Michael’s Gourmet Pantry, Inc. v. Back of the House, LLC

Summary

The United States District Court for the District of Nevada granted in part Michael’s Gourmet Pantry, Inc.’s motion for default judgment against Back of the House, LLC. The court entered judgment on claims for breach of contract, implied indemnity, and declaratory relief, but found that the complaint did not support a separate claim for breach of the implied covenant of good faith and fair dealing. The court awarded $36,836.75 in damages and deferred ruling on attorney’s fees, allowing supplemental briefing.

Holdings

1. The Eitel factors favored granting default judgment because Plaintiff would be prejudiced without relief, the complaint adequately stated several claims, Defendant’s default was not excusable, material facts were not disputed at the default stage, and a decision on the merits was unlikely.
2. Plaintiff adequately stated a breach-of-contract claim by alleging the existence of a valid contract, Plaintiff’s performance, Defendant’s failure to provide a conforming cooler, and resulting damages.
3. Plaintiff failed to state a claim for breach of the implied covenant because the claim was based on the same conduct as the separately pleaded breach-of-contract claim and Plaintiff did not adequately explain how Defendant breached the covenant.
4. Plaintiff adequately stated a claim for implied indemnity by alleging that it discharged an obligation to a third party, Defendant was also liable to that third party, and fairness required Defendant to bear the resulting loss.
5. Plaintiff adequately stated a claim for declaratory relief by alleging an actual controversy, a legally protectable interest, and an issue ripe for determination.
6. Plaintiff was entitled to $31,836.75 on its contract-related damages and $5,000 for the implied-indemnity settlement, for a total award of $36,836.75.

Questions Presented

1. Whether the Eitel factors favored entering default judgment against Defendant.
2. Whether Plaintiff adequately pleaded claims for breach of contract, breach of the implied covenant of good faith and fair dealing, implied indemnity, and declaratory relief.
3. Whether Plaintiff proved recoverable damages for breach of contract and implied indemnity.
4. Whether Plaintiff adequately supported its request for attorney’s fees under the implied-indemnity claim.

Disposition

other