US LOGISTICS, LLC, Plaintiff, vs. WEST EDGE FREIGHT, INC., et al., Defendants.

 

Case No. 1:15-cv-273

 

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO, WESTERN DIVISION

 

2015 U.S. Dist. LEXIS 89914

 

 

July 10, 2015, Decided

July 10, 2015, Filed

 

 

COUNSEL:  [*1] For US Logistics, LLC, Plaintiff: Curtis L Cornett, LEAD ATTORNEY, Cors & Bassett LLC – 1, Cincinnati, OH; James Charles Kezele, LEAD ATTORNEY, Cors & Bassett LLC, Cincinnati, OH.

 

JUDGES: Timothy S. Black, United States District Judge.

 

OPINION BY: Timothy S. Black

 

OPINION

 

ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT (Doc. 6)

This civil action is before the Court on Plaintiff’s motion for default judgment. (Doc. 6). Defendants did not respond.

 

I. PROCEDURAL HISTORY

Plaintiff1 filed its Complaint on April 24, 2015. (Doc. 1). Defendants West Edge Freight, Inc.,2 Rick Howard,3 Maria Soloranzo,4 and Filipe Lozano5 were served with a copy of the summons and complaint on April 27 and 28, 2015. (Doc. 3). Pursuant to Federal Rule of Civil Procedure 12(a)(1)(A), Defendants were required to file and serve their answers no later than May 18 and 19, 2015. To date, no responsive pleadings have been filed or served. On May 21, 2015, the Clerk properly entered default. (Doc. 5). Subsequently, Plaintiff filed the instant motion for default judgment. (Doc. 6).

 

1   Plaintiff is a New Mexico limited liability company which serves as a transportation broker properly licensed under the Department of Transportation’s regulations. (Doc. 6, Ex. 1 at ¶ 3). Plaintiff’s principal place [*2]  of business is located at 901 Adams Crossing, Cincinnati, Ohio 45202.

2   Defendant West Edge is a Nevada corporation with its principal place of business located at 3247 N. 38th Street, McAllen Texas 78501. (Doc. 6, Ex. 1 at ¶ 4). West Edge, at all times relevant hereto, was also a licensed DOT transportation broker. (Id.)

3   Defendant Rick Howard is a resident of the State of Texas who is the day-to-day operations manager of Defendant West Edge. (Doc. 6, Ex. 1 at ¶ 5). Howard is also married to West Edge’s President, Defendant Maria Soloranzo. (Id.)

4   Defendant Soloranzo is a resident of the State of Texas. (Doc. 6, Ex. 1 at ¶ 6). She is the President of West Edge, assists in operating West Edge’s business, and is the wife of Defendant Howard. (Id.)

5   Defendant Felipe Lozano, Jr. is a resident of the State of Texas. (Doc. 6, Ex. 1 at ¶ 7). Lozano is an employee of West Edge and also assists in operating West Edge’s business. (Id.)

 

II. FACTUAL BACKGROUND

Defendants all agreed to assist Plaintiff in performing transportation brokerage services as independent contractors pursuant to an Agreement for Business Development (“the Agreement”). (Doc. 6, Ex. 1 at ¶ 8).6 Pursuant to the Agreement, Plaintiff [*3]  agreed to pay Defendant West Edge for soliciting business, dispatching shipments, and assisting it with broker activities. (Id.) Specifically, West Edge agreed to locate customers for Plaintiff who needed goods shipped from one point to another (known as “shippers” in the transportation industry), and to coordinate these shipments on behalf of Plaintiff with both the shippers and the trucking companies who transported the shipments (known as “vendors” in the trucking industry). (Id.) However, instead of Defendants assisting Plaintiff, Defendants instead began: (1) redirecting payments to West Edge that were in fact due to Plaintiff; and (2) acting as a broker on their own behalf without remitting any payments to Plaintiff despite the fact that Plaintiff was continuing to pay West Edge and vendors for transporting the shipments. (Id.) Defendants further fraudulently informed numerous shippers that those shippers should pay Defendants directly for the brokerage services which Plaintiff was financing so that Defendants could unlawfully keep all of the fees for these brokerage services and cut Plaintiff out of its fees to which it was contractually entitled. (Id.)

 

6   Plaintiff and West Edge [*4]  entered into the Agreement on or about January, 2013. (Doc. 6, Ex. 1 at ¶ 9). Pursuant to the Agreement, West Edge agreed to serve as an independent contractor for Plaintiff. Defendant Soloranzo signed the Agreement on behalf of West Edge in her capacity as President of West Edge. (Id.)

Pursuant to the Agreement, Plaintiff agreed to provide credit to West Edge, advance capital to West Edge, and manage all the administrative services necessary for West Edge to assist Plaintiff with its brokering activities. (Doc. 6, Ex. 1 at ¶ 10). In exchange, West Edge, on behalf of Plaintiff, agreed to develop and solicit freight transportation services for Plaintiff by identifying and soliciting shippers for freight transportation. (Id.)

In exchange for West Edge’s services, Plaintiff would pay West Edge 70% of the gross profits, after vendor costs, for every shipment West Edge was responsible for securing. If a shipper failed to pay Plaintiff for the amount invoiced to the shipper, West Edge assumed responsibility for the unpaid invoice and was required to reimburse Plaintiff for any advances made by Plaintiff, expenses incurred by Plaintiff, and other unpaid amounts owed to Plaintiff as a result [*5]  of the unpaid invoice. (Doc. 6, Ex. 1 at ¶ 11).

Beginning in 2014, West Edge, through the actions of the individual Defendants, began to fraudulently inform certain shippers that those shippers should pay West Edge or one or more of the individual Defendants directly instead of paying Plaintiff. (Doc. 6, Ex. 1 at ¶ 12). If the shippers agreed to pay West Edge or the individual Defendants directly, West Edge and/or the individual Defendants kept the entire amount paid and did not disclose to Plaintiff that West Edge and/or the individual defendants had been paid. (Id.)

On other shipments, West Edge would inform Plaintiff that a shipment had been arranged for a certain shipper when, in fact, the shipment had been performed for another shipper and the shipper for whose benefit the goods were actually transported paid West Edge directly for West Edge’s brokerage services. (Doc. 6, Ex. 1 at ¶ 13). Thus, Plaintiff would bill a shipper who did not actually receive any brokerage services from either Plaintiff or West Edge and that shipper therefore obviously refused to pay Plaintiff for these phantom brokerage services. (Id.)

On still other shipments, the shippers simply failed to pay Plaintiff [*6]  for the shipments arranged by West Edge for reasons which remain unknown to Plaintiff, even though Plaintiff has already paid West Edge in full for arranging those shipments. (Doc. 6, Ex. 1 at ¶ 14). To date, West Edge owes Plaintiff a total of $265,521.00 for shipments that West Edge was supposed to broker on behalf of Plaintiff, but for which Plaintiff has not received any payment.

 

III. STANDARD OF REVIEW

Applications for default judgment are governed by Fed. R. Civ. P. 55(b)(2). Following the clerk’s entry of default pursuant to Fed. R. Civ. P. 55(a) and the party’s application for default under Rule 55(b), “the complaint’s factual allegations regarding liability are taken as true, while allegations regarding the amount of damages must be proven.” Morisaki v. Davenport, Allen & Malone, Inc., No. 2:09cv298, 2010 U.S. Dist. LEXIS 86241, at *1 (E.D. Cal. Aug. 23, 2010) (citing Dundee Cement Co. v. Howard Pipe & Concrete Products, 722 F.2d 1319. 1323 (7th Cir. 1983)).

While liability may be shown by well-pleaded allegations, this Court is required to “conduct an inquiry in order to ascertain the amount of damages with reasonable certainty.” Osbeck v. Golfside Auto Sales, Inc., No. 07-14004, No. 07-14004, 2010 U.S. Dist. LEXIS 62027, at *5 (E.D. Mich. June. 23, 2010). To do so, the civil rules “require that the party moving for a default judgment must present some evidence of its damages.” Mill’s Pride, L.P. v. W.D. Miller Enters., No. 2:07cv990, 2010 U.S. Dist. LEXIS 36756, at *1 (S.D. Ohio Mar. 12, 2010).

 

IV. ANALYSIS

Defendants having defaulted, the factual allegations in [*7]  the complaint, except those related to the amount of damages, are deemed true. Antoine v. Atlas Turner, Inc., 66 F.3d 105, 110 (6th Cir. 1995). To ascertain an uncertain sum of damages, Rule 55(b)(2) “allows but does not require the district court to conduct an evidentiary hearing.” Vesligaj v. Peterson, 331 F. App’x 351, 354-55 (6th Cir. 2009). An evidentiary hearing is not required if the Court can determine the amount of damages by computation from the record before it. HICA Educ. Loan Corp. v. Jones, No. 4:12cv962, 2012 U.S. Dist. LEXIS 116166, at *1 (N.D. Ohio Aug. 16, 2012). The Court may rely on affidavits submitted on the issue of damages. Schilling v. Interim Healthcare of Upper Ohio Valley, Inc., No. 206-cv-487, 2007 U.S. Dist. LEXIS 3118, at *2 (S.D. Ohio Jan. 16, 2007).

As established by the facts set forth in the Complaint, as well as Plaintiff’s affidavit and spreadsheet, Plaintiff is entitled to damages against the Defendants, jointly and severally, in the amount of $265,521.00.

 

V. CONCLUSION

Based on the foregoing, Plaintiff’s motion for default judgment (Doc. 6) is GRANTED. The Clerk shall enter Judgment in favor of Plaintiff and against Defendants West Edge Freight, Inc., Rick Howard, Maria Soloranzo, and Filipe Lozano, Jr., jointly and severally, in the amount of $265,521.00, whereupon this civil action is TERMINATED on the docket of this Court.

IT IS SO ORDERED.

Date: 7/10/15

/s/ Timothy S. Black

Timothy S. Black

United States [*8]  District Judge

 

KATRINA CUMMINGS, Plaintiff, v. JAMES RICHARD DOUBERLY, Defendant.

 

CV 214-152

 

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF GEORGIA, BRUNSWICK DIVISION

 

2015 U.S. Dist. LEXIS 94876

 

 

July 21, 2015, Decided

July 21, 2015, Filed

 

 

COUNSEL:  [*1] For Katrina Cummings, Plaintiff: W. Douglas Adams, LEAD ATTORNEY, W. Douglas Adams, Attorney at Law, Brunswick, GA.

 

For James Richard Douberly, Defendant: Paul Michael Scott, Richard K. Strickland, LEAD ATTORNEYS, Brown, Readdick, Bumgartner, Carter, Strickland & Watkins, LLP, Brunswick, GA.

 

JUDGES: LISA GODBEY WOOD, CHIEF UNITED STATES DISTRICT JUDGE.

 

OPINION BY: LISA GODBEY WOOD

 

OPINION

 

ORDER

Plaintiff Katrina Cummings seeks to renew her dismissed complaint, which alleges violations of her constitutional rights under 42 U.S.C. § 1983, against Defendant James Richard Douberly. See Dkt. no. 1 (“Renewed Complaint”). This Court dismissed Plaintiff’s original complaint without prejudice in a prior action because Plaintiff failed to show proof that she had effectuated timely service on Defendant. She now comes before the Court with proof of untimely service on Defendant, and Defendant has moved to dismiss the Renewed Complaint as time-barred. Dkt. no. 5. This Court converted the Motion to Dismiss into a Motion for Summary Judgment. Dkt. no. 12. Because the prior complaint was dismissed by a judicial determination that dismissal was authorized, the prior action was void and thus is not renewable under Georgia’s renewal statute. Therefore, [*2]  Defendant’s Motion for Summary Judgment (Dkt. no. 5) is GRANTED.

 

FACTUAL AND PROCEDURAL HISTORY

Plaintiff alleges that on April 27, 2011, she returned from the store to find several police officers around her home. Dkt. no. 1, ¶¶ 5-9. A man had fled police and entered her home, and the police wanted to search inside for him. Id. Plaintiff says that when she asked the police why they wanted her consent to search her home, the “officers became upset.” Id. ¶ 10. Plaintiff ultimately consented to the search on the condition that the police first allow her to remove her children from the home. Id. ¶ 11. Plaintiff says that after police searched her home and arrested the fugitive, Defendant Douberly had her arrested, without probable cause and for malicious purposes, for obstructing or hindering law enforcement officers. Id. ¶ 12. Plaintiff claims the arrest violated her constitutional rights, “including but not limited to the Fourth, Fifth, Sixth, and Fourteenth Amendments to the United States Constitution.” Id. ¶ 13.

Plaintiff, who is represented by counsel, filed her first complaint against Defendant on April 22, 2013, just a few days before Georgia’s two-year statute of limitations for personal injury claims would expire. See Complaint (Dkt. no. 1), Cummings [*3]  v. Douberly et al., 2:13-CV-59 (S.D. Ga. Apr. 22, 2013)1; Ga. Code Ann. § 9-3-33. On October 11, 2013, Defendant moved to dismiss the complaint for failure to make timely service. See Def.’s Mot. to Dismiss (Dkt. no. 7), Cummings v. Douberly et al., 2:13-CV-59 (S.D. Ga. Oct. 11, 2013). This Court granted Defendant’s motion to dismiss the first complaint on April 7, 2014, because Plaintiff failed to show proof that she had effectuated service on Defendant even after being given extra time to do so. See Order Granting Def.’s Mot. to Dismiss (Dkt. no. 14), Cummings v. Douberly et al., 2:13-CV-59 (S.D. Ga. Apr. 7, 2014) (“Cummings I Order”).

 

1   This Court takes judicial notice of the public records-such as Plaintiff’s complaint and this Court’s own Orders-pertaining to Plaintiff’s prior action, Cummings v. Douberly et al., 2:13-CV-59 (S.D. Ga. Feb. 11, 2015).

Plaintiff filed her Renewed Complaint against Defendant in the present action on October 6, 2014, one day within Georgia’s six-month window for recommencing discontinued or dismissed cases, but more than three years after the right of action accrued. See Dkt. no. 1; Ga. Code Ann. § 9-2-61(a); § 9-3-33. Plaintiff has provided a copy of the Summons on Defendant, which indicates service on December [*4]  5, 2013–some two years, seven months, and eight days after the alleged constitutional violations were committed and 106 days after Plaintiff was afforded a 30-day extension by the Magistrate Judge to effectuate service on Defendant. See Dkt. no. 8-1. Thus, the copy of the Summons shows that Plaintiff served Defendant in the prior action after Defendant filed his motion to dismiss for untimely service in October 2013, but before the Court granted that motion in April 2014. For some unexplained reason, Plaintiff never presented this Court the summons in the prior action, even when faced with a motion to dismiss due to lack of service.

Defendant has filed a Motion to Dismiss the Renewed Complaint, arguing that this suit is barred by the statute of limitations and cannot be saved by Georgia’s tolling provision for renewal actions. Dkt. no. 5. Because Plaintiff, as the nonmovant, filed an extraneous document in her opposition to Defendant’s Motion to Dismiss purporting to show that Defendant was eventually served, the Court converted Defendant’s Motion to Dismiss into a Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 12(d). See Dkt. no. 12. The Court allowed the parties ten days to supplement the record. [*5]  Id. Defendant promptly responded with additional argument. Dkt. no. 13. Plaintiff filed a late response, but did not otherwise attempt to introduce new evidence for the Court’s consideration. Dkt. no. 14. Defendant’s Motion to Dismiss is thus ripe for adjudication as a Motion for Summary Judgment.

 

LEGAL STANDARD

When considering a motion for summary judgment the court “shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The dispute in this case turns solely on the interpretation of Georgia’s renewal statute and its resultant case law.

 

DISCUSSION

Under Georgia’s renewal statute,

 

When any case has been commenced in either a state or federal court within the applicable statute of limitations and the plaintiff discontinues or dismisses the same, it may be recommenced in a court of this state or in a federal court either within the original applicable period of limitations or within six months after the discontinuance or dismissal, whichever is later . . .

 

 

Ga. Code Ann. § 9-2-61(a). “The privilege of dismissal and renewal does not apply to cases decided on their merits or to void cases.” Tate v. Coastal Utils., Inc., 247 Ga. App. 738, 545 S.E.2d 124, 126 (Ga. Ct. App. 2001). An action is [*6]  “void” under one of two circumstances: (1) if service is never perfected, and (2) if there has been a judicial determination that dismissal is authorized and such an order has been entered. See id. “However, unless and until the trial court enters an order dismissing a valid action, it is merely voidable and not void.” Id. (quoting Hobbs v. Arthur, 264 Ga. 359, 444 S.E.2d 322, 323 (Ga. 1994)).

The central issue in this case is whether Plaintiff’s prior action against Defendant was void. Plaintiff argues that even though her prior action was dismissed for failure to perfect service, Defendant was nevertheless served. According to Plaintiff, “[a]ny delay in service in the prior action is essentially irrelevant in this action.” Dkt. no. 8, p. 2 (citing Hobbs v. Arthur, 264 Ga. 359, 444 S.E.2d 322 (Ga. 1994)).

The circumstances in this case are distinguishable from Hobbs. In Hobbs, the Georgia Supreme Court held that an action was voidable, but not void, where (1) the plaintiff had served the defendant after the service period in the original action; (2) the plaintiff then voluntarily dismissed his complaint; and (3) the dismissal came before the trial court ruled on the defendant’s motion for summary judgment. Hobbs, 444 S.E.2d at 323-24. But here, Plaintiff did not voluntarily dismiss her prior action before the Court granted Defendant’s [*7]  motion to dismiss. See Cummings I Order. Because the Court entered an Order dismissing the otherwise valid action, Plaintiff’s initial suit was void and cannot be renewed under Georgia’s renewal statute. See Hobbs, 444 S.E.2d at 323 (“A suit is also void and incapable of renewal under OCGA § 9-2-61(a) if there has been a judicial determination that dismissal is authorized. However, unless and until the trial court enters an order dismissing a valid action, it is merely voidable and not void.”).

In fact, as opposed to Hobbs, this case is on all fours with Tate. In Tate, the plaintiffs brought suit against the defendant trucking company and its driver in federal district court just days within the statute of limitations for their personal injury claims arising from a multi-vehicle accident. Tate, 545 S.E.2d at 125. The district court ordered plaintiffs to provide proof that the defendants had been served within the time limits of Federal Rule of Civil Procedure 4 (m). Id. Later, the district court dismissed the defendants from the litigation, having found that plaintiffs “failed to provide the required proof of service.” Id. However, plaintiffs had actually effectuated service three days before the court issued its order. Id. In light of this fact, the district court issued another [*8]  order reaffirming that the plaintiffs had “failed to show good cause for their failure to serve defendants within the 120 day service period,” and also finding that the plaintiffs “failed to diligently serve defendants [. . .] after the expiration of the statute of limitations as required under Georgia law,” and were thus “guilty of laches because they have indulged in unreasonable delays without excuse.” Id. In concluding that the claims against the defendants should remain dismissed, the district court nevertheless granted the plaintiffs’ alternative motion to dismiss the action without prejudice for the express purpose of renewing the action pursuant to Georgia’s renewal statute. Id. at 125-26.

Upon renewal, the Georgia Superior Court determined, and the Court of Appeals affirmed, that the initial suit was void because the prior action was not commenced within the applicable statute of limitation “since service had not been timely perfected.” Id. at 126-27. Nor was it “dismissed voluntarily at the plaintiff’s behest.” Id. There had also been a judicial determination that dismissal was authorized. Id. at 126-127. Thus, even upon a dismissal without prejudice for the stated purpose of allowing plaintiffs to renew [*9]  their action under Georgia’s renewal statute, a case cannot be renewed, under any circumstances, if it is void.

The prior action in this case was void. Plaintiff failed to show that she ever served Defendant in the prior action, and her case was dismissed accordingly. It does not matter that Plaintiff actually served Defendant before the Court dismissed the case for two reasons. First, just as in Tate, that service was still 76 days too late, and was thus untimely.2 Second, also echoing Tate, Plaintiff failed to show good cause for her delay in effectuating service or that she had exercised due diligence in doing so.

 

2   Per Rule 4 (m), Plaintiff had 120 days after the complaint in the original action was filed on April 22, 2013, to serve Defendant. The Magistrate Judge granted her request for an extension, affording her an additional 30 days to perfect service. See Cummings I Order, p. 1. The summons was not served until December 5, 2015, 226 days after the complaint was filed, or 76 days after service would have been timely.

It is also of no consequence that the prior action was dismissed without prejudice. The district court in Tate dismissed the plaintiffs’ case without prejudice expressly so they [*10]  could take advantage of Georgia’s renewal statute–but the Georgia Superior and Appellate Courts still refused the plaintiffs their mulligan. Plaintiff in this case lacks even the prior Court’s blessing for renewal. As the Court noted in its prior Order, “given the timing of Plaintiff’s actions, or, more precisely, inactions, a dismissal without prejudice may be tantamount to a dismissal with prejudice.” Cummings I Order, p. 4 n.2. Indeed it was.

Thus, Plaintiff’s prior action against Defendant was void and cannot be renewed under the renewal statute. Her instant complaint was filed beyond the two-year statute of limitations period governing 42 U.S.C. § 1983 claims. Therefore, Defendant’s Motion for Summary Judgment (Dkt. no. 5) must be GRANTED. The Clerk of Court is directed to enter the appropriate judgment.

SO ORDERED, this 21ST day of July, 2015.

/s/ Lisa Godbey Wood

LISA GODBEY WOOD, CHIEF JUDGE

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF GEORGIA