Southstate Bank, N.A. v. Capital Air Tool Systems, Inc. and Curtis Dahmen

Summary

The document is a magistrate judge’s findings and recommendations on Southstate Bank’s motion for default judgment against Capital Air Tool Systems, Inc. and Curtis Dahmen in an action arising from a defaulted loan, guarantee, and security agreement. It recommends awarding $594,415.73 after accounting for the estimated value of collateral and authorizing foreclosure and recovery of specified personal property. The recommendations were dated December 16, 2025, and were subject to objections under 28 U.S.C. § 636(b)(1).

Holdings

1. Default judgment should be granted because the Eitel factors favor entry of judgment against defendants who were properly served, failed to defend, and remain in default.
2. Defendants' default establishes the well-pleaded factual allegations concerning liability, but does not establish damages or legally insufficient claims.
3. The recommended judgment should award $594,415.73 in damages after deducting the estimated $30,000 value of the collateral, foreclose plaintiff's security interests, and authorize immediate possession of the collateral.

Questions Presented

1. Whether default judgment should be entered under Federal Rule of Civil Procedure 55 after defendants failed to appear or defend.
2. Whether the complaint's well-pleaded allegations sufficiently established defendants' liability on the note, guarantee, and security agreement.
3. What damages and collateral-related relief should be included in the recommended judgment.

Disposition

other