Authentic Fitness Corp. v. Polymer Research Corp. of America

251 A.D.2d 209, 678 N.Y.S.2d 889, 1998 N.Y. App. Div. LEXIS 7441

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: June 23, 1998
• Status: Published

Opinion

—Order, Supreme Court, New York County (Harold Tompkins, J.), entered December 9, 1997, which, inter alia, denied defendant’s motion for summary judgment, unanimously modified, on the law, the motion granted to the extent of dismissing plaintiffs’ claims for lost profits, and otherwise affirmed, without costs.

The letter agreements in issue, which refer to plaintiffs’ specifications, are ambiguous as to whether defendant’s performance obligation was merely to do research to develop formulations for plaintiffs’ evaluation without a warranty that application of any of the submitted formulations would result in a product that met plaintiffs’ specifications. However, plaintiffs’ claims for lost profits should have been dismissed, there being no evidence that such damages were contemplated by the parties during their negotiations or at the time they executed the agreements, and the alleged loss of profits being speculative and not capable of proof with reasonable certainty (Travellers Intl. v Trans World Airlines, 41 F3d 1570, 1577-1578). Nor should there be a severance. The action involves one defendant, who made nearly identical commitments to closely related plaintiffs, in virtually identical letter agreements involving the same issues of law, and some of the same witnesses will testify at trial. Concur — Sullivan, J. P., Rosenberger, Wallach, Tom and Saxe, JJ.