DAYS INNS WORLDWIDE, INC. v. BRADDOCK REALTY, LLC et al
Filing
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OPINION. Signed by Judge William J. Martini on 7/19/16. (gh, )
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
DAYS INNS WORLDWIDE, INC.,
Civ. No. 16-370 (WJM)
Plaintiff,
v.
OPINION
BRADDOCK REALTY, LLC and
PRASHANT PATEL,
Defendants.
Plaintiff Days Inns Worldwide, Inc. (“DIW”) brings the instant unopposed
motion for default judgment against Defendants Braddock Realty, LLC
(“Braddock”) and Prashant Patel (“Patel” and, collectively, “Defendants”) pursuant
to Rule 55(b) of the Federal Rules of Civil Procedure. For the reasons set forth
below, DIW’s motion is GRANTED.
I.
BACKGROUND
On or about June 7, 2007, DIW entered into a License Agreement (“License
Agreement”) with the Defendants for the operation of a 165-room Days Inn in
Lexington Park, Maryland. (Compl., ECF No. 1, ¶ 15.) In accordance with the
License Agreement, Defendants were required to operate a Days Inn for a fifteenyear term. (Id. ¶ 16.) On September 30, 2014, Defendants unilaterally terminated
the License Agreement. (Id. ¶ 28.) The same day, DIW sent letters to Defendants
informing them of their violation of the License Agreement and the requirement
that they provide all outstanding payments. (Id. ¶ 29.) Upon Defendants failing to
do so, DIW commenced the instant action seeking payment of outstanding fees in
amount of $55,475.57, liquidated damages in the amount of $165,000.00, and
prejudgment interest. (Id. ¶¶ 18, 56.)
DIW commenced this action on January 21, 2016. The service of the
Complaint was effectuated on defendant Patel on April 5, 2016. Unable to locate
defendant Braddock, DIW served Braddock via certified and regular mail with
return receipt requested on April 14, 2016. (Certification Bryan P. Couch Supp.
Mot. Final J. by Default (“Couch Cert.”), ECF No. 8-2, ¶ 5-7.) The Clerk entered
default against the Defendants on May 10, 2016, which was also served upon
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Defendants. (Couch Cert. ¶ 10.) DIW then filed the instant motion for default
judgment on May 25, 2016.
II.
DISCUSSION
The mere fact of default does not entitle plaintiff to judgment. To enter
default judgment, the court must first determine whether a sufficient cause of
action has been stated, taking as true the factual allegations of the complaint. See
Chanel Inc. v. Gordashevsky, 558 F. Supp. 2d 532, 535-36 (D.N.J. 2008). Once a
cause of action has been established, “[b]efore imposing the extreme sanction of
default, district courts must make explicit factual findings as to: (1) whether the
party subject to default has a meritorious defense, (2) the prejudice suffered by the
party seeking default, and (3) the culpability of the party subject to default.” Doug
Brady, Inc. v. N.J. Bldg. Laborers Statewide Funds, 250 F.R.D. 171, 177 (D.N.J.
2008) (citing Emcasco Ins. Co. v. Sambrick, 834 F.2d 71, 74 (3d Cir. 1987)).
Although the facts plead in the complaint are accepted as true, plaintiff must prove
damages. See Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir. 1990).
The Court finds that based on the facts set forth by DIW, default judgment
should be entered. DIW has put forth a valid cause of action based on a breach of
the License Agreement. See Ramada Worldwide Inc. v. Courtney Hotels USA,
LLC, No. 11–896, 2012 WL 924385, at *3 (D.N.J. Mar. 19, 2012) (stating that to
establish a breach of contract claim, a plaintiff has the burden of showing: “(1) a
valid contract, (2) breach of that contract, and (3) damages resulting from that
breach.”) Accordingly, since there is sufficient evidence on the record that
Defendants entered into and breached the License Agreement, the Court finds that
there is no basis for Defendants to claim a meritorious defense. Additionally, the
Court finds that Plaintiff has been prejudiced by Defendants’ failure to plead or
otherwise defend, because it has been prevented from moving forward with its case
and receiving the requested relief. Lastly, where a defendant has failed to respond,
this failure “evinces [a defendant’s] culpability in its default.” Teamsters Pension
Fund of Philadelphia & Vicinity v. Am. Helper, Inc., No. CIV. 11-624 JBS/JS,
2011 WL 4729023, at *4 (D.N.J. Oct. 5, 2011).
As to damages, DIW has submitted sufficient evidence to support its request
for damages totaling $272,444.42. (Aff. Suzanne Fenimore, ECF No. 8-3, ¶¶ 2223.)
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III.
CONCLUSION
For the above reasons, Plaintiff’s motion for default judgment is
GRANTED. An appropriate order follows.
/s/ William J. Martini
WILLIAM J. MARTINI, U.S.D.J.
Date: July 19, 2016.
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