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Xerox Corp. v. Jojomonster Graphics, LLC

United States District Court, W.D. New York

September 6, 2017

XEROX CORPORATION Plaintiff,
v.
JOJOMONSTER GRAPHICS, LLC, Defendant.

          For Plaintiffs: Tony R. Sears, Esq. Harold A. Kurland, Esq. Abigail L. Giarrusso, Esq. Ward Greenberg Heller & Reidy LLP

          For Defendant: Edwin M. Larkin, Esq. Maura C. McGuire, Esq. Harter Secrest & Emery LLP

          DECISION AND ORDER

          CHARLES J. SIRAGUSA UNITED STATES DISTRICT JUDGE

         INTRODUCTION

         Xerox Corporation brought this action alleging that JoJoMonster Graphics, LLC, breached finance leases, defaulted in paying a promissory note and failed to return leased equipment. Now before the Court is Xerox's unopposed motion (Docket No. [#15]), for summary judgment on its claims, and for dismissal of JoJoMonster's counterclaims. Xerox's application is granted.

         BACKGROUND

         The facts contained in Xerox Corporation's Statement of Facts [#15-1] are not opposed, and are therefore deemed admitted. See, Local Rule of Civil Procedure 56(a)(3). The Court will only summarize those facts to the extent necessary to explain its decision. To the extent that there are any other relevant facts that are disputed, the Court views them in the light most-favorable to JoJo Monster Graphics, as the non-moving party.

         At all relevant times Xerox Corporation (“Xerox” or “Plaintiff”) manufactured and leased commercial printing equipment, while JoJo Monster Graphics (“JoJoMonster” or “Defendant”) was a commercial printer. In February 2010, Xerox leased a commercial printer and server to JoJoMonster, pursuant to an equipment finance lease. The lease contained three significant provisions. First, the parties agreed that the lease was “a ‘finance lease' under Article 2A of the Uniform Commercial Code, ” and that except as provided in the lease, JoJoMonster waived its “rights and remedies as a lessee under Article 2A.” Second, the lease contained a “hell or high water clause, ” that stated in pertinent part:

YOUR OBLIGATION TO MAKE ALL PAYMENTS, AND TO PAY ANY OTHER AMOUNTS DUE OR TO BECOME DUE, IS ABSOLUTE AND UNCONDITIONAL AND NOT SUBJECT TO DELAY, REDUCTION, SET-OFF, DEFENSE, COUNTERCLAIM OR RECOUPMENT FOR ANY REASON WHATSOEVER. IRRESPECTIVE OF XEROX'S PERFORMANCE OF ITS OBLIGATIONS HEREUNDER, ANY CLAIM AGAINST XEROX MAY BE ASSERTED IN A SEPARATE ACTION AND SOLELY AGAINST XEROX.

         Third, the lease provided JoJoMonster with a “Total Satisfaction Guarantee” that stated, in pertinent part: “If you are not totally satisfied with any Xerox-brand Equipment delivered under this Agreement, Xerox will, at your request, replace it without charge with an identical model or, at Xerox's option, with Xerox Equipment with comparable features and capabilities.”

         By 2013, JoJoMonster had failed to make all required payments under the lease. At JoJoMonster's request, the parties executed an Account Modification Agreement. Pursuant to this agreement, JoJoMonster executed a promissory note in the amount of $44, 000.00., and Xerox conditionally credited JoJoMonster $15, 000.00, with the condition being that JoJoMonster henceforth make all required payments.

         Also in 2013, the parties entered into a second finance lease for another commercial printer and server. Again, the parties agreed that the lease was “a ‘finance lease' under Article 2A of the Uniform Commercial Code, ” and that except as provided in the lease, JoJoMonster waived its “rights and remedies as a lessee under Article 2A.” Additionally, the second lease contained a “hell or high water clause” and “Total Satisfaction Guarantee” identical to those in the first finance lease.

         Since April 2015, JoJoMonster has not made payments to Xerox as required by the promissory note. Further, since August 2015, JoJoMonster has not made payments to Xerox as required by the two finance leases and the modification agreement.

         On February 3, 2016, Xerox commenced this action. In pertinent part, the Complaint [#1] purports to assert three claims for monetary damages: 1) breach of the first finance lease, as modified; 2) breach of the promissory note; and 3) breach of the second finance lease.[1] The Complaint also seeks a declaratory ...


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