Transcontinental Refrigerated Lines Inc v. New Prime Inc et al

Filing 194

ORDER denying Transcontinental's motion for default jdgmt 193 against Cherry Marine & S&M Leasing w/out prejudice to reintstatement after all remaining claims resolved against non-defaulting defts & noting entry of default 145 against same shall remain on docket. (See order for complete details.) Signed by Chief Judge Christopher C. Conner on 2/24/16. (ki)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
TRANSCONTINENTAL
REFRIGERATED LINES, by
LAWRENCE V. YOUNG, ESQ.,
Liquidating Agent,
Plaintiff
v.
NEW PRIME, INC., et al.,
Defendants

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CIVIL ACTION NO. 1:13-CV-2163
(Chief Judge Conner)

ORDER
AND NOW, this 24th day of February, 2016, upon consideration of the
motion (Doc. 193) for default judgment by plaintiff and debtor Transcontinental
Refrigerated Lines, Inc. (“Transcontinental”), wherein Transcontinental requests
that the court enter default judgment against defendants Cherry Marine, LLC
(“Cherry Marine”) and S&M Leasing, Inc. (“S&M Leasing”), but also that the court
defer a determination of the appropriate amount of damages until the time of trial
against remaining defendants, and further upon consideration of the court’s order
(Doc. 134) dated September 29, 2014, wherein the court granted a request (Doc. 126)
by then-counsel to Cherry Marine and S&M Leasing to withdraw as counsel of
record for both entities, upon the representation that both entities had discharged
counsel, and wherein the court noted that corporate entities cannot proceed pro se
in federal court, see Lawson v. Nat’l Cont’l-Progressive Ins. Co., 347 F. App’x 741,
742 n.1 (3d Cir. 2009) (nonprecedential) (citing Rowland v. Cali. Men’s Colony, 506
U.S. 194, 201-02 (1993)); see also Falato v. Fotografixusa, LLC, No. 09-5232, 2013 WL

3873260, at *1 (D.N.J. July 25, 2013) (citing Dougherty v. Snyder, 469 F. App’x 71, 7273 (3d Cir. 2012)); observed that defendant Stephen P. Hrobuchak, Jr.
(“Hrobuchak”), the sole principal of both entities, understands and accepts that
default judgment may be entered against the unrepresented corporate defendants,
(Doc. 134 at 2); and formally admonished that the court may enter default judgment
against Cherry Marine and S&M Leasing if substitute counsel does not enter an
appearance on their behalf, (id.), and it appearing that substitute counsel has not
entered an appearance or otherwise defended on behalf of either entity, and that, at
the request (Doc. 144) of Transcontinental, the Clerk of Court entered default (Doc.
145) against Cherry Marine and S&M Leasing on December 10, 2014, see FED. R.
CIV. P. 55(a), but it further appearing that, in light of the potential for inconsistent
judgments, a court should not enter default judgment against defaulting defendants
when claims based upon identical allegations and theories of liability remain for
trial against defendants not in default, see Farzetta v. Turner & Newall, Ltd., 797
F.2d 151, 154 (3d Cir. 1986) (quoting Frow v. De La Vega, 82 U.S. 552, 554 (1872)); see
also Animal Sci. Prods., Inc. v. China Nat’l Metals & Minerals Imp. & Exp. Corp.,
596 F. Supp. 2d 842, 849 (D.N.J. 2008) (collecting cases), and the court concluding
that entry of default judgment against corporate entities Cherry Marine and S&M
Leasing while identical claims remain pending against Hrobuchak, the principal of
both entities, might result in “logically inconsistent determinations as to liability,”
Stout St. Funding LLC v. Johnson, 873 F. Supp. 2d 632, 649-50 (E.D. Pa. 2012), and

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work “an incongruous result” such that defaulting defendants would “unjustly bear
the burden of judgment,” Joe Hand Promotions, Inc. v. Tickle, No. 4:12-CV-1874,
2014 WL 1051821, at *5-7 (M.D. Pa. Mar. 17, 2014) (Brann, J.) (quoting Frow, 82 U.S.
at 554), and observing that, according to Transcontinental, a determination of the
proper amount of damages must await trial in any event, (see Doc. 193 at 3), such
that Transcontinental will not be prejudiced by delay in entry of default judgment,
it is hereby ORDERED that:
1.

Transcontinental’s motion (Doc. 193) for default judgment against
Cherry Marine and S&M Leasing is DENIED without prejudice to
reinstatement thereof after all remaining claims have been resolved
against the non-defaulting defendants.

2.

The entry of default (Doc. 145) against Cherry Marine and S&M
Leasing shall remain on the docket.

/S/ CHRISTOPHER C. CONNER
Christopher C. Conner, Chief Judge
United States District Court
Middle District of Pennsylvania