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Sisters of Providence in Washington v. A.A. Pain Clinic12/19/2003
s & Sanderson, P.C. v. National Union Fire Insurance Co. represents the opposite view. Citing the difference in corporate structure which distinguishes a professional corporation from the more traditional corporation, the Fourth Circuit concluded that eliminating salary compensation from the lost profits calculation for professional corporations would make it virtually impossible to ever prove damages. This would result in an unrealistic picture of corporate profits and an injustice to the professional shareholder. The court elaborated that one distinguishing mark of a professional corporation is that its shareholders actually earn their compensation through services rendered rather than through ownership. As a result the corporation ends up calculating its net income with different goals in mind.
In our opinion, the Bettius line of thinking better reflects actual losses of a professional corporation. It prevents a situation where a wrongdoer can avoid liability simply because of a technicality in the corporate structure. We conclude therefore that the superior court did not err in adopting the Bettius approach.
We next turn to the sufficiency of the evidence. " ost profits must be proven with reasonable certainty." For all three of their lost profits theories, Chandler and Borrello rely almost exclusively on their own testimony coupled with the conclusions of Tuck, which Providence and the Group assert are nothing more than a series of "assumptions" relayed to him by the doctors' own self-serving testimony.
Appellants question several of Tuck's assumptions. First, with regard to Borrello's practice, Tuck assumed that the addition of a second doctor to a clinic should have doubled gross receipts within six months. Appellants argue that more evidence was necessary since both doctors "always work to do" and were both attempting to shift their practices in other directions.
With regard to referrals, Tuck assumed that, because Chandler told him he observed a twenty percent decrease in clinic income or billings during the exclusive, A.A. Pain's figures during the exclusive would have been twenty percent higher, absent the restraint. But Chandler testified in court that he had no idea how many referrals his clinic received before or during the time the exclusive contract was in effect.
With regard to the Medicare and Medicaid patients, Tuck admitted that he had not conducted any independent research on the matter, relying instead solely on Chandler and Borrello's estimates.
The applicable standard is that " he evidence must afford sufficient data from which the court or jury may properly estimate the amount of damages, which data shall be established by facts rather than by mere conclusions of witnesses." Were only Tuck's testimony available, the evidence might be insufficient to meet this standard.
But other evidence exists. Appellants' own witnesses and documents provided support: in particular, preliminary estimates made by the hospital as to how much revenue its proposed pain service would generate, and the testimony of two doctors who were able to build their successful pain service practices in a relatively short time. Such data also demonstrated the Group's own caseload around the time of the exclusive. A juror could have compared this to Borrello and Chandler's own caseload. In addition, Chandler's estimated percentage of Medicare and Medicaid patients were substantially higher than the Group's; this is significant when coupled with evidence of the Group's patient-screening practices and its "dumping" of unprofitable patients. Given this corroborative evidence, a juror's finding consistent with Tuck's testimony would be
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