United States District Court, N.D. Mississippi, Aberdeen Division
ORDER GRANTING DEFAULT JUDGMENT
SHARION AYCOCK UNITED STATES DISTRICT JUDGE.
before the Court is Plaintiff's Motion  for Default
Judgment as to L&J Products & Sales, Inc. The Court
has considered the Motion and relevant authorities, and finds
and Procedural Background
Innocor, Inc. filed an action against Defendants L&J
Products & Sales, Inc., North Carolina Foam and Sales,
Inc., Ken Lockhart, and Larry Jackson, individually, stemming
from Plaintiff's previous business relationship with the
Defendants. In its First Amended Complaint , Plaintiff
alleges that Defendant L&J Products & Sales, Inc.
frequently bought polyurethane foam from Plaintiff, that
Defendant L&J opened a line of credit with Plaintiff, and
that there remains a balance due from Defendant L&J to
Plaintiff in the amount of $2, 150, 676.43. The seven count
Complaint includes claims for: (1) breach of contract; (2)
liability under Mississippi Code Annotated section 11-53-81 -
Open account/attorney's fees statute; (3) price and
incidental damages under the Mississippi Uniform Commercial
Code; (4) piercing the corporate veil as to Defendant
Lockhart; (5) piercing the corporate veil as to Defendant
Jackson, (6) fraudulent conveyance; and (7) continuity of
September 18, 2018, the Clerk of Court entered a default
against Defendant L&J due to Defendant's failure to
plead or otherwise defend as provided by the Federal Rules of
Civil Procedure. See Entry of Default . Now
before the Court is Plaintiff's Motion  for Default
Judgment. Plaintiff requests $2, 150, 675.43 in compensatory
damages, pre-judgment interest from the date of each sale,
post-judgment interest from the date of judgment,
attorney's fees, costs, and expenses.
judgments are generally disfavored. See Lacy v. Sitel
Corp., 227 F.3d 290, 292 (5th Cir. 2000). However,
Federal Rule of Civil Procedure 55 permits a court, upon
motion by the plaintiff, to enter default judgment against a
defendant who fails to plead. Fed.R.Civ.P. 55(b)(2). A
default judgment is not “an absolute confession by the
defendant on his liability and of the plaintiff's right
to recover.” Nishimatsu Constr. Co. v. Houston
Natl'l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975).
Instead, the Court must consider whether the unchallenged
facts support the relief sought prior to entering a default
judgment. Id. A defendant “is not held to
admit facts that are not well-pleaded or to admit conclusions
of law.” Wooten v. McDonald Transit Associates,
Inc., 788 F.3d 490, 496 (5th Cir. 2015) (quoting
Nishimatsu, 515 F.2d at 1206). Under Rule
55(b)(2)(C), the Court “may conduct hearings . . .
when, to enter or effectuate judgment, it needs to . . . (A)
conduct an accounting; (B) determine the amount of damages;
(C) establish the truth of any allegation by evidence; or (D)
investigate any other matter.”
Sufficiency of Claims for Default Judgment
to Plaintiff's First Amended Complaint , after
subtracting all credit due for payments made on Defendant
L&J's account, there remains a balance due from
Defendant L&J to Plaintiff in the amount of $2, 150,
676.43. Plaintiff also claims that it sent Defendant L&J
itemized monthly statements of the amount owed and that
Defendant L&J was aware of the exact amount owed.
Additionally, Plaintiff claims that Defendant L&J
repeatedly represented that it would pay its outstanding and
delinquent balance, that Defendant L&J failed to pay its
balance, and that Defendant Lockhart subsequently shut down
Defendant L&J's operations and conveyed its assets to
Defendant NCFS which began operating with Defendant
L&J's assets and accounts.
Plaintiff's allegations that Defendant L&J failed to
pay its outstanding balance of $2, 150, 676.43 are sufficient
to state a claim for breach of contract. See T.C.B.
Construction Co. v. W.C. Fore Trucking, Inc., 134 So.3d
701, 705 (Miss. 2013) (finding that unpaid invoices
constituted liability for breach of contract when the
defendant failed to compensate plaintiff for performed work).
Second, L&J's unpaid balance is sufficient to state a
claim for attorney's fees under Mississippi Code
Annotated section 11-53-81. See Knights Marine &
Indus. Serv., Inc. v. Gulfstream Enter., Inc., 216 So.3d
1164, 1169-70 (Miss. Ct. App. 2017) (finding evidence that
plaintiff performed the work for which it was hired, along
with evidence of the date of purchase, kind of goods,
quantity, and price, sufficient for an award for compensatory
damages, pre-judgment interest, post-judgment interest, and
attorney's fees under Miss. Code. Ann. § 11-53-81).
Third, Plaintiff's allegations are sufficient to state a
claim under Mississippi Code Annotated section 75-2-709, the
Mississippi Uniform Commercial Code section establishing a
cause of action for price. Under this section, a seller may
recover “the price of goods accepted” by a buyer
who fails to pay the price. See Miss. Code Ann.
allegations are not sufficient, however, to support a claim
for incidental damages under Mississippi Code Annotated
section 75-2-710 because compensatory damages cover the
purchase price of the goods it sold to Defendant L&J.
Under section 75-2-710, the Court may award incidental
damages for reasonable charges “in connection with
return or resale of the goods or otherwise resulting from the
breach.” Because Plaintiff requests claim for
compensatory damages covers the purchase price under the
open-account, return and/or resale of the goods is not
required, and section 75-2-710 would not apply.
Plaintiff requests pre-judgment interest from the date of
each sale. Interest on judgments is governed by ...