Gibson’s Bakery v. Oberlin College – Trial Day 12 – Defense says Bakery worth only $35k, less than one semester at Oberlin College
Risky defense strategy to demean business that prior to student protests supported three generations of Gibsons and almost a dozen local employees — “it is not a successful business.”
Today was Day 12 of witness testimony in Gibson Bros. v. Oberlin College. The events giving rise to the lawsuit have been said to represent “the worst of identity politics.” You can read about some of the background on this case here.
In many civil court cases, it is not the liability of the defendant that causes the jury the most trouble. It is how they measure that liability in dollar amounts.
In previous testimony by plaintiff’s expert Frank Monaco, an accountant with about 40 years experience doing businesses valuations and income streams calculations, testified Gibson’s was set to lose about $5.8 million over the next 30 years from the defendant’s alleged racist accusations.
Defendants today presented their own expert’s findings. That expert, an accountant, stated his opinion that $5.8 million quite a bit off, and told the jury that the 135-year-old small business was only worth $35,000.
Sean Saari, a ten-year veteran of the firm Skoda Minotti in Cleveland thought that the previous study put forward by plaintiffs was “overly inflated, unreliable and erroneous.” He based his valuation by looking at Gibson’s assets, amounts they owed, the worth of items in the shelves and other factors to come to his small valuation.“I wouldn’t equate longevity with success,” Saari told the jury. “The actual recent numbers show that it is not a successful business.” But then he also added, “It is just more of an indication of permanent damage [to the business].”
That last part added all sort of question marks to the faces of those in the courtroom and in the jury box. The question became, of course, if the business wasn’t worth much, and had permanent damage as well, was that loss of value caused by the protest and racism accusations, or were the losses because Gibson’s had just a business going under before the protests happened.
Plaintiffs’ expert put it this way last week. “When you look at how the revenues have declined, it is clear that those numbers represent that something major happened,” he said, referring to the plus and minuses before and after the protest.
Plaintiffs’ expert said he based his 30-year estimates on the fact that Gibson’s Bakery & Market has been around for more than 130 years and that “when you have people thinking you’re racist, and you live in a small town, the accusation can last a lifetime.” He said 30 years was a “generational” estimate, being that Gibson’s family has been in the business for five generations.Saari dismissed the 30-year time frame as one that is rarely used by any accountants who study businesses that have had revenue decline like Gibson’s has had. Saari claimed plaintiffs’ expert had gotten his 30-year time frame by putting “generation” in Google. And Saari dismissed Monaco’s numbers as “a way to manufacture damages and get to a higher [monetary] number for the plaintiffs.”
But what this argument does is raise some real questions. The question for the jury is how long will the damage last, and should the school be on the hook for 30 years. Saari said most of the previous report by the plaintiffs was “speculative,” but then again so was his. And Saari refused to include the downtown building that houses Gibson’s as something that can be included in the business asset value, as the building is owned by the family.
That made little sense, as the family owns both the business and the historic building it is housed in, and to say they are not connected in some way economically doesn’t pass the common sense test.Neither Monaco nor Saari brought up the severity of the recession in this part of the Midwest, and how that might have impacted the businesses’ earnings before the protests. For example, both showed that the business revenues declined slightly from 2010 to 2016, but they didn’t mention that Northeast Ohio was going through the worst part of the housing foreclosure mess. In fact, economists and the media saw the big problems that Lorain County during this time period.
In other words, Saari testified that a loss of revenue during 2012 to 2016 was a sign that the business was in decline and explained that because Gibson’s didn’t have a good values of assets and revenues. But he never mentioned that almost every business like Gibson’s in that part of the country saw a decline during this period. That it survived is testimony to how the family having gutted it out during this tough economic time. Perhaps that will come out on cross-examination tomorrow.
Again, one expert was saying the problems were there before the protests, while the other said there was a definite change in the financials of Gibson’s after Nov. 10, 2016. One more point: Saari didn’t seem to understand the problem that males in their sixties have in finding high paying jobs. He said counting the lost income that David Gibson, age 64, has experienced since the protests is not right, because “It’s not that they have to work for Gibson’s to make the same amount … They could get just as much, if not more, based on the hours they work.”
The defense is expected to end their testimony tomorrow, with the final part from Saari, and then the current president of Oberlin College, Carmen Twillie Ambar. There is a sense from sitting through this trial, that the defense seems to have given up on the libel and defamation side of this case, and is concentrating more on the financials.
Consider this: The defendants initially indicated they would call several students to testify. But that does not appear to be likely to happen based on statements today as to remaining witnesses. The flyers were produced by the protesters, and the student senate resolution demanded action from the administration against Gibson’s, are a huge part of this case. The jury has seen those documents produced by students, and allegedly spread by the college and defendant Raimondo.
It is odd the defense chose to have not one student to come forward and explain their positions in the best way possible. But then again, maybe it is best for the defense to not have them in a courtroom in Elyria, Ohio.
The defense now seems to be more focused on cutting their losses as best they can. Perhaps that is why their last witness is the current president of the school, who wasn’t even employed by the school at the time the protests occurred.
If all goes as expected, the defense will finish Saari’s direct examination and the plaintiffs’ counsel will cross examine Saari tomorrow. Then current Oberlin College President Twillie Ambar will be the last witness and closing arguments will begin Monday. The jury could get the case as early as Tuesday, depending how long it takes the attorneys to argue over jury instructions.
Daniel McGraw is a freelance writer and author in Lakewood, Ohio. Follow him on Twitter @danmcgraw1
WAJ adds: I’m still shaking my head at the tone-deafness of the defense in belittling this family business which has sustained five generations of Gibsons, and at the time of the protests sustained three generations: 90-year-old Allyn W. Gibson, his son David Gibson, and his grandson Allyn D. Gibson. There also were almost a dozen employees. After the protests, the Gibsons stopped taking salaries and most of the employees have been laid off. This is real life to these people. To say that the business was worth only $35,000 erases the lives of these people. Maybe it’s just the plaintiff’s lawyer in me coming out, but I’d cross examine this defense expert and college president, and show in closing argument, the tuition, room and board charges at Oberlin College. [Featured image.] This business, which has been an important feature of the community since 1885, is worth less than one semester at Oberlin College?———— DONATE
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