United States District Court, N.D. Georgia, Atlanta Division
OPINION & ORDER
MICHAEL L. BROWN UNITED STATES DISTRICT JUDGE
Bank of America, N.A., sued Defendants Elite Satellite
Communications, Inc. (“ESCI”) and Byram D. Smith,
Sr. (together, “Defendants”), alleging they
defaulted under a promissory note by failing to make payments
when due. (Dkt. 1.) Neither Defendant answered the complaint.
Plaintiff now moves for default judgment as to Defendant
ESCI. (Dkt. 10.) The Court agrees that Plaintiff
has a right to default judgment as to Defendant ESCI and
grants Plaintiff's motion.
2013, Defendant ESCI and Plaintiff executed a promissory note
(labeled a loan agreement) for a loan in the original
principal amount of $280, 000. (Dkts. 1 ¶ 5; 1-1 at 1.)
To secure the debt, Defendant ESCI also executed a security
deed pledging all its right, title, and interest in its real
property located at 1677 Forest Parkway in Lake City, Clayton
County, Georgia, and all rents, royalties, or other income
derived from it. (Dkts. 1 ¶ 6; 1-1 at 3.) Defendant
Smith signed a guarantee in favor of Plaintiff, guaranteeing
and promising to pay promptly when due, all indebtedness of
Defendant ESCI. (Dkt. 1 ¶ 7.) Collectively the loan
agreement, security deed, and guarantee are referred to as
the “loan documents.”
is the holder and owner of the loan documents. (Id.
¶ 8.) Plaintiff concluded Defendants were in default of
the loan documents because they failed to make payments when
due and failed to pay the 2017 Clayton County real property
taxes for the property (leading to a tax lien on the property
in the amount of $4, 720.16). (Id. ¶ 9.) In
October (Dkts. 9; 11.) Plaintiff only moved for default
judgment against Defendant ESCI. 2018, Plaintiff notified
Defendants that they were in default and that, as permitted
in the loan documents, it had elected to accelerate all sums
due on the loan and demanded full and immediate payment of
the entire debt. (Id. ¶ 10.) Defendants have
paid no further amounts owed under the loan documents.
(Id. ¶ 11.)
sued Defendants for breach of the loan documents, seeking to
recover $229, 130 in unpaid principal; $3, 497.24 in accrued
interest as of December 7, 2018; $213.78 in late charges; and
additional interest, late charges, fees, costs, and expenses
accrued since December 7, 2018. (Id. ¶ 12.)
Plaintiff served Defendants, but Defendants failed to answer
by the time required. (Dkts. 6; 7.) Plaintiff then requested
a clerk's entry of default for Defendant ESCI under Rule
55(a). The Clerk entered that default. (Dkt. 8.) Plaintiff
then moved for default judgment against Defendant ESCI and
provided updated damages for interest accruals and
attorneys' fees. (Dkt. 10.) Defendant ESCI did not oppose
the motion, and in fact, has not responded here since being
served in December 2018.
defendant fails to plead or otherwise defend a lawsuit within
the time required by the Federal Rules of Civil Procedure and
the plaintiff moves for default, the clerk must enter
default. See Fed. R. Civ. P. 55(a). Default
constitutes admission of all well-pleaded factual allegations
in the complaint but not an admission of facts incompletely
pleaded or conclusions of law. See Cotton v. Mass. Mut.
Life Ins. Co., 402 F.3d 1267, 1278 (11th Cir. 2005).
the clerk enters default, the “entry of a default
judgment is committed to the discretion of the district
court.” See Hamm v. DeKalb Cty., 774 F.2d
1567, 1576 (11th Cir. 1985). Because of the “strong
policy of determining cases on their merits, ” the
Eleventh Circuit has cautioned that “default judgments
are generally disfavored” and not granted as a matter
of right. Surtain v. Hamlin Terrace Found., 789 F.3d
1239, 1244- 45 (11th Cir. 2015). A court enters default
judgment only “when there is ‘a sufficient basis
in the pleadings for the judgment entered.' ”
Id. at 1245 (citing Nishimatsu Constr. Co. v.
Hous. Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir.
standard for determining the sufficiency of the basis for the
judgment is “akin to that necessary to survive a motion
to dismiss for failure to state a claim.” Id.
A motion for default judgment is conceptually like a reverse
motion to dismiss for failure to state a claim. Id.
the motion to dismiss stage, all well-pleaded facts are
accepted as true, and the reasonable inferences therefrom are
construed in the light most favorable to the
plaintiff.” Bryant v. Avado Brands, Inc., 187
F.3d 1271, 1273 n.1 (11th Cir. 1999). So in considering a
motion for default judgment, a court accepts all well-pleaded
facts as true and determines whether those facts state a
claim for relief that is plausible on its face - that is,
whether the plaintiff's allegations allow “the
court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Singleton v.
Dean, 611 Fed.Appx. 671, 671 (11th Cir. 2015) (per
when assessing default judgment damages, the court has
“an obligation to assure that there is a legitimate
basis for any damage award it enters.” Anheuser
Busch, Inc. v. Philpot, 317 F.3d 1264, 1266 (11th Cir.
2003). Courts may enter such awards without holding an
evidentiary hearing, but only if “the amount claimed is
a liquidated sum or one capable of mathematical
calculation.” Adolph Coors Co. v. Movement Against
Racism and the Klan, 777 F.2d 1538, 1543-44 (11th Cir.
the Clerk entered default and Defendant ESCI failed to
acknowledge or otherwise respond to Plaintiff's lawsuit,
the Court considers admitted all well-pleaded factual