Javelin Global Commodities Ltd. v. Investment Mining Group LLC

Background

Javelin agreed to provide financing for Investment Mining Group LLC’s development of the Point Lick Mine. Investment Mining Group entered into a lease with Macquarie Corporate and Asset Funding Inc. for excavators and trucks, and Javelin guaranteed that lease. After Investment Mining Group failed to make payments to Macquarie, Javelin paid Macquarie and subleased the equipment to Investment Mining Group.

Investment Mining Group then failed to pay Javelin. Javelin terminated the sublease, demanded payment, and sued for breach of contract and other relief, including an order allowing it to repossess the equipment. Investment Mining Group did not appear, and the court entered a default against it on February 25, 2022. A default treats the well-pleaded allegations as admitted, but the plaintiff still must prove the amount of damages.

The court later ordered Investment Mining Group to identify the equipment’s location and allow Javelin to take possession. Javelin took possession of the equipment on or around May 20, 2022. Investment Mining Group submitted an opposition to Javelin’s damages evidence but did not submit supporting evidence, despite receiving an opportunity to do so. The parties later agreed that no evidentiary hearing was necessary.

Objections to the damages report

Magistrate Judge Barbara Moses recommended awarding Javelin $2,596,205 in unpaid rent, $189,915 in default interest accrued from August 13, 2021, through May 20, 2022, and additional default interest at 12%, or $853.55 per day, from May 21, 2022, until entry of final judgment.

Investment Mining Group objected that Javelin had failed to reduce its losses by taking and re-leasing the equipment during the nine months before May 20, 2022. Judge Cote rejected the objection for two reasons. First, Investment Mining Group had not made that argument before Judge Moses, so Judge Moses had no opportunity to make the related factual findings. Second, the record showed that Javelin could not take physical possession until the court ordered access and Javelin obtained the equipment in May 2022.

Judge Cote also declined to consider a new affidavit attached to Investment Mining Group’s reply. Investment Mining Group had not offered comparable evidence during the earlier proceedings and gave no adequate justification for its delay. The court found that the new evidence was untimely and supported an argument that had not previously been presented to Judge Moses.

Ruling

Judge Denise Cote adopted Judge Moses’s December 30, 2024 Report in full. The Clerk was directed to enter judgment for Javelin for $2,596,205 in unpaid rent, $189,915 in default interest through May 20, 2022, and additional default interest at 12% from May 21, 2022, until final judgment. Javelin’s February 4, 2025 motion to strike Investment Mining Group’s reply was dismissed as moot, and the case was closed.