DAYS INNS WORLDWIDE, INC. v. ALEX HOSPITALITY, LLC et al

Filing 19

MEMORANDUM AND ORDER - Under Fed. R. Civ. P. 55(b)(2), its hereby ORDERED that Plaintiff present to the Court an itemized statement of damages still owed to DIW under the license agreement that reflects an amount already paid by Pravin Patel under the settlement agreement; If the terms of the settlement agreement are confidential, DIW will submit the agreement under seal. Signed by Judge William H. Walls on 8/25/2015. (anr)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

DAYS INN WORLDWIDE, fNC, a
Delaware Corporation,
Plaintiff,

MEMORANDUM AND ORDER
Civ. No. 13-3273 (WHW)(CLW)

v.
ALEX HOSPITALITY, LLC, a Minnesota
Limited Liability Company; PRAV1N
PATEL, an individual; and KAUSIK PATEL,
an individual,
Defendants.

This matter comes before the Court on the motion of Plaintiff Days Inn Worldwide, Inc.
(DIW) for default judgment against Defendants Alex Hospitality, LLC (“Alex Hospitality”) and
Kausik Patel. ECF No. 13. DIW filed this action on May 23, 2013, alleging that Alex Hospitality
breached a license agreement with DIW and seeking $145,728.63 in recurring fees owed under
the license agreement. ECF No. 1. Both Pravin Patel and Kausik Pate! served as guarantors of
the agreement. See Aff. of Suzanne Fenimore in Supp. of Mot. for Final J. by Default as to Alex
Hospitality, LLC and Kausik Patel Only (“Fenimore Aff.”) Ex. B., ECF No. 13-3. DIW reached
a settlement with Pravin Pate!, and the Court entered a stipulation of dismissal as to Pravin Patel
on April 2, 2014, retaining jurisdiction over the enforcement of the settlement. ECF No. 12. DIW
filed a motion for default judgment against Alex Hospitality and Kausik Patel on November 7,
2014, alleging that damages stemming from the breach of the agreement include unpaid
recurring fees in the amount of$140,473.22, along with attorney’s fees and court costs in the
amounts of $7,800 and $1,073.24, respectively. See ECF No. 13, fenimore Aff.

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¶J 17-19; ECF

NOT FOR PUBLICATION
No. 13-3, Ex. E. DIW noted that the amount it seeks has been reduced by the settlement amount
received from Pravin Patel and submitted an itemized statement detailing the recurring fees. ECF
No. 13, Fenimore Aff

¶

17 n. 1; ECF No. 13-3, Ex. D. The itemized statement contains no

reference to Pravin Pate!’ s settlement contribution or any other reduction in fees owed. The
Court ordered DIW to present the terms of the settlement agreement with Pravin Patel in order to
calculate the damages still owed to DIW under the license agreement on March 18, 2015. ECF
No. 14. The Court again instructed DIW to provide the Court with the terms of the settlement
agreement on August 5, 2015. ECF No. 17.

On August 20, 2015, DIW submitted a letter to the Court under seal attaching the
settlement agreement with Pravin Pate! and informing the Court that the damages sought in DIW
motion for default judgment reflect a contribution of $25,000 by Pravin Patel under the
settlement agreement. ECF No. 1$.
When ruling on a motion for default judgment, if the damages are not for a “sum certain
or for a sum that can be made certain by computation,” Fed. R. Civ. P. 55(b)(1), the “court may
conduct hearings or make referrals.

.

.

when, to enter or effectuate judgment, it needs to

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determine the amount of damages.” Fed. R. Civ. P. 55(b)(2); see also Comdyne I, Inc. v. Corbin,
908 F.2d 1142, 1149 (3d Cir. 1990). In calculating damages for breach of contract, a court may
reduce the outstanding obligation of a defendant by an amount paid to the plaintiff by another
settling defendant. See Gen. Elec. Capital Corp. v. Clflon Radiology Associates, LLC, No.
CIVA 05-CV-4867 PGS, 2007 WL 1791267, at *5 (D.N.J. June 19, 2007).
Because Pravin Patel and Kausik Patel were co-guarantors of the license agreement, any
amount paid by Pravin Patel would reduce the amount allegedly owed to DIW by Kausik Patel.
Though DIW has informed the Court that the amount in recurring fees it seeks has been reduced

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NOT FOR PUBLICATION
by Pravin Patel’ s settlement contribution, the itemized statement submitted with the motion for
default judgment does not make this reduction clear. ECF No. 13-3, Ex. D.
The Court cannot determine the amount still allegedly owed to DIW under the license
agreement without a more detailed damages calculation that explicitly reflects Pravin Patel’ s
settlement contribution.

ORDER
Under Fed. R. Civ. P. 55(b)(2), it is hereby ORDERED that Plaintiff present to the Court
an itemized statement of damages still owed to DIW under the license agreement that reflects
any amount already paid by Pravin Patel under the settlement agreement.
It is further ORDERED that if the terms of the settlement agreement are confidential,
DIW will submil the agreement under sea/

William H. Walls
Senior United States District Court Judge

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