United States District Court, M.D. Pennsylvania
REPORT AND RECOMMENDATION
C. CARLSON UNITED STATES MAGISTRATE JUDGE.
now called upon to write the first draft of the final chapter
in this litigation and recommend the proper scope of a
liquidated damages order in this lawsuit, following the
corporate defendants' failure to respond to this
complaint in a meaningful fashion or otherwise litigate this
a breach of contract and fraud action brought by a
Pennsylvania company against various Cayman island business
entities, and the principal behind these businesses, Mark
Brooke. The plaintiff commenced this action on November 1,
2017, in order to collect on a $200, 000 promissory note
allegedly executed by Brooke on behalf of these Cayman island
companies in order to secure financing from the plaintiff.
plaintiff filed proof of service upon the following named
corporate defendants in March of 2018: HILTS GLOBAL US, HILTS
GLOBAL CAYMAN, and HILTS GLOBAL UK. (Doc. 7.) Despite the
passage of many months, none of these defendants ever
answered or otherwise appeared in this action. Accordingly,
on December 17, 2018, we directed the plaintiff to either
seek entry of default judgments against these previously
served corporate defendants who have failed to respond to
this complaint, or provide the court with a status report
regarding the plaintiff's proposed course of action with
respect to these other defendants. (Doc. 13.) The plaintiff
then moved for entry of default against these defendants.
(Doc. 15.) When the time for responding to this motion passed
without any response from the defendants, we recommended that
the motion be granted, but that this case be remanded to us
in order to liquidate the amount of damages owed in this
case. (Doc. 17.) The district court adopted this
recommendation, (Doc. 18), and on March 19, 2019, the
plaintiff filed a motion to liquidate its damages as to these
corporate defendants. (Docs. 22 and 23.) Once again, the
defendants have failed to respond to this motion, and the
time for responding has passed. Therefore, this motion is now
ripe for resolution.
reasons set forth below, it is recommended that the court
enter a default judgment in favor of the plaintiff in the
amount of $238, 723.07.
previously determined that the entry of judgment in favor of
the plaintiff is appropriate given the corporate
defendants' on-going defaults in this litigation.
However, “[w]hen a plaintiff prevails by default, he or
she is not automatically entitled to the damages they
originally demanded. Comdyne I, Inc. v. Corbin, 908
F.2d 1142, 1149 (3d Cir. 1990). Rather, defaults are treated
as admissions of the facts alleged, but a plaintiff may still
be required to prove that he or she is entitled to the
damages sought. Id.; DIRECTV Inc. v. Pepe,
431 F.3d 162, 165 (3d Cir. 2005).” Rainey v.
Diamond State Port Corp., 354 Fed.Appx. 722, 724 (3d
Cir. 2009). In performing this task:
The district court has considerable latitude in determining
the amount of damages. Jones v. Winnepesaukee
Realty, 990 F.2d 1, 4 (1st Cir. 1993). In determining
the amount, the district court may conduct a hearing.
Fed.R.Civ.P. 55(b)(2). The court is not required to do so,
however, “as long as it ensure[s] that there [is] a
basis for the damages specified in the default
judgment.” Transatlantic Marine Claims Agency, Inc.
v. Ace Shipping Corp., Div. of Ace Young Inc., 109 F.3d
105, 111 (2d Cir. 1997). “It is familiar practice and
an exercise of judicial power for a court upon default, by
taking evidence when necessary or by computation from facts
of record, to fix the amount which the plaintiff is lawfully
entitled to recover and to give judgment accordingly.”
Pope v. United States, 323 U.S. 1, 12, 65 S.Ct. 16,
89 L.Ed. 3 (1944). IBEW Local Union No. 102 v. Dane
Const. Co., LLC, No. 08B907, 2009 WL 872018, at *2
(D.N.J. Mar. 30, 2009).
Malik v. Hannah, 661 F.Supp.2d 485, 493 (D.N.J.
2009). As part of this process, “the defaulting party
is entitled to be heard on the amount of damages.”
Tristrata Tech., Inc. v. Med. Skin Therapy
Research, Inc., 270 F.R.D. 161, 164-65 (D. Del. 2010)
(citing 5 James Wm. Moore et al., Moore's Federal
Practice' 55.32[c], [f]).
have provided these corporate defendants an opportunity to be
heard on the amount of damages, but they have elected to
forego this opportunity. Therefore, we will assess the
plaintiff's right to recover damages based upon the
information that is presently before us.
first to the plaintiff's request for principal damages of
$200, 000 and accrued interest of $38, 203.20, we recognize
that “defaults are treated as admissions of the facts
alleged, but a plaintiff may still be required to prove that
he or she is entitled to the damages sought.”
Rainey v. Diamond State Port Corp., 354 Fed.Appx.
722, 724 (3d Cir. 2009). In this case, UM plainly alleges a
breach of contract claim against these defendants relating to
a $200, 000 note memorializing a loan made by UM to the
defendants, a loan that has not been repaid. The corporate
defendants' default is an admission to these facts,
establishing principal liability of $200, 000 that is due and
owing in this case.
plaintiff has also tendered to the court an authentic copy of