Workwear Outfitters, LLC v. ADN Jeans Grp.

1

WORKWEAR OUTFITTERS, LLC, Plaintiff, v. ADN JEANS GROUP, LLC, Defendant.

No. 8:23-cv-2580-MSS-AAS

United States District Court, M.D. Florida, Tampa Division

May 29, 2024

ORDER

MARY S. SCRIVEN, UNITED STATES DISTRICT JUDGE.

THIS CAUSE comes before the Court for consideration of Plaintiff's Motion for Final Default Judgment. (Dkt. 16) Despite having been served, Defendant ADN Jeans Group, LLC has failed to appear, answer, or otherwise respond to the Complaint, which Plaintiff filed on November 10, 2023. (Dkt 1) The Clerk entered default on December 18, 2023. (Dkt. 15) Upon consideration of all relevant filings, case law, and being otherwise fully advised, the Court ORDERS as follows.

I. BACKGROUND

Plaintiff Workwear Outfitters, LLC (“Workwear”) initiated this action against Defendant ADN Jeans Group, LLC (“ADN”) on November 10, 2023 for claims of money had and received, unjust enrichment, and restitution (Count I), and conversion (Count II) under Florida common law. (Dkt 1) Workwear is a manufacturer and seller of workwear apparel and footwear. (Id. at ¶ 8) ADN is a Tampa-based limited liability company that distributes apparel manufactured by its affiliate. (Id. at ¶ 9) Until recently, Workwear contracted with ADN to manufacture some of its products. (Id.) According to ADN's written instructions, Workwear directed its payments to ADN to ADN's factoring company, ExpoCredit LLC (“ExpoCredit”), during the period relevant to this case. (Id.; Dkt. 16-1 at 6-7)

In August 2022 and again in January 2023, Workwear made several duplicate payments to ExpoCredit for invoices from ADN that Workwear had already paid. (Dkt. 1 at ¶ 11) Workwear also sent money to ExpoCredit to pay an invoice that was not from ADN. (Id.) The table below summarizes the inadvertent payments. (Id.) In total, Workwear overpaid ADN $945,097.79. (Id.)

Invoice No.

Invoice Amount

1^st Payment Date

1^st Payment Amount

2nd Payment Date

2^nd Payment Amount

Amount Overpaid

182842D

$18,675.35

7/15/22

$18,675.35

1/4/23

$18,675.35

$18,675.35

182801D

$22,905.79

7/15/22

$22,905.79

1/4/23

$22,905.79

$22,905.79

lg28O4D

$1,508.55

7/15/22

$1,508.55

1/4/23

$l,5O8.55

$1408.55

182842

$182,375.15

7/15/22

$182,375-15

8/16/22

$182,37515

$182,375.15

182916

$143,33682

7/15/22

$143436.82

8/11/22

$143,33643

$143,33682

183353

$156,989.10

8/8/22

$178,239.04

8/25/22

$156,989.10

$182,948.71

183122

$ 84,4 28.39

8/822

$184,428.39

8/11/22

$184,428.39

$184,428.39

182354

$208,919.03

8/8/22

$208,919.03

$208,919.03

Total

$945,097.70

When Workwear discovered these overpayments in August 2023, Workwear requested ExpoCredit return the money. (Dkt. 1 at ¶ 12) In response, ExpoCredit informed Workwear that ExpoCredit had transferred the money to ADN. (Id.; Dkt. 16 at ¶ 9) ExpoCredit produced wire advices showing that it transferred more than $991,378.07 to ADN after Workwear made the overpayments. (Dkt. 16 at ¶ 9) ExpoCredit also produced evidence that it had applied a portion of the Workwear funds to debts ADN owed to ExpoCredit. (Id.)

In August 2023, ADN delivered two shipments of products to Workwear and invoiced Workwear for $281,412.29. (Dkt. 1 at ¶ 13) Because the outstanding overpayments remained unresolved, Workwear did not pay these invoices. (Id.)

Workwear repeatedly requested that ADN return Workwear's funds. (Id. at ¶¶ 14-16) ADN acknowledged its receipt of the funds but refused to return them. (Id. at ¶ 15) In September 2023, Workwear sent ADN a demand letter in which Workwear requested ADN apply a portion of the overpayments to Workwear's outstanding balance and return the remaining funds. (Id.) ADN has refused to apply Workwear's overpayments to its outstanding balance and has failed to return the remainder of Workwear's funds. (Id.) Consequently, Workwear filed the Complaint on November 10, 2023. (Dkt. 1)

On November 16, 2023, Workwear filed a Return of Service which shows ADN was served with process. (Dkt. 12) To date, ADN has not filed an answer or other responsive pleading in this case. Upon Workwear's Motion for Clerk's Default, (Dkt. 13), the Clerk entered default against ADN on December 18, 2023. (Dkt. 15) Under Federal Rule of Civil Procedure 55, Workwear now seeks entry of a final judgment of default against ADN as well as an award of damages plus pre- and post-judgment interest. (Dkt. 16)

II. LEGAL STANDARD & ANALYSIS

Under Federal Rule of Civil Procedure 55, a court may enter a default judgment if it has jurisdiction over the claims and parties and there is a sufficient basis in the pleadings to support the relief sought. Nishimatsu Constr. Co., Ltd. v. Houston Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975);^[1] Surtain v. Hamlin Terrace Found., 789 F.3d 1239, 1245 (11th Cir. 2015). In defaulting, a defendant admits the plaintiff's well-pled allegations of fact. Id. at 1245. But “[t]he defendant is not held to admit facts that are not well-pleaded or to admit conclusions of law. In short . . . a default is not treated as an absolute confession of the defendant of his liability and of the plaintiff's right to recover.” Nishimatsu Constr. Co., 515 F.2d at 1206.

If the facts in the complaint are sufficient to establish liability, then the court must conduct an inquiry to ascertain the amount of damages. See Adolph Coors Co. v. Movement Against Racism & the Klan, 777 F.2d 1538, 1543-44 (11th Cir. 1985). Damages may be awarded only if the record adequately reflects the basis for the award via a hearing or the submission of detailed affidavits establishing the necessary facts. See id. at 1544.

a. Jurisdiction

First, this Court has subject matter jurisdiction over this action under 28 U.S.C. § 1332(a)(2), which confers jurisdiction for suits between citizens of different states where the amount in controversy exceeds $75,000. Workwear establishes it is a citizen of the District of Columbia, Florida, Georgia, Maryland, and Pennsylvania for purposes of diversity jurisdiction. (Dkt. 16 at ¶ 5) ADN, on the other hand, is a citizen of Mexico. (Id. at ¶ 6) The amount in controversy here exceeds $75,000. Thus, the Court has subject matter jurisdiction over this case under § 1332(a)(2). Also, the Court has personal jurisdiction over ADN because it maintains its principal place of business in Tampa, Florida. (Id. at ¶ 7) Thus, the Court finds it has jurisdiction over the claims and the parties.

b. Liability

Workwear sets forth a valid cause of action against ADN for unjust enrichment and restitution.^[2] Florida courts recognize a cause of action for unjust enrichment “to prevent the wrongful retention of a benefit, or the retention of money or property of another, in violation of good conscience and fundamental principles of justice or equity.” State Farm Fire & Cas. Co. v. Silver Star Health & Rehab, 739 F.3d 579, 584 (11th Cir. 2013) (citation and internal quotation omitted). Unjust enrichment exists where: “(1) a benefit is conferred on defendant with plaintiff's knowledge of the benefit; (2) that defendant voluntarily accepted and retained such benefit; and (3) the circumstances are such that it would be inequitable for the defendant to retain the benefit without paying the value thereof to plaintiff.” Sea-Land Serv., Inc. v. Sellan, 64 F.Supp.2d 1255, 1263 (S.D. Fla. 1999). For example, the cause of action lies where a plaintiff seeks to recover money paid under a mistake of fact. See Equilease Corp. v. Hentz, 634 F.2d 850, 853 (5th Cir. 1981).^[3]

In the Complaint, Workwear alleges sufficient facts to establish ADN was unjustly enriched by Workwear's inadvertent payments. Workwear made overpayments of $945,097.79 to ExpoCredit. (Dkt. 1 at ¶ 11) ExpoCredit transferred $902,008.10 of those funds to ADN and applied $43,089.69 of those funds to debts ADN owed to ExpoCredit. (Id. at ¶ 12; Dkt. 16 at ¶ 9) Workwear authorized and directed ADN to apply $281,412.29 of its overpayments to Workwear's outstanding invoices. (Dkt. 1 at ¶ 15) Consequently, ADN still holds $663,685.50 that belongs to Workwear. The attachments to Workwear's Motion support these allegations. (Dkt. 16-1 at 31-44; Dkt. 16-2) By failing to defend against the Complaint, ADN is deemed to have admitted the well-pled factual allegations against it. Eagle Hosp. Physicians, LLC v. SRG Consulting, Inc., 561 F.3d 1298, 1307 (11th Cir. 2009). Thus, the Court finds Workwear is entitled to default judgment against ADN on its claim of unjust enrichment and restitution.

However Workwear fails to state a claim for conversion under Florida law against ADN. “Under Florida law, conversion is an unauthorized act which deprives another of his property permanently or for an indefinite period of time.” Longo v. Campus Advantage, Inc., 588 F.Supp.3d 1286, 1298 (M.D. Fla. 2022) (citation and internal quotation omitted). “In Florida, the conversion of money is treated differently than traditional conversion.” Id. (citation and internal quotation omitted). The elements of conversion of money are: “(1) specific and identifiable money; (2) possession or an immediate right to possess that money; (3) an unauthorized act which deprives plaintiff of that money; and (4) a demand for return of the money and a refusal to do so.” IberiaBank v. Coconut 41, LLC, 984 F.Supp.2d 1283, 1306 (M.D. Fla. 2013) (quotation omitted). “The first element-specific and identifiable money- requires that the money is deposited into an account designed to keep the money segregated and identifiable, such as a trust or escrow account, or where there is an obligation or fiduciary duty to keep money segregated.” Longo, 588 F.Supp.3d at 1298-99 (citation and internal quotation omitted) (dismissing the plaintiffs' conversion claim where they made “no allegations . . . that [the defendant] kept the money Pla...