Stamtec Inc v. Anson Stamping Co

• Court: Court of Appeals for the Sixth Circuit
• Decided: October 7, 2003
• Docket: 01-6582
• Status: Published

Opinion

RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit Rule 206 2 Stamtec, Inc. v. Nos. 01-6541/6582 ELECTRONIC CITATION: 2003 FED App. 0358P (6th Cir.) Anson Stamping Co. File Name: 03a0358p.06 _________________ UNITED STATES COURT OF APPEALS COUNSEL FOR THE SIXTH CIRCUIT ARGUED: Winston S. Evans, EVANS, JONES & _________________ REYNOLDS, Nashville, Tennessee, for Appellant. Kenneth L. Sales, SALES, TILLMAN & WALLBAUM, Louisville, STAMTEC , INC., X Kentucky, for Appellee. ON BRIEF: Winston S. Evans, Plaintiff-Appellant/ - EVANS, JONES & REYNOLDS, Nashville, Tennessee, for Cross-Appellee, - Appellant. Kenneth L. Sales, SALES, TILLMAN & - Nos. 01-6541/6582 WALLBAUM, Louisville, Kentucky, Michael G. Mason, - NEAL & HARWELL, Nashville, Tennessee, for Appellee. v. > , _________________ - ANSON STAMPING COMPANY , - OPINION LLC, - _________________ Defendant-Appellee/ - Cross-Appellant. - KENNEDY, Circuit Judge. This case presents an appeal - and a cross-appeal from the district court’s order granting N partial summary judgment in favor of Plaintiff-Appellant and Appeal from the United States District Court Cross-Appellee Stamtec, Inc. Stamtec argues that the district for the Middle District of Tennessee at Nashville. court erred when it failed to include various payments made No. 98-00308—William J. Haynes, Jr., District Judge. to a third party as an element of Stamtec’s total damage award and when it failed to award prejudgment interest on the Argued: July 31, 2003 damages award. Stamtec also argues that the district court abused its discretion when it failed to enter a default judgment Decided and Filed: October 7, 2003 against Anson Stamping Company (ASCO). Defendant- Appellee and Cross-Appellant ASCO argues that the district Before: KENNEDY, GILMAN, and GIBBONS, Circuit court erred when it determined that the issue of Stamtec’s lost Judges. profits did not present a genuine issue of material fact that precluded summary judgment and awarded Stamtec damages for estimated delivery costs. We REVERSE in part, AFFIRM in part, and REMAND in part.

1 Nos. 01-6541/6582 Stamtec, Inc. v. 3 4 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

I. substantially completed one press and had begun work on the second press. ASCO is engaged in the manufacture of stamped metal products. Stamtec is engaged in the sale, service, and On October 18, 1996, Chin Fong advised Stamtec that engineering of large-scale mechanical presses for industrial Stamtec would be charged interest and held responsible for applications. Chin Fong Machine Industrial Co. (Chin Fong) any losses if ASCO cancelled its order. Chin Fong further is a manufacturer of large-scale presses. Stamtec is a wholly demanded that Stamtec pay a non-refundable $100,000 owned subsidiary of Chin Fong. deposit to Chin Fong, which was to be applied to the purchase price of the first ASCO press. On December 10, 1996, On April 8, 1996, Stamtec prepared a proposal for the sale Stamtec paid Chin Fong $80,000 toward the deposit and paid of a mechanical press to ASCO for $1,989,000. Stamtec’s the $20,000 balance on January 3, 1997. proposal included the following payment terms: (1) thirty percent payment with the purchase order; (2) thirty percent On or about January 9, 1997, Chin Fong issued its first payment upon sign off at manufacturer; (3) thirty percent invoice to Stamtec demanding full payment for the first press payment upon delivery; and (4) ten percent payment upon the ($1,600,000) and partial payment for the second press completion of press installation. On April 25, 1996, ASCO ($640,000 based on forty percent completion). Stamtec did placed purchase orders for two presses. The ASCO purchase not make any payment. orders included the following revisions to Stamtec’s sales proposal: (1) minor changes in the press specifications; (2) a On November 30, 1997, Chin Fong invoiced Stamtec reduction in the purchase price to $1,900,000; (3) a change in $213,996 for interest charges on the cancelled orders and the delivery location; and (4) a reduction in the down $560,000 in storage fees. Stamtec paid the1997 storage fees payment from $570,000 to $200,000 per press. ASCO did on January 23, 1998 and the 1997 interest charge on March 2, not make the required down payment at the time it placed its 1999. On December 31, 1998, Chin Fong invoiced Stamtec order. Though Stamtec never waived the down payment $213,996 in interest charges and $240,000 in storage fees that requirement, it acted on ASCO’s purchase orders. accrued during 1998. Stamtec paid Chin Fong’s interest and storage fee invoices. Stamtec paid the 1998 storage fee on Stamtec entered into a contract with Chin Fong on April 26, March 2, 1999 and the 1998 interest charge on May 20, 1999. 1996. Chin Fong immediately commenced production of the presses, which were to be specially manufactured for ASCO. In October 1998, Stamtec received an order for two presses The Stamtec-Chin Fong contract provided that Chin Fong from Precision Machine & Tool. Stamtec contracted with would sell Stamtec the presses for $1,600,000 each, or a total Chin Fong to manufacture the presses. Chin Fong was able of $3,200,000. Stamtec did not make a down payment to to use many, but not all, of the parts that had been fabricated Chin Fong presumably because it had not received a down for the ASCO presses. Chin Fong then forgave Stamtec’s payment from ASCO. obligation to pay the purchase price for the ASCO presses and, instead, required Stamtec to pay a $272,000 salvage loss On August 30, 1996, Chin Fong notified ASCO that it charge. Chin Fong invoiced Stamtec a $272,000 salvage loss would discontinue manufacturing the presses until and unless charge on November 10, 1999, and Stamtec paid the charge a down payment was made. At the time, Chin Fong had on March 17, 2000. Nos. 01-6541/6582 Stamtec, Inc. v. 5 6 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

On December 18, 1998, the district court granted summary A. judgment on the issue of liability in favor of Stamtec, adopting the magistrate judge’s finding that the parties’ ASCO argues that the district court’s determination that conduct subsequent to April 25, 1996 evidenced their intent Stamtec was entitled to $264,880 in damages due to lost to be bound by the reasonably certain terms of Stamtec’s sales profits resulting from ASCO’s breach was error because the proposal and ASCO’s purchase orders. Neither party district court did not make any findings as to whether Stamtec objected to the magistrate judge’s finding of contract liability. actually experienced any lost profits. ASCO further argues On August 23, 2001, the district court granted summary that the lost profits figure is hypothetical and, therefore, judgment in favor of Stamtec on the issue of damages. The presents a genuine issue of material fact that precludes parties timely appealed the district court’s order regarding summary judgment. The following facts are not in dispute: Stamtec’s damages.1 The district court did not determine the ASCO contracted with Stamtec to deliver two presses F.O.B. date of ASCO’s breach and the parties dispute the date that Louisville for $3.8 million ($1.9 million per press). Stamtec the breach occurred. placed a purchase order with Chin Fong for the manufacture of the two presses according to Stamtec’s specifications for II. $3.2 million ($1.6 million per press). The fee paid to Chin Fong did not include any delivery costs; Stamtec bore The district court’s disposition of a summary judgment responsibility for shipping the presses from Taiwan to motion is reviewed de novo. Hunter v. Caliber Sys., Inc., 220 Louisville. The $600,000 difference between Stamtec’s F.3d 702, 709 (6th Cir. 2000). Summary judgment is contract with Chin Fong and its contract with ASCO included appropriate where there is no genuine issue as to any material $264,880 in expected profit and $335,120 in expected fact and the moving party is entitled to judgment as a matter delivery, installation and warranty costs. In light in of these of law. Fed. R. Civ. P. 56(c). Material facts are those facts uncontested facts, the amount of Stamtec’s lost profits does defined by the substantive law and that are necessary to apply not pose a genuine issue of material fact that precludes it. Anderson v. Liberty Lobby, 477 U.S. 242, 248 (1986). summary judgment and the district court was not required to While a court must draw all inferences in a light most make any specific findings with respect to Stamtec’s actual favorable to the non-moving party, it may grant summary losses. Consequently, we affirm the district court’s award of judgment if the record, taken as a whole, could not lead a $264,880 in lost profits. rational trier of fact to find for that party. Matusushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). B. ASCO argues that the district court erred when it determined that Stamtec’s $335,120 estimated delivery costs qualified as overhead and could be awarded as damages under 1 Tennessee Code § 47-2-708(2). Stamtec concedes that the ASC O’s notice of appeal, filed December 7, 2001, included an appeal of the district court’s Decemb er 18, 1998 o rder, as we ll as the estimated delivery costs are not overhead expenses and that magistrate judge’s report and recommendation, on the issue of contract the expenses should not have been awarded as damages under liability. ASCO did not file any written o bjec tion to the magistrate’s § 47-2-708(2). The district court held that Stamtec was finding of contra ct liability and, therefore, is barred from raising that issue on ap peal. Thomas v. Arn, 474 U.S. 140 (1985). entitled to the estimated delivery costs as overhead under the Nos. 01-6541/6582 Stamtec, Inc. v. 7 8 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

rule established in Mid-South Materials Co. v. Ellis, 1988 WL costs because the manufacturer, not the seller, was 23914 (Tenn. Ct. App. Mar. 16, 1988).2 The Ellis court responsible for the cost of delivering the goods to the buyer. interpreted the meaning of profit under Tennessee Code Annotated § 47-2-708(2) when the non-breaching party is a The district court erred by not deducting for Stamtec’s seller acting as a jobber. Section 47-2-708(2) states: saved delivery costs from the measure of Stamtec’s lost profits. Ellis makes clear that where there is no delivery cost, If the measure of damages provided in subsection (1) is a jobber’s measure of damages under § 47-2-708(2) is gross inadequate to put the seller in as good a position as profits, without any reduction for saved overhead. But where performance would have done then the measure of a jobber’s contract price includes saved delivery costs, the damages is the profit (including reasonable overhead) measure of damages under § 47-2-708(2) is gross profits (no which the seller would have made from full performance reduction for overhead) less the saved delivery cost. Thus, by the buyer, together with incidental damages provided under Ellis, the measure of Stamtec’s damages under § 47-2- in this chapter (§ 47-2-710), due allowance for costs 708(2) is the contract price ($3.9 million) less Stamtec’s cost reasonably incurred and due credit for payments or of acquiring the presses ($3.2 million) less the saved delivery proceeds of resale. costs ($335,120), or $264,880. Consequently, we reverse the district court’s award of delivery costs as an element of TENN. CODE ANN . § 47-2-708 (2003). Stamtec’s measure of lost profits. The Ellis court concluded that the section intended “to Stamtec next argues that the district court erred when it compensate the seller for losses incurred and gains prevented refused to include the $100,000 deposit and $272,000 salvage in excess of savings made possible by the breach.” Id. at *3. loss charge paid to Chin Fong as “costs reasonably incurred” “In the case of a middleman or a jobber where there is no cost under § 47-2-708(2) or, in the alternative, as an element of of delivery that measure usually equals what we call gross incidental damages under § 47-2-710. The district court profits: the jobber’s mark-up, or, in the case of a middleman, determined that the deposit was a transaction-specific the contract price less the middleman’s costs of acquiring the payment and, as such, did not qualify as a recoverable goods.” Id. Further, the court held that overhead savings are overhead expense. The district court determined that the not deducted under § 47-2-708(2). Id. The Ellis court salvage loss charge fell within the definition of consequential awarded the seller “the difference between the contract price damages, which are not recoverable by a seller. ASCO and the cost to the seller of acquiring the goods ‘F.O.B. contends that the district court properly excluded these costs jobsite.’” Id. Thus, in Ellis, the measure of the seller’s lost as consequential damages. ASCO does not contend that it profits was not adjusted to reflect the seller’s saved delivery was commercially unreasonable for Stamtec to pay the charges. Though a deposit paid by a jobber to a manufacturer may 2 be recovered as a cost reasonably incurred, Stamtec’s The district court applied the damages measure provided in § 47-2- payment of the $100,000 deposit was commercially 708(2) because it found that Stamtec acted as a jobber in this transaction, unreasonable. Under the “due allowance for costs reasonably citing Ellis. The parties do not dispute that Stam tec meets the Ellis test for a jobber. incurred” provision of § 47-2-708(2), those costs reasonably Nos. 01-6541/6582 Stamtec, Inc. v. 9 10 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

incurred by a seller or jobber prior to the buyer’s breach, such court properly excluded these costs as consequential damages. as a jobber’s payment of a non-refundable deposit to a ASCO does not contend that the charges were commercially manufacturer, are recoverable. Giantonio’s Pastry Shop v. unreasonable. Champagne & Co., Inc., 1986 WL 3704, at *3 (Ohio Ct. App. Mar. 25, 1986) (holding that a jobber is entitled to recover The $272,000 salvage loss charge is not recoverable under non-refundable deposit paid to manufacturer as cost § 47-2-708(2) as a cost reasonably incurred because the reasonably incurred prior to buyer’s breach under R.C. charge occurred after ASCO’s breach.3 Nor may the charge 1302.82(B), the Ohio version of Tennessee Code § 47-2- be recoverable as an element of incidental damages. 708(2)). Stamtec’s conduct, however, was not commercially Tennessee Code Annotated § 47-2-710 states: reasonable. Stamtec’s payment consumed a large proportion (almost forty percent) of the profit it expected to earn on its Incidental damages to an aggrieved seller include any contract with ASCO. Stamtec’s payment of the deposit was commercially reasonable charges, expenses, or commercially unreasonable for several reasons. First, when commissions incurred in stopping delivery, in the Stamtec paid the deposit for the first ASCO press in transportation, care and custody of goods after the December 1996 and January 1997, the press was substantially buyer’s breach, in connection with the return or resale of complete. At that time, ASCO had not only breached the the goods or otherwise resulting from the breach. contract downpayment term but had arguably breached the contract term that required ASCO to inspect the completed TENN. CODE ANN . 47-2-710 (2003). press and make an additional payment against the purchase price. Given ASCO’s failure to meet any of its obligations Although the record is not totally clear on this matter, it under the contract, it was commercially unreasonable for appears Chin Fong presumably imposed the salvage-loss Stamtec to advance nearly forty percent of its expected profits charge on Stamtec because Stamtec breached its contract with from the ASCO contract. Stamtec’s conduct did nothing to Chin Fong. All parties agree that ASCO was not a party to preserve its position relative to the measure of its lost profits the Stamtec-Chin Fong contract, and the Stamtec-Chin Fong owed as damages; rather it inflated ASCO’s potential contract did not expressly incorporate the Stamtec-ASCO damages liability by almost forty percent. Accordingly, we contract. ASCO’s breach of its contract with Stamtec was affirm the district court’s refusal to include the $100,000 therefore neither necessary nor sufficient for Stamtec to deposit as an element of Stamtec’s damages because the cost breach its contract with Chin Fong. As a practical matter, of was not reasonably incurred. course, Stamtec breached its contract with Chin Fong because ASCO would not fulfill its payment obligations to Stamtec. Next, Stamtec argues that the $272,000 salvage loss charge But that means that the salvage-loss charge imposed by Chin assessed by Chin Fong in March 2000 is recoverable as a Fong on Stamtec was a consequence of ASCO’s breach, “cost reasonably incurred” under § 47-2-708(2) or, in the rather than a direct result of ASCO’s breach. Regardless of alternative, an element of incidental damages under § 47-2- 710. The district court refused to award Stamtec recovery on the ground that the salvage loss payment constituted 3 Though the parties dispute the exact date of ASCO ’s breach, the consequential damages, which are not available to an salvage loss charge was levied at a point in time when the parties do not aggrieved seller. ASCO, again, contends that the district dispute that ASCO was in breach. Nos. 01-6541/6582 Stamtec, Inc. v. 11 12 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

the date of ASCO’s breach, therefore, the salvage-loss charge C. is an element of consequential, not incidental, damages. Firwood Mfg. Co. v. Gen. Tire, Inc., 96 F.3d 163, 169-71 (6th Stamtec argues that it is entitled to recover prejudgment Cir. 1996) (distinguishing between incidental and interest as an element of its damages arising from ASCO’s consequential damages under the Uniform Commercial Code, breach. First, Stamtec argues the $427,992 interest charge as adopted by Michigan.) Thus, we affirm the district court’s payments made to Chin Fong are recoverable as an element refusal to permit Stamtec to recover the salvage cost as an of incidental damages under § 47-2-710. Second, Stamtec element of incidental damages. argues that it is entitled to recover interest based on the one percent penalty term Stamtec claims was included in its Finally, Stamtec argues that the district court erred when it contract with ASCO. In the alternative, Stamtec argues that refused to include the $800,000 storage charge paid to Chin it is entitled to interest based on its lost use of money under Fong as an element of its incidental damages under § 47-2- § 47-2-710. The district court refused to permit Stamtec to 710. Stamtec paid Chin Fong a total of $800,000 in storage recover either the Chin Fong interest charges or interest based charges; a $560,000 storage charge was assessed for the on its loss use of money under § 47-2-710 because the court period from November 1, 1996 through December 31, 1997 concluded that such interest costs are consequential damages and a $240,000 storage charge was assessed for the period that are not available to an aggrieved seller, citing Firwood from January 1, 1998 through December 31, 1998. Though Mfg. Co., 96 F.3d at 169. The district court also refused to the district court found that storage charges may be permit Stamtec to recover interest under the one percent recoverable as incidental damages, the court denied recovery penalty term because that term was not a part of the parties’ because it found that Stamtec had failed to prove the storage contract. cost losses with reasonable certainty. While we find that the district court erred in treating the total amount of storage As an initial matter, the district court’s finding that the charges as incidental damages,4 we agree with the district penalty term was not a part of the Stamtec-ASCO contract is court that Stamtec cannot recover any of its storage costs supported by the record. Stamtec’s vice president testified because it failed to prove the commercial reasonableness of “he was not sure the page of the contract dealing with that the amount.5 Nashland Assocs. v. Shumate, 730 S.W.2d 332, subject was included in ASCO’s copy of the contract nor was 334 (Tenn. Ct. App. 1987) (holding that Tennessee law does the item billed to defendant before the action was filed. not permit the recovery of speculative or uncertain damages). Nor did the district court err when it concluded that Stamtec could not recover either the interest charges paid to Chin Fong or interest based on its lost use of money because these 4 costs are consequential damages, which are not available to As discussed above, costs incurred prior to a breach may be recoverab le as costs reasonably incurred under § 47-2 -708 (2), while costs an aggrieved seller. Like the district court, we find the incurred following a breach may be recoverable as incidental damages reasoning in Firwood persuasive. The Firwood court under § 47-2-710. considered whether an aggrieved seller could collect the cost 5 of its lost use of money (interest) as an element of its The only evidence with respect to the reasonableness of the amount incidental damages. The Firwood court began by noting that of the storage charge was testimony given by Don Chi, who served at the time as both an officer of Stamtec and an officer of Chin Fong. the Uniform Commercial Code entitles sellers to collect Nos. 01-6541/6582 Stamtec, Inc. v. 13 14 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

incidental, but not consequential damages. Id. at 169. interest paid on a commercial loan. Each involves a financial Focusing on the issue of how Michigan had defined incidental transaction that falls outside the immediate scope of the damages, the court found that Michigan courts had not buyer-seller transaction at issue: the first involves a bank permitted an aggrieved seller to collect interest payments on transaction necessary to maintain an entity’s financial a loan secured to maintain a business after a buyer’s breach viability and the second involves a transaction with an on the ground that such interest payments fell within the unspecified party that would produce uncertain results. Thus, definition of consequential damages. Id. at 170. Because the we conclude that the Tennessee Uniform Commercial Code, Michigan courts had not addressed the specific issue of which adopted the relevant Uniform Commercial Code incidental damages arising from the lost use of money, the provisions without modification, does not permit a seller’s Firwood court considered the competing positions taken by claim for damages based on either lost use of money or the Seventh and Second Circuits. In doing so, the Firwood interest paid to a third party (which is analogous to interest court looked to the general structure of the Uniform paid on a commercial loan) because these costs represent Commercial Code for guidance. The Firwood court “agree[d] consequential damages. Given that a seller is not entitled to with the Seventh Circuit’s view that sellers are not entitled to consequential damages, and the Commercial Code portion of [lost use of money] as an element of the damage award” the Tennessee law precludes the award of consequential because “a foregone profit from exploiting a valuable damages except as specifically provided by statute, TENN . opportunity that the breach of contract denied to the victim of CODE ANN . § 47-1-106(1), Stamtec cannot recover the the breach fits more comfortably under the heading of interest-charge payments made to Chin Fong nor the cost of consequential damages than of incidental damages.” Id. at its lost use of money as an element of incidental damages 171 (quoting Afram Export Corp. v. Metallurgiki Halyps, under § 47-2-710. S.A., 772 F.2d 1358 (7th Cir. 1985)). The Firwood court “decline[d] to follow the Second Circuit’s embrace of an Prejudgment interest may, however, be awarded under expansive definition of incidental damages because “[that] Tennessee Code Annotated § 47-14-123, which provides, in Court appeared to conflate the definition of consequential relevant part, damages with that of incidental damages” when it determined that recovery depended on whether the interest payments were Prejudgment interest, i.e., interest as an element of, or in foreseeable, an element of the test for consequential damages. the nature of, damages, as permitted by the statutory and Id. at 170 n.2. Thus, it was the considered opinion of the common laws of the state as of April 1, 1979, may be Firwood court that the general structure of the Uniform awarded by courts or juries in accordance with the Commercial Code precluded the award of interest, whether principles of equity at any rate not in excess of a claimed as charges arising from a bank loan or the buyer’s maximum effective rate of ten percent (10%) per lost use of money, as incidental damages because such costs annum. . . . In addition, contracts may expressly provide fell outside the immediate buyer-seller transaction. for the imposition of the same or a different rate of interest to be paid after breach or default within the limits We believe that the Firwood court was correct in its set by § 47-14-123. analysis of recoverability of interest costs as an element of incidental damages. We do not see a meaningful distinction TENN. CODE ANN . 47-14-123 (2003). Section 47-14-123 between costs incurred due to the lost use of money and permits an aggrieved seller’s damage award to include an Nos. 01-6541/6582 Stamtec, Inc. v. 15 16 Stamtec, Inc. v. Nos. 01-6541/6582 Anson Stamping Co. Anson Stamping Co.

amount for prejudgment interest as a matter of equity, rather district court summarily denied. In light of the Tennessee than as a form of incidental damages. Supreme Court’s presumption in favor of granting prejudgment interest under the statute, we remand the Stamtec argues that it is entitled to prejudgment interest question so that the district court can provide a reasoned under § 47-14-123 because fairness requires a plaintiff to be decision on this issue. fully compensated by a defendant for losses incurred, including the lost of use of money. The Tennessee Supreme D. Court has held that, under § 47-12-123, “the court must decide whether the award of prejudgment interest is fair, Stamtec argues that the district court erred when it did not given the particular circumstances of the case.” Myint v. grant its motion for entry of a default judgment. Stamtec Allstate Ins. Co., 970 S.W.2d 920, 927 (Tenn. 1998). In urged the district court to enter a default judgment against reaching an equitable decision, “a court must keep in mind ASCO on the ground that an ASCO represenative’s that the purpose of awarding the interest is to fully deposition testimony in this case conflicted with the compensate a plaintiff for the loss of the use of funds to testimony given by that same person in another lawsuit. We which he or she was legally entitled, not to penalize a agree with the district court that its finding of liability on the defendant for wrongdoing.” Id. Though courts traditionally part of ASCO moots the conflicting testimony issue. have awarded interest in cases where the amount of the obligation is certain and the existence of the obligation is not III. disputed on reasonable grounds, “[t]he uncertainty of either the existence or the amount of an obligation does not mandate In sum, we reverse the district court’s decision to include denial of prejudgment interest.” Id. at 928. The Tennessee Stamtec’s estimated delivery costs in its damages award. We Court of Appeals found that Myint “shifted the balance to affirm the district court’s decision to award Stamtec $264,880 favor awarding prejudgment interest whenever doing so will in lost profits and to exclude Stamtec’s payment of the Chin more fully compensate plaintiffs for the loss of use of their Fong storage, salvage loss, and interest charges from the funds,” and concluded that “[f]airness will, in almost all damages award, as well as its decision to deny damages based cases, require that a successful plaintiff be fully compensated on the interest term allegedly included in the contract. We by the defendant for all losses caused by the defendant, also affirm the district court’s decision to deny Stamtec’s including the loss of use of money the plaintiff should have motion for default judgment. Finally, we remand Stamtec’s received.” Scholz v. S.B. Int’l, Inc., 40 S.W.3d 78, 83 (Tenn. claim for prejudgment interest under § 47-14-123 for Ct. App. 2000). additional proceedings.

The district court stated that its conclusion that interest charges were not recoverable as incidental damages under § 47-2-710 did not bar an award of prejudgment interest under Tennessee law. The district court, however, did not grant Stamtec’s request for prejudgment interest under § 47- 14-123. Stamtec filed a motion to alter or amend again seeking prejudgment interest under the statute, which the