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BMO Harris Bank N.A. v. Supermaz Logistic Services LLC

United States District Court, D. Massachusetts

May 31, 2019

BMO HARRIS BANK, N.A., Plaintiff,
v.
SUPERMAZ LOGISTIC SERVICES, LLC, and SERGEY AGIBALOV, Defendants.

          REPORT AND RECOMMENDATION ON PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT AGAINST DEFENDANTS SUPERMAZ LOGISTIC SERVICES, LLC AND SERGEY AGIBALOV (DKT. NO. 11)

          KATHERINE A. ROBERTSON, UNITED STATES MAGISTRATE JUDGE

         I. Introduction

         Plaintiff BMO Harris Bank, N.A. ("BMO") seeks recovery by a default judgment against the defendants Supermaz Logistic Services, LLC ("Supermaz") and Sergey Agibalov ("Agibalov") (collectively, "Defendants") for failure to make payments on nine similarly worded Loan and Security Agreements through which Supermaz borrowed funds from BMO to finance the purchase of fourteen commercial trucks. Agibalov guaranteed Supermaz's obligations under the nine Loan and Security Agreements. Before the court is BMO's motion for entry of a default judgment against Supermaz and Agibalov for failure to make payments to BMO on the equipment purchase loans. The motion was referred to the undersigned by presiding District Judge Mark G. Mastroianni (Dkt. No. 12). See 28 U.S.C. § 636(b)(1)(B); Fed.R.Civ.P. 72. Having reviewed the verified complaint, the motion for default judgment, and the attachments thereto, the court recommends that BMO's motion be GRANTED and that judgment enter against Supermaz and Agibalov in the amount of $662, 977.40.

         II. Relevant Procedural and Factual Background

         BMO filed its complaint on January 2, 2018 (Dkt. No. 1). Supermaz and Agibalov were personally served with a summons, the complaint, and attachments on January 18, 2018 (Dkt. Nos. 5 & 6). BMO filed its affidavits of service and moved for entry of default on February 13, 2018 (Dkt. Nos. 4, 5, 6). On June 14, 2018, District Court Judge Michael A. Ponsor granted BMO's motion for entry of default and Supermaz's and Agibalov's defaults were entered on that date (Dkt. Nos. 4, 7, 8). BMO moved for default judgments thereafter (Dkt. No. 11).

         "In view of Defendants' failure to appear, the facts alleged in the verified complaint are taken to be true." Volvo Fin. Servs, a division of VFS U.S. LLC v. Freightport, Inc., No. 17-cv-10401-MGM, 2017 WL 7049168, at *1 (D. Mass. Dec. 27, 2017), report and recommendation adopted, Civil Action No. 17-10401-MGM, 2018 WL 547539 (D. Mass. Jan. 23, 2018) (citing Ortiz-Gonzalez v. Fonovisa, 277 F.3d 59, 62-63 (1st Cir. 2002)).

         According to the complaint, between February 26, 2015 and February 28, 2017, Supermaz and BMO entered into nine Loan and Security Agreements for the purchase of trucks (Dkt. No. 1 ¶¶ 6-59).[1] The agreements included similarly worded terms addressing "Default and Remedies" (see, e.g., Dkt. No. 1-2 at 6 ¶ 5.0). Paragraph 5.1 of the contracts, which addressed "Events of Default," stated that default would occur if the debtor failed to pay any amount owed to the lender when due or if the debtor or guarantor failed to pay any liability to the lender when due (Dkt. No. 1-2 at 6, 12, 18, 24, 30, 36, 42, 48, 54). The remedies for an event of default were contained in paragraph 5.2 and included BMO's option to "declare this Agreement to be in default" and "declare the indebtedness [under the Agreement] to be immediately due and payable" (Dkt. No. 1-2 at 6, 12, 18, 24, 30, 36, 42, 48, 54).

         Supermaz granted BMO a security interest in the purchased equipment (Dkt. No. 1-2 at 4, 5, 10, 11, 16, 17, 22, 23, 28, 29, 34, 35, 40, 41, 46, 47, 52, 53). In the event of default by Supermaz, BMO had the rights of a secured party under the Uniform Commercial Code, including the right to "dispose of any Equipment at a public or private sale or at auction" (see, e.g., Dkt. No. 1-2 at 6).

         The details of the nine Loan and Security Agreements are as follows:

1. Supermaz and BMO entered into Loan and Security Agreement 1 on February 26, 2015 (Dkt. No. 1-2 at 8).[2] Supermaz borrowed $160, 200. for the purchase of two 2014 International Prostar 122" BBC Conv Cab tractors and was obligated to pay $3, 314.84 each month for 60 months (Dkt. No. 1-2 at 4). BMO alleges that Supermaz defaulted on or about August 1, 2017 by failing to make the monthly payment (Dkt. No. 1 ¶ 11).
2. Supermaz and BMO entered into Loan and Security Agreement 2 on February 25, 2015 (Dkt. No. 1-2 at 14). Supermaz borrowed $85, 250. for the purchase of one 2013 Volvo VNL-Series BBC Conv Cab SBA tractor and was obligated to pay $1, 958.78 each month for 54 months (Dkt. No. 1-2 at 10). BMO alleges that Supermaz defaulted on or about August 1, 2017 by failing to make the monthly payment (Dkt. No. 1 ¶ 17).
3. Supermaz and BMO entered into Loan and Security Agreement 3 on March 2, 2016 (Dkt. No. 1-2 at 20). Supermaz borrowed $161, 800. for the purchase of two 2014 Volvo VNL-Series SLPR 173" BBC Conv Cab SBA tractors and was obligated to pay $3, 221.11 each month for 60 months (Dkt. No. 1-2 at 16). BMO alleges that Supermaz defaulted on or about August 1, 2017 by failing to make the monthly payment (Dkt. No. 1 ¶ 23).
4. Supermaz and BMO entered into Loan and Security Agreement 4 on April 20, 2016 (Dkt. No. 1-2 at 26). Supermaz borrowed $182, 800. for the purchase of two 2015 Volvo VNL-Series SLPR 173" BBC Conv Cab SBA tractors and was obligated to pay $3, 629.34 each month for 60 months (Dkt. No. 1-2 at 22). BMO alleges that Supermaz defaulted on or about August 5, 2017 by failing to make the monthly payment (Dkt. No. 1 ¶ 29).
5. Supermaz and BMO entered into Loan and Security Agreement 5 on April 29, 2016 (Dkt. No. 1-2 at 32). Supermaz borrowed $182, 800. for the purchase of two 2015 Volvo VNL-Series SLPR 173" BBC Conv Cab SBA tractors and was obligated to pay $3, 641.28 each month for 60 months (Dkt. No. 1-2 at 28). BMO alleges that Supermaz defaulted on or ...

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