Sargon Enterprises, Inc. v. University of Southern California
215 Cal. App. 4th 1495
Cal. Ct. App.2013Background
- Sargon sued USC for breach of contract stemming from a dental implant clinical trial under a 1996 Clinical Trial Agreement, with the trial court initially excluding lost profits evidence at trial.
- Jury awarded Sargon $433,000 in compensatory damages; Sargon appealed, and this court reversed the evidentiary ruling, leading to Supreme Court review and remand.
- Supreme Court reversed this court, affirming the trial court’s exclusion of Skorheim’s market-driver lost profit testimony and remanding for further proceedings consistent with that ruling.
- On remand, Sargon argued the Supreme Court announced a new evidentiary rule and sought a new trial to present lost profits under the new standard; USC sought dismissal of its cross-appeal.
- The appellate court held the Supreme Court’s ruling did not introduce a new rule but was law of the case, precluding retrial on lost profits, and that the stipulated judgment barred further relitigation of reserved issues.
- The court affirmed the trial court’s judgment, dismissed USC’s cross-appeal, and clarified that the stipulated judgment was final and not subject to retrial on new theories of damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is Sargon entitled to a new trial on lost profits? | Sargon claims the Supreme Court announced a new rule warranting retrial. | USC argues no new rule; retroactivity applies; law of the case precludes retrial. | Not entitled to a new trial; law of the case bars retrial on lost profits. |
| Does the law of the case preclude retrial on lost profits on remand? | Sargon relied on a potential change in evidentiary standard on remand. | Supreme Court decision did not create a new rule; remains law of the case. | Yes; law of the case forecloses retrial on lost profits. |
| Does the stipulated judgment preserve or reserve issues for appeal? | Stipulated judgment preserves rights to challenge trial court rulings on appeal. | Stipulation reserves no issues for further trial; final judgment precludes new theories. | Stipulated judgment was final and did not permit retrial on new theories of damages. |
| Does the stipulated judgment bar relitigation under res judicata? | Judgment should not bar review of reserved issues on appeal. | Final judgment mergers and bars relitigation of the same cause of action. | Res judicata applies; stipulated judgment bars relitigation of lost profits theories. |
| Should USC’s cross-appeal be dismissed? | No special objection to dismissal stated by Sargon. | Cross-appeal concerns postoffer fees; merits moot. | USC’s cross-appeal dismissed. |
Key Cases Cited
- Sargon Enterprises, Inc. v. University of Southern California, 55 Cal.4th 747 (Cal. 2012) (upholds exclusion of expert testimony; retroactivity/concepts of rule of law)
- Nally v. Grace Community Church, 47 Cal.3d 278 (Cal. 1988) (law of the case doctrine and finality in appellate decisions)
- In re Borlik, 194 Cal.App.4th 30 (Cal. App. 2011) (retroactivity considerations for appellate rulings)
- People v. Guerra, 37 Cal.3d 385 (Cal. 1984) (explanation of when decisions do or do not announce new rules)
- Resort Video, Ltd. v. Laser Video, Inc., 35 Cal.App.4th 1679 (Cal. App. 1995) (new-trial based on excess/damages; remand on damages only)
- Dell’Oca v. Bank of New York Trust Co., N.A., 159 Cal.App.4th 531 (Cal. App. 2008) (new trial for excessive/uncertain damages; opportunity to present evidence)
- Kelly v. CB&I Construction, Inc., 179 Cal.App.4th 442 (Cal. App. 2009) (one final judgment rule and reserved issues on appeal)