Friday, December 27, 2013

Walters v. Marathon Oil Co. case brief

Walters v. Marathon Oil Co. case brief summary
642 F.2d 1098 (1981)

CASE SYNOPSIS
Appellant oil company challenged an order of the United States District Court for the Southern District of Indiana, Indianapolis Division, which held that appellee gas station owners were entitled to an award of lost profits as to appellant's refusal to enter a seller agreement.

PROCEDURAL HISTORY
The trial court determined that appellee gas station owners were entitled to an award of lost profits regarding appellant oil company's refusal to enter a seller agreement.

DISCUSSION
  • The court affirmed that judgment on appeal. 
  • The court found that the record showed that the trial court's determination that appellees exercised the ordinary care of a person in the same circumstances to mitigate their damages was not clearly erroneous. 
  • The court also held that the fact the trial court's judgment was based on promissory estoppel did not preclude awarding lost profits to appellees because it was reasonable to assume that they anticipated a return of profits from the investment of time and funds that they made in reliance on appellant's promise to supply them with gasoline and that they relinquished the opportunity to make an alternate investment. 
  • The court also determined that the record showed that appellees would have received the anticipated net profits that they were awarded if appellant fulfilled its promise.
CONCLUSION
The court affirmed an award of lost profits to appellee gas station owners as to appellant oil company's refusal to enter a seller agreement. The court held that the record supported a finding that appellees used the ordinary care of a similarly situated person to mitigate their damages and that basing the judgment on promissory estoppel did not bar recouping lost profits because appellant's promise led to a reasonable profit expectation.

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