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Goldblatt v C.P. Motion, Inc.

Case No. 3D10-1848 (FL Dist. 3 Ct. App., Dec. 28, 2011)

Richard and Valerie Goldblatt appeal a final judgment awarding appellee C.P. Motion, Inc. $4,969,339. The Goldblatts maintain, in part, that the final judgment award is invalid, as it is the product of an unenforceable liquidated damages clause. We agree and therefore reverse on this basis. We affirm the final judgment in all other respects.

In November of 1999, Richard Goldblatt and Raymond Weisbein created C.P. Motion, a business that specializes in the distribution of a medical device used in the treatment of joint injuries. During the course of business, C.P. Motion, with Richard Goldblatt and Valerie Goldblatt as personal guarantors, entered into an agreement with Real Lease, Inc. whereby Real Lease agreed to lease medical equipment to C.P. Motion in exchange for monthly lease payments.

Raymond Weisbein and Richard Goldblatt terminated their business agreement in 2004. The parties subsequently negotiated and executed a settlement and release agreement. Pursuant to the agreement, C.P. Motion paid the Goldblatts $2.7 million in cash, paid $300,000 in periodic salary payments, and agreed to forgive $4 million in debt. C.P. Motion also promised to indemnify the Goldblatts from judgments and liabilities arising from their business relationship. In return, the Goldblatts agreed to relinquish any ownership interest in C.P. Motion. The Goldblatts also agreed to a five-year restrictive covenant, which restricted the Goldblatts from conducting any business that competed with C.P. Motion. In the event that the Goldblatts breached the restrictive covenant, the parties negotiated a liquidated damage sum of $250,000 per breach.
 

 

Judge(s): Ivan F. Fernandez
Jurisdiction: Florida Court of Appeals, Third District
Related Categories: Damages
 
Trial Court Judge(s)
John Schlesinger

 
Court of Appeals Judge(s)
Ivan Fernandez
Richard Suarez
Linda Wells

 
Appellant Lawyer(s) Appellant Law Firm(s)
Gerald Houlihan
Sandra Millor Kasowitz Benson Torres & Friedman LLP
Lawrence Silverman Kasowitz Benson Torres & Friedman LLP

 
Appellee Lawyer(s) Appellee Law Firm(s)
David Levine Carey Rodriguez Greenberg & Paul LLP
David Milian Carey Rodriguez Greenberg & Paul LLP

 

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Click the maroon box above for a formatted PDF of the decision.
parties did neither. the goldblatts cite several compelling reasons why the liquidated damages forfeiture is whether the sum named is just conferring a windfall to the non-breaching party. this result is unacceptable and contract language similar to the one here, and stated the following: state of florida, july term, a.d. 2011 opinion filed december 28, 2011. forfeited must not be so grossly disproportionate to any law, subject to a de novo review on appeal. see fayad v. clarendon nat'l ins. co., provision is a penalty or a proper liquidated damages clause, "the tendency of the event that the goldblatts breached the restrictive covenant, the parties negotiated a penalty or deterrent to the breaching party. use of liquidated damages clauses to compensation for damages resulting from the breach. argument, however, is unconvincing. no. 3d10-1848 from a breach as to show that the parties could have enforceability of the liquidated damages clause in the settlement agreement. first, 8 even where contracting parties stipulate that a liquidated damages clause is the motion, valerie goldblatt argued that she should not be held liable for richard 6 are improper and not enforceable by courts). where there is doubt as to whether a covenants and the contract so made. the prime factor in this end is never allowed. see secrist v. nat'l serv. indus., inc., 395 so. 2d 1280 damages that resulted from the contract breach were ascertainable at the time the valerie goldblatt, individually, an appeal from the circuit court for miami-dade county, john appellee. fernandez, j. 7 c.p. motion correctly argues that florida law is well settled that the parties to are susceptible of ascertainment by some known rule or consistent with this opinion. instead, the liquidated damages clause awarded the non-breaching party pecuniary standard under reasonable circumstances, the readily ascertainable. second, the sum stipulated to be the parties subsequently breached the terms of the agreement. the vs. damages clause is unenforceable. goldblatts also agreed to a five-year restrictive covenant, which restricted the breach. there is little doubt that sophisticated business people with a long history was enforceable and that valerie goldblatt was jointly and severally liable. product of the contracting parties' inability to readily ascertain damages, the court see coleman v. b.r. chamberlain & sons, inc., 766 so. 2d 427, 429 (fla. 5th not final until disposition of timely filed motion for rehearing. liquidated damages clause. the trial court entered final judgment in the amount of (fla. 3d dca 1992). in order to be enforceable, a liquidated damages clause must and sandra j. millor; gerald j. houlihan, for appellants. 2 a contract may stipulate in advance the amount that is to be paid or retained as other respects, including the trial court's conclusion that the restrictive covenant the trial court denied richard goldblatt's motion for summary judgment, 3 m. levine, for appellee. goldblatts from conducting any business that competed with c.p. motion. in the c.p. motion, inc., a florida corporation, richard goldblatt and valerie goldblatt as personal guarantors, entered into an actual harm suffered. thus, the liquidated damages sum has the potential of appellants, forgive $4 million in debt. c.p. motion also promised to indemnify the goldblatts $250,000 per breach, regardless of what the actual harm was. this resembles a equipment to c.p. motion in exchange for monthly lease payments. that the non-breaching party could collect more in liquidated damages than the 5 goldblatts claim that c.p. motion breached when it failed to indemnify them schlesinger, judge. 4 lower tribunal no. 07-31623 damages for a breach by calculating a percentage of lost profits (of the specific lost can still invalidate the clause. for example, in north beach investments, inc. v. this court is committed to the doctrine that when the judgment in all other respects. richard goldblatt, individually and from judgments and liabilities arising from their business relationship. in return, true, that is, that when the actual damages cannot be here, the award of $250,000 per breach would be the same regardless of what kasowitz, benson, torres & friedman, llp, and lawrence d. silverman, both parties brought suit and subsequently filed cross motions for summary (fla. 2d dca 1981) (stating liquidated damage provisions operating as a penalty because the damages were readily ascertainable, and it constituted a penalty. motion, a business that specializes in the distribution of a medical device used in 532 so. 2d 23, 25 (fla. 4th dca 1988). additionally, where a court finds that the proper determination of the actual damages. we affirm the final judgment in all liquidated damages clause does not automatically render the clause enforceable. proven at trial. see secrist, 395 so. 2d at 1282 (citing poinsettia dairy prods. v. we thus conclude that the liquidated damages clause was unenforceable the goldblatts agreed to relinquish any ownership interest in c.p. motion. the village of davie, llc., 983 so. 2d 20, 21 (fla. 4th dca 2008) (affirming the industry, stipulated to the impossibility of ascertaining potential damages. this goldblatt's actions because she did not personally breach the restrictive covenant. ascertainable, preciseness is not the legal standard. rather, damages must be first, the damages consequent upon a breach must not be in nothing more than a penalty. we agree with the goldblatts that the liquidated provision is a penalty, the plaintiff may only recover the actual damages pled and raymond weisbein and richard goldblatt terminated their business the fact that c. p. motion had substantial industry experience, such that it was c.p. motion, inc. $4,969,339. the goldblatts maintain, in part, that the final holding that the liquidated damages clause was enforceable as a matter of law. the contract was formed. second, they argue that the liquidated damages clause results dca 2000). richard and valerie goldblatt appeal a final judgment awarding appellee calculating damages. for example, the parties could have agreed to arrive at actual damages contemplated by the parties upon breach rulings, c.p. motion moved for summary judgment for damages under the furthermore, although the parties claim that precise damages were not readily ________________ chief among their issues on appeal, the goldblatts challenge the damages, and the parties should be bound by their disproportionate thereto, it will be regarded as a penalty. ________________ liquidated damages in the event of a contract breach. see mineo v. lakeside accordingly, we reverse the judgment award of $4,969,339 and remand for a $4,969,339 against the goldblatts jointly and severally. c.p. motion argues that the goldblatts, who were equally knowledgeable in the agreement with real lease, inc. whereby real lease agreed to lease medical and release agreement. pursuant to the agreement, c.p. motion paid the goldblatts unenforceable as it constitutes an award that is disproportionate to the actual harm. clause is unenforceable due to a lack of ascertainable profits. first, they point to wessel co., 166 so. 306 (fla. 1936)). courts is to construe a provision for payment of an arbitrary sum a penalty rather capable of forecasting any damages that might flow from their breach. in turn, judgment. in his motion, richard goldblatt argued that the restrictive covenant they argue that the liquidated damages clause is unenforceable because any judgment award is invalid, as it is the product of an unenforceable liquidated in november of 1999, richard goldblatt and raymond weisbein created c.p. lefemine v. baron, 573 so. 2d 326, 328 (fla. 1991). harm (if any) actually befell the non-breaching party. it is therefore conceivable enforceable in florida courts, such clauses may be held invalid where their purpose against a lawsuit by real lease, one of c.p. motion's creditors. c.p. motion, on in the industry could arrive at a standard or a more formulaic approach for determining whether such sum is a penalty or a client), or even by reclaiming any profits gained by the breaching party. the 899 so. 2d 1082 (fla. 2005). to prevail on a motion for summary judgment, the is to deter a breach. see humana med. plan, inc. v. jacobson, 614 so. 2d 520, 522 id. at 499 (emphasis added). unenforceable as it amounted to an unconscionable penalty. c.p. motion argued the mere fact that the goldblatts stipulated to an otherwise unenforceable enforceability of a $60,000 liquidated damages clause). although generally damages clause. we agree and therefore reverse on this basis. we affirm the final intended only to induce full performance, rather than to movant must prove that there are no genuine issues of material fact. see moore v. stipulated amount should be regarded as liquidated they solicited c.p. motion's clients. $2.7 million in cash, paid $300,000 in periodic salary payments, and agreed to denied valerie goldblatt's motion for summary judgment. following these the entry of summary judgment in favor of the movant involves a question of liquidated damage sum of $250,000 per breach. before wells, c.j., and suarez and fernandez, jj. third district court of appeal satisfy two conditions: sheikewitz, 63 so. 2d 498 (fla. 1953), the florida supreme court addressed liquidate their damages. the treatment of joint injuries. during the course of business, c.p. motion, with readily ascertainable, and they must compensate for damages resulting from the was unenforceable as to its duration and that the liquidated damages clause was damages that might reasonably be expected to follow trial court granted c.p. motion's motion for summary judgment as to liability and affirmed in part, reversed in part, and remanded for further proceedings pecuniary standard and the stipulated sum is susceptible of ascertainment by some known rule or morris, 475 so. 2d 666, 668 (fla. 3d dca 1999). the other hand, claims that the goldblatts breached the restrictive covenant when such being the case, the corollary of the rule should be carey rodriguez greenberg & paul, llp, and david p. milian, and david than one for liquidated damages." see t.a.s. heavy equip., inc. v. delint, inc., that the liquidated damages provision was enforceable as a matter of law. in her agreement in 2004. the parties subsequently negotiated and executed a settlement


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