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Xerox Corp. v. Everest Bus. Servs., LLC

United States District Court, W.D. New York

September 24, 2013

XEROX CORPORATION, Plaintiff,
v.
EVEREST BUSINESS SERVICES, LLC, Defendant

For Xerox Corporation, Plaintiff: Tony R. Sears, Ward Greenberg Heller & Reidy LLP, Rochester, NY.

Page 463

DECISION AND ORDER

DAVID G. LARIMER, United States District Judge.

INTRODUCTION

Plaintiff Xerox Corporation (" Xerox" ) commenced this action alleging breach of contract and conversion against defendant Everest Business Services, LLC. (" Everest" ). Xerox seeks a money judgment against Everest for failure to pay monies due, or to return rented equipment,[1] pursuant to thirteen different equipment lease finance agreements and a maintenance agreement. (Dkt. #1). On February 8, 2013, the Summons and Complaint was personally served upon Everest's owner and Chief Executive Officer, Joseph Makarewicz. Proof of service was filed on February 27, 2013. (Dkt. #5). Everest has failed to appear or to answer the complaint.

An initial Entry of Default was entered by the Clerk on April 18, 2013. (Dkt. #7).

Plaintiff now moves for a default judgment pursuant to Fed.R.Civ.P. 55(b)(2), seeking a judgment of $2,330,209.20 in damages, plus $350.00 in disbursements, against Everest. (Dkt. #8). For the reasons set forth below, that motion is granted.

FACTUAL ALLEGATIONS IN THE COMPLAINT

According to the complaint, between June 15, 2010 and July 23, 2012, Everest executed thirteen equipment lease agreements and one maintenance agreement with Xerox. Each of the leases was considered a " finance lease," and gave Everest the option to purchase the leased equipment from Xerox the end of the lease term. The lease agreements and the maintenance agreement further provided that in the event of Everest's default, the equipment was to be returned to Xerox and Everest would immediately be required to pay, as liquidated damages and not as a penalty, the total of all amounts then due under the lease, plus interest, as well as the remaining payments due for the remainder of the term, the applicable purchase option, and all applicable taxes. Each agreement further stated that in the event of default, Everest would be responsible for Xerox's reasonable resultant costs, including attorneys fees.

Xerox duly delivered all of the agreed-upon equipment and rendered the agreed-upon maintenance services. However, Everest defaulted on its payments under each of the agreements.

The complaint and the instant motion seek damages for breach of contract, representing the total of: (1) unpaid " amounts due" under the leases; and (2) accelerated balances for the remainder of certain lease's terms; minus (3) repossession credits to Everest representing the market value of the leased equipment which was returned to Xerox. Xerox also seeks its costs and taxable disbursements spent in connection with the instant lawsuit.

Page 464

MOTION FOR DEFAULT JUDGMENT

Initially, in order to secure a default judgment, a party must first secure the clerk's entry of default by demonstrating, by affidavit or in some other manner, that the opposing party is in default. See Fed. R. Civ. Proc. 55(a); J& J Sports Prods. v. Bimber, at *2 (W.D.N.Y. 2008). Once a default has been entered, the Court will accept as true the allegations of the complaint that establish the defendant's liability, and will carefully scrutinize those relating to the amount ...


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