United States District Court, Southern District of Alabama, Southern Division
KRISTI K. DuBOSE, UNITED STATES DISTRICT JUDGE
This matter is before the Court on Plaintiff Siemens Financial (Plaintiff)’s Rule 55(b) Motion for Entry of Default Judgment against Defendant Delta Radiology Associates, PLLC (Delta), and individual Defendant Jason R. Williams (Williams). (Doc. 23). Plaintiff seeks entry of a default judgment against these Defendants because they have failed to plead, answer or otherwise defend in this case.
From December 2010 through August 2012, Plaintiff and Delta entered into certain leases (also called leasing schedules), personally guaranteed by Williams, through which Delta leased specific medical equipment from Plaintiff in connection with a December 8, 2010 Master Equipment Lease Agreement (Master Lease): 1) Lease 1--Leasing Schedule #20700-16317 (contract #130-0002825-000) and Lease 1 Guaranty; 2) Lease 2--Leasing Schedule #20701-16318 (contract #110-0001996-000) and Lease 2 Guaranty; 3) Lease 3--Leasing Schedule #20917-17814 (contract #110-0002038-000) and Lease 3 Guaranty; 4) Lease 4--Leasing Schedule #222058-30180 (contract #121-0000201-000) and Lease 4 Guaranty; and 5) Lease 5--Leasing Schedule #21938-30004 (contract #130-0003060-000) and Lease 5 Guaranty. (Doc. 23; Doc. 23-1 at 12-67 (leases and guaranties); Doc. 23-1 (Decltn. Petrone at 2-10)).
Plaintiff accepted and relied upon the Guaranties, and in consideration for the Guaranties, entered into the Leases with Delta. (Id.) Each of the Leases required Delta to make monthly rental payments to Plaintiff for the equipment leased. (Id.) However, Delta defaulted under its Lease obligations by failing to pay the amounts due and owing to Plaintiff when those amounts were due. (Id.) Given the default, Plaintiff exercised its right to declare the following amounts immediately due and payable: 1) for Leases 1, 2 and 3, the applicable Stipulated Loss Value of the medical equipment leased, together with all past due and unpaid Lease Payments and all other amounts due under these Leases; and 2) for Leases 4 and 5, all remaining lease payments for the balance of the lease term plus the Purchase Option Price stated in these Leases, such sum discounted in accordance with these Leases, plus all past due and unpaid lease payments and all other amounts due under these Leases. (Id.)
On February 6, 2014, Plaintiff demanded that Delta pay all accelerated amounts due under the Leases and return the Leased Equipment to Plaintiff as provided for in the Leases. (Doc. 23; Doc. 23-1 at 12-67 (leases and guaranties); Doc. 23-1 (Decltn. Petrone at 2-10)). Delta failed to pay the amounts demanded. (Id.) Upon Delta's default, the Guaranties allow Plaintiff to also proceed against Williams, individually, for all amounts due from Delta to Plaintiff under the Leases. (Id.) As such, also on February 6th, Plaintiff demanded Williams pay all amounts due to Plaintiff under the Leases and the Guaranties. (Id.) Williams failed to pay the amounts demanded. (Id.) As a result of Delta's defaults on its obligations to Plaintiff under the Leases, and pursuant to the terms of the Guaranties, Delta and Williams are liable to Plaintiff, jointly and severally, for 100% of all amounts due to Plaintiff under the Leases. (Id.)
Plaintiff removed and then sold the Leased Equipment in accordance with the terms of the Leases and applied the net sales proceeds to the amounts due from Delta under the Leases. (Doc. 23; Doc. 23-1 at 12-67 (leases and guaranties); Doc. 23-1 (Decltn. Petrone)). As of March 27, 2015, and after giving credit for the net sale proceeds, the amount due and owing by Delta to Plaintiff pursuant to the Leases is no less than $2, 567, 253.06, exclusive of attorneys’ fees and costs, consisting of the following: $1, 605, 990.20 --Lease 1; $730, 165.33 --Lease 2; $59, 478.72 --Lease 3; $29, 614.21 --Lease 4; and $141, 004.40 --Lease 5. (Doc. 23-1 (Decltn. Petrone); Doc. 23-1 at 75-80). Additionally, for each day after March 27, 2015, late charges accrue as follows: $609.09 -- Lease 1; $306.61 -- Lease 2; $22.46 -- Lease 3; $11.23 -- Lease 4; and $53.48 -- Lease 5. (Id.) Plaintiff contends that per the Leases’ terms, Delta is obligated to pay all costs, including reasonable attorneys’ fees and amounts incurred removing, marketing, and selling the equipment, as incurred in the enforcement of the Leases. (Id.)
Plaintiff asserts that as of March 31, 2015, it has incurred $57, 590.79 in attorneys’ fees and costs enforcing its rights and remedies under the Leases. (Doc. 23; Doc. 23-1 (Decltn. Petrone); Doc. 23-2 (Decltn. Jackson); Doc. 23-3 (Aff. Callaway)). Plaintiff also seeks $15, 000 more in attorneys’ fees to cover “estimated future” such fees and costs. (Doc. 23).
On May 20, 2014, Plaintiff filed a 10 count Complaint against Delta and Williams for the breaches of the five (5) leases and five (5) guaranties. (Doc. 1). On March 24, 2015, a Clerk’s entry of default was issued against Delta and Williams for failure to plead or otherwise defend the case. (Doc. 20). Plaintiff now moves for entry of a default judgment, submitting the Declaration of O’Neil Petrone, Declaration of Daniel P. Jackson, and Affidavit of Henry A. Callaway, in support. (Docs. 23-1, 23-2, 23-3). Plaintiff seeks a default judgment against the Defendants in the amount of $2, 567, 253.06, plus the amounts due under the Leases, late charges in the amount of $1, 002.87/day after March 27, 2015 through entry of judgment, post-judgment interest at the applicable rate, and $72, 590.79 in attorneys’ fees, costs and expenses.
II. Standard of Review
The Federal Rules of Civil Procedure establish a two-part process for obtaining a default judgment. Fed.R.Civ.P. 55. If “a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by affidavit or otherwise, the clerk must enter the party’s default.” Fed.R.Civ.P. 55(a). After default has been entered, if the “claim is for a sum certain or a sum that can be made certain by computation” the clerk must enter default judgment. Fed.R.Civ.P. 55(b)(1). In all other circumstances, such as here, “the party must apply to the court for a default judgment.” Fed.R.Civ.P. 55(b)(2).
Rule 55(b)(2) of the Federal Rules of Civil Procedure provides, in relevant part, as follows with regard to entering a default judgment:
(b) Entering a Default Judgment.
(2) By the Court. In all other cases, the party must apply to the court for a default judgment. A default judgment may be entered against a minor or incompetent person only if represented by a general guardian, conservator, or other like fiduciary who has appeared. If the party against whom a default judgment is sought has appeared personally or by a representative, that party or its representative must be served with written notice of the application at least 7 days before the hearing. The court may conduct hearings or make referrals--preserving any federal statutory right to a jury trial--when, to enter or effectuate judgment, it needs to:
(A) conduct an accounting;
(B) determine the amount of ...