# Comdyne I, Inc. v. Corbin > Court of Appeals for the Third Circuit · July 20, 1990 · 908 F.2d 1142 URL: https://www.frixlaw.com/law-library/cases/9480597 ## Case - **Full name:** COMDYNE I, INC. (Formerly Known as Corbin Sales Corporation) v. George T. CORBIN, Jr., Corbin Sales Corp., Corbin Superior Composites, Inc. Appeal of George T. CORBIN, Jr., Corbin Sales Corporation, Corbin Superior Composites, Inc., and Clifford L. Van Syoc, Esquire - **Court:** Court of Appeals for the Third Circuit - **Decided:** July 20, 1990 - **Citations:** 908 F.2d 1142; 17 Fed. R. Serv. 2d 503; 1990 U.S. App. LEXIS 12158; 1990 WL 99720 - **Precedential status:** Published - **Opinion:** Dissent by Fullam - **Judges:** Sloviter, Mansmann, Fullam - **Cited by:** 621 later opinions in the Frix Law Library ## Citator (automated) - No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases. - Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9480597 ## How later opinions describe it (automated extraction) - explaining that even though by virtue of defendant's default, every "well-plead allegation" of the complaint, except those relating to damages, are deemed admitted, a plaintiff must articulate the substantive legal basis for a finding in its favor - explaining that no damages hearing is required at default judgment if the movant supports its request “for a ‘sum certain or for a sum which can by computation be made certain’” (quoting Fed. R. Civ. P. 55(b)(1)) - holding that when deciding whether to grant a default judgment, “all well-pleaded allegations in a complaint, except those relating to the amount of damages, are admitted as true following a default” - finding that “[a] consequence of the entry of a default judgment is that the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true” - explaining that every “well- pled allegation” of the complaint, except those relating to damages, are deemed admitted, when considering a default judgment ## Opinion text FULLAM, District Judge, dissenting. In Dunbar v. Triangle Lumber & Supply Co., 816 F.2d 126, 129 (3d Cir.1987), this court, invoking its supervisory power *1154 over district courts within the circuit, established the following rule: “While it is true that Poulis affords some judicial protection to innocent litigants from the consequences of professional defaults, it is evident that such litigants are often in extremis, legally speaking. Yet, they are, nevertheless, dependent on their attorneys to protect their interests. A conflict in interest is almost inherent in such a situation ... “We conclude that any motion, whether by court or counsel, seeking an effective dismissal or default judgment based on an apparent default on the part of a litigant’s counsel be pleaded with particularity and with supporting material and that where the papers demonstrate reasonable grounds for dismissal on that basis, the court shall direct the clerk of the court to mail notice directly to the litigant of the time and place of a hearing on any such motion, reasonably in advance of the hearing date_” As the majority recognizes, there was no attempt to comply with this requirement in the present case. Neither the magistrate’s order purporting to strike defendant’s answer and counterclaim, nor the hearing for the entry of default judgment, was preceded by the required direct notice to Mr. and Mrs. Corbin. Although there is some indication in the record that the Corbins may have been made aware, through counsel, that sanctions had been imposed, and although their lawyer claimed to have discussed the damage hearing with them by telephone, the record falls far short of demonstrating substantial compliance with the Dunbar requirement. The whole purpose of a direct notice from the court to the client is to alert the client to the possible derelictions of counsel, and the looming conflict-of-interest issue; and to make certain that the client is made aware of the need for prompt action, and of the possible inadvisability of continuing to rely exclusively upon counsel’s advice and interpretation of litigation developments. By the time of the damage hearing, defendants’ then-attorney, through a series of inexplicable derelictions, had virtually abandoned the litigation. His only response to the application for default judgment was to request a continuance based upon other alleged court commitments and, when that failed, to make a (patently meritorious, but nevertheless rejected) motion for a jury trial, and to request, unsuccessfully, permission to present evidence in the form of additional cross-examination of an officer of the plaintiff. To assume that this attorney adequately alerted the Cor-bins to their imminent peril, and that no direct notice from the court was necessary, is, I submit, squarely contrary to the Dunbar decision — which this panel is, of course, bound to follow. I would therefore vacate the judgment and remand for a new hearing on the motion for default judgment. Even assuming that Dunbar had been complied with and that the Poulis factors were properly evaluated, I am of the opinion that there is inadequate evidentiary support in the record for some of the damages awarded. The award included an item of $40,540 allegedly incurred in conducting a re-testing program. The majority upholds this award on the theory that an injured party has an obligation to mitigate damages, that the New Jersey Supreme Court would permit recovery of expenses reasonably associated with mitigation efforts, and that there is no reason to apply a different rule in defamation actions. I agree that there may be situations in which this approach would be permissible, but the evidence in this case does not justify it. It is clear that the additional testing was not mandated, or even suggested, by any customer or government agency. There was no evidence that plaintiff’s status as a defense supplier was actually affected, or jeopardized, by Mr. Corbin’s communications. In short, so far as this record is concerned, there were no damages to be mitigated. At the very least, before permitting recovery for a $40,540 expenditure to “mitigate damages”, we should require proof of reasonable necessity. Plaintiff’s own witnesses candidly testified that the re-testing program was essen *1155 tially a public relations effort. I am unwilling to predict that the New Jersey Supreme Court — assuming it would be likely to permit recovery of mitigation damages in defamation cases under some circumstances — would go so far as to permit a defamed plaintiff to impose upon the defendant the costs of a public relations campaign mounted purely as a precautionary measure, without any showing of actual damage or actual need for image-enhancement. For one thing, it is impossible to state whether such an award would overcompensate the injured party, leaving it better off than if the tort had not occurred. At the very least, as discussed above, I am confident that such a plaintiff would be required to prove that, in the absence of the expenditure, damages to its reputation would have been likely to equal or exceed the amount of the expenditure. I would therefore vacate so much of the judgment as awarded $40,540 for re-testing expenses. Finally, it is my view that the $10,000 punitive damage award cannot be sustained on this record. There was no evidence of actual malice — no proof that the defendant knew his charges were false, or acted in reckless disregard. And even if there had been such evidence, the trial judge made no findings of fact on that subject. The district court seems clearly to have assumed that the failure to file an answer to the amended complaint obviated the need for evidence on that subject. For all of these reasons, I would vacate the judgment and remand for further proceedings. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9480597. Public record. Not legal advice.