Pharmerica Midwest LLC d/b/a Pharmerica v. Bravo Care of Galesburg, Inc. d/b/a Rosewood Care Center of Galesburg

CourtDistrict Court, C.D. Illinois
DecidedMarch 19, 2021
Docket4:20-cv-04023
StatusUnknown

This text of Pharmerica Midwest LLC d/b/a Pharmerica v. Bravo Care of Galesburg, Inc. d/b/a Rosewood Care Center of Galesburg (Pharmerica Midwest LLC d/b/a Pharmerica v. Bravo Care of Galesburg, Inc. d/b/a Rosewood Care Center of Galesburg) is published on Counsel Stack Legal Research, covering District Court, C.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pharmerica Midwest LLC d/b/a Pharmerica v. Bravo Care of Galesburg, Inc. d/b/a Rosewood Care Center of Galesburg, (C.D. Ill. 2021).

Opinion

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF ILLINOIS ROCK ISLAND DIVISION

PHARMERICA MIDWEST, LLC d/b/a ) PHARMERICA, ) ) Plaintiff, ) ) v. ) Case No. 4:20-cv-04023-SLD-JEH ) BRAVO CARE OF GALESBURG, INC. ) d/b/a ROSEWOOD CARE CENTER OF ) GALESBURG, ) ) Defendant. )

ORDER Before the Court is Plaintiff PharMerica Midwest, LLC d/b/a PharMerica’s Motion for Default Judgment, ECF No. 8. For the following reasons, the motion is GRANTED. Plaintiff is awarded $122,631.46 in damages for unpaid invoices, $27,385.94 in prejudgment interest, post- judgment interest accruing at the statutory rate prescribed by 28 U.S.C. § 1961, $71,999.00 in damages for lost profits, $10,398.50 in attorney’s fees, and $509.99 in costs. BACKGROUND1 Plaintiff entered into a Pharmacy Services Agreement (“PSA”) with Defendant Bravo Care of Galesburg, Inc. d/b/a Rosewood Care Center of Galesburg, effective September 1, 2014, for Plaintiff to provide pharmacy-related goods and services to the residents of a facility operated and managed by Defendant (“the Facility”). Under the PSA, Plaintiff would be the exclusive and preferred provider of pharmacy-related goods to Defendant. The PSA provided that

1 The factual background is taken from the complaint, ECF No. 1, which the Court accepts as true because a default judgment has been entered against Defendant. See Dundee Cement Co. v. Howard Pipe & Concrete Prods., Inc., 722 F.2d 1319, 1323 (7th Cir. 1983) (“Upon default, the well-pleaded allegations of a complaint relating to liability are taken as true.”). Defendant was to pay the amount due for each month within ninety days of the statement date. If payment was not made within the ninety-day period, interest would accrue at the lower of an annualized rate of ten percent or the highest rate permitted by applicable law. If the operator of the Facility was to change, Defendant was required to give Plaintiff thirty days’ advance notice and pay all outstanding amounts before the change occurred.

Either party had the option under the PSA to terminate the agreement for any reason by providing the other party with written notice of non-renewal at least thirty days before the expiration of the current term of the agreement. If no such notice was given, the PSA would automatically renew for an additional one-year term. The initial term of the PSA ended on August 31, 2016; it was then automatically renewed for successive one-year terms, most recently on August 31, 2018. As such, the PSA was in effect through August 31, 2019. Defendant submitted orders to Plaintiff, which Plaintiff filled and delivered to Defendant. Plaintiff submitted detailed written monthly invoices to Defendant for the orders. Defendant did not object to or dispute the invoice charges. However, it failed to pay these

invoices as they became due and has continued to refuse to pay, despite Plaintiff’s demands for payment. On March 26, 2019, Plaintiff received verbal notice that, effective April 1, 2019, Defendant would be transferring operations of the Facility to Aperion Care Galesburg North, LLC (“Aperion”). Aperion notified Plaintiff that it would not be using Plaintiff as the provider of pharmacy-related goods and services for the Facility, effective April 15, 2019. Defendant did not give Plaintiff the required thirty days’ notice of a transfer. It also failed to pay all outstanding amounts prior to the change in operators, as required by the PSA. Because of Defendant’s failure to comply with the terms of the PSA, the PSA did not properly terminate and remained in effect through August 31, 2019, the end of its current term. On February 11, 2020, Plaintiff filed suit for breach of contract. Compl., ECF No. 1.2 The complaint alleges that the PSA is a valid and binding agreement between Plaintiff and Defendant, that Plaintiff performed all of its obligations under the PSA, and that Defendant

“materially breached the PSA . . . by failing to pay sums due and owing for the goods and services provided, failing to provide [Plaintiff] with the requisite written notice of the operations transfer to Aperion, and failing to maintain [Plaintiff] as the exclusive provider of pharmacy- related goods and services to the Facility for the duration of the PSA.” Id. ¶¶ 36–38. Plaintiff seeks compensatory damages; lost profits for the orders that would have been placed between April 15, 2019 and August 31, 2019; “[t]he imposition of a constructive trust on sums received by [Defendant] as Medicare reimbursement for pharmaceutical products and services provided by [Plaintiff] and not paid for by Defendant[]”; prejudgment and post-judgment interest; and Plaintiff’s costs, fees, and attorney’s fees. Id. at 8, ¶ 39.

Defendant was served on February 17, 2020, see ECF No. 4, but failed to plead or otherwise defend, so the Clerk entered Defendant’s default on March 27, 2020 at Plaintiff’s request, see Mar. 27, 2020 Text Order. Plaintiff now seeks the entry of default judgment in the amount of $122,631.46 in damages for unpaid invoices, $15,346.64 in prejudgment interest through April 10, 2020, per diem interest in the amount of $35.10 for each day between April 10, 2020 and entry of judgment against Defendant, post-judgment interest from the date of judgment

2 The Court has jurisdiction over this matter on the basis of diversity. See Compl. ¶¶ 2–4 (stating that the parties are citizens of different states and alleging that the amount in controversy exceeds $75,000, exclusive of interest and costs). accruing at the applicable rate, $71,999 in damages for lost profits, $10,398.50 in attorney’s fees, and $509.99 in costs. Mot. Default J. ¶ 7. DISCUSSION I. Legal Standard A court may enter judgment against a defaulted party under Federal Rule of Civil

Procedure 55(b)(2). A default judgment establishes, as a matter of law, that a defendant is liable to a plaintiff as to each cause of action alleged in the complaint. e360 Insight v. Spamhaus Project, 500 F.3d 594, 602 (7th Cir. 2007). After default is entered, “the well-pleaded allegations of a complaint relating to liability are taken as true.” Dundee Cement Co. v. Howard Pipe & Concrete Prods., Inc., 722 F.2d 1319, 1323 (7th Cir. 1983). However, allegations as to the amount of damages are not. Id. A court must conduct a hearing on damages unless “the amount claimed is liquidated or capable of ascertainment from definite figures contained in the documentary evidence or in detailed affidavits.” Id. II. Analysis

a. Liability The Court finds it appropriate to enter default judgment against Defendant under Rule 55(b)(2). Defendant is found liable as a matter of law for breaching the PSA by failing to pay Plaintiff for the goods and services it provided, failing to provide Plaintiff with the requisite written notice when operations of the Facility were transferred to Aperion, and failing to maintain Plaintiff as the exclusive provider of pharmacy-related goods and services to the Facility for the duration of the PSA, as alleged in the complaint. See Compl. ¶ 38. b. Damages The Court finds it unnecessary to hold a hearing on damages because Plaintiff has requested specific amounts and has submitted documentary evidence and affidavits in support of its requests. The amounts requested are “capable of ascertainment” from documentary evidence or affidavits. See Dundee Cement, 722 F.2d at 1323. Thus, the only task remaining for the

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Bluebook (online)
Pharmerica Midwest LLC d/b/a Pharmerica v. Bravo Care of Galesburg, Inc. d/b/a Rosewood Care Center of Galesburg, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pharmerica-midwest-llc-dba-pharmerica-v-bravo-care-of-galesburg-inc-ilcd-2021.