Brinkman v. Cty. of Los Angeles, 726 F.3d 299 (9th Cir. 2020)
Brinkman v. Cty.
Can a plaintiff recover lost profits as damages in a breach of contract claim against a governmental entity, given sovereign immunity and public policy considerations?
When a contractual breach involves a governmental entity, damages are typically limited to compensatory amounts unless expressly stipulated otherwise in the contract, due to sovereign immunity and the need to balance public interest.
The court held that while Brinkman was entitled to recover damages from the County, the damages were limited to actual expenditures directly incurred and not speculative lost profits.
This case is a crucial study in understanding how contract law principles are applied when a public entity is involved. It underscores the cautious approach courts must adopt to safeguard governmental functions and taxpayer funds while ensuring private party rights are enforced. For law students, it highlights the critical intersection of contract law and public policy.