APL Co. Pte Ltd. v. Extreme Linen, LLC
2:16-cv-06885
C.D. Cal.Jul 31, 2017Background
- APL Co. Pte Ltd and American President Lines (collectively APL) contracted with Extreme Linen, LLC to transport linens from China/India to the U.S.; contract term ended April 30, 2015.
- The service contract contained a Minimum Volume Commitment (MVC) requiring 175 FEUs and a liquidated damages (dead freight) clause of $350 per FEU shortfall, payable within 30 days of invoice; it also provided for attorney’s fees for the nonprevailing party.
- APL alleges Extreme Linen tendered only 120.5 FEUs (54.5 FEUs short), resulting in $19,075 in liquidated damages; APL invoiced Extreme Linen on August 12, 2015 and the invoice went unpaid.
- APL sued on September 14, 2016 asserting breach of maritime contract, open account, and common count; Extreme Linen was served but did not answer; clerk entered default January 6, 2017.
- APL moved for default judgment; the court considered the Eitel factors and the contract terms, and held an evidentiary assessment of damages under the contract and local rules for attorneys’ fees and costs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether default judgment is appropriate given defendant's failure to appear | APL: Extreme Linen was properly served, breached the MVC, and failed to pay; Eitel factors favor default judgment | Extreme Linen: no appearance or opposition | Court: Default judgment appropriate — all Eitel factors except the merit-of-the-merits policy weighed for judgment |
| Whether APL stated a valid breach of contract/maritime claim | APL: Written service contract, MVC shortfall, liquidated damages clause, unpaid invoice | N/A (no responsive defense asserted) | Court: Breach of maritime contract adequately alleged and supports relief |
| Whether open account claim is viable alongside express contract recovery | APL: Invoice and account entries support open account | N/A; court notes money is fixed by express contract, not an open account | Court: Open account claim insufficient because debt is defined by express contract |
| Damages amount and entitlement to fees/costs | APL: $19,075 liquidated damages; attorneys' fees per contract; $400 filing cost; fee calculation per C.D. Cal. L.R. 55-3 | N/A (no opposition) | Court: Awards $19,075 in damages, $1,744.50 attorneys' fees (per Local Rule), and $400 costs; total $21,219.50 |
Key Cases Cited
- Eitel v. McCool, 782 F.2d 1470 (9th Cir. 1986) (factors for default-judgment analysis)
- Geddes v. United Fin. Group, 559 F.2d 557 (9th Cir. 1977) (well-pleaded allegations deemed true upon default except damages)
- Oasis W. Realty, LLC v. Goldman, 250 P.3d 1115 (Cal. 2011) (elements for breach of contract under California law)
- PepsiCo, Inc. v. California Sec. Cans, 238 F. Supp. 2d 1172 (C.D. Cal. 2002) (prejudice and appropriateness of default judgment)
- Elektra Entm't Group, Inc. v. Crawford, 226 F.R.D. 388 (C.D. Cal. 2005) (default-judgment discretion and analysis)