Horizon Air Charter, LLC v. ACM Havayollari Sanayi Tic.Ltd.Sti

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HORIZON AIR CHARTER, LLC, Plaintiff, v. ACM HAVAYOLLARI SANAYI TIC.LTD.STI, Defendant.

Civil Action No. 4:21-cv-86

United States District Court, S.D. Georgia, Savannah Division

November 3, 2022

ORDER

R STAN BAKER UNITED STATES DISTRICT JUDGE

This matter comes before the Court on Plaintiff Horizon Air Charter, LLC's Motion for Default Judgment. (Doc. 18.) For the reasons set forth below, the Court GRANTS Plaintiff's Motion IN PART. Plaintiff has demonstrated that its claims fall within this Court's subject matter jurisdiction. Moreover, Defendant ACM Havayollari Sanayi TIC.LTD.STI is subject to the Court's personal jurisdiction, and Defendant has been served with the Complaint and has failed to respond. Additionally, the Complaint sufficiently establishes Defendant's liability on Plaintiff's claims for breach of contract and conversion as well as its request for attorney's fees and expenses. However, the Court cannot assess the appropriate measure of damages on the current record. Thus, the Court will hold a hearing in this matter on December 6, 2022, at 2:00 p.m., in Courtroom One, 8 Southern Oaks Court, Savannah, Georgia.

BACKGROUND

Plaintiff is a business aircraft charter services company based in Dallas, Texas. (Doc. 1, p. 3.) On February 19, 2021, it entered into a charter aircraft agreement with Defendant, a Turkish company. (Id.) Defendant markets its Gulfstream G-IV aircraft r/n TC-GVB (the “Aircraft”) for third-party charters throughout the world including in the United States. (Id.) Plaintiff chartered the Aircraft for Defendant to fly one of Plaintiff's clients from Cartagena, Colombia, to Cairo, Egypt. (Id.) At the time of the contract, the aircraft was undergoing routine maintenance in Savannah, Georgia. (Id.) Per the parties' agreement, Plaintiff wired Defendant the full cost of the charter contract, $97,500, as an advance deposit. (Id.) On February 22, 2021, Defendant dispatched the aircraft from Savannah to Colombia to fulfill the contract with Plaintiff. (Id. at p. 4.) However Defendant's flight crew detected a crack in the windshield of the aircraft. (Id.) Thus, the crew returned the aircraft to Savannah, and Defendant notified Plaintiff that it would not be able to fulfill the contract. (Id.) Plaintiff then secured an alternative aircraft from a different operator at a cost of $139,000. (Id.) Plaintiff demanded that Defendant return the $97,500 deposit, and Defendant refused. (Id.)

Plaintiff filed this action on March 31, 2021. (See generally id.) The progress of the case was delayed by Plaintiff's efforts to serve Defendant outside of the United States. (See doc. 11.) However, Plaintiff eventually served Defendant and obtained a Clerk's Entry of Default on April 1, 2022. (Doc. 16.) Plaintiff then filed the instant Motion for Default Judgment on July 5, 2022. (Doc. 18.)

STANDARD OF REVIEW

Federal Rule of Civil Procedure 55 establishes a two-step procedure for a party to obtain a default judgment. First, “[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by affidavit or otherwise, the clerk must enter the party's default.” Fed.R.Civ.P. 55(a). Second, after receiving the clerk's default, the Court can enter a default judgment provided the defendant is not an infant or incompetent. Fed.R.Civ.P. 55(b)(2). However, the clerk's entry of default does not automatically warrant entry of default judgment. “[T]hree distinct matters emerge as essential in considering any default judgment: (1) jurisdiction; (2) liability; and (3) damages. Before the Court can grant plaintiff's motion for default judgment, all three must be established.” Pitts ex rel. Pitts v. Seneca Sports, Inc., 321 F.Supp.2d 1353, 1356 (S.D. Ga. 2004). Thus, “before entering a default judgment for damages, the district court must ensure that the well-pleaded allegations in the complaint, which are taken as true due to the default, actually state a substantive cause of action and that there is a substantive, sufficient basis in the pleadings for the particular relief sought.” Tyco Fire & Sec., LLC v. Alcocer, 218 Fed.Appx. 860, 863 (11th Cir. 2007); see also Eagle Hosp. Physicians v. SRG Consulting, 561 F.3d 1298, 1307 (11th Cir. 2009). In assessing liability, the Court must employ the same standard as when addressing a Rule 12(b)(6) motion to dismiss for failure to state a claim. Surtain v. Hamlin Terrace Found., 789 F.3d 1239, 1245 (11th Cir. 2015) (“Conceptually, then, a motion for default judgment is like a reverse motion to dismiss for failure to state a claim.”).

DISCUSSION

I. Jurisdiction

The Court must “satisfy itself that it has personal jurisdiction before entering judgment against an absent defendant.” Odyssey Marine Exploration, Inc. v. Unidentified, Wrecked & Abandoned Sailing Vessel, 727 F.Supp.2d 1341, 1345 (M.D. Fla. 2010); see also Geodetic Servs., Inc. v. Zhenghzou Sunward Tech. Co. Ltd., No. 8:13-CV-1595-T-35TBM, 2014 WL 12620804, at *2 (M.D. Fla. Apr. 4, 2014) (“A default judgment is void in the absence of the Court's personal jurisdiction over the defendant ....”). Plaintiff alleges that the Court has subject matter jurisdiction over this case pursuant to 28 U.S.C. § 1332(a). (Doc. 1, p. 1; doc. 18, p. 4.) The Court agrees.

Section 1332(a)(2) vests this Court with jurisdiction over civil actions where the amount in controversy exceeds $75,000 and the action is between “citizens of a State and citizens or subjects of a foreign state.” 28 U.S.C. § 1332(a)(2). The well-pleaded allegations of Plaintiff's Complaint establish that Plaintiff is a citizen of Texas and Defendant is a citizen of Istanbul, Turkey. (Doc. 1, p. 1; see also docs. 12-1, 12-3, 13); see 28 U.S.C. 1332(a)(c)(1) (“corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business”). Moreover, Plaintiff's claim to the $97,500 deposit alone, not to mention its claim for additional damages, exceeds $75,000.

While a closer issue, the Court also finds that Plaintiff has sufficiently pleaded that Defendant is subject to this Court's personal jurisdiction. On this front, Plaintiff alleges,

[Defendant] continually and systematically solicits and does business within the United States, including the State of Georgia. [Defendant] also regularly takes the Aircraft at issue to Savanah, Georgia for maintenance and inspections to maintain airworthy status. Additionally, . . . this matter arises from and is related to [Defendant's] contacts with the forum state. Namely, [Defendant's] Aircraft was positioned in Savanah, Georgia at the time the contract with [Plaintiff] was entered, the Aircraft was flown back to Savanah, Georgia due to a cracked windshield, and the basis for [Defendant's] refusal to return the Deposit is predicated on the Aircraft having to be repaired in Savanah, Georgia.

(Doc. 1, pp. 1-2.) The Court must accept these facts regarding jurisdiction as true as they are uncontroverted by Defendant through affidavit or otherwise. See Madara v. Hall, 916 F.2d 1510, 1514 (11th Cir. 1990).

For a defendant to be subject to a federal court's personal jurisdiction in a diversity action, “the exercise ofjurisdiction must (1) be appropriate under the [forum state's] long-arm statute and (2) not violate the Due Process Clause of the Fourteenth Amendment to the United States Constitution.” Diamond Crystal Brands, Inc. v. Food Movers Int'l, Inc., 593 F.3d 1249, 1257-58 (11th Cir. 2010) (quoting United Techs. Corp. v. Mazer, 556 F.3d 1260, 1274 (11th Cir. 2009)). The Georgia long-arm statute, O.C.G.A. § 9-10-91, does not grant jurisdiction that is “coextensive with procedural due process,” and “imposes independent obligations that a plaintiff must establish for the exercise of personal jurisdiction that are distinct from the demands of procedural due process.” Id. at 1259 (citing Innovative Clinical & Consulting Servs., LLC v. First Nat'l Bank of Ames, Iowa, 620 S.E.2d 352 (Ga. 2005)). As such, the Court must apply the “specific limitations and requirements of O.C.G.A. § 9-10-91 literally and must engage in a statutory examination that is independent of, and distinct from, the constitutional analysis to ensure that both, separate prongs of the jurisdictional inquiry are satisfied.” Id. at 1263. If the long-arm statute's requirements are satisfied, the Court then determines whether the exercise ofjurisdiction comports with federal due process.

Among other things, the Georgia long-arm statute permits the exercise ofjurisdiction over a nonresident who, personally or through an agent, transacts business within Georgia. O.C.G.A. § 9-10-91(1).^[1] In determining whether jurisdiction can be exercised over a nonresident defendant under subsection (1) of the Georgia long-arm statute, the Supreme Court of Georgia has stated:

‘jurisdiction exists on the basis of transacting business in this state if (1) the nonresident has purposefully done some act or consummated some transaction in this state, (2) [] the cause of action arises from or is connected with such act or transaction, and (3) [] the exercise ofjurisdiction by the courts of this state does not offend traditional fairness and substantial justice.'

Amerireach.com, LLC v. Walker, 719 S.E.2d 489, 496 (Ga. 2011) (quoting Aero Toy Store v. Grieves, 631 S.E.2d 734, 737 (Ga.Ct.App. 2006)). The first two factors determine whether “a defendant has established the minimum contacts with the forum state necessary for the exercise of jurisdiction,” and, if such minimum contacts exist, the third element determines whether the exercise of jurisdiction “does not result solely from random, fortuitous or attenuated...