ANCHER L. HAGGERTY, United States District Judge
The plaintiffs in this diversity action have alleged a claim for legal malpractice. Presently before the court is the defendants' motion for summary judgment. For the reasons stated below, the defendants' motion is granted.
BACKGROUND
The plaintiffs are the owners of Northwest Windshields Inc., (NWI), which operates franchises in some rural counties in Oregon and other states in the northwest United States. In 1996, the defendants drafted documents for the plaintiffs which purported to re-define the existing franchises as distributorships. The plaintiffs then attempted to breach the original franchise agreements, and several of the franchisees challenged those actions.
The franchisees hired an attorney, who set forth the franchisees' complaints in a letter dated March 10, 1999. (Plaintiff's exhibit 4).
The defendants in this case referred the plaintiffs to an Oregon law firm. That firm filed a lawsuit on behalf of the plaintiffs in state court in Oregon against the disgruntled franchisees, who are referred to in this litigation as the "renegades." The renegades counterclaimed. The Oregon law firm billed the plaintiffs well over $100,000 in legal fees for a case which ultimately resulted in a settlement that appears to have been favorable for the renegades.
The plaintiffs then sued the Oregon firm for malpractice. That case settled, and the settlement amount included approximately $16,000 which must be credited to any amount recovered by the plaintiffs in this case for their claims for lost profits.
The plaintiffs originally claimed a loss for the future value of the business, but do not argue for that in their opposition to summary judgment. To the extent that the plaintiffs have not relinquished that claim, it is hereby dismissed. The plaintiffs' only evidence of future value is Frank Sorrels' "gut feeling," and their evidence of present value is similarly lacking.
STANDARD OF REVIEW
A party is entitled to summary judgment as a matter of law if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show there is no genuine issue as to any material fact." Fed.R.Civ.P. 56(c); Bahn v. NME Hosp's. Inc., 929 F.2d 1404, 1409 (9th Cir.) cert. denied, 112 S.Ct. 617 (1991).
The moving party must carry the initial burden of proof. The party meets this burden by identifying portions of the record on file which demonstrate the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322-324 (1986). Once the initial burden is satisfied, the burden shifts to the opponent to demonstrate through the production of probative evidence that there remains an issue of fact to be tried. Id. The facts on which the opponent relies must be admissible at trial, although they need not be presented in admissible form for the purposes of opposing the summary judgement motion. Id.
The court must view the evidence in the light most favorable to the nonmoving party. Bell v. Cameron Meadows Land Co., 669 F.2d 1278, 1284 (9th Cir. 1982). All reasonable doubt as to the existence of a genuine issue of fact should be resolved against the moving party. Hector v. Wiens, 533 F.2d 429, 432 (9th Cir. 1976). The inference drawn from the underlying facts must be viewed in the light most favorable to the party opposing the motion. Valadingham v. Bojorguez, 886 F.2d 1135, 1137 (9th Cir. 1989). Where different ultimate inferences may be drawn, summary judgment is inappropriate. Sankovich v. Insurance Co. of North America, 638 F.2d 136, 140 (9th Cir. 1981).
Deference to the non-moving party does have some limit. The non-moving party must set forth specific facts showing that there is a genuine issue for trial. Fed.R.Civ.P. 56(e) (emphasis added). The "mere existence of a scintilla of evidence in support of the plaintiff's position would be insufficient." Anderson v. Liberty Lobby Inc., 477 U.S. 242, 252 (1986). Therefore, where "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
DISCUSSION
To recover for lost profits under Oregon law, "a plaintiff must establish, with reasonable certainty, both the existence and amount of lost profits." GPL Treatment, Ltd., v. Louisiana-Pacific Corporation, 133 Or. App. 633, 637 (1995). "Lack of absolute certainty does not bar submission of a claim for lost profits; reasonable probability is all that is required." City of Eugene v. Monaco, 171 Or. App. 681, 688 (2000). The evidence must refer "unambiguously to net profits," Cruz Development. Inc. v. Yamalova, 174 Or. App. 494, 498 (2001), because "only net profits may be recovered." GPL Treatment, 133 Or. App. at 637. Lost profits "may be established by proof of past profits of an established business or by expert projections based on tests performed under substantially similar conditions." City of Eugene v. Monaco, 171 Or. App. at 688; Willamette Quarries v. Wodtli, 308 Or. 406, 412 (1989).
In this case, the plaintiffs argue that the requirement that they disclose their franchise litigation is costing them ongoing lost profits because the disclosure discourages prospective franchisees. However, they have presented no evidence that any of the few persons they spoke with were discouraged by that disclosure. Further, although they have offered the testimony of a franchise expert as to the expected increase in the number of franchises absent the disclosure, the plaintiffs would not have even come close to the projected number had every person they solicited purchased a franchise. The basis for the expert testimony on franchise development was primarily based on the opinion of Frank Sorrels, who was not able to provide documentation of past business records to support his opinions. The expert opinion was not based on proof of past profits or on projections based on tests performed under substantially similar conditions.
The plaintiffs' opinions of actual amounts of loss are deficient in exactly the same ways. Frank Sorrels simply has no past records to support his contentions. His financial expert relies primarily on Sorrels' opinions, which are without foundation. For example, he claims each "lost" franchise would have sold for $15,000, yet the record is clear that in the past he had sold some for $10,000 and had given some without charge. His claim for yearly fees from those franchises is similarly undocumented, as is his claim for profits lost due to lost sales of materials. There is simply no evidence from which a factfinder could do anything other than speculate as to possible lost profits. Although the reasonable certainty standard is not demanding, the plaintiffs here have failed to meet it.
This assumes that the plaintiffs could prove some loss of franchises due to the disclosure, which they cannot.
As to the franchises which the plaintiff's claim were lost due to the faulty legal documents, the proof of damages is similarly lacking. The plaintiffs have no clear records of income from those franchises.
Although the defendants base their summary judgment motion only on the plaintiffs' failure to prove damages, it is not at all clear that the plaintiffs could prove that the defendants' alleged malpractice caused the loss of the renegade franchises.
CONCLUSION
The defendants' motion (#62) for summary judgment is granted. This case is dismissed with prejudice.