The district judge determined that, notwithstanding the default, he should not rely merely on unverified allegations to determine an appropriate award of damages in a case not involving a liquidated amount, see, e.g., Dundee Cement Co. v. Howard Pipe Concrete Prods., Inc., 722 F.2d 1319, 1323 (7th Cir. 1983); Byrd v. Keene Corp., 104 F.R.D. 10, 12 (E.D.Pa. 1984), and, therefore, convened an evidentiary hearing to establish the quantum of the award. See Al-Kazemi v. General Acceptance Inv. Corp., 633 F. Supp. 540, 542 (D.D.C. 1986); Systems Indus., Inc. v. Han, 105 F.R.D. 72, 74-75 (E.D.Pa. 1985). Absent a sum certain, the district court, in arriving at the award, could do no more than rely on the evidence before it.
A defaulting defendant concedes all well-pleaded factual allegations as to liability, though the court may require additional evidence concerning damages. SeeAlβKazemi v. Gen. Acceptance & Inv. Corp., 633 F.Supp. 540, 542 (D.D.C.1986). To determine damages, the court may rely on detailed affidavits or documentary evidence to determine the appropriate sum of default judgment, or order an evidentiary hearing.
"At the damages hearing, the party seeking a default judgment must provide evidence supporting the damages claimed." Al-Kazemi v. General Acceptance & Inv. Corp., 633 F. Supp. 540, 542 (D.D.C. 1986) (citing Dundee Cement Co. v. Howard Pipe & Concrete Products, Inc., 722 F.2d 1319, 1324 (7th Cir. 1983)). The entry of a default order does not, however, preclude a party from challenging the sufficiency of the complaint.
This determination is not a "trial on the merits" of the defaulted defendants' liability, but rather a consideration of the sufficiency of the Amended Complaint. "Upon a party's default, the well-pleaded allegations of the complaint related to liability are taken as true. Allegations related to damages, however, are not taken as true. At the damages hearing, the party seeking a default judgment must provide evidence supporting the damages claimed." Al-Kazemi v. General Acceptance & Inv. Corp., 633 F. Supp. 540, 542 (D.D.C. 1986) (internal citations omitted); see also Dundee Cement Co. v. Howard Pipe & Concrete Products, Inc., 722 F.2d 1319, 1323 (7th Cir. 1983); Castellanos v. Deli Casagrande Corp., 2013 U.S. Dist. LEXIS 45858, *6-8 (E.D.N.Y. Mar. 7, 2013).β’ To the extent that the allegations constitute viable claims, the Court will determine
Tafflin v. Levitt, 493 U.S. 455, 464 (1990) (citing Shearson v. Am. Express Inc. v. McMahon, 482 U.S. 226, 240-241 (1987)); Faircloth v. Finesod, 938 F.2d 513, 518 (4th Cir. 1991). See alsoAl-Kazemi v. Gen. Acceptance Inv. Corp., 633 F. Supp. 540, 543-544 (D. D.C. 1986) (the court did not address the issue of multiple recovery for the same damages, nor can it be determined from the decision whether the issue existed). As such, the conclusion necessarily follows that the separate punitive damages awarded to each Plaintiff by the jury in this action are to be considered in addition to the trebled RICO award and not encompassed within it.
While some courts have ruled that punitive damages are unavailable, see Moravian Development Co. v. Dow Chemical Co., 651 F. Supp. 144, 149 (E.D. Pa. 1986), in cases involving claims under both RICO and other causes of action, courts have permitted punitive damage awards. See Bingham v. Zolt, 823 F. Supp. 1126 (S.D.N.Y. 1993) (holding that punitive damages are unavailable for RICO claims, but permitting a (reduced) punitive damage award pursuant to another claim) aff'd 66 F.3d 553 (2d Cir. 1995); Al-Kazemi v. General Acceptance Investment Corp., 653 F. Supp. 540, 543-54 (D.D.C. 1986) (lowering, but permitting, a punitive damage award in addition to a RICO treble damage award); see also First American Corp. v. Al-Nahyan, 948 F. Supp. 1107, 1122 (D.D.C. 1996) (treble damage provision of RICO may suggest a punitive element).
Although courts are divided with regard to the availability of punitive damages in a civil RICO action depending on whether the purpose of the treble damage award is viewed as either remedial or punitive ( see D. Smith T. Reed, Civil RICO ΒΆ 10.04 [1990] [collecting cases]), this Court is of the view that at least at the pleading stage, a claim for punitive damages should be permitted to stand, especially since the Supreme Court has held that civil RICO is primarily remedial in nature and only secondarily punitive ( see Shearson/American Express, Inc. v. McMahon, supra). The Court makes no determination of its future course with regard to the availability of punitive damages in a civil RICO action ( cf. Holmberg v. Morrisette, 800 F.2d 205, 211-12 [8th Cir. 1986], cert. denied, 481 U.S. 1028, 107 S.Ct. 1953, 95 L.Ed.2d 526; Al-Kazemi v. General Acceptance Investment Corp., 633 F. Supp. 540, 543-44 [D.D.C. 1986]). Apart from the RICO claims, the plaintiffs also seek punitive damages in connection with their common-law claims.
Additionally, the plaintiff must suffer injury to his business or property. Al-Kazemi v. General Acceptance and Investment Corporation, et al., 633 F. Supp. 540 (D.D.C. 1986). The defendants argue that the instant RICO counts are deficient on the following grounds: (1) failure to plead a special racketeering-type injury; (2) failure to allege a prior criminal conviction; (3) failure to allege a nexus to organized crime; (4) failure to properly plead an "enterprise"; and (5) failure to plead a "pattern of racketeering activity."
If, in order to enable the court to enter judgment or to carry it into effect, it is necessary to take an account or to determine the amount of damages or to establish the truth of any averment by evidence or to make an investigation of any other matter, the court may conduct such hearings or order such references as it deems necessary and proper . . . .See Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1152 (3d Cir. 1990); Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974);Al-Kazemi v. General Acceptance Inv. Corp., 633 F. Supp. 540, 542 (D.D.C. 1986). ΒΆ 24.
Id. However, a significant treble damage award reduces the defendant's wealth and might render any punitive award excessive. See Al-Kazemi v. General Acceptance Inv. Corp., 633 F. Supp. 540, 543-544 (D.D.C. 1986). The punitive damage award in this case is arguably excessive in light of the trebling effect of the racketeering statute.