United States District Court, N.D. Illinois, Eastern Division
BA JACOBS FLIGHT SERVICES, LLC, an Illinois Limited Liability Company, Plaintiff,
RUTAIR LIMITED, a/k/a RUTAIR LLC, a Jamaica Corporation, and GEORGE LEVY, an individual, Defendants.
MEMORANDUM OPINION AND ORDER
Jeffrey T. Gilbert Magistrate Judge.
Court assumes familiarity with, and incorporates by
reference, the underlying facts and conclusions set forth in
its previous Memorandum Opinions and Orders in this case.
See [ECF Nos. 74, 88, 116]. This dispute arises out
of a lease agreement (the "Lease") entered into
between Plaintiff BA Jacobs Flight Services LLC ("BA
Jacobs") and Defendant RutAir Limited
("RutAir") in December 2010. BA Jacobs leased a new
2010 Cessna Caravan 208B airplane (the "Aircraft")
to RutAir. Defendant George Levy ("Levy") signed a
guaranty ("the Guaranty") pursuant to which he
personally guaranteed RutAir's Lease payments up to $300,
000 in the event of a breach of the Lease, and agreed to pay
attorneys' fees and costs incurred by BA Jacobs in
enforcing its rights under the Guaranty. The Court already
has held that RutAir breached the Lease and that Levy is
liable on his Guaranty, and it awarded damages against both
RutAir and Levy consequent to the breach after a bench trial.
[ECF Nos. 74, 116].
Court concluded that BA Jacobs is entitled to damages of
$400, 245, plus prejudgment interest and attorneys' fees
and costs. See generally BA Jacobs Flight Services, LLC
v. RutAir Limited a/k/a RutAir LLC, 2017 WL 277913 (N.D.
Ill. Jan. 20, 2017) [ECF No. 116]. The Court ordered the
parties to confer in good faith and attempt to reach
agreement on the amount of prejudgment interest and
attorneys' fees and costs to be awarded. They were unable
to resolve those issues. The Court, therefore, set a briefing
schedule on the issues of prejudgment interest and BA
Jacobs's request for attorneys' fees. The parties
have filed their briefs, and this matter is now before the
Court on Plaintiffs Motion for Prejudgment Interest and
Attorneys' Fees and Expenses [ECF No. 119].
initial matter, RutAir is fundamentally mistaken in its
presumption that the question of whether to award prejudgment
interest is an open question yet to be resolved. It is not.
An award of prejudgment interest is left to the sound
discretion of the district court. See United States v,
Bd. of Educ. of Consol. High Sch. Dist. 230, Palos Hills,
III, 983 F.2d 790, 799 (7th Cir. 1993). In its most
recent Memorandum Opinion and Order issued January 20, 2017,
the Court concluded that "BA Jacobs is entitled to
prejudgment interest and that such an award is appropriate
given the facts and circumstances of this case." BA
Jacobs Flight Services, LLC, 2017 WL 277913, at *5. At
this point, that is the law of the case, and the Court sees
no reason to revisit its earlier conclusion.
addition, RutAir's argument that the Court should deny BA
Jacobs's request for prejudgment interest was not made
earlier and is waived. In fact, in earlier briefing, RutAir
specifically cited the Illinois Interest Act and acknowledged
that BA Jacobs "is entitled to a 5% interest on the
amount owed from the date the Lease was breached."
RutAir's Prehearing Memorandum, [ECF No. 95, at 6].
RutAir now cannot argue differently. Therefore, there is no
question that BA Jacobs is entitled to prejudgment interest
at the rate of 5% pursuant to the Illinois Interest Act, 815
ILCS 205/2, The only question regarding prejudgment interest
to be resolved is from what date the interest should be
not disputed that RutAir owed BA Jacobs unpaid monthly rent
and other fees pursuant to the Lease prior to BA Jacobs
repossessing the Aircraft at the beginning of April in 2011.
BA Jacobs also continued to incur substantial money damages
after BA Jacobs repossessed the Aircraft in April 2011, and
late fees continued to accrue for the past due monthly rent
payments until the Aircraft was sold in February 2012. In the
Court's view, the amount due and owing to BA Jacobs
pursuant to the Lease, therefore, became a fixed amount as of
the date the Aircraft was sold in February 2012. The Court
will use February 1, 2012, as the start date for the accrual
of prejudgment interest as to the Lease.
the Lease, BA Jacobs asserts that based on a damages award of
$400, 245, at a rate of 5% per annum, the interest is $20,
012.25 per year. For the five-year period of February 1, 2012
through February 1, 2017, the total interest is $100, 061.25.
BA Jacobs submits that interest runs at a rate of $54.82 per
day for each day running from February 2, 2017, until the
date judgment is entered, which is $5482. Although RutAir
argued that prejudgment should not be awarded at all (an
argument the Court rejected above), it does not dispute the
prejudgment interest calculations submitted by BA Jacobs.
Court also is not persuaded by any of Levy's arguments
that prejudgment interest should not be awarded on the
Guaranty. For the first time, Levy argues that the Guaranty
is a separate contract and does not expressly provide for the
recovery of prejudgment interest, and prejudgment interest,
therefore, should not be awarded on the Guaranty. The Court
disagrees. As previously cited above, the award of
prejudgment interest is left to the sound discretion of the
district court. See Bd. of Educ. of Consol High Sch.
Dist. 230, Pahs Hills, III., 983 F.2d at 799. The Court
finds that an award of prejudgment interest is appropriate in
this case against RutAir for breach of the Lease and against
Levy on the Guaranty. As the Court noted previously, "BA
Jacobs has waited a long time to recover its losses. There is
a time value of money, and the Court finds that BA Jacobs is
entitled to prejudgment interest and that such an award is
appropriate given the facts and circumstances of this
case." BA Jacobs Flight Services, LLC, 2017 WL
277913, at *5. That statement, made with respect specifically
to RutAir's default under the Lease, is equally
applicable to Levy and his Guaranty of the amount due under
had numerous opportunities to challenge BA Jacobs's
argument regarding an award of prejudgment interest. He
raised no such challenge. The amount recoverable by BA Jacobs
pursuant to the Guaranty is easily calculated given that the
specific amount of $300, 000 was agreed to by the parties as
set forth in the Guaranty, and the Illinois Interest Act, 815
ILCS 205/2, specifically provides for the recovery of
prejudgment at a rate of 5% per annum. As explained above,
the recent briefing schedule set for the parties on
prejudgment interest was not an invitation to RutAir or Levy
to argue that an award of prejudgment interest should be
denied or limited. The Court already concluded that an award
of prejudgment interest is appropriate in this case. Again,
the only matter at issue is how to calculate the prejudgment
the Guaranty, the Court concluded that Levy is liable for
S300, 000 pursuant to the Guaranty. At 5% per annum, BA
Jacobs submits that interest accrues at the rate of $15, 000
per year for a total of $75, 000, from February 1, 2012
through February 1, 2017, and that prejudgment interest then
continues to accrue at a rate of $41.09 per day from February
2, 2017, until judgment is entered, which amounts to $4109.
Levy also does not dispute these calculations.
summary, based on the calculations submitted by BA Jacobs,
and not challenged by either RutAir or Levy, the Court awards
a total of $105, 543.25 in prejudgment interest against