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Mit, Inc. v. Medcare Express, N. Charleston, LLC

United States District Court, S.D. Georgia, Augusta Division

October 14, 2014

M.I.T., INC., a Georgia Corporation, Plaintiff,
v.
MEDCARE EXPRESS, N. CHARLESTON, LLC, a South Carolina Limited Liability Company, and MEDCARE URGENT CARE CENTER, W. ASHLEY, LLC, a South Carolina Limited Liability Company, and MEDCARE EXPRESS LEXINGTON, LLC, a South Carolina Limited Liability Company, Defendants.

ORDER

J. RANDAL HALL, District Judge.

Presently pending before the Court is Plaintiff's Motion for Default Judgment. (Doc. 9.) For the reasons set forth below, Plaintiff's motion is GRANTED.

I. BACKGROUND

This dispute arises from a contract between Plaintiff and Defendants regarding the sale and service of medical imaging equipment. (Compl. ¶ 6-10.) Plaintiff is in the business of selling and servicing the imaging equipment, and Defendants provide medical services to the general public. (Id. ¶ 6.) In 2010, Radwin S. Hallaba, M.D., who owns and manages the three Defendant companies, spoke with Plaintiff regarding the purchase of CT Imaging Equipment, along with service for those machines. (Id. ¶ 7.)

The present dispute regards contracts entered into by all three Defendants; the contract terms are identical, though they were entered into on different dates. (Id. ¶ 8-10.) Each contract provided for the purchase of the CT machine and thirtysix months of service for that machine. (Id.) The machine cost $150, 000 for Medcare Express, N. Charleston and Medcare Urgent Care Center, but $160, 000 for Medcare Express Lexington. (Id.) The monthly service fee was $4, 500 for each Defendant. (Id.)

On October 1, 2010, Plaintiff quoted Medcare Express, N. Charleston for the purchase and service of the machine. (Id. ¶ 8.) In response, Medcare Express, N. Charleston paid for the equipment and eleven months of service, leaving twenty-five months unpaid. (Id.) On May 15, 2011, Plaintiff quoted Medcare Urgent Care Center for the purchase and service of the machine. (Id. ¶ 9.) In response, Medcare Urgent Care Center paid for the equipment and four months of service, leaving thirty-two months unpaid. (Id.) On January 5, 2012, Plaintiff quoted Medcare Express Lexington for the purchase and service of the machine. (Id. ¶ 10.) In response, Medcare Express Lexington paid for the equipment but has yet to pay any of the service payments, leaving thirty-six months unpaid. (Id.) In Plaintiff's complaint, it alleges that Defendants, on multiple occasions, acknowledged their debt under the service agreement via e-mail. (Id. ¶ 12.) The contracts additionally provided that, in the event of default, Plaintiff may "terminate this Agreement and all Service Obligations and accelerate all remaining payments due under th[e] Agreement." (Compl., Exs. 2-4.) Plaintiff provided service for the equipment to all Defendants, upon Defendants' request. (Id. ¶ 13.)

On March 25, 2014, Plaintiff filed suit seeking to compel arbitration and/or for breach of contract and quantum meruit. (Doc. 1.) Defendants waived service on May 6, 2014, and their answers were due May 26, 2014. (Doc. 3.) Defendants failed to plead or otherwise respond to the Complaint. (Doc. 8.) Subsequently, Plaintiff filed its Motion for Default Judgment on June 17, 2014, asserting that, pursuant to Federal Rule of Civil Procedure 55(b), the Court should enter a default judgment against Defendants on its claims. (Doc. 9.)

II. DISCUSSION

"[D]efendant's default does not in itself warrant the court in entering a default judgment. There must be a sufficient basis in the pleadings for a judgment entered.... The defendant is not held to admit facts that are not well-pleaded or to admit conclusions of law." Nishimatsu Constr. Co. v. Houston Nat'l Bank , 515 F.2d 1200, 1206 (5th Cir. 1975).[1] A defendant, by his default, is only deemed to have admitted the "plaintiff's well-pleaded allegations of fact." Id . "[T]hree distinct matters [are] essential in considering any default judgment: (1) jurisdiction; (2) liability; and (3) damages." Pitts ex rel. Pitts v. Seneca Sports, Inc. , 321 F.Supp.2d 1353, 1356 (S.D. Ga. 2004).

A. Jurisdiction

The parties in this case are diverse and the amount in controversy exceeds $75, 000. Thus, the Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332.

The Complaint alleges that the Defendants are South Carolina limited liability companies. (Compl. ¶ 2.) To determine whether nonresident defendants are subject to personal jurisdiction in Georgia, the Court must perform a two-part analysis. Diamond Crystal Brands, Inc. v. Food Movers Int'l, Inc. , 593 F.3d 1249, 1257-58 (11th Cir. 2010). First, the Court must decide whether the exercise of personal jurisdiction is proper under Georgia's long-arm statute. Id . Second, the Court must determine whether there are sufficient "minimum contacts" with the forum state to satisfy the Due Process Clause of the Fourteenth Amendment. Id .; Int'l Shoe Co. v. Washington , 326 U.S. 310 (1945).

Here, the parties agreed in the Equipment Management and Repair Agreements to the jurisdiction of the State or Federal Courts of Columbia County, Georgia. (Doc. 1, Exs. 2-4.) Contractual provisions such as these, which provide for the advance consent of jurisdiction, are valid and enforceable. Lightsey v. Nalley Equip. Leasing, Ltd. , 432 S.E.2d 673, 675 (Ga.Ct.App. 1993). In fact, the Supreme Court held in Burger King Corp. v. Rudzewicz , 471 U.S. 462 (1985), that "a variety of legal arrangements" exist through which a litigant can consent to personal jurisdiction and explicitly recognized that "in the commercial context, parties frequently stipulate in advance to submit their controversies for ...


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