## Facts

- Indianapolis Motor Speedway, LLC contracted with Karma International, LLC to host a ticketed, Maxim-branded party during Indianapolis 500 weekend in 2016.
- The written agreement required the Speedway to provide marketing support, including social-media promotion and a dedicated email to its database.
- The agreement required Karma to (i) place a Maxim.com banner ad with at least one million impressions and (ii) provide Maxim social-media marketing support for certain Speedway music events.
- The Speedway sent four party-promotional emails in May 2016 to different segments of its contacts, including three dedicated emails and one cross-promotional email.
- The party drew 1,787 attendees, but only 92 paid full price; Karma spent about $635,855.71 and grossed about $215,690.39.
- Karma claimed Speedway officials projected about $1 million in gross ticket and table sales and that broader email promotion would have produced at least 1,500 ticket sales, but Karma offered no expert analysis or data connecting additional email marketing to increased sales.
- Karma sued for breach of contract based on allegedly inadequate marketing support and sought $817,500 in damages.
- The Speedway counterclaimed for breach, alleging Karma failed to deliver the promised Maxim.com impressions and Maxim social-media promotion.

## Issues

1. Whether Karma produced evidence of lost-profit damages with reasonable certainty, as required by Indiana law, sufficient to survive summary judgment on its breach-of-contract claim.
2. Whether sufficient evidence supported the jury’s finding that Karma breached its advertising obligations under the contract.
3. Whether the Speedway’s $75,000 damages award on the counterclaim was supported by non-speculative evidence and was legally permissible under Indiana contract-damages standards.

## Decision

- The Seventh Circuit affirmed summary judgment for the Speedway on Karma’s breach-of-contract claim.
- The court held Karma’s lost-profit damages theory was speculative because it lacked evidence (including expert proof or reliable metrics) linking the alleged marketing shortfall to a quantifiable increase in ticket sales.
- The court affirmed the jury verdict for the Speedway on its counterclaim and upheld the $75,000 damages award.
- The court found the evidentiary record supported the jury’s determination that Karma failed to perform its online and social-media advertising promises.
- The court affirmed the denial of Karma’s post-trial motions seeking judgment as a matter of law or a new trial.

## Legal Principles

- Under Indiana law, contract damages—especially lost profits—must be proven with reasonable certainty; remote, uncertain, or speculative damages are not recoverable.
- To defeat summary judgment, a party claiming damages must present evidence allowing a factfinder to estimate loss without guesswork; conclusory assertions and unsupported projections are insufficient.
- Contract damages are assessed based on objectively foreseeable consequences at the time of contracting; subjective expectations are not the measure of recoverable loss.
- Damages need not be calculated with mathematical precision, but must rest on a rational evidentiary basis tied to the breach and the contractual performance promised.
- A party may recover on a counterclaim for breach when supported by trial evidence of nonperformance and a reasonable, non-speculative damages theory, even if the opposing party’s affirmative damages claim fails for lack of proof.

## Conclusion

The Seventh Circuit held that Karma’s claimed lost profits failed for lack of reasonably certain proof under Indiana law, while the Speedway’s counterclaim succeeded because trial evidence supported both Karma’s breach of specific advertising duties and a modest, non-speculative damages award.


Karma Int'l, LLC v. Indianapolis Motor Speedway, LLC, 938 F.3d 921 (7th Cir. 2019)