficient for a jury to calculate damages with reasonable certainty.

(emphasis added). After listing his reasons for this conclusion, he again stated: "I find that it would be impossible for a jury to use this evidence to calculate a damage award with reasonable certainty. " (emphasis added).

Three Ninth Circuit cases have explicitly rejected the standard of "reasonable certainty" and embraced the more lenient standard of "just and reasonable estimate." Flintkote Co. v. Lysfjord, 246 F.2d 368, 391 (9th Cir.), cert. denied, 355 U.S. 835 (1957); Knutson v. Daily Review, Inc., 548 F.2d 795, 811-12 (9th Cir. 1976), cert. denied, 433 U.S. 910 (1977); Moore v. Jas. H. Mathews & Co., 682 F.2d 830, 836 (9th Cir. 1982). Several decisions of the United States Supreme Court support this result. Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 563 (1931); Bigelow v. RKO Radio Pictures, 327 U.S. 251, 264 (1946); Zenith Radio Corp. v. Hazeltine Research, 395 U.S. 100, 124 (1969).

Ameron cites stray statements from other circuits in an attempt to show that "reasonable certainty" is the appropriate standard. As we pointed out to counsel at oral argument, however, none of the cases cited correctly states the law of the circuit in which it was decided.1 

Ameron maintains there is no material difference between the two tests. We disagree. The "reasonable certainty" standard has long been applied to measure whether there is sufficient evidence of antitrust injury. Injury and damages are distinct elements of an antitrust claim. J. Truett Payne Co. v. Chrysler Motors Corp., 451 U.S. 557, 567 n. 5 (1981). Once injury has been demonstrated, it would be unfair to hold a plaintiff to the same burden of proof to show the extent of damages; a defendant who has caused injury should not elude judgment merely because damages are difficult to calculate. Story Parchment, 282 U.S. at 563; Bigelow, 327 U.S. at 264-65.

Accordingly, courts consistently have applied different standards to measure injury and damages. In Re Coordinated Pretrial Proceedings, 691 F.2d 1335, 1341 n. 7 (9th Cir. 1982), cert. denied, 464 U.S. 1068 (1984); Rosebrough Monument Co., 666 F.2d at 1146; Int'l Travel Etc., 623 F.2d at 1270-73; Nat'l Farmers Org., 850 F.2d at 1292-94; Fed. Prescription Serv., 663 F.2d at 268. Semantically, the two tests are distinguishable: "Certainty" demands more than "estimate." We therefore decline to collapse the distinction.

Ameron correctly notes the Magistrate used language familiar to the "reasonable estimate" test. For instance, he observed that "a jury may not engage in 'guesswork or speculation.' " There is thus some chance that he applied the correct test and merely mislabeled it. On balance, however, we believe the Magistrate's mistake in thrice repeating the unduly strict standard of "reasonably certainty" is too worrisome an indicator that he had the wrong idea in mind. We must give FPF the benefit of the doubt under these circumstances.


Tort Damages

The Magistrate was correct to apply the "reasonable certainty" standard to FPF's tort damages claim. There is no doubt that California applies this standard to measure lost anticipated profits. Christiansen v. Roddy, 186 Cal. App. 3d 780, 790 (1986); Rickards v. Canine Eye Registration Fdtn., Inc., 704 F.2d 1449, 1457 (9th Cir.), cert. denied, 464 U.S. 994 (1983).

FPF relies on Guntert v. City of Stockton, 55 Cal. App. 3d 131, 143 (1976) but mischaracterizes the holding in that case. Guntert stated that lost anticipated profits "need not be established with certainty. " Id. (emphasis supplied). Almost in the same breath, however, the opinion then held that "reasonable certainty" is the correct standard. Id. (emphasis supplied). We therefore affirm the Magistrate's decision on this point.



On remand, the magistrate shall reconsider his decision to grant a directed verdict in favor of Ameron, and he shall do so under the standard articulated in this decision. The parties shall be given an opportunity to reargue this aspect of the case. If on reconsideration he should determine it was error to direct a verdict in favor of Ameron, he shall then determine the appropriate consequences of such a decision. His decision shall be expressed in writing, and this panel retains jurisdiction of any further appeals in this case.

The parties shall bear their own costs of this appeal.



Honorable Charles A. Legge, United States District Judge for the Northern District of California, sitting by designation


This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.Rule 36-3


Ameron first cites Coal Resources, Inc. v. Gulf & Western Industries, Inc., 865 F.2d 761, 772 n. 4 (6th Cir. 1989). In the first place, Coal Resources is not even an antitrust case; it involved damages due to fraud. Coal Resources referred to an unpublished opinion which in turn cited Volasco Products Co. v. Lloyd A. Fry Roofing Co., 308 F.2d 383, 392 (6th Cir. 1962), cert. denied, 372 U.S. 907 (1963). Volasco Products is an antitrust damages case, but has been implicitly overruled by subsequent Sixth Circuit decisions, the first of which outright rejected the "reasonable certainty" test in favor of the "reasonable estimate" standard. Elyria-Lorain Broadcasting Co. v. Lorain Journal Co., 358 F.2d 790, 793 (6th Cir. 1966); Bell v. Cherokee Aviation Corp., 660 F.2d 1123, 1133 (6th Cir. 1981); Barnosky Oils, Inc. v. Union Oil Co. of Cal., 665 F.2d 74, 83 (6th Cir. 1981)

Randy's Studebaker Sales, Inc. v. Nissan Motors Corp., 533 F.2d 510, 518 (10th Cir. 1976), is a stray ship on the sea of the Tenth Circuit. Webb v. Utah Tour Brokers Ass'n, 568 F.2d 670, 677-78 (10th Cir. 1977); Aspen Highlands Skiing Corp. v. Aspen Skiing Co., 738 F.2d 1509, 1525-26 (10th Cir. 1984), aff'd, 472 U.S. 585 (1985); Reazin v. Blue Cross & Blue Shield of Kansas, 899 F.2d 951, 972 (10th Cir.), cert. denied, 110 S. Ct. 3241 (1990).

Nat'l Reporting Co. v. Alderson Reporting Co., 567 F. Supp. 1011, 1020 (E.D. Mo. 1983), rev'd, 763 F.2d 1020 (8th Cir. 1985), misstates Eighth Circuit law. Int'l Travel, Etc. v. Western Airlines, 623 F.2d 1255, 1270-73 (8th Cir.), cert. denied, 449 U.S. 1063 (1980); Rosebrough Monument Co. v. Memorial Park Cemetery Ass'n, 666 F.2d 1130, 1146 (8th Cir. 1981), cert. denied, 457 U.S. 1111 (1982); Nat'l Farmers Org. v. Ass'n of Milk Producers, 850 F.2d 1286, 1292-94 (8th Cir. 1988), cert. denied, 109 S. Ct. 1535 (1989).

Grip-Pak, Inc. v. Ill. Tool Works, Inc., 651 F. Supp. 1482, 1501 (N.D. Ill. 1986) misstates Seventh Circuit law. Ohio-Sealy Mattress Mfg. Co. v. Kaplan, 745 F.2d 441, 448 (7th Cir. 1984), cert. denied, 471 U.S. 1125 (1985); Olympia Equip. Leasing v. Western Union Telegraph, 797 F.2d 370, 383 (7th Cir. 1986), cert. denied, 480 U.S. 934 (1987).

Finally, Fed. Prescription Serv. v. Am. Pharmaceutical Ass'n, 484 F. Supp. 1195 (D.D.C. 1980), stated both the correct standard, id. at 1210, and the incorrect standard, id. at 1211. When the case reached the D.C. Circuit, however, the court of appeals was careful to distinguish between the two standards. Fed. Prescription Serv. v. Am. Pharmaceutical Ass'n, 663 F.2d 253, 268 (D.C. Cir. 1981), cert. denied, 455 U.S. 928 (1982). See also, Smith v. Pro Football, Inc., 593 F.2d 1173, 1189 (D.C. Cir. 1978).