KD's Crossing, LTD v. Martin
Filing
11
MEMORANDUM OPINION AND ORDER: Before the court is Plaintiff's 10 Motion for Default Judgment, filed 7/31/2014. After careful consideration of the motion, record, and applicable law, the court grants Plaintiff's Motion for Default Judgment. (Ordered by Judge Sam A Lindsay on 3/30/2015) (tln)
IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
KD’S CROSSING, LTD d/b/a Five Star
Formulas,
Plaintiff,
v.
SCOTT MARTIN,
Defendant.
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Civil Action No. 3:13-CV-4922-L
MEMORANDUM OPINION AND ORDER
Before the court is Plaintiff’s Motion for Default Judgment, filed July 31, 2014. After
careful consideration of the motion, record, and applicable law, the court grants Plaintiff’s Motion
for Default Judgment.
I.
Background
On December 18, 2013, KD’s Crossing, Ltd (“Plaintiff” or “KD’s Crossing”) filed this
action against Scott Martin (“Defendant” or “Martin”) for alleged violations of the Texas
Deceptive Trade Practices Act (“TDTPA”), breach of contract, common law fraud, and quantum
meruit.1 On April 11, 2014, a copy of the Summons and Plaintiff’s Original Petition2 was served
personally on Martin. Martin was required to answer or otherwise respond to Plaintiff’s Complaint
1
The caption of Plaintiff’s pleading states that it includes a claim for “violations of the Federal
Debt Collection Act.” The body of the pleading never references this Act, and the court concludes that
such inclusion was inadvertent. Therefore, the court does not treat Plaintiff’s pleading as having set forth
a claim under this federal statute.
2
Plaintiff’s pleading document is labeled as Plaintiff’s “Original Petition.” This is a misnomer, as
the document to commence an action in federal court is designated as a “complaint.” Fed. R. Civ. P. 3.
Hereafter, the court will refer to Plaintiff’s Original Petition as Plaintiff’s Complaint.
Memorandum Opinion and Order – Page 1
by May 2, 2014, 21 days after service of the Complaint. See Fed. R. Civ. P. 12. As of today’s
date, Martin has not answered, filed a motion to dismiss, or otherwise responded as required by
law. Martin is not an infant, incompetent person, or member of the United States military.
On June 2, 2014, KD’s Crossing filed Plaintiff’s Request[s] for Clerk’s Entry of Default.
The clerk of court entered default on the same day.
II.
Discussion
A party is entitled to entry of a default by the clerk of the court if the opposing party fails
to plead or otherwise defend as required by law. Fed. R. Civ. P. 55(a). Under Rule 55(a), a default
must be entered before the court may enter a default judgment. Id.; New York Life Ins. Co. v.
Brown, 84 F.3d 137, 141 (5th Cir. 1996). The clerk of the court has entered a default against
Martin.
Martin, by failing to answer or otherwise respond to Plaintiff’s Complaint, has admitted
the well-pleaded allegations of the Complaint and is precluded from contesting the established
facts on appeal. Nishimatsu Constr. Co. v. Houston Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir.
1975) (citations omitted). Based on the well-pleaded allegations of Plaintiff’s Complaint, which
the court accepts as true, and the record in this action, the court determines that Martin breached
the contract between him and KD’s Crossing, violated the TDTPA as set forth in the Complaint,
and committed common law fraud. Martin is in default, and KD’s Crossing is entitled to a default
judgment and appropriate damages against him. As Plaintiff seeks treble damages, the court
determines that Plaintiff elects to recover under the TDTPA. In this regard, the court concludes,
based upon the record and well-pleaded allegations of the Complaint, that Martin undertook an
unconscionable course of action against Plaintiff to its detriment in that he engaged in acts that
Memorandum Opinion and Order – Page 2
took advantage of the lack of knowledge, ability, experience, or capacity of Plaintiff to a grossly
unfair degree regarding the parties’ agreement to develop jointly a formula for a diet supplement.
III.
Damages, Prejudgment Interest, and Attorney’s Fees
A.
Damages
Plaintiff has submitted evidence that itemizes and supports the damages it incurred because
of Martin’s unconscionable conduct. The amount is $22,281.69, and the court determines that this
reflects the actual economic damages incurred by KD’s Crossing.
The court expressly finds that the acts relating to Martin’s unconscionable conduct were
committed knowingly by him. When the court finds that the conduct or acts were committed
knowingly, it may award up to three times the amount of economic damages. Tex. Bus. & Com.
Code Ann. § 17.50(b)(1). The court determines that Martin’s conduct warrants a trebling of KD’s
Crossing’s economic damages, and the total amount of damages to which KD’s Crossing is entitled
is $66,845.07.
B.
Prejudgment Interest
KD’s Crossing does not provide the court with sufficient information to determine the
amount of prejudgment interest to which it is entitled. Accordingly, the court will make no award
of prejudgment interest to KD’s Crossing.
C.
Attorney’s Fees and Costs
Plaintiff seeks attorney’s fees pursuant to section 17.50(d) of the Texas Business and
Commerce Code. As the prevailing party, Plaintiff is entitled to reasonable attorney’s fees.
Plaintiff seeks $5,046.85 as reasonable attorney’s fees. KD’s Crossing seeks fees of $275 per hour
for its counsel, Mr. Warren V. Norred, and $90 per hour for Mr. Norred’s paralegal.
Memorandum Opinion and Order – Page 3
Mr. Norred does not state how long he has been licensed by the State of Texas, but the
State Bar of Texas records indicate that he has been licensed since December 2007, just over seven
years. The court is familiar with the normal and customary hourly rate for attorneys in the DallasForth Worth Metroplex with the level of ability and experience similar to that of Mr. Norred. An
hourly rate of $275 is reasonable for a seven-year attorney in this legal market. The court also
notes that the wage for paralegals is from $75 to more than $200, and determines that an hourly
rate of $90 is quite reasonable.
The court, upon a review of the time records and its familiarity in setting fees in numerous
cases, concludes that the hours expended by Mr. Norred and his paralegal were necessarily
incurred for the successful prosecution of this action. Accordingly, the court will award KD’s
Crossing $5,046.85 for attorney’s fees and expenses.
IV.
Conclusion
For the reasons herein stated, the court grants KD’s Crossing’s Motion for Default
Judgment against Scott Martin. KD’s Crossing is entitled to and shall recover a judgment against
Martin in the amount of $66,845.07, which represents the actual economic damages multiplied by
three. The court finds that KD’s Crossing is entitled to recover reasonable attorney’s fees and
expenses in the amount of $5,046.85. The court, as required by Federal Rule of Civil Procedure
58, will enter judgment by a separate document.
It is so ordered this 30th day of March, 2015.
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Sam A. Lindsay
United States District Judge
Memorandum Opinion and Order – Page 4
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