A Florida court recently upheld a lower court's decision in the case of Diamond Art Club, LLC v. Lindsay Gosnell, which could have significant implications for businesses seeking to recover lost profits. The ruling, issued by the Third District Court of Appeal on July 23, 2026, affirmed that businesses must provide clear evidence of lost profits to recover damages. This decision affects how companies approach claims for lost earnings in future legal disputes.
The case arose when Diamond Art Club, a company known for its diamond painting kits, filed an appeal against Lindsay Gosnell. The specifics of the dispute were not detailed in the court filing, but it centered around claims of lost profits. Diamond Art Club argued that they had suffered financial losses due to actions taken by Gosnell, leading them to seek damages in court.
The dispute reached the Third District Court of Appeal after the Circuit Court for Miami-Dade County, presided over by Judge Spencer Eig, made a ruling that Diamond Art Club found unfavorable. The company believed the lower court had erred in its assessment of the evidence regarding lost profits, prompting them to appeal the decision.
The court ruled in favor of Gosnell, stating, "In Florida, unless the fact-finder is presented with evidence which will enable it to determine damages for lost profits with a reasonable degree of certainty, rather than by means of speculation and conjecture, the claimant may not recover such damages." This statement underscores the court's position that businesses must substantiate their claims with clear and convincing evidence.
Additionally, the court referenced previous cases to support its decision, including Himes v. Brown & Co. Sec. Corp. and Continuum Condo. Ass’n, Inc. v. Continuum VI, Inc. These cases established that lost profits must be shown with a reasonable degree of certainty and that nominal damages can only be awarded when a legal wrong has been proven without demonstrable damages.
The ruling has implications for businesses in Florida and potentially beyond. Companies that seek to recover lost profits must now be more diligent in gathering evidence to substantiate their claims. This decision reinforces the standard that businesses cannot rely on speculation when seeking damages for lost profits.
Moving forward, this ruling may influence how businesses prepare for litigation. They will need to ensure they have robust documentation and evidence to support any claims for lost profits. This could lead to more thorough record-keeping practices and a greater emphasis on financial forecasting and planning.
As for the possibility of an appeal, the court's ruling is not final until the disposition of any timely filed motion for rehearing. Therefore, Diamond Art Club may still have the option to contest the decision further. Details were not available in the court filing regarding any related cases or motions pending.