738 F.Supp.3d 669
D. Maryland2024Background
- Timilon Corporation sued Empowerment Justice Center (EJC), EJC Wellness Center (EJCW), MyVision LLC, Medical Arts Capital Group, Dr. Allyson Abrams, and Dr. Diana Williams for breach of contract, fraud, promissory estoppel, and unjust enrichment.
- In early 2022, EJC and others ordered 3,000 air purifiers from Timilon for $2,397,000 to improve indoor air quality at various facilities as a COVID-19 measure. Timilon delivered the goods and provided related services.
- Defendants promised payment through multiple written communications and payment schedules, but ultimately made no payment.
- Timilon filed suit in April 2023. Defendants did not timely respond; default was entered against all defendants, and Timilon moved for default judgment.
- Defendants subsequently moved to vacate default, arguing improper service and lack of notice, but the court had evidence they received actual notice and evaded service.
- The Court considered default judgment motions, vacatur requests, and, upon finding no meritorious defenses and significant bad faith/delay by Defendants, granted default judgment in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Motion to Vacate Default | Defendants got notice and evaded service; affidavits of service were ultimately filed. | Defendants were not properly served and thus didn’t respond timely. | Denied—service sufficient, Defendants had notice, no good cause to vacate. |
| Breach of Contract Liability | Defendants contracted for and received goods but did not pay; all elements of contract satisfied. | No breach, and no contract liability; argued procedural grounds (service, delay). | Granted only as to EJC, Medical Arts, MyVision (contract existed and was breached). |
| Personal Liability / Veil Piercing & Fraud | Dr. Abrams & Dr. Williams used corporate entities as alter egos and made false promises. | No factual showing/support for veil piercing; denied fraud. | Denied—conclusory allegations, insufficient facts for veil piercing or fraud. |
| Quasi-Contract Claims (Promissory Estoppel/Unjust Enrichment) | Promissory estoppel and unjust enrichment alleged for parties not bound by contract. | No direct defense; challenged overall liability and service. | Granted promissory estoppel and unjust enrichment only against EJCW, Abrams, Williams; cannot recover twice. |
Key Cases Cited
- Taylor v. NationsBank, N.A., 365 Md. 166 (Md. 2001) (defining breach of contract elements)
- Hildreth v. Tidewater Equip. Co., 378 Md. 724 (Md. 2003) (corporate veil piercing in Maryland)
- Berry & Gould, P.A. v. Berry, 360 Md. 142 (Md. 2000) (unjust enrichment standard)
- Augusta Fiberglass Coatings, Inc. v. Fodor Contracting Corp., 843 F.2d 808 (4th Cir. 1988) (meritorious defense standard for setting aside default)
- Payne ex rel. Est. of Calzada v. Brake, 439 F.3d 198 (4th Cir. 2006) (factors for vacating entry of default)