RenewalMD, PC v. Shanklin

Filing 36

ORDER granting 33 Plaintiff's Motion for Default Judgment. Signed by District Judge R. Stan Baker on February 5, 2024. (jrb) (Additional attachment(s) added on 2/5/2024: # 1 Order) (jrb).

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF GEORGIA
SAVANNAH DIVISION
RENEWALMD, PC,
Plaintiff,

CIVIL ACTION NO.: 4:21-cv-184

v.
JOEL SHANKLIN, MD,
Defendant.
ORDER
This matter comes before the Court on Plaintiff’s Motion for Default Judgment. (Doc. 33.)
For the reasons below, the Court GRANTS Plaintiff’s Motion. (Id.)
BACKGROUND
Plaintiff RenewalMD, PC, (hereinafter “Renewal”) filed this action against Defendant Joel
Shanklin, M.D., (hereinafter “Shanklin”) on June 18, 2021. (Doc. 1.) In its Amended Complaint,
Renewal alleges that Shanklin has breached a contract by failing to pay amounts due and owing
on a contract. (Doc. 20, p. 4.)
Renewal originally formed and operated as Coastal Empire Plastic Surgery, PC. On June 9,
2013, the then existing shareholders in the Company, Shanklin, Luke Curtsinger, Meghan
McGovern, and Micheal Huntly entered an Amended and Restated Shareholders Agreement (“the
Shareholders Agreement”). (Doc. 20-2.) The Shareholders Agreement established that the four
physicians were equal shareholders in the Company. (Id. at p. 2.) The agreement’s Shareholder
Compensation Formula provided that “[i]t is accepted by all Shareholder physicians that certain
corporate expenses will be shared equally.” (Id. at p. 12.) The formula then specified the

allocation of various categories of expenses. (Id. at pp. 13—15.) Pertinently, the shareholders
agreed to share equally a broad category of “General Overhead” expenses. (Id. at p. 14.) On
June 1, 2018, the company changed its name to RenewalMD, PC. (Doc. 20-1.)
Before July 31, 2019, Curtsinger disassociated from Renewal, and a dispute arose about
that disassociation. (Doc. 20, p. 2.) Curtsinger sued Renewal, Shanklin, McGovern, Huntly, and
others in the Superior Court of Chatham County. (See doc. 20-8, p. 5.) The defendants in that
action (including Shanklin and Renewal) entered into a Settlement Agreement and Mutual Release
(hereinafter the “Settlement Agreement”) through which they jointly agreed to pay Shanklin a total
of $

in return for a release of liability and redemption of Curtsinger’s interest in Renewal. 1

(Id. at p. 7.) Renewal paid the entire settlement amount to Curtsinger by booking a debt of
$

to both McGovern and Huntley and thereby causing McGovern and Huntley to each pay

$

to Curtsinger. (Doc. 20-7, p. 4.)
On July 31, 2019, before execution of the Settlement Agreement, Shanklin also

disassociated with Renewal and sold his interest in Renewal to McGovern through a Stock
Transfer Agreement (“the Stock Transfer Agreement”). (Id. at p. 3.) As part of that agreement,
Shanklin agreed to pay his share of liabilities for Renewal’s debts that arose before the stock

The Court has sealed the Settlement Agreement because it contains a confidentiality agreement. (Doc.
7.) The Court must recount some of the information contained within the Settlement Agreement to rule on
the Motion for Default Judgment. To balance the need for the agreed-upon confidentiality and the public’s
right to access, the Court has prepared a version of this Order which redacts any information that warrants
protection from public view. Primarily, the redactions protect the amount paid under the Settlement
Agreement. Additionally, to prevent that amount from being evident by simple subtraction, the Court has
redacted other amounts owed by Shanklin to Renewal. The version of this Order with those redactions will
be filed on the public docket, and an unredacted version of this Order will be filed in a restricted manner,
with access restricted to only the Court and the parties. That said, the total amount of judgment against
Shanklin in this lawsuit will be included in this Order and the judgment entered by the Clerk of Court.

1

2

transfer, which the parties labeled “Pre-Assignment Obligations.” (Doc. 20-4, p. 2.) Shanklin and
McGovern agreed that,
[w]ithout limitation, the Pre-Assignment Obligations include all obligations
regarding reversals, chargebacks, and penalties (whether claimed by insurers or any
other person or entity), claims against distributions made by the Company to
Shanklin prior to the Assignment Time, and obligations relating to claims made by
Dr. Luke Curtsinger against the Company (the “Curtsinger Matter”), as if Shanklin
still owned Shanklin’s Shares and as if Shanklin retained his status as a shareholder
of the Company. In furtherance of the foregoing, Shanklin hereby agrees to
indemnify the Company and its shareholders against, or otherwise contribute
Shanklin's portion in respect of, Pre-Assignment Obligations, with Shanklin’s
portion being one-third in the case of the Curtsinger Matter . . . .
(Id.)

Renewal alleges that “[i]t was the understanding and contractual agreement of Dr.

McGovern, Dr. Shanklin, and [Renewal] that Dr. Shanklin would pay 1/3 of the total settlement
fees and expenses, including attorneys’ fees, arising from the Curtsinger Matter, and that
understanding is mirrored in the Stock Transfer Agreement.” (Doc. 20, p. 3.) Renewal also asserts
that it “was a third-party beneficiary of the Stock Transfer Agreement’s provisions which specified
that Dr. Shanklin retained responsibility for pre-assignment obligations, including those connected
to the Curtsinger matter.” (Id.) Renewal claims that Shanklin owes it his share of the Curtsinger
settlement, $
$

, plus his share of the legal fees Renewal incurred in the Curtsinger dispute,

, for a total principal indebtedness of $

. (Doc. 20-7, p. 4.) Renewal demanded

that Shanklin pay this debt, but Shanklin refused to do so. (Doc. 20, pp. 4—5.)
In Count I of its Amended Complaint, Renewal asserts a claim for breach of contract
against Shanklin, based on his failure to pay the indebtedness memorialized in the Stock Transfer
Agreement. (Id. at pp. 5–6.) In Count II, Renewal seeks to also recover prejudgment interest
under O.C.G.A. § 7-2-4 for the simple interest accrued (at the statutory rate of 7% per year) since
the demand for payment was made to Shanklin on or before February 26, 2020. (Id. at p. 6.)

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Finally, in Count III, Renewal seeks to recover attorneys’ fees and costs under O.C.G.A. §§ 13-611 and 9-15-14 because it “has expended time and effort attempting to contact Dr. Shanklin and
in requesting that he pay amounts due and owing” but he has “offered no good faith excuse for his
failure to pay.” (Id. at p. 7.) Renewal asserts that Shanklin’s actions have been “stubborn, litigious,
and have no good-faith explanation,” and that, because of Shanklin’s actions, Renewal has “been
forced to retain [an attorney] to attempt to pursue the amount due and owing, including by initiating
and prosecuting this lawsuit.” (Id. at pp. 5–6.) The Original Complaint was verified by McGovern.
(Doc. 1-3.)
Shanklin was personally served with a summons and the Complaint on July 20, 2021.
(Doc. 9.) Yet Shanklin never filed an answer and has failed to otherwise appear. Thus, Renewal
moved for a clerk’s entry of default, (doc. 10), and the Clerk of Court granted that request,
(doc. 11). Renewal then filed a Motion for Default Judgment, (doc. 12), which the Court denied
without prejudice, (doc. 18).

Renewal then filed an Amended Complaint to remedy the

deficiencies noted in the Court’s prior Order. (Doc. 20.) Shanklin was personally served with the
Amended Complaint on January 20, 2023. (Doc. 26.) However, he never filed an Answer or
otherwise responded, and the Clerk entered his default on May 15, 2023. (Doc. 30.) Renewal then
filed the instant Motion for Default Judgment. (Doc. 33.)
STANDARD OF REVIEW
Federal Rule of Civil Procedure 55 establishes a two-step procedure for a party to obtain a
default judgment. First, “[w]hen 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). Second, after receiving the clerk’s

4

default, the court can enter a default judgment provided the defendant is not an infant or
incompetent. Fed. R. Civ. P. 55(b)(2). The clerk’s entry of default does not automatically warrant
entry of default judgment. “[T]hree distinct matters emerge as essential in considering any default
judgment: (1) jurisdiction; (2) liability; and (3) damages. Before the Court can grant plaintiff’s
motion for default judgment, all three must be established.” Pitts ex rel. Pitts v. Seneca Sports,
Inc., 321 F. Supp. 2d 1353, 1356 (S.D. Ga. 2004). Thus, “before entering a default judgment for
damages, the district court must ensure that the well-pleaded allegations in the complaint, which
are taken as true due to the default, actually state a substantive cause of action and that there is a
substantive, sufficient basis in the pleadings for the particular relief sought.” Tyco Fire & Sec.,
LLC v. Alcocer, 218 F. App’x 860, 863 (11th Cir. 2007); see also Eagle Hosp. Physicians v. SRG
Consulting, 561 F.3d 1298, 1307 (11th Cir. 2009). In assessing liability, the Court must employ
the same standard as when addressing a Rule 12(b)(6) motion to dismiss for failure to state a claim.
Surtain v. Hamlin Terrace Found., 789 F.3d 1239, 1245 (11th Cir. 2015) (“Conceptually, then, a
motion for default judgment is like a reverse motion to dismiss for failure to state a claim.”).
Once the Court determines that default judgment should be entered, it then turns to the
question of the type and amount of damages. Pitts, 321 F. Supp. 2d at 1356. Even when the Court
finds that default judgment is appropriate, it must make certain “that there is a legitimate basis for
any damage award it enters[.]” Anheuser-Busch, Inc. v. Philpot, 317 F.3d 1264, 1266 (11th Cir.
2003); see also Faria v. Lima Inv. Sols. LLC, No. 6:19-CV-535-ORL-37GJK, 2019 WL 3044033,
at *2 (M.D. Fla. June 24, 2019), report and recommendation adopted, No. 6:19-CV-535-ORL37GJK, 2019 WL 3037796 (M.D. Fla. July 11, 2019) (“Unlike well-pleaded allegations of fact,
allegations relating to the amount of damages are not admitted by virtue of default; rather, the court

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must determine both the amount and character of damages.”). Further, as the Eleventh Circuit
Court of Appeals explained, “despite Rule 55’s permissive language, judgment of default awarding
cash damages [cannot] properly be entered without a hearing unless the amount claimed is a
liquidated sum or one capable of mathematical calculation.” Organizacion Miss Am. Latina, Inc.
v. Urquidi, 712 F. App’x 945, 948 (11th Cir. 2017) (internal quotations omitted).
DISCUSSION
I.

Jurisdiction
A.

Subject Matter Jurisdiction

Plaintiff’s claims fall squarely within this Court’s diversity subject matter jurisdiction set
forth in 28 U.S.C. § 1332. Renewal alleges that Shanklin is a citizen and resident of Florida and
was a citizen of resident of Ohio when this suit was filed. (Doc. 20, p. 1.) Renewal is a Georgia
professional corporation with a principal place of business in Georgia. (Id.) Additionally,
Renewal’s sole shareholder is Dr. McGovern, who is a Georgia citizen and resident. (Id.)
Accordingly, the Amended Complaint establishes complete diversity of citizenship between the
parties. The amount in controversy requirement is met as Renewal asserts that it is entitled to more
than $75,000 because of Shanklin’s breach of contract ($
B.

before interest and fees).

Personal Jurisdiction

The Court must “satisfy itself that it has personal jurisdiction before entering judgment
against an absent defendant.” Odyssey Marine Expl., Inc. v. Unidentified, Wrecked & Abandoned
Sailing Vessel, 727 F. Supp. 2d 1341, 1345 (M.D. Fla. 2010); see also Geodetic Servs., Inc. v.
Zhenghzou Sunward Tech. Co., No. 8:13-CV-1595-T-35TBM, 2014 WL 12620804, at *2 (M.D.
Fla. Apr. 4, 2014) (“A default judgment is void in the absence of the Court’s personal jurisdiction

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over the defendant . . . .”). On this front, Renewal alleges that Shanklin “conducted business in
Georgia for many years while residing in the state, entered [into] the subject contract in Georgia,
the subject contract was to be performed in Georgia, and Shanklin’s breach directly affected a
Georgia entity.” (Doc. 20, p. 1.)
The Court can exercise personal jurisdiction over Shanklin only if doing so complies with
Georgia’s long-arm statute and the Due Process Clause of the Fourteenth Amendment to the
United States Constitution. Diamond Crystal Brands, Inc. v. Food Movers Int’l, Inc., 593 F.3d
1249, 1257–58 (11th Cir. 2010) (quoting United Techs. Corp. v. Mazer, 556 F.3d 1260, 1274 (11th
Cir. 2009)). The Georgia long-arm statute, O.C.G.A. § 9-10-91, does not grant jurisdiction that is
“coextensive with procedural due process,” and “imposes independent obligations that a plaintiff
must establish for the exercise of personal jurisdiction that are distinct from the demands of
procedural due process.” Id. at 1259 (citing Innovative Clinical & Consulting Servs., LLC v. First
Nat’l Bank of Ames, Iowa, 620 S.E.2d 352 (Ga. 2005)). Thus, the Court must apply the “specific
limitations and requirements of O.C.G.A. § 9-10-91 literally and must engage in a statutory
examination that is independent of, and distinct from, the constitutional analysis to ensure that
both, separate prongs of the jurisdictional inquiry are satisfied.” Id. at 1263. If the long-arm
statute’s requirements are satisfied, the Court then determines whether the exercise of jurisdiction
comports with federal due process.
Among other things, the Georgia long-arm statute permits the exercise of jurisdiction over
a nonresident who, personally or through an agent, transacts business within Georgia. O.C.G.A.
§ 9-10-91(1). In determining whether jurisdiction can be exercised over a nonresident defendant
under subsection (1) of the Georgia long-arm statute, the Supreme Court of Georgia has stated:
‘jurisdiction exists on the basis of transacting business in this state if (1) the
nonresident has purposefully done some act or consummated some transaction in
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this state, (2) [] the cause of action arises from or is connected with such act or
transaction, and (3) [] the exercise of jurisdiction by the courts of this state does not
offend traditional fairness and substantial justice.’
Amerireach.com, LLC v. Walker, 719 S.E.2d 489, 496 (Ga. 2011) (quoting Aero Toy Store v.
Grieves, 631 S.E.2d 734, 737 (Ga. Ct. App. 2006)). The first two factors determine whether “a
defendant has established the minimum contacts with the forum state necessary for the exercise of
jurisdiction,” and, if those minimum contacts exist, the third element determines whether the
exercise of jurisdiction “does not result solely from random, fortuitous or attenuated contacts.”
Paxton v. Citizens Bank & Tr. of W. Ga., 704 S.E.2d 215, 219 (Ga. Ct. App. 2010). Physical
presence in the state is not a requisite for jurisdiction under this subsection, and “Georgia allows
the assertion of long-arm jurisdiction over nonresidents based on business conducted through . . .
Internet contacts.” Id. (quoting ATCO Sign & Lighting Co. v. Stamm Mfg., 680 S.E.2d 571, 576
(Ga. Ct. App. 2009)). The ultimate question is whether the defendant engaged in conduct directed
at Georgia and could “fairly be said” to have literally “transacted” business in the state of Georgia.
Diamond Crystal Brands, Inc., 593 F.3d at 1264; see also id. at 1264 n.18 (“‘Transact’ means ‘to
prosecute negotiations,’ to ‘carry on business,’ ‘to carry out,’ or ‘to carry on.’”) (quoting Webster’s
Third New Int’l Dictionary 2425 (1993)).
Shanklin purposefully transacted business in Georgia. He lived in Georgia and was an
equal and active shareholder in Renewal, a Georgia corporation. In that capacity, he practiced
medicine in the state and participated in the company’s affairs. He also entered into agreements
in Georgia through which he agreed to take certain actions in the state and took on obligations for
the operation of Renewal in Georgia. The Court easily finds that Shanklin transacted business in
Georgia. Moreover, Plaintiff’s Complaint directly arises from those transactions. As a result,
exercising jurisdiction over Shanklin is appropriate under Georgia’s long-arm statute.

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Turning to step two of the personal jurisdiction analysis, the Due Process Clause of the
Fourteenth Amendment allows for two types of personal jurisdiction, “general” and “specific.”
See Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 923–24 (2011). General
personal jurisdiction arises where “continuous corporate operations within a state [are] so
substantial and of such a nature as to justify suit against [the corporation] on causes of action
arising from dealings entirely distinct from those activities.” Id. (quoting Int’l Shoe Co. v. State
of Wash., Off. of Unemployment Comp. & Placement, 326 U.S. 310, 326 (1945) (first alteration
in original)). On the other hand, specific personal jurisdiction arises based on a party’s contacts
with the forum state that are related to the cause of action. Id.; see also Helicopteros Nacionales
de Colombia, N.A. v. Hall, 466 U.S. 408, 414 nn.8 & 9 (1984); Cable/Home Commc’n Corp. v.
Network Prods., Inc., 902 F.2d 829, 857 n.41 (11th Cir. 1990). Because general jurisdiction is
based on activity unrelated to a particular cause of action, the “due process requirements for
general personal jurisdiction are more stringent than for specific personal jurisdiction.” Consol.
Dev. Corp. v. Sherritt, Inc., 216 F.3d 1286, 1292 (11th Cir. 2000). Under the more exacting
general jurisdiction standard, due process requires that a defendant’s “affiliations with the State
[be] so ‘continuous and systematic’ as to render [it] essentially at home in the forum State.”
Daimler AG v. Bauman, 571 U.S. 117, 139 (2014) (quotation and citation omitted). For either
general or specific jurisdiction to comport with due process, the defendant must have certain
minimum contacts with the state, and “[t]he minimum contacts inquiry focuses on ‘the relationship
among the defendant, the forum, and the litigation.’ This inquiry ensures that a defendant is haled
into court in a forum state based on the defendant’s own affiliation with the state, rather than the
‘random, fortuitous, or attenuated’ contacts it makes by interacting with other persons affiliated

9

with the state.” Waite v. All Acquisition Corp., 901 F.3d 1307, 1312 (11th Cir. 2018) (quoting
Walden v. Fiore, 571 U.S. 277, 284 (2014)) (internal citations omitted).
In this case, the Amended Complaint establishes specific jurisdiction over Shanklin. To
assess specific jurisdiction, the Court must apply a “three-part test.” Waite, 901 F.3d at 1313
(citing Louis Vuitton Malletier, S.A. v. Mosseri, 736 F.3d 1339, 1355 (11th Cir. 2013)). The Court
must weigh: (1) whether Renewal’s claim arises out of or relates to the nonresident defendant’s
contacts with Georgia; (2) whether Shanklin purposely availed himself of the privilege of
conducting activities in Georgia; and (3) whether exercising jurisdiction comports with traditional
notions of fair play and substantial justice. Id.
Plaintiff’s claims arise out of and relate to Shanklin’s contacts with Georgia. Plaintiff
claims that Shanklin breached his obligations arising out of his ownership and participation in
Renewal, a Georgia corporation. These facts establish a “direct causal relationship between the
defendant[s], the forum, and the litigation.” Louis Vuitton Malletier, 736 F.3d at 1355–56.
Further, Plaintiff has sufficiently alleged that Shanklin has sufficient contacts with Georgia such
that he has purposely availed themselves of the privilege of conducting activities within the state.
As laid out above, Plaintiff’s claims relate to Shanklin’s contacts with Georgia—his ownership of,
participation in, and promises to, a Georgia entity that operated a medical practice in Georgia.
Further, Shanklin purposely availed himself of the privilege of doing business in Georgia by
forming and owning a Georgia corporate entity, by using that entities to own and operate a medical
practice, and by contracting with others to guarantee the performance of contractual obligations in
Georgia. Thus, Shanklin had sufficient minimum contacts with Georgia, and those contacts related
to Plaintiff’s claims.

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Ordinarily, the burden would now shift to the non-resident defendant to present a
“compelling case” that exercising jurisdiction over them would violate traditional notions of fair
play and substantial justice. Louis Vuitton Malletier, 736 F.3d at 1355. But because Shanklin has
defaulted, he has not made any such arguments. All the same, the Court has considered the
following:
(a) the burden on the defendant, (b) the forum State’s interest in adjudicating the
dispute, (c) the plaintiff’s interest in obtaining convenient and effective relief, (d)
the interstate judicial system’s interest in obtaining the most efficient resolution of
controversies, and ([e]) the shared interest of the several States in furthering
fundamental substantive social policies.
Future Tech. Today, Inc. v. OSF Healthcare Sys., 218 F.3d 1247, 1251 (11th Cir. 2000) (citing
Burger King v. Rudzewicz, 471 U.S. 462, 466 (1985)). Having weighed each of these factors, the
Court finds that exercising jurisdiction over Shanklin would not violate traditional notions of fair
play and substantial justice.
II.

Liability and Damages
A. Count I Breach of Contract
For Renewal to recover any of the requested types of relief, the well-pleaded allegations

must establish that Shanklin is liable to Renewal for breach of the at-issue contract. The elements
of a breach of contract claim in Georgia 2 are “(1) a valid contract; (2) material breach of its terms;

Because this Court is sitting in diversity, it applies the choice-of-law rules of the forum state (i.e.,
Georgia). See Nat’l Fire Ins. of Hartford v. Thrasher Contracting, 142 F. Supp. 3d 1309, 1312 n.1 (N.D.
Ga. 2015). In the context of contracts, Georgia follows the lex loci contractus doctrine. See id. This case
involves contracts executed in Georgia that concerned a corporation and individuals operating out of
Georgia, and the contracts themselves state that the law of Georgia shall be the governing law in applying
and interpreting them. (Doc. 20, pp 2—4.) Accordingly, the Court applies Georgia law. See Thrasher
Contracting, 142 F. Supp. 3d at 1312 n.1 (applying Georgia law where it “appears all of the contracts in
this case were both formed and performed—or at least intended to be performed—in Georgia”) (emphasis
in original).
2

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and (3) damages arising therefrom.” Brooks v. Branch Banking & Tr. Co., 107 F. Supp. 3d 1290,
1295 (N.D. Ga. 2015).
As described in the Background Section, supra, Renewal specifically asserts that Shanklin
is liable for breaching an agreement he made in the Stock Transfer Agreement “to pay his share of
liability for the Curtsinger Settlement, as well as to pay his 1/3 share of the attorneys’ fees incurred
in defending the Curtsinger Matter.” (Doc. 20, p. 3.) In its prior Order denying default judgment,
the Court noted apparent inconsistencies between this allegation and the documents Renewal
attached to its Complaint. Renewal has explained those inconsistencies through its Amended
Complaint and Motion for Default Judgment.
Reading the Shareholders Agreement, Stock Transfer Agreement, and Settlement
Agreement together, Shanklin agreed to pay his portions of the Curtsinger settlement and fees
associated with the Curtsinger dispute. Through the Shareholders Agreement, Shanklin agreed to
pay his pro rata share of Renewal’s general expenses, and Renewal has plausibly alleged that the
expenses incurred to litigate and resolve the Curtsinger matter fell within that obligation.
Moreover, through the Stock Transfer Agreement, Shanklin agreed to “indemnify [Renewal] and
its shareholders against, or otherwise contribute Shanklin’s portion in respect of, Pre-Assignment
Obligations, with Shanklin’s portion being one-third in the case of the Curtsinger Matter.”
(Doc. 20-4, p. 2.) The Court noted in its prior Order denying Renewal’s first Motion for Default
Judgment that Renewal was not a party to the Stock Transfer Agreement. (Doc. 13, pp. 7—8.) In
response, Renewal plausibly alleged in its Amended Complaint that it is a third-party beneficiary
to that agreement. (Doc. 20, p. 3.)

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“The beneficiary of a contract made between other parties for his benefit may maintain an
action against the promisor on the contract.” OCGA § 9–2–20(b). “The remedies available to the
beneficiary are exactly the same as would be available to [it] if [it] were a contractual promisee of
the performance in question.” Reaugh v. Inner Harbour Hosp., Ltd., 447 S.E.2d 617, 620 (Ga.
App. 1994). That said, “it is essential to identify the specific contractual promises, if any, of which
[a third party beneficiary] was an intended beneficiary, and [its] rights as an intended beneficiary
attach only to those promises.” Archer W. Contractors, Ltd. v. Est. of Pitts, 735 S.E.2d 772, 778
(Ga. 2012). The parties to the Stock Transfer Agreement intended for Renewal to directly benefit
from Shanklin’s promises in the Agreement. This is particularly evident as to his promise to pay
his pre-assignment obligations including his share of the expenses incurred to litigate and resolve
the Curtsinger dispute. He agreed to indemnify Renewal directly for those expenses and to pay
those obligations as if he were still a contributing shareholder of the company. Accordingly,
Renewal can seek the same remedies for Shanklin’s breach of those promises as if Shanklin made
those promises to Renewal.
Renewal has also plausibly alleged that Shanklin breached his promises memorialized in
the Shareholder Agreement and Stock Transfer Agreement to pay his share of the Curtsinger
settlement and fees. Shanklin was clearly aware of the amount owned to Curtsinger as he was a
party to the Settlement Agreement. Renewal demanded that Shanklin pay his portion of the
settlement amount and fees, and he has failed to do so. Additionally, Renewal has asserted, without
dispute, that the parties contemplated that Shanklin would pay his portion of the Curtsinger
settlement and fees directly after the Settlement Agreement was finalized. Though the Shareholder
Agreement and Stock Transfer Agreement did not contain a timing provision, this period is

13

reasonable given the documents and undisputed allegations before the Court.

Parker v. Futures

Unlimited, Inc., S.E.2d 99, 99 (Ga. App. 1981) (“If no time is specified for performance,
performance is due immediately or within a reasonable time after the contract is made.”).
The Amended Complaint also plausibly alleges that Renewal suffered damages because of
Shanklin’s breach of the Shareholder Agreement and Stock Transfer Agreement. To be sure,
to Curtsinger. (Doc. 20, p. 4.) That said, Renewal

McGovern and Huntley each paid $

asserts that it was the ultimate source of this funding as it booked a debt of $

to McGovern

and Huntley. (Id.)
Having found that Renewal is entitled to judgment as to liability for Shanklin’s breach of
contract, the Court also finds that no further proof is necessary regarding the amount of damages
resulting from that breach. Ordinarily, unless a plaintiff’s claim against a defaulting defendant is
for a sum certain, the law “requires the district court to hold an evidentiary hearing” to fix the
amount of damages. S.E.C. v. Smyth, 420 F.3d 1225, 1231 (11th Cir. 2005). Yet no hearing is
needed “when the district court already has a wealth of evidence from the party requesting the
hearing, such that any additional evidence would be truly unnecessary to a fully informed
determination of damages.” Id. at 1232 n. 13. The Court has all the relevant evidence necessary
to consider Renewal’s damages, and those damages are “a liquidated sum or one capable of
mathematical calculation.” Organizacion Miss Am. Latina, Inc., 712 F. App’x at 948. As laid out
above, Renewal’s allegations and the documents attached to the Amended Complaint establish
that Renewal paid $
is $

to settle the Curtsinger matter, and Shanklin’s share of that payment

. Renewal also paid $

Shanklin’s share of that expense $

in legal fees to litigate the Curtsinger dispute, and
.

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For all these reasons, the Court fins that Shanklin is liable to Renewal in the amount of
$

for Shanklin’s breach of contract as stated in Count I.
B. Count II Prejudgment Interest
In entering default judgment, a district court may also award per diem interest. See Wells

Fargo Bank, Nat. Ass’n v. Columbia Hardwoods & Floors, Inc., No. CV 112-004, 2013 WL 8523,
at *4 (S.D. Ga. Jan. 7, 2013) (awarding accrued interest). Applying O.C.G.A. § 7-4-2(b)’s
statutory rate of 7% per year to the principal of $

, interest has accrued at a rate of $

per diem since Renewal’s demand to Shanklin on February 26, 2020. (Doc. 20-7, p. 6.) The Court
agrees that Plaintiff is entitled to interest, and it agrees with Plaintiff’s calculation. Accordingly,
the Court finds that Shanklin is liable to Renewal in the amount of $

per diem for every day

from February 26, 2020, to the date of this Order. This award of interest totals $
C. Count III Attorneys’ Fees
Plaintiff has also established that it has a right to default judgment on its claim for
attorneys’ fees and expenses. The relevant statute provides:
The expenses of litigation generally shall not be allowed as a part of the damages;
but where the plaintiff has specially pleaded and has made prayer therefor and
where the defendant has acted in bad faith, has been stubbornly litigious, or has
caused the plaintiff unnecessary trouble and expense, the jury may allow them.
O.C.G.A. § 13-6-11. Under Georgia law, “if a plaintiff in its original complaint puts the defendant
on notice that it is seeking attorney fees and expenses under O.C.G.A. § 13-6-11 as part of the
relief prayed for in the case, and if a default judgment is subsequently entered against the defendant
for failing to answer the complaint, then the plaintiff is entitled to an award of attorney fees and
expenses as a matter of law.” Water’s Edge Plantation Homeowner’s Ass’n, Inc. v. Reliford, 727
S.E.2d 234, 237 (Ga. Ct. App. 2012); see also Cotto L. Grp., LLC v. Benevidez, 870 S.E.2d 472,

15

480 (Ga. Ct. App. 2022) (“Thus, it is reversible error to decline to award attorney fees where a
default judgment has been entered on a complaint that specifically seeks attorney fees under
O.C.G.A. § 13-6-11.”). Plaintiff specifically sought attorneys’ fees in its Complaint and Amended
Complaint. Moreover, the Amended Complaint plausibly alleges that Shanklin acted in bad faith,
was stubbornly litigious, and caused Plaintiff unnecessary trouble an expense by refusing to fulfill
his contractual obligations with no excuse for his failure. Accordingly, Defendant is liable for
Renewal’s expenses of this litigation including reasonable attorneys’ fees under O.C.G.A. § 13-611. Through affidavit of counsel, Renewal has established that it has accrued at least $

.

CONCLUSION
For the reasons set forth above, the Court GRANTS Renewal’s Motion for Default
Judgment. Accordingly, the Court AWARDS Plaintiff $

in damages in connection with

Plaintiff’s claim for breach of contract. Pursuant to O.C.G.A. §§ 7–4–2, –15, the Court AWARDS
Plaintiff prejudgment interest of $
$

. The Court also AWARDS Plaintiff a total of

for attorney fees and costs.
Thus, the judgment against Shanklin totals $122,734.02. 3 The Clerk is DIRECTED to

enter judgment for Plaintiff and against Defendant in this amount and to CLOSE this case.
SO ORDERED, this 5th day of February, 2024.

R. STAN BAKER
UNITED STATES DISTRICT JUDGE
SOUTHERN DISTRICT OF GEORGIA
Under O.C.G.A. § 7–4–12(a), post-judgment interest shall bear on the total sum awarded to Plaintiff at
the rate of 11.5% per year, compounded annually, from and after the date of the Final Default Judgment
until it is satisfied in full.

3

16