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Aegis Spine, Inc. v. Aegis Spine Canada, Ltd.

United States District Court, D. Colorado

May 23, 2017

AEGIS SPINE, INC., Plaintiff,


          William J. Martinez United States District Judge

         Plaintiff Aegis Spine, Inc. (“Plaintiff”) brings this action against Defendant Aegis Spine Canada, Ltd. (“Defendant”) for breach of contract and quantum meruit. (ECF No. 1.) Before the Court is Plaintiff's Motion for Entry of Default Judgment (“Motion”). (ECF No. 15.) For the following reasons, the Motion is granted.


         Default must enter against a party who fails to appear or otherwise defend a lawsuit. Fed.R.Civ.P. 55(a). Pursuant to Rule 55(b)(1), default judgment must be entered by the clerk of court if the claim is for “a sum certain”; in all other cases, “the party must apply to the court for a default judgment.” Fed.R.Civ.P. 55(b)(2). “[D]efault judgment must normally be viewed as available only when the adversary process has been halted because of an essentially unresponsive party. In that instance, the diligent party must be protected lest he be faced with interminable delay and continued uncertainty as to his rights. The default judgment remedy serves as such a protection.” In re Rains, 946 F.2d 731, 732-33 (10th Cir. 1991) (internal quotation marks and citation omitted).

         Further, “a party is not entitled to a default judgment as of right; rather the entry of a default judgment is entrusted to the ‘sound judicial discretion' of the court.” Greenwich Ins. Co. v. Daniel Law Firm, 2008 WL 793606, at *2 (D. Colo. Mar. 22, 2008). Before granting a motion for default judgment, the Court must take several steps. First, the Court must ensure that it has personal jurisdiction over the defaulting defendant and subject matter over the action. See Williams v. Life Sav. & Loan, 802 F.2d 1200, 1202-03 (10th Cir. 1986). Next, the Court should consider whether the well-pleaded allegations of fact-which are admitted by the defendant upon default-support a judgment on the claims against the defaulting defendant. See Fed. Fruit & Produce Co. v. Red Tomato, Inc., 2009 WL 765872, at *3 (D. Colo. Mar. 20, 2009) (“Even after entry of default, however, it remains for the court to consider whether the unchallenged facts constitute a legitimate basis for the entry of a judgment.”). “In determining whether a claim for relief has been established, the well-pleaded facts of the complaint are deemed true.” Id. (citing Dundee Cement Co. v. Howard Pipe & Concrete Prods., Inc., 722 F.2d 1319, 1323 (7th Cir. 1983)).


         Given Defendant's failure to appear and answer, the Court finds the following to be undisputed.

         Plaintiff is a Colorado corporation with its principal place of business in Greenwood Village, Colorado. (ECF No. 1 ¶ 1.) Plaintiff “is a distributor of orthopedic implant products, with a primary focus on spinal implant devices.” (Id. ¶ 2.) According to the Complaint, Plaintiff contracted with Defendant, a Canadian company, to effect distribution of its spinal products in the Canadian market. (Id. ¶¶ 4, 7.)

         Thus, on December 1, 2015, the parties entered into a contract (the “Distribution Agreement”) in which Plaintiff agreed to ship certain medical devices and instruments to Defendant for Defendant to market in Canada. (Id. ¶ 11; see also ECF No. 1-2.) The Distribution Agreement details a six-part payment schedule beginning July 31, 2016 through December 31, 2016, in which Defendant would compensate Plaintiff for the products delivered. (ECF No. 1 ¶ 19; see also ECF No. 1-2 at 17.) Plaintiff also asserts that it loaned additional medical instruments to Defendant. (ECF No. 1 ¶¶ 21, 28.) Plaintiff claims that it “shipped all of the specified products and [loaned] instruments to Defendant.” (Id. ¶ 12.) Plaintiff now asserts that Defendant “has made none of the payments that it was required to make” and that it “is still in possession of [Plaintiff's] loaned instruments.” (Id. ¶¶ 27, 28.)

         Based on this course of events, Plaintiff initiated this action by filing a complaint on September 29, 2016. (ECF No. 1.) As noted above, Defendant failed to appear, thus the Clerk filed an Entry of Default as to Defendant on March 2, 2017. (ECF No. 18.) Plaintiff filed the instant Motion before the Court on January 3, 2017. (ECF No. 15.)

         This Court has reviewed the Motion, the exhibits and declarations, and the applicable law, and is sufficiently advised on the issues involved.

         III. ANALYSIS

         With the preceding legal standards in mind and before considering whether damages should be assessed in this case, the Court addresses whether Plaintiff has established jurisdiction and whether its claims state a legal basis for relief.

         A. ...

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