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United States District Court, E.D. New York

December 2, 2004.

KOYLUM, INC. Plaintiff,
PEKSEN REALTY CORP., f/k/a Route 25 Calverton Realty Corp., Successor by merger to Ridge Petroleum Realty Corp., and 1677 RIDGE ROAD REALTY CORP., Defendants, and ADNAN KIRISCIOGLU and EROL BAYRAKTAR, Additional Party Defendants.

The opinion of the court was delivered by: ARTHUR SPATT, District Judge


Presently before the Court is a motion for summary judgment by the defendant 1677 Ridge Road Realty Corp. ("1677 Ridge" or the "Defendant") to enforce a liquidated-damages clause against the plaintiff Koylum, Inc. ("Koylum" or the "Plaintiff") and the additional party defendants Adnan Kiriscioglu ("Kiriscioglu") and Erol Bayraktar ("Bayraktar"). The plaintiff and the additional party defendants cross move for summary judgment.


  It is assumed that the parties are familiar with the factual background of this case, as set forth in the Court's two prior decisions, dated September 30, 2002 ("September 30, 2002 Order") and March 17, 2004 ("March 17, 2004 Order"). For the purpose of clarity, the factual background will be repeated in relevant part. This case involves a gas station located at 1677 Route 25A, Ridge, New York ("Premises") and a series of transactions with its landlords and gasoline supply company. The defendant 1677 Ridge is the current owner of the Premises. It is also the assignee of all the landlord rights pursuant to a lease dated January 1, 1994 ("Lease") for the Premises originally between Ridge Petroleum Realty Corp., as landlord, and R.B.P. Enterprises, Inc., as tenant. The termination of that Lease by the landlord was a subject of this lawsuit.

  Koylum operated a gas station on the Premises between June 21, 1996 and October 31, 2002 as a result of an assignment of the Lease. The station, which was a Coastal Refining and Marketing, Inc. ("Coastal") branded station, was previously operated by Koylum's assignor, R.B.P. Enterprises, pursuant to two agreements: (1) the Lease under which Koylum's assignor leased the Premises from the predecessor in interest of the defendant Peksen Realty Corp. ("Peksen"); and (2) a Supply Agreement that fixed the terms under which the operator would purchase its gasoline supplies from Ocean Petroleum, Inc., which distributed Coastal petroleum.

  The Lease includes provisions that are material to the issues in this case. Initially, the Court notes that the Lease expressly refers to the Supply Agreement, as follows: "Section 2.10. Purchase Agreement: means the Agreement dated January 1, 1994 between Ocean Petroleum Inc., as Seller, and Tenant, as Purchaser, under which Tenant has contracted to purchase all of its requirements of Gasoline to be sold at the Demised Premises." (Dft. Ex. B).

  Also relevant is Section 7.03, entitled "Purchase of Petroleum Products" and reads as follows:

Section 7.03. Purchase of Petroleum Products:
(a) In order to induce Landlord to enter into this Lease, Tenant covenants and agrees that during the term of this Lease, Tenant shall not nor permit others to store, handle, sell, offer for sale, advertise for sale, use or permit to be used upon the Demised Premises or any part thereof or any premises adjacent thereto over which Tenant has control any Gasoline, oil or other petroleum product not supplied by Seller under the Purchase Agreement.
(b) In furtherance of Tenant's covenants contained in subsection (a), Tenant agrees to enter into the Purchase Agreement simultaneously with the execution of this Lease.
(Dft. Ex. B).

  In addition to the Supply Agreement, a Rider was executed on December 1, 1995 that further delineated the relationship of the parties. In particular, the rider provided that the tenant could exercise an option to purchase petroleum from suppliers other than Ocean, but only under certain circumstances and conditions. Specifically, the Rider provided that if petroleum was to be purchased from other suppliers, the product should be transported as follows:

It is further agreed that the transport of any and all petroleum products sold by any supplier from all terminals in the Long Island and Metropolitan area to 450 Neighborhood Rd., Mastic Beach, County of Suffolk, State of New York and 1677 Route 25, Ridge, County of Suffolk, State of New York, shall be made by National Petroleum Transporters, Inc. at a transportation rate of .0125 cents per gallon.
(Dft. Ex. B)

  The relationship between the landlord and the supplier is relevant in this case. Peksen and Ocean were affiliated with one another, in that both are closely held corporations owned by Refik Peksen and Mine Peksen, who are husband and wife. Mine Peksen was the Vice President of Ocean, which distributed Coastal petroleum. Mine Peksen and her husband Refik, who were separated at the time of the trial, operated a family business which included Ocean, Peksen, and National Petroleum Transporters, Inc. Ocean supplied gasoline to the Ridge Station. Mine Peksen was also an officer of Ridge Petroleum Realty Corp., the prior owner and landlord of the Ridge Station premises. Ocean was an authorized distributor for Coastal and sold that brand of product to Koylum for resale at the Premises, pursuant to the Supply Agreement. The defendant Peksen is the successor to Ridge Petroleum Realty Corp., as owner of the Ridge Station property and as the landlord of Koylum.

  Sometime in 1998, Koylum began purchasing non-Coastal gasoline without complying with the Rider or the Supply Agreement. Specifically, Koylum did not provide documentation to Ocean on the prices that were paid for the non-Coastal petroleum and the products were not transported via National Petroleum Transporters. By letter dated October 2, 1998, Peksen informed Koylum that it would terminate the Lease as of midnight October 6, 1998. The termination letter accused Koylum of purchasing unbranded gasoline and selling it under the Coastal trademark in violation of the Supply Agreement. The next day, Peksen initiated dispossess proceedings in the Suffolk County District Court to evict Koylum from the Premises as a holdover tenant. This proceedings was stayed by a stipulation between the parties.

  Koylum continued to operate the gas station on the Premises without complying with the agreements. On January 29, 1999, Mine Peksen wrote to Koylum (Plf. Ex. 40) calling to its attention certain lease provisions, namely, Sections 5.04(b)(i), 5.04(b)(ii) and 7.03(a). The letter also notified Koylum of alleged violations of the Supply Agreement, as follows:

By reason of you having stored, handled, sold, marketed and dispensed gasoline that has been supplied by someone other than Ocean Petroleum, Inc. under the Purchase Agreement it had with you; to wit: as recently as January 26, 1999 when a gasoline delivery truck of Ark Transportation, tractor number TX6834, trailer number 731891 was observed delivering gasoline to your station at about 5:30 p.m. This delivery is not the first. Moreover, on at least another occasion and on October 7, 1998, you had 8,500 gallons of gasoline delivered by Mystic Bulk Carriers, Inc. which was purchased from Benit Fuel Sales and Services which you sold from the premises.
Accordingly, notice is hereby given that on two days from the date of this letter your lease shall terminate. You are thereby expected to vacate the premises and remove all of your personal property.
In the interim, you should be further advised that the underground storage tanks and related piping, the gasoline dispensing pumps and signs are not owned by you and you have no right to use that equipment for any purpose whatsoever, including the storage, supply, sale or offering for sale gasoline you purchase form any source other than Ocean Petroleum, Inc.
Moreover, the sign is owned by Ocean Petroleum, Inc. and by selling gasoline provided by another source as Coastal gasoline you may be violating Coastal's trademark rights.

  Therefore you are required to immediately cease and desist from any use of the equipment at the premises.

  At no time did Koylum request permission from Ocean to sell gasoline other than Coastal gas. Notwithstanding this failure to obtain consent, Koylum purchased gas from other distributors, such as Benit, T. Hutchinson Trading Corp., Ercat Corp. and Nassau and Suffolk Fuel Oil Corp.; it stored the non-Coastal gasoline at the Ridge Station when it had Coastal markings; and then unilaterally removed the Coastal markings. The record is replete with documents showing Koylum's purchase of gasoline from distributors other than Ocean. With regard to non-Coastal purchases, no documents of any kind, as to price or otherwise, were ever sent by Koylum to Peksen or Ocean, in violation of the Rider provisions. Further, none of these deliveries were made by National Petroleum Transporter Inc. Failure to use National Petroleum Transporters to deliver the non-Coastal gasoline was also a violation of the Rider provisions.

  On May 6, 1999, Peksen Realty Corp. sold the premises to 1677 Ridge, which is the present owner of the premises and the landlord of Koylum. Frank Mascolo ("Mascolo") is the principal owner and President of 1677 Ridge. He also operates three other gasoline stations and is a Coastal brand wholesale petroleum distributor. At the time of the purchase, Mascolo knew that the Supply Agreement was in existence and that it constituted a franchise agreement between Koylum and Ocean.

  After purchasing the property, Mascolo filed a petition in Suffolk County District Court to oust Koylum as a holdover tenant and also entered into negotiations with Koylum. Mascolo offered Koylum the opportunity to stay at the Premises with a new agreement if he would brand the station as a Coastal station. However, the negotiations failed; Koylum insisted on keeping the terms in the existing Supply Agreement and Rider and refused to enter into a new franchise agreement. That holdover petition was dismissed by the court in July of 1999.

  On July 7, 1999, Koylum filed this suit, seeking, among other things, the right of first refusal to purchase the Premises. After a bench trial, the Court found in its September 30, 2002 Order that Koylum materially breached the Supply Agreement and the Lease by selling non-Coastal gasoline under Coastal signage, among other reasons. Therefore, the Court ruled that Koylum had no right of first refusal to purchase the Premise and Peksen had the right to terminate the lease. On October 31, 2002, Koylum vacated the Premises.

  Thereafter, 1677 Ridge moved for summary judgment seeking liquidated damages under the Lease. 1677 Ridge sought to enforce Article III, Section 3.02 of the Lease, which provides for rent during any holdover period. Under the terms of Section 3.02, if a tenant remains in possession after the expiration date, "the annual rate of Minimum Rent and Additional Rent shall be two (2) times the annual rates of Minimum Rent and Additional Rent which are in effect during the month proceeding the Expiration Date which Landlord and Tenant acknowledge is the fair value of the use and occupancy of the Demised Premises during such period."

  Under the Lease, the minimum rent is the sum of $4,000 per month for the period October 1998 through May 31, 1999 and the sum of $4,500 per month for the period June 1, 1999 through October 31, 2002. In addition, Article IV, Section 4.02(b) of the Lease defines additional rent as "a sum equal to 1/12 of the amount, as estimated from time to time by the landlord, of all real estate taxes. . . ."

  On March 17, 2004, the Court found that Koylum was a holdover tenant from October 6, 1998 to October 31, 2002, the date that Koylum vacated the Premises. However, the Court deferred decision on the issue of whether the liquidated-damages clause in Section 3.02 was enforceable or was an unenforceable penalty, and directed the parties to file supplemental briefs on the issue by April 21, 2004.


  A. Standard of Review

  A motion for summary judgment should be granted only when "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); Miller v. Wolpoff & Abramson, L.L.P., 321 F.3d 292, 300 (2d Cir.), cert. denied, 124 S.Ct. 153, 157 L.Ed.2d 44 (2003). The moving party bears the burden of establishing the absence of a genuine issue of material fact. See United States v. Collado, 348 F.3d 323, 327 (2d Cir. 2003). Once the moving party has met this burden, the non-moving party "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). When deciding a motion for summary judgment, the court must view the evidence in the light most favorable to the non-moving party and must draw all permissible inferences from the submitted affidavits, exhibits, interrogatory answers, and depositions in favor of that party. See Leeds v. Meltz, 85 F.3d 51, 53 (2d Cir. 1996). However, a party's "bald assertion," completely unsupported by evidence, is not sufficient to overcome a motion for summary judgment. Carey v. Crescenzi, 923 F.2d 18, 21 (2d Cir. 1991).

  Summary judgment is appropriate in cases involving unambiguous contracts because contract interpretation is a matter of law, not fact. Harris Trust and Sav. Bank v. John Hancock Mut. Life Ins. Co., 970 F.2d 1138, 1147-48 (2d Cir. 1992) aff'd, 510 U.S. 86, 126 L. Ed. 2d 524, 114 S. Ct. 517 (1993). "Ascertaining whether or not a writing is ambiguous is a question of law for the trial court." Sayers v. Rochester Tel. Corp. Supp. Mgmt. Pension Plan, 7 F.3d 1091, 1094 (2d Cir. 1993). If the Court determines that the contract is unambiguous, it will assign the plain and ordinary meaning to each term and interpret the contract without the aid of extrinsic evidence. Int'l Multifoods Corp. v. Commercial Union Ins. Co., 309 F.3d 76, 83 (2d Cir. 2002) (citation omitted). However, "when the provisions of the contract are susceptible to conflicting constructions and when there is also relevant extrinsic evidence of the parties' actual intent, the meaning of the provisions becomes an issue of fact barring summary judgment." Williams and Sons Erectors, Inc. v. South Carolina Steel Corp., 983 F.2d 1176, 1183-84 (2d Cir. 1993).

  B. The Liquidated-Damages Clause

  It is common for contracting parties to determine in advance the amount of damages due in the event of a future breach of an agreement by including a liquidated-damages clause. United Air Lines, Inc. v. Austin Travel Corp., 867 F.2d 737, 740 (2d Cir. 1989). Whether or not a liquidated-damages clause will be enforced is a question of law to be decided by the court. DAR & Assocs., Inc. v. Uniforce Servs., Inc., 37 F. Supp. 2d 192, 201 (E.D.N.Y. 1999). If the clause "is intended by the parties to operate in lieu of performance, it will be deemed a liquidated-damages clause and may be enforced by the courts. . . . If such a clause is intended to operate as a means to compel performance, it will be deemed a penalty and will not be enforced." Brecher v. Laikin, 430 F. Supp. 103, 106 (S.D.N.Y. 1977).

  Under New York law, it is well-established that courts will enforce a liquidated-damages clause as long as it is not unconscionable or contrary to public policy. Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc., 41 N.Y.2d 420, 424-25, 361 N.E.2d 1015, 1018, 393 N.Y.S.2d 365, 369 (1977); see also Morgan Servs., Inc. v. Lavan Corp., 59 N.Y.2d 796, 451 N.E.2d 480, 464 N.Y.S.2d 733 (1983). A clause fixing damages in the event of a breach will be enforced if: (1) the liquidated amount is a reasonable estimate of potential damages, that is, not plainly or grossly disproportionate to the possible loss; and (2) the estimated actual damages are difficult to determine, or are not readily ascertainable. Leasing Service Corp. v. Justice, 673 F.2d 70, 73 (2d Cir. 1982); Howard Johnson Int'l Inc. v. HBS Family, 1998 U.S. Dist. LEXIS 11040 at *13-14 (S.D.N.Y. July 21, 1998). "Both the reasonableness of the liquidated damages and the certainty of actual damages should be measured as of the time the parties entered the contract, not as of the time of the breach." DAR & Assocs., Inc., 37 F. Supp. 2d at 200-01 (E.D.N.Y. 1999) (citing Vernitron Corp. v. CF 48 Assocs., 104 A.D.2d 409, 478 N.Y.S.2d 933, 934 (2d Dep't 1984)).

  Under the second prong, courts will not enforce a clause that is grossly disproportionate to the estimated actual loss as it is a penalty that is contrary to public policy. JMD Holding Corp. v. Congress Fin. Corp., 309 A.D.2d 645, 765 N.Y.S.2d 848 (1st Dep't 2001); see, e.g., Hanover Direct, Inc. v. T.R. Acquisition Corp., 309 B.R. 830, 837 (S.D.N.Y. 2003). A clause setting an amount much higher than the estimated actual amount does not provide fair compensation, but secures "performance by the compulsion of the very disproportion." Truck Rent-A-Center, Inc., 41 N.Y.2d at 424.

  Estimating actual damages at the time of contract formation may be difficult. "The utility of liquidated damages clauses is manifest in those cases where calculation of the amount of actual loss is difficult, if not impossible; in such case, the parties may agree in advance of the breach or default as to the amount of damages to be paid thereupon, rather than requiring proof and an assessment thereof in some future proceeding." LeRoy v. Sayers, 217 A.D.2d 63, 69, 635 N.Y.S.2d 217 (1st Dep't 1995).

  Koylum argues that it is possible to estimate the actual damages that have been suffered by the landlord and that such damages are limited to the amount of rent owed to the landlord under the Lease. Koylum also argues that it is proper to use the rent as an estimate of future actual damages because the rent schedule was established through negotiating what the parties believed to be the fair market rental value for the Premises throughout the term of the Lease. In support of this argument, Koylum relies on Hanover Direct, which held that a landlord's actual damages under a commercial lease could be estimated by looking at the amount of rent owed under the lease, and that a double rent liquidated-damages clause is grossly disproportionate to those actual damages. 309 B.R. at 837-38.

  Koylum's reliance on Hanover Direct, is misplaced for several reasons. Hanover Direct involved a commercial lease of property for a term of less than five years. Id. at 832. The Lease at issue in this case was for a duration of almost twenty years. In addition, the lease in Hanover Direct only covered possession, while Koylum's lease is expressly tied to the Supply Agreement. Under the terms of this agreement, Koylum was required to carry out several obligations beyond merely paying the rent under the Lease. Koylum was obligated to: (1) purchase all of its requirements of petroleum products from Ocean; (2) operate under Ocean's designated brand name, trademark, logo, and insignia; and (3) utilize National Petroleum Transporters, Inc. to transport any and all petroleum products sold to the premises. The existence of these additional agreements compels the conclusion that the rent schedule established in the Lease was not solely based on the fair market rental value of the property. Under these circumstances, the Court finds that the liquidated-damages clause passes the second prong of the test in that estimating actual damages would have been difficult, if not impossible, at the time the parties entered into the agreement.

  Turning to the first prong, in order for a court to enforce a liquidated-damages clause, the liquidated amount must bear a reasonable proportion to the probable loss. Leasing Service Corp. v. Justice, 673 F.2d 70, 73 (2d Cir. 1982); Truck Rent-A-Center, 41 N.Y.2d at 425, 393 N.Y.S.2d 365, 361; Howard Johnson Int'l Inc., 1998 U.S. Dist. LEXIS 11040 at *13-14. If "the amount fixed is plainly or grossly disproportionate to the probable loss, the provision calls for a penalty and will not be enforced." Truck Rent-A-Center, 41 N.Y.2d at 425, 393 N.Y.S.2d 365, 361. On the other hand, courts will enforce a liquidated-damages clause when the liquidated amount reasonably measures the anticipated harm. Id. at 425; see also Vernitron Corp., 104 A.D.2d at 409-10, 478 N.Y.S.2d at 934. "Where there is no evidence of a gross deviation from actual damages, courts will enforce a liquidated damages clause calling for double or even treble rent when a tenant fails to timely vacate premises." Hanover Direct, Inc., 309 B.R. at 837 (citing Federal Realty L.P. v. Choices Women's Med. Ctr., 289 A.D.2d 439, 735 N.Y.S.2d 159 (2d Dep't 2001) (granting summary judgment enforcing a treble-rent liquidated-damages clause against non-vacating tenant, absent evidence that sum was grossly disproportionate to the actual damages); see also Thirty-third Equities Company, LLC v. Americo Group, Inc., 294 A.D.2d 222, 222, 743 N.Y.S.2d 10, 10 (1st Dep't 2002) (enforcing a liquidated-damages clause obligating the holdover tenant to pay two and one-half times the monthly rent); Bates Adver. USA, Inc. v. 498 Seventh, LLC, 291 A.D.2d 179, 181, 739 N.Y.S.2d 71, 73 (1st Dep't 2002) (upholding a liquidated-damages clause calling for a one-half rent abatement per day if the landlord fails to make timely improvements of the premises).

  The parties disagree as to whether the Supply Agreement should be considered a factor in determining the reasonableness of the liquidated-damages clause. Koylum argues that 1677 Ridge has no right to enforce the Supply Agreement because it purchased the Premises from Peksen after Ocean terminated the Supply Agreement, and thus Peksen had no rights to assign to 1677 Ridge. However, the reasonableness of a liquidated-damages clause should be measured as of the time the original parties entered into the contract. DAR & Assocs., Inc., 37 F. Supp. 2d at 200-01 (E.D.N.Y. 1999). The fact that Koylum was in breach of the Supply Agreement when 1677 Ridge purchased the Premises and assumed the Lease should not affect the reasonableness of the liquidated-damages clause. Therefore, the Court agrees with the Defendant that in determining the reasonableness of the liquidated-damages clause, the Supply Agreement must be considered together with the terms of the Lease.

  Moreover, as stated above, the Lease and the Supply Agreement are inextricably linked. For example, the Lease and the Supply Agreement provided for cross defaults in that "any default of the terms of this [Supply Agreement] shall be considered a default under the terms of that certain lease agreement dated January 1, 1994 for the subject premises. Any default under the terms of the lease agreement shall be construed to constitute a default there under [the Supply Agreement]." (Dft. Ex. J ¶ 1). This type of cross default is exactly the scenario that occurred between the parties. When both the Lease and the Supply Agreement are read together, it appears that the parties intended the liquidated-damages clause to determine the fair and reasonable future rent and to compensate the landlord for the loss of the right to supply gasoline to the gasoline station in the event of a holdover by the tenant.

  General industry standards or customs may also be helpful in deciding whether a liquidated-damages clause is reasonable. See M. Viaggio & Sons, Inc. v. New York, 114 A.D.2d 939, 941, 495 N.Y.S.2d 680, 681 (2nd Dep't 1985) (upholding a liquidated-damages clause by looking at general industry standards for profit and overhead); Bates, 291 A.D.2d at 181, 739 N.Y.S.2d at 73 (explaining that rent abatement is commonly used to ensure landlords make timely improvements to the leasehold). Here, the Defendant contends that the double rent clause was customary:

Leases for gasoline stations routinely provide that liquidated damage provisions in an amount normally of 200% or more of the minimum and additional rent especially in circumstances in which the landlord either has the right to supply gasoline or designate a supplier of gasoline to the premises, which gasoline is to be purchased for him to operate the premises as a gasoline service station.
(Dft. Aff. ¶ 5).

  Koylum does not refute the Defendant's assertion that double rent provisions are customary under these circumstances, but argues that 1677 Ridge has suffered no damage from Koylum's two-year holdover. However, the Defendant submits that if it had been supplying gasoline to the station on the Premises it would have been able to earn an approximate profit of 3 cents per gallon. There is a dispute between the parties as to whether the property was selling 60,000 or 120,000 gallons of gasoline per month, but in either case it appears that the landlord would be realizing a profit from the premises in addition to the rent owed under the Lease.

  Moreover, Koylum has adduced no evidence that the liquidated-damages clause is a gross deviation from actual damages. Although the reasonableness of the liquidated-damages clause is to be measured at the time the parties enter into the contract, a comparison of actual damages and liquidated damages is helpful to the court in determining whether the amount is reasonable. See Federal Realty L.P., 289 A.D.2d at 441, 735 N.Y.S.2d at 161 (2d Dep't 2001); see, e.g., Norwalk Door Closer Co. v. Eagle Lock & Screw Co., 153 Conn 681, 220 A2d 263 (1966). Koylum argues that the liquidated-damages clause should not be enforced because the Defendant has been sufficiently compensated throughout the holdover period with the minimum monthly rental payments. Koylum submitted an affidavit from an appraiser that estimated the rental value of the property at approximately $4,500 per month, an amount equal to the minimum rent set forth in the Lease. Koylum also contends that the Defendant could not possibly suffer any damages under the Purchase Agreement because it was entitled to purchase petroleum from other sources under the terms of the agreement. The Court finds that this line of reasoning does not refute the Defendant's assertions, but instead, disputes the Court's September 30, 2002 Order, which found that Koylum had materially breached the Supply Agreement.

  On the other hand, the Defendant presented specific evidence alleging that the liquidated-damages clause was not a gross deviation from actual damages, but rather a reasonable measure designed to compensate the landlord for the loss of rent under the Lease and profits under the Supply Agreement. The affidavits offered by 1677 Ridge demonstrate that under the Supply Agreement the landlord could expect a profit of approximately $3,600 per month if the station were selling 120,000 gallons of gasoline a month. 1677 Ridge also presented evidence that the current tenant's rent is $6,000 per month. When combined, the potential damage add up to $9,600 per month. This amount is not a gross deviation from the amount of liquidated damages in the Lease, which are approximately $11,800 per month. In light of the highly volatile retail gas market and the unpredictable commercial real estate market, the Court finds that this double rent provision is not plainly or grossly disproportionate to the estimated probable loss.

  Consequently, the Court concludes that the liquidated-damages clause was a reasonable estimate of the landlord's potential damages from the Koylum's use and enjoyment of the premises as a holdover tenant. Under the terms of the Lease, the Supply Agreement was inextricably linked to the Lease and the liquidated-damages clause calling for double rent in the event of a holdover. The Court also finds that the amount of the Defendant's prospective actual damages are not a gross deviation from the amount of liquidated damages. Therefore, the Court grants the motion of the Defendant for summary judgment and finds that the liquidated-damages clause is enforceable.


  Based on the foregoing, it is hereby

  ORDERED, that 1677 Ridge's motion for summary judgment is GRANTED; and it is further

  ORDERED, that the cross-motion by Koylum, Kiriscioglu, and Bayraktar for summary judgment is DENIED; and it is further

  ORDERED, that the Defendant's counsel is directed to serve and file a proposed judgment with notice of entry on or before December 23, 2004.



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