FAT Brands Inc. v. PPMT Capital Advisors, Ltd.

Background

FAT Brands asked the court to enter judgment for damages connected to PPMT Capital Advisors, Ltd.’s alleged breach of the duty to negotiate in good faith. The opinion refers to FAT Brands’ default motion and to the damages demanded in that motion, but it does not state the dollar amount. FAT Brands represented that it would limit itself to those damages if the court concluded that Rule 54(b) prevented entry of judgment for only part of the damages.

Court’s Analysis

The court agreed that attorney fees were available as consequential damages for PPMT’s breach of the duty to negotiate in good faith. It also agreed that the fees sought were not subject to review for reasonableness, for substantially the reasons stated in FAT Brands’ letter.

The court then addressed Rule 54(b) of the Federal Rules of Civil Procedure. It concluded that the rule did not allow entry of judgment for partial damages while leaving other damages to be determined later. The court declined to follow a prior decision to the extent that decision suggested otherwise. Because FAT Brands agreed to limit its recovery to the damages demanded in its default motion, the court deemed FAT Brands to have waived any request for additional damages under the First Claim for Relief.

Ruling and Effect

Judge Jesse M. Furman stated that the court would enter judgment for the sum certain FAT Brands was seeking. The court directed FAT Brands to file a proposed judgment on the electronic docket and simultaneously send it by email in Word format no later than October 13, 2020. The proposed judgment was to calculate prejudgment interest as of October 14, 2020. The opinion does not state the resulting judgment amount.