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Cg Power Solutions Usa Inc, D/B/A Mse Power Systems v. Dgp Power

October 24, 2011


The opinion of the court was delivered by: Mae A. D'Agostino, U.S. District Judge:



Plaintiff brings the within action to enforce its rights under an Amended and Restated Loan Agreement and Promissory Note ("Loan Agreement") with defendants and its rights under a Continuing General Guaranty between the individual defendants. Presently before the Court is plaintiff's motion for a default judgment pursuant to Rule 55 of the Federal Rules of Civil Procedure. (Dkt. No. 14).


The Court has taken the facts set forth below from plaintiff's pleading and submissions.*fn1

Plaintiff is a New York corporation with its principal place of business in Albany, New York. Defendant DGP is a Pennsylvania limited liability company with an office for the transaction of business in Sunbury, Pennsylvania. The individual defendants are residents of Pennsylvania. On January 18, 2011, defendant DGP executed and delivered a Loan Agreement to plaintiff. Under the Loan Agreement, plaintiff loaned $255,000.00 to defendant to be used in connection with various solar projects defendant was developing in Pennsylvania. The loan provided for the payment of interest at the rate of 7.5% per annum. The loan was secured by a Security Agreement and Authorization to File Financing Statements ("Security Agreement") executed on July 20, 2010 between plaintiff and defendant and a Collateral Assignment of Lessee's Interest in Lease ("Collateral Assignment") executed on July 28, 2010 between plaintiff and defendant. Repayment of the loan was also guaranteed jointly and severally by the individual defendants pursuant to a Continuing General Guaranty executed on July 28, 2010. In the Continuing General Guaranty, the individual defendants agreed to reimburse plaintiff for all expenses, including counsel fees, incurred pursuant to an action to enforce payment of defendant's indebtedness:

NOW, THEREFORE, in consideration of the promises set forth herein and of other good and valuable consideration and in order to induce Creditor to loan funds to Borrower, the undersigned unconditionally guarantees to Creditor, jointly and severally, the payment of all liabilities of Borrower to Creditor of whatever nature, whether now existing or hereafter incurred, whether created directly or acquired by Creditor by assignment or otherwise, whether matured or unmatured and whether absolute of contingent arising out of the Loan Agreement and Promissory Note.

On March 15, 2011, the loan matured. On April 18, 2011, plaintiff sent a Demand for Payment to defendants via certified and electronic mail. The principal amount under the Loan Agreement and accrued interest has not been paid. As of June 30, 2011, the total amount owed to plaintiff was $272,033.33 including accrued interest. On July 22, 2011, plaintiff filed the complaint in this action. No papers have been filed by defendants.


A. Default Judgment

"Under Rule 55(b) default judgment shall be entered if a defendant has failed to plead or otherwise defend an action." Parise v. Riccelli Haulers, Inc., 672 F. Supp. 72, 74 (N.D.N.Y. 1987). Fed. R. Civ. P. 55(b)(2) and Local Rule 55.2 set forth the procedural prerequisites plaintiffs must meet before a motion for default motion may be granted. Plaintiffs must: (1) properly serve defendant with a summons and complaint (to which no response has been made); (2) obtain an entry of default; and (3) provide an affidavit setting forth the facts required by L.R. 55.2(a), including an affidavit of non-military service and evidence that defendant is neither an infant nor incompetent. See Fed. R. Civ. P. 55(b)(2); N.Y.N.D.L.R. 55.1 and 55.2.

As referenced above, plaintiff filed a complaint on July 22, 2011. On August 15, 2011, plaintiff filed the returns of service with the Court. Plaintiff avers that defendants never answered or otherwise moved with respect to the complaint, thus on September 7, 2011, plaintiff requested a clerk's entry of default. Said default was entered on September 13, 2011. On September 15, 2011, plaintiff filed a notice of motion for default judgment pursuant to Fed. R. Civ. P. 55(a) and 55(b)(2). Plaintiff has fulfilled the procedural prerequisites for default judgment. Accordingly, the Court will address the issues of liability and damages.

B. Liability

"A party's default is deemed to constitute a concession of all well-pleaded allegations of liability." Resolution Trust Corp. v. Forney, 1993 WL 261415, *1 (W.D.N.Y. 1993) (citing Greyhound Exhibitgroup v. E.L.U.L. Realty, 973 F.2d 155, 158 (2d Cir. 1992)). The allegations in ...

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