The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
GOLD STAR FEED AND GRAIN, No. 4:23-CV-01942
LLC,
(Chief Judge Brann)
Plaintiff,
v.
ULSTER DAIRY, LLC, CASHELL’S
CATTLE COMPANY, BEN
CASHELL, and ELIZABETH
CASHELL,
Defendants.
MEMORANDUM OPINION
FEBRUARY 22, 2024
I. BACKGROUND
This case was initially filed by Plaintiff, Gold Star Feed and Grain, LLC
(“GSFG”), against Defendants Ulster Dairy, LLC (“Ulster”), Cashell’s Cattle
Company, Ben Cashell, and Elizabeth Cashell (collectively “Cashell”) on
November 22, 2023.1 Since then, the Defendants have failed to appear before this
Court at all. After Plaintiff moved for entry of default, the Clerk of Court entered
default on January 12, 2024.2 GSFG has now moved for default judgment.3 Still,
the Defendants have refused to respond, and therefore the motion is now ripe for
1 See Doc. 1 (Compl.).
2 See Doc. 6 (Clerk’s Entry of Default).
disposition. For the reasons that follow, the motion is granted in part and denied in
part.
II. DISCUSSION
A. Default Judgment is Warranted
Federal Rule of Civil Procedure 55 allows the District Court to enter default
judgment upon application by a party.4 “Generally, the entry of a default judgment
is disfavored, and a court is required to exercise sound judicial discretion in
deciding whether to enter default judgment.”5 “This element of discretion makes it
clear that the party making the request is not entitled to a default judgment as of
right, even when [the] defendant is technically in default and that fact has been
noted under Rule 55(a).”6
The Court must consider three factors in deciding whether to grant default
judgment: “(1) prejudice to the plaintiff if default is denied, (2) whether the
defendant appears to have a litigable defense, and (3) whether [the] defendant’s
delay is due to culpable conduct.”7 “But when a defendant has failed to appear or
respond in any fashion to the complaint, this analysis is necessarily one-sided;
entry of default judgment is typically appropriate in such circumstances at least
4 FED. R. CIV. P. 55(b)(2).
5 Kibbie v. BP/Citibank, No. 3:CV-08-1804, 2010 WL 2573845, at *2 (M.D. Pa. June 23,
2010) (Vanaskie, J.).
6 Charles Alan Wright and Arthur R. Miller, FEDERAL PRACTICE AND PROCEDURE, § 2685
(Apr. 2020 Update).
7 Chamberlain v. Giampapa, 210 F.3d 154, 164 (3d Cir. 2000).
until the defendant comes forward with a motion to set aside the default judgment
under Rule 55(c).”8 In cases where a defendant fails to appear, this Court may enter
default judgment “based solely on the fact that the default has occurred.”9
The Court nevertheless considers those factors for the sake of completeness;
in this case, they favor the grant of default judgment. First, Plaintiff would be
prejudiced by their “current inability to proceed with [their] action due to [the]
Defendant[s’] failure to defend.”10 Their decision to not appear before this Court
prevents GSFG from recovering any damages. Similarly, the second factor points
in Plaintiff’s favor. The “Defendants [have] not responded to the allegations and,
thereby, [have] failed to assert a defense.”11 Finally, there does not seem to be any
excuse for the Defendants’ failure to appear. Service was accepted on behalf of the
Defendants on December 7, 2023.12 Having received service, the Defendants have
yet to respond. Because the Defendants have offered no explanation for their
failure to engage, the Court finds that the Defendants are culpable.13 Therefore,
default judgment is appropriate.
8 Deutsche Bank Nat. Trust Co. v. Strunz, Civ. No. 1:12-CV-01678, 2013 WL 122644, at *1
(M.D. Pa. June 9, 2013) (Kane, J.).
9 Anchorage Assocs. v. Virgin Islands Bd. of Tax Rev., 922 F.2d 168, 177 n.9 (3d Cir. 1990).
10 Broadcast Music, Inc. v. Kujo Long, LLC, No. 1:14-CV-00449, 2014 WL 4059711, at *2
(M.D. Pa. Aug. 14, 2014) (Kane, J.).
11 Pesotski v. Summa & Lezzi, Inc., No. 1:17-CV-00221, 2017 WL 3310951, at *3 (M.D. Pa.
Jan. 9, 2013) (Kane, J.).
12 See Doc. 4 (Affidavit of Service).
13 See Laborers Local Union 158 v. Shaffer, Civ. No. 1:CV-10-1524, 2011 WL 1397107 (M.D.
Pa. Apr. 13, 2011)(Kane, J.).
A finding that default judgment is warranted, however, “is not the end of the
inquiry.”14 First, the Court must consider whether the “unchallenged facts
constitute a legitimate cause of action.”15 Although the defaulting party does not
concede conclusions of law, “the factual allegations of the complaint, except those
relating to the amount of damages, will be taken as true.”16 Plaintiff’s complaint
asserts breach of contract claims against the Defendants and, in the alternative,
claims for breach of an implied contract and unjust enrichment.17 The Court now
considers whether the allegations in the complaint, taken as true, state a claim
under those causes of action.
B. Facts Alleged in the Complaint
GSFG, a limited liability company, provides dairy feed and other
commodities to farmers and agricultural businesses.18 After a customer receives
and accepts the products they ordered, Plaintiff sends them an invoice.19 “The
invoices reference the terms and conditions governing the transaction, including
terms and conditions located on [J.D. Heiskell Holdings, LLC’s (“JDH”)]
website,”20 the sole member of GSFG.21 These terms and conditions provide “(1)
14 Martin v. Nat’l Check Recovery Servs., LLC, Civ. No. 1:12-CV-1230, 2016 WL 3670849, at
*1 (M.D. Pa. July 11, 2016) (Caldwell, J.).
15 Broad Music, Inc. v. Spring Mount Area Bavarian Resort, Ltd., 555 F. Supp. 2d 537, 541
(E.D. Pa. 2008).
16 Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir. 1990).
17 See Doc. 1 (Compl.) ¶¶ 45-88.
18 See id. ¶¶ 1, 13.
19 See id. ¶ 15.
20 Id. ¶ 16.
that all purchases on credit were due and payable in accordance with the
corresponding invoice; (2) that amounts unpaid by customers would accrue interest
at 1.5% per month or 18% per annum (compounded monthly); and (3) that defaults
for non-payment do not require notice from GSFG to constitute a breach.”22 The
JDH website further outlined that “GSFG may suspend product shipments” or
credit and “collect[] amounts owed via lawsuit” when faced with a default by a
customer.23
Ulster, a limited liability company, began to order products from GSFG in
February 2022 for use in its dairy operations.24 The invoices sent to Ulster
“incorporate by reference the terms and conditions on JDH’s website.”25 For
several months Ulster paid for its deliveries.26 In December 2022, GSFG
“continued to deliver” products followed by an invoice “in accordance with the
prior course of dealing, but Ulster failed to timely pay the invoices.”27 Ulster has
accumulated an overdue balance “of at least $145,170.94.”28
21 See id. ¶ 2.
22 Id. ¶ 17.
23 Id. ¶¶ 18-19.
24 See id. ¶¶ 4, 20.
25 Id. ¶ 21.
26 See id. ¶ 24.
27 Id. ¶ 25.
28 Id. ¶ 26.
Plaintiff sent two demand letters to Ulster requesting payment on this
overdue balance but has received no response.29 Ulster’s overdue balance has been
incurring a monthly interest charge of 1.5% “since at least January 31, 2023.”30
In February 2022, Cashell’s Cattle Company, an unincorporated entity,
began to order products from Plaintiff to use in its dairy operations.31 The invoices
sent to Cashell incorporated by reference the terms and conditions on JDH’s
website.32 Cashell failed to “timely pay the invoices” beginning in December 2022
and now has an overdue account of “at least $7,202.62.”33 GSFG sent a demand
letter requesting payment but again received no response.34 Cashell has
accordingly been subject to an interest rate of 1.5% per month since “at least
January 31, 2023” on its overdue account.35
C. Plaintiff’s Claims
1. Breach of Contract Claims
To assert a breach of contract claim under Pennsylvania law,36 GSFG must
show “‘(1) the existence of a contract, including its essential terms, (2) a breach of
a duty imposed by the contract[,] and (3) resultant damages.’”37
29 See id. ¶¶ 27-32.
30 Id. ¶ 33.
31 See id. ¶¶ 6, 34.
32 See id. ¶ 35.
33 Id. ¶¶ 39-40.
34 See id. ¶¶ 41-43.
35 Id. ¶ 44.
36 The Court is applying Pennsylvania law in accordance with the terms of the relevant
contracts and due to GSFG’s own application of Pennsylvania law in its submissions to the
GSFG has alleged a valid breach of contract claim against both Ulster and
Cashell. Contracts existed between Plaintiff and the parties,38 with their terms
clearly defined by the terms and conditions on JDH’s website.39 The Defendants
breached a duty imposed by the contracts when they failed to timely pay.40 Finally,
GSFG’s “resultant damages”41 are the amounts owed on the overdue accounts.
2. Breach of Implied Contract Claims
“[A]n implied contract is cognizable only where it is ‘entirely unrelated to
the express contract” between the parties.42 “To be entirely unrelated to the express
contract, the implied contract would at least have to require…some duties different
from those under the formal agreement.”43 Here, any implied contract would
impose no duties beyond those identified in the JDH terms and conditions.
Consequently, Plaintiff cannot bring a claim for breach of an implied contract
against the Defendants.
Court. See Doc. 8 (Brief in Support of Motion for Default), Ex. A (Commodities Contract
General Terms and Conditions); Doc. 8 (Brief in Support of Motion for Default) at 5. Even if
New York law were to apply, Plaintiff has still established a claim for breach of contract. See
e.g., Solid State Chems. Ltd. v. Ashland Inc., No. 22-2724, 2023 U.S. App. LEXIS 28363, at
*7 (3d Cir. 2023) (“Under New York law, the elements of a breach of contract claim are: (1)
the existence of a contract; (2) performance under the contract by one side; (3) breach of the
contract by the other side; and (4) resulting damages”).
37 Udodi v. Stern, 438 F. Supp. 3d 293, 299 (E.D. Pa. 2020) (quoting Ware v. Rodale Press Inc.,
322 F.3d 218, 225 (3d Cir. 2003)).
38 See Doc. 1 (Compl.) ¶¶ 25, 39.
39 See id. ¶¶ 21, 35.
40 See id. ¶¶ 48, 53.
41 Udodi, 438 F. Supp. 3d at 299.
42 Hickey v. Univ. of Pittsburgh, 77 F.4th 184, 192 (3d Cir. 2023) (quoting ITT Fed. Support
Servs., Inc. v. United States, 531 F.2d 522, 529 (Ct. Cl. 1976)).
43 Id.
3. Unjust Enrichment Claims
“A claim for unjust enrichment is ‘inapplicable when the relationship
between the parties is founded on a written agreement or express contract.’”44
Alternatively pleading unjust enrichment to a breach of contract claim requires “‘a
dispute about the existence or validity of a contract.’”45 Due to the valid contracts
between Plaintiff and the Defendants, GSFG cannot “proceed on a quasi-
contractual claim like unjust enrichment.”46 “Instead, [Plaintiff] may only pursue
[its] rights under the contract.”47
D. Damages
Having found that GSFG has stated a legitimate cause of action against the
Defendants for breach of contract, the Court must consider the amount of damages
it is able to recover. Plaintiff seeks $149,149.22, plus post-judgment interest
calculated at the rate of 18% per annum, from Ulster; $7,400.70, plus post-
judgment interest calculated at the rate of 18% per annum, from Cashell; and
$4,800.00 in attorney’s fees. The Court will evaluate each of these requests in turn.
44 Holovich v. Progressive Specialty Ins. Co., 600 F. Supp. 3d 572, 582 (E.D. Pa. 2022)
(quoting Benefit Tr. Life Ins. Co. v. Union Nat’l Bank of Pittsburgh, 776 F.2d 1174, 1177 (3d
Cir. 1985)).
45 Id. at 583 (quoting Buccigross v. Thomas Jefferson Univ., Civ. A. No. 21-cv-221-JMY, 2022
U.S. Dist. LEXIS 67135 (E.D. Pa. Apr. 12, 2022)).
46 Id. at 584.
47 Id.
1. Ulster
Plaintiff is entitled to recover $152,578.77 from Ulster on its breach of
contract claim. This figure represents $149,149.22 for the principal balance and
interest that has accrued through January 11, 2024 and $3,429.55 in interest
incurred from January 12, 2024 through February 21, 2024.
“As for [GSFG’s] request for post-judgment interest, ‘because it will accrue
on a federal judgment, [the Court] look[s] to federal law’ to determine whether”
Plaintiff is entitled to this interest.48 “Federal law instructs that ‘[i]nterest shall be
allowed on any money judgment in a civil case recovered in a district court.’”49
“‘Such interest shall be calculated from the date of the entry of the judgment, at a
rate equal to the weekly average 1-year constant maturity Treasury yield, as
published by the Board of Governors of the Federal Reserve System, for the
calendar week preceding the date of the judgment.’”50 “Thus, ‘[b]ecause interest on
a district court civil judgment is mandatory if requested, [Plaintiff] is entitled to
post-judgment interest accruing from the date of entry of default judgment at the
rate designated under 28 U.S.C. § 1961(a).’”51
48 EQT Prod. Co. v. Aspen Flow Control, LLC, No. 2:20-CV-295-NR, 2022 U.S. Dist. LEXIS
231359, at *9 (W.D. Pa. Dec. 21, 2022) (quoting Thorn Flats, LLC v. BuildPro Constr. LLC,
No. 21-5412, 2022 U.S. Dist. LEXIS 95360, at *4 (E.D. Pa. May 26, 2022) (emphasis
excluded)).
49 Id. (quoting 28 U.S.C. § 1961(a)).
50 Id. at *10.
51 Id. (quoting United States v. Structure Builders, LLC, No. 22-705, 2022 U.S. Dist. LEXIS
173376, at *4 (M.D. Pa. Sept. 23, 2022)).
2. Cashell
GSFG is entitled to recover from Cashell $7,571.46 on its breach of contract
claim. This amount is comprised of $7,400.70 in principal and accrued interest
through January 11, 2024 and $170.76 of interest incurred from January 12, 2024
through February 21, 2024. Plaintiff is similarly entitled to post-judgment interest
on this amount at the rate “designated under 28 U.S.C. § 1961(a).”52
3. Attorney’s Fees
“‘Pennsylvania law does not allow awards for attorney[‘s] fees in suits for
ordinary breach of contract…unless there is express statutory authorization, a clear
express agreement of the parties[,] or some other established exception.’”53 Here,
there is clear agreement between the parties to provide for the payment of
Plaintiff’s attorney’s fees.54
“In assessing a request for attorney’s fees, ‘the most useful starting point for
determining the amount of a reasonable fee is the number of hours reasonably
expended on the litigation multiplied by a reasonable hourly rate.’”55 “An hourly
52 EQT Prod. Co., 2022 U.S. Dist. LEXIS 231359, at *10.
53 Zurich Am. Ins. Co. v. Sunshine Trucking, LLC, Civ. No. 5:20-cv-04481-JMG, 2021 U.S.
Dist. LEXIS 42507, at *5 (E.D. Pa. Mar. 8, 2021) (quoting Canters Deli Las Vegas, LLC v.
FreedomPay, Inc., 460 F. Supp. 3d 560, 574 (E.D. Pa. 2020)).
54 See Doc. 8 (Brief in Support of Motion for Default Judgment), Ex. A (Commodities Contract
General Terms and Conditions) (“If Company is the prevailing party in any dispute or
litigation under any Commodities Contract, it shall be entitled to recover all costs of
collection, including reasonable attorney’s fees”).
55 Rey Logistics, Inc. v. Zlotshewer, Civ. A. No. 21-442, 2023 U.S. Dist. LEXIS 177415, at *9
(E.D. Pa. Sept. 28, 2023) (quoting Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S. Ct. 1933,
56 L.3d 2d 40 (1983)).
rate is reasonable if the fee applicant demonstrates by evidence, in addition to the
fee applicant’s own affidavit, that the suggested rate is comparable to the current
‘rates prevailing in the community for similar services by lawyers of reasonably
comparable skill, experience, and reputation.’”56
In her Attorney’s Fee Declaration, Amy Blumenthal asserts that “[b]ased on
the skill and experience of each attorney who has worked on this matter, the nature
of the work performed, the relevant areas of expertise, and the customary billing
rates for each attorney, the fees incurred by Plaintiff in this matter were both
reasonable and necessary.”57 No information regarding the hours worked for each
task or the reasonableness of the rates in comparison to the “prevailing market rate
in the relevant community”58 is provided.59 As such, GSFG has failed to meet its
“burden to show that the requested attorney’s fees are reasonable.”60 Should
Plaintiff care to recover the attorney’s fees it is entitled to under the contracts, “it
will need to submit a supplemental request with sufficient documentation to justify
its demand.”61
56 Id. (quoting Maldonado v. Houstoun, 256 F.3d 181, 184 (3d Cir. 2001)).
57 Doc. 8 (Brief in Support of Motion for Default Judgment), Ex. 5 (Blumethal Affidavit).
58 Nat’l Salvage v. Biogas, Civ. A. No. 22-1428-TMH, 2023 U.S. Dist. LEXIS 127846, at *7
(D. Del. July 25, 2023).
59 Id.; Doc. 8. (Brief in Support of Motion for Default Judgment), Ex. 5 (Blumenthal Affidavit).
60 Id.
61 Allstate Ins. Co. v. Nw. Med., Civ. A. No. 23-2480, 2023 U.S. Dist. LEXIS 196327, at *9
(E.D. Pa. Oct. 31, 2023).
III. CONCLUSION
The Court therefore finds Plaintiff is entitled to recover $152,578.77 from
Ulster; this represents $149,149.22 in principal and interest accrued through
January 11, 2024 and $3,429.55 in interest from January 12, 2024 through
February 21, 2024. From Cashell, GSFG is entitled to recover $7,571.46. This
amount is comprised of $7,400.70 in principal and interest incurred through
January 11, 2024 and $170.76 in interest incurred from January 12, 2024 through
February 21, 2024. Post-judgment interest will accrue on both of these awards.
An appropriate Order follows.
BY THE COURT:
s/ Matthew W. Brann
Matthew W. Brann
Chief United States District Judge