1012-00006 · Stonefield Logistics Group · Pleadings

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IN THE 134TH JUDICIAL DISTRICT COURT

OF DALLAS COUNTY, TEXAS

PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT WITH SUPPORTING BRIEF

TO THE HONORABLE JUDGE OF SAID COURT:

I. INTRODUCTION

Plaintiff Stonefield Logistics Group Inc. ("Stonefield" or "SLG"), a Texas corporation with its principal offices at 4100 Commerce Street, Suite 1200, Dallas, Texas 75226, by and through its counsel of record, Calderwood & Harkness LLP, 2200 Ross Avenue, Suite 3600, Dallas, Texas 75201, respectfully moves this Court to enter default judgment against Defendants Ridgeline Freight Carriers LLC ("Ridgeline"), an Oklahoma limited liability company with its principal office at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159, and Gerald "Gerry" Brashear ("Brashear"), individually, of 2314 Quail Creek Drive, Edmond, Oklahoma 73034, jointly and severally.

In support of this Motion, Stonefield would respectfully show the Court as follows:

Defendants were properly served with process in accordance with the Texas Rules of Civil Procedure and applicable statutes governing service on out-of-state defendants and foreign limited liability companies. Despite having been afforded full and adequate notice of this lawsuit and a reasonable opportunity to appear and respond, Defendants have wholly failed to file an answer or any other responsive pleading within the time prescribed by the Texas Rules of Civil Procedure. Default has been entered by the Clerk of this Court as to both Defendants.

Stonefield's claims arise from Defendants' material breach of a Dedicated Freight Services Agreement dated April 15, 2022 (the "DFSA"), and from Brashear's personal guaranty of Ridgeline's obligations thereunder. Ridgeline progressively failed to perform its contractual obligations under the DFSA beginning in July 2023 and ultimately ceased all freight operations entirely on or about December 8, 2023, leaving Stonefield without the dedicated carrier capacity essential to its Texas retail distribution network. Despite written notice of material breach, a contractual cure period, and multiple pre-suit demands for payment, neither Ridgeline nor Brashear has taken any action to cure the breach or satisfy the amounts owed.

Through this Motion, Stonefield seeks entry of a total judgment in the amount of $2,545,188.60, comprising the following:

This Motion is supported by the Brief set forth below, together with the following evidence submitted contemporaneously herewith:

• Exhibit A: Affidavit of Marcus Ellington, Chief Executive Officer of Stonefield Logistics Group Inc. (with attached documentary Exhibits 1 through 5);

• Exhibit B: Affidavit of Priya Anand, Partner at Calderwood & Harkness LLP, in support of attorneys' fees.

The documentary exhibits authenticated by the Ellington Affidavit include, among other things, the DFSA itself, written cure notices, formal demand letters, and detailed re-procurement cost documentation, all of which are described more fully in the Evidence section of this Motion and in the Exhibit List appended hereto.

Stonefield respectfully requests that this Court grant this Motion, enter default judgment against Defendants jointly and severally in the total amount of $2,545,188.60, award post-judgment interest as provided by law, and grant such other and further relief to which Stonefield may be justly entitled.

II. SUPPORTING BRIEF

A. Procedural History and Proper Service of Process

1. Filing of the Original Petition. On February 12, 2024, Stonefield filed its Original Petition in this Court, asserting claims for breach of contract against Ridgeline and for enforcement of the personal guaranty against Gerald Brashear, individually. The claims arise from Defendants' obligations under the Dedicated Freight Services Agreement dated April 15, 2022, between Stonefield (as "Shipper") and Ridgeline (as "Carrier"), including the personal guaranty executed by Brashear as Managing Member and sole owner of Ridgeline under Section 14.5 of the DFSA. The Original Petition sets forth well-pleaded facts establishing this Court's subject matter jurisdiction, personal jurisdiction over both Defendants, proper venue in Dallas County, and the elements of each cause of action.

Citation was issued by the Clerk of this Court for both Defendants on February 14, 2024, two days after the filing of the Original Petition.

2. Service on Gerald "Gerry" Brashear. Defendant Gerald "Gerry" Brashear was personally served with process on February 22, 2024, at his residence located at 2314 Quail Creek Drive, Edmond, Oklahoma 73034. Personal service was effected in the State of Oklahoma by a licensed process server retained for that purpose, in accordance with the Texas long-arm statute, Texas Civil Practice & Remedies Code § 17.042, which authorizes service of process on nonresident defendants who have engaged in business in this State or committed a tort in whole or in part in this State. Brashear's execution of a personal guaranty in connection with a contract governed by Texas law and subject to exclusive jurisdiction and venue in Dallas County, Texas, together with his role as Managing Member and sole owner of Ridgeline during the performance of the DFSA in Texas, provides a sufficient basis for the exercise of personal jurisdiction over Brashear under the Texas long-arm statute.

The Officer's Return of Service on file with the Clerk of this Court confirms that Brashear was personally served by delivery of a true copy of the citation together with a copy of the Original Petition directly into his hands on February 22, 2024. Service was accomplished in strict compliance with Texas Rule of Civil Procedure 106(a).

Under Texas Rule of Civil Procedure 99(b), a defendant served with citation must file a written answer with the clerk of the court within the time provided by Rule 101. Pursuant to Rule 101, a defendant served within the State of Texas must answer by 10:00 a.m. on the first Monday after the expiration of twenty days after the date of service. Although Brashear was served in Oklahoma rather than in Texas, Rule 108 provides that service of process beyond the State of Texas shall be in the same manner as provided for personal service within the State, and the same answer deadline applies. Accordingly, Brashear's answer was due on or before Monday, March 18, 2024—the first Monday following the expiration of twenty days after the date of personal service on February 22, 2024.

As of the date of this Motion, April 15, 2024, twenty-eight days after the expiration of the answer deadline, Gerald Brashear has not filed an answer, a general denial, a motion to dismiss, a motion for extension of time, or any other responsive pleading or appearance whatsoever with this Court. The docket sheet of this Court reflects no filing of any kind by or on behalf of Brashear.

3. Service on Ridgeline Freight Carriers LLC. Ridgeline Freight Carriers LLC is an Oklahoma limited liability company that was authorized to transact business in the State of Texas during the performance period of the DFSA. Ridgeline designated Lone Star Registered Agents LLC, 811 Congress Avenue, Suite 400, Austin, Texas 78701, as its registered agent for service of process in Texas.

Initial attempts to effect personal service on Ridgeline through its designated registered agent were unsuccessful. Lone Star Registered Agents LLC was non-responsive to service attempts conducted on February 15, 2024 and February 19, 2024, and the process server was unable to effect service at the registered agent's address on either occasion. The process server's affidavit documenting these unsuccessful attempts is on file with the Clerk.

In light of the inability to serve Ridgeline through its designated registered agent, Stonefield effected substitute service on Ridgeline through the Texas Secretary of State on February 26, 2024, in accordance with Texas Business Organizations Code § 5.251 and Texas Civil Practice & Remedies Code § 17.044, which authorize service on a foreign entity through the Secretary of State when the entity's registered agent cannot be found at the registered office address with reasonable diligence. The Secretary of State received the citation and a copy of the Original Petition and forwarded the same by certified mail to Ridgeline at its principal office address: 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159.

Under Texas Rule of Civil Procedure 101, when service is effected through the Secretary of State, the defendant's answer is due on or before 10:00 a.m. on the first Monday after the expiration of twenty days after the date of service. For purposes of determining the answer deadline, service through the Secretary of State is deemed complete on the date the Secretary of State is served. See Tex. Civ. Prac. & Rem. Code § 17.045. The Secretary of State was served on February 26, 2024. Accordingly, Ridgeline's answer was due on or before Monday, March 27, 2024—the first Monday following the expiration of twenty days after substitute service was deemed complete.

As of the date of this Motion, April 15, 2024, nineteen days after the expiration of the answer deadline, Ridgeline Freight Carriers LLC has not filed an answer or any other responsive pleading or appearance with this Court. The docket sheet of this Court reflects no filing of any kind by or on behalf of Ridgeline.

4. Certificate of Last Known Address and Request for Default. On April 2, 2024, in compliance with Texas Rule of Civil Procedure 239, Stonefield filed a Certificate of Last Known Address with the Clerk of this Court, certifying the last known addresses of both Defendants as follows:

• Ridgeline Freight Carriers LLC: 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159

• Gerald "Gerry" Brashear: 2314 Quail Creek Drive, Edmond, Oklahoma 73034

Contemporaneously with the Certificate of Last Known Address, Stonefield filed a Request for Entry of Default, confirming that neither Defendant had appeared or filed any responsive pleading within the time prescribed by law. Upon review of the Court's records and verification that no answer or other responsive pleading had been filed, the Clerk of this Court entered default as to both Defendants.

Stonefield now moves for the entry of default judgment against both Defendants based on the default entered by the Clerk, the evidence of proper service, and the proof of Stonefield's claims and damages set forth herein and in the supporting affidavits and documentary evidence.

B. Legal Standard for Default Judgment in Texas

Under Texas Rule of Civil Procedure 239, when a defendant who has been duly served with process in the manner prescribed by law fails to appear or answer within the time allowed, the court may, upon the plaintiff's motion and proof of claim, render judgment by default against the non-answering defendant. The entry of default judgment requires satisfaction of the following elements:

(1) The plaintiff must demonstrate that the defendant was properly served with citation and a copy of the petition in compliance with the Texas Rules of Civil Procedure;

(2) The plaintiff must establish that the defendant failed to file an answer or other responsive pleading within the time prescribed by law;

(3) The default must have been entered by the Clerk of the Court; and

(4) The plaintiff must present evidence sufficient to support the judgment sought, including proof of the amount of damages claimed.

It is well established under Texas law that a default judgment constitutes an admission of all well-pleaded facts contained in the petition. Stoner v. Thompson, 578 S.W.2d 679, 682 (Tex. 1979); Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex. 1992). A defendant who fails to answer is deemed to have admitted the material allegations of the plaintiff's petition, and the plaintiff is not required to offer further proof of those facts at the default judgment hearing. See Morgan v. Compugraphic Corp., 675 S.W.2d 729, 731 (Tex. 1984).

However, while the well-pleaded facts in the petition are deemed admitted by default, unliquidated damages are not admitted by default and must be proven by evidence. Tex. R. Civ. P. 241; Holt Atherton, 835 S.W.2d at 83. The plaintiff bears the burden of presenting competent evidence to support the amount of unliquidated damages sought. Where the damages claimed include both liquidated and unliquidated components, the plaintiff must offer evidence establishing each component with reasonable certainty. See Argyle Indep. Sch. Dist. v. Wolf, 234 S.W.3d 229, 236 (Tex. App.—Fort Worth 2007, no pet.).

Additionally, the court has an independent obligation to ensure that service of process was accomplished in strict compliance with the Texas Rules of Civil Procedure. Wilson v. Dunn, 800 S.W.2d 833, 836 (Tex. 1990). Strict compliance with the rules governing service of citation is required before a default judgment may be rendered, because service of citation is the means by which a court acquires jurisdiction over a defendant and ensures the defendant has received constitutionally adequate notice of the proceedings. Id.; Uvalde Country Club v. Martin Linen Supply Co., 690 S.W.2d 884, 885 (Tex. 1985).

The procedural requirements for default judgment in Texas are governed by Texas Rules of Civil Procedure 107, 239, and 241, among others. Rule 107 sets forth the requirements for the Officer's Return of Service, which must be on file for at least ten days before default judgment may be rendered. Rule 239 authorizes the entry of default when the defendant has been duly served and has failed to answer. Rule 241 provides that in cases of default judgment on unliquidated demands, the court shall hear evidence as to damages and render judgment therefor.

As set forth in detail in Section II.A above, Stonefield has satisfied each of these requirements. Both Defendants were duly served with process in compliance with applicable rules and statutes; both Defendants have failed to file any answer or responsive pleading within the prescribed time periods; the Clerk has entered default as to both Defendants; and Stonefield presents herein, and through the supporting affidavits and documentary exhibits, competent evidence establishing each element of its claims and supporting the damages sought with reasonable certainty.

C. Well-Pleaded Facts Establishing Breach of Contract

1. The Dedicated Freight Services Agreement. On April 15, 2022, Stonefield Logistics Group Inc., acting as "Shipper," and Ridgeline Freight Carriers LLC, acting as "Carrier," entered into a Dedicated Freight Services Agreement (the "DFSA"). The DFSA is a comprehensive, arms-length commercial transportation services agreement negotiated between sophisticated parties, each represented by counsel, governing the provision of dedicated freight transportation services for Stonefield's Texas retail distribution operations.

The DFSA has a term of thirty-six (36) months, commencing on April 15, 2022 and running through April 14, 2025 (the "Term"). Under the DFSA, Ridgeline committed to providing a minimum of twelve (12) dedicated Class 8 tractor-trailers, each operated by a qualified commercial driver holding a valid Class A commercial driver's license, for exclusive deployment on Stonefield's Texas retail distribution lanes. These dedicated lanes encompass daily routes between Stonefield's distribution centers located in Dallas, Houston, San Antonio, and Austin, Texas, serving Stonefield's network of retail customers throughout the State of Texas.

Section 3.2 of the DFSA established a Minimum Monthly Revenue Commitment of Three Hundred Twenty-Five Thousand Dollars ($325,000.00) per month, representing an annualized revenue floor of Three Million Nine Hundred Thousand Dollars ($3,900,000.00) and a total contract value over the thirty-six-month Term of Eleven Million Seven Hundred Thousand Dollars ($11,700,000.00). The Minimum Monthly Revenue Commitment reflected the parties' agreement as to the base-level economic commitment necessary to sustain the dedicated fleet capacity required by Stonefield's distribution operations.

A true and correct copy of the DFSA is attached as Exhibit 1 to the Affidavit of Marcus Ellington, Chief Executive Officer of Stonefield Logistics Group Inc. (Exhibit A hereto). The DFSA is authenticated by Mr. Ellington in his Affidavit at paragraphs 5 through 9.

2. The Liquidated Damages Provision (§ 14.3). The DFSA contains a carefully negotiated liquidated damages provision at Section 14.3. That provision states, in relevant part, that in the event of Carrier's material default under the DFSA and Carrier's failure to cure such default within thirty (30) days of Shipper's written notice thereof, Carrier shall pay to Shipper liquidated damages in an amount equal to the greater of:

(a) twenty-five percent (25%) of the remaining unpaid Minimum Monthly Revenue Commitment for the unexpired portion of the Term; or

(b) Five Hundred Thousand Dollars ($500,000.00).

Section 14.3 further provides that the parties expressly acknowledge and agree that the liquidated damages amount set forth therein represents a reasonable estimate of Shipper's losses and damages that would be incurred as a result of Carrier's material default, including but not limited to re-procurement costs, service disruption to Shipper's distribution network, loss of customer goodwill, and reputational harm, which losses and damages the parties agree would be difficult or impracticable to calculate with precision at the time of contracting. The inclusion of this provision reflects the reality that, in the dedicated freight transportation industry, the sudden loss of committed carrier capacity creates cascading disruptions across the shipper's supply chain that are not readily quantifiable in advance.

3. The Consequential Damages Carve-Out (§ 14.4). In addition to the liquidated damages recoverable under Section 14.3, the DFSA provides at Section 14.4 a consequential damages carve-out that expressly permits Shipper to recover actual re-procurement damages incurred as a result of Carrier's material default, to the extent such re-procurement damages are not duplicative of the liquidated damages amount calculated under Section 14.3. This carve-out was specifically negotiated to address the circumstance—which ultimately materialized here—in which the shipper is forced to procure emergency substitute carrier capacity on the open spot market at rates substantially above the contract rate, incurring actual out-of-pocket costs that exceed the scope of the liquidated damages formula.

Section 14.4 provides that re-procurement damages recoverable under this carve-out shall include, without limitation, emergency spot-market freight charges, surge pricing premiums, substitute carrier mobilization fees, and other direct costs incurred by Shipper to maintain its distribution network operations during the period following Carrier's default and cessation of services.

4. The Personal Guaranty (§ 14.5). Pursuant to Section 14.5 of the DFSA, Gerald "Gerry" Brashear executed a personal, unconditional, and irrevocable guaranty of Carrier's obligations under Section 14 of the DFSA, including but not limited to Carrier's obligations to pay liquidated damages under Section 14.3 and re-procurement damages under Section 14.4. The personal guaranty is capped at a maximum aggregate liability of Three Million Dollars ($3,000,000.00).

Brashear signed the personal guaranty in his individual capacity, acknowledging in the guaranty provision that he is the Managing Member and sole owner of Ridgeline Freight Carriers LLC, and that his personal guaranty was a material inducement to Shipper's willingness to enter into the DFSA. The personal guaranty provides that it is a guaranty of payment and not merely of collection, and that Shipper may proceed directly against Brashear without first pursuing remedies against Ridgeline.

The personal guaranty bears Brashear's original signature, dated April 15, 2022, as set forth in the DFSA attached as Exhibit 1 to the Ellington Affidavit.

5. Attorneys' Fee Provision (§ 14.6). Section 14.6 of the DFSA provides that, in any action or proceeding arising out of or relating to this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees and costs of suit from the non-prevailing party. This provision is enforceable under Texas law and independently supports an award of attorneys' fees in addition to the statutory entitlement under Texas Civil Practice & Remedies Code § 38.001 for breach of contract claims.

6. Governing Law and Forum Selection (§§ 18.1, 18.2). The DFSA is governed by the laws of the State of Texas without regard to its conflict-of-laws principles (Section 18.1). The DFSA further provides that the parties irrevocably submit to the exclusive jurisdiction and venue of the courts of Dallas County, Texas, for the resolution of any dispute arising out of or relating to the Agreement (Section 18.2). Both Defendants, including Brashear in his individual capacity as guarantor, consented to this forum selection clause. Accordingly, this Court has proper subject matter jurisdiction over the claims asserted, personal jurisdiction over both Defendants, and venue is proper in Dallas County, Texas.

D. Ridgeline's Material Breach and Failure to Cure

1. Progressive Service Failures. Ridgeline Freight Carriers LLC was a regional motor carrier operating under United States Department of Transportation Number 3281947 and Motor Carrier Authority Number MC-1042886. At peak operations during the early months of the DFSA's performance period, Ridgeline operated a fleet of up to thirty-eight (38) Class 8 tractors and fifty-two (52) dry van trailers, and it maintained a roster of qualified commercial drivers sufficient to staff the twelve (12) dedicated units committed to Stonefield's distribution lanes.

For approximately the first fifteen months of the DFSA's term—from April 2022 through June 2023—Ridgeline performed its obligations under the DFSA in a generally satisfactory manner, providing the required minimum of twelve dedicated tractor-trailers with qualified drivers on Stonefield's Texas retail distribution lanes and meeting or exceeding the Minimum Monthly Revenue Commitment.

Beginning in July 2023, however, Ridgeline began failing to provide the contractually required minimum of twelve (12) dedicated trucks under the DFSA. Ridgeline progressively reduced the number of trucks and drivers deployed on Stonefield's lanes without contractual justification or prior notice, resulting in a steadily worsening degradation of service levels. In July 2023, Ridgeline deployed only ten (10) trucks on Stonefield's lanes. By August 2023, the number had fallen to eight (8). In September 2023, Ridgeline provided only six (6) trucks. By October 2023, Ridgeline was providing as few as four (4) trucks—representing merely one-third of the contractual minimum of twelve—causing severe and escalating disruption to Stonefield's Texas retail distribution network.

The progressive reduction in dedicated carrier capacity resulted in delayed shipments, missed delivery windows, loss of retail customer confidence, and the accumulation of freight backlogs at Stonefield's Dallas distribution center. Stonefield's operations team repeatedly contacted Ridgeline's management, including Gerald Brashear personally, to demand restoration of service levels, but Ridgeline failed to remedy the deficiency or provide any credible plan for doing so.

These facts are established in detail in the Affidavit of Marcus Ellington (Exhibit A), at paragraphs 12 through 19, based on Mr. Ellington's personal knowledge as Chief Executive Officer of Stonefield and his direct involvement in overseeing the company's carrier relationships and distribution operations during the relevant period.

2. Written Cure Notice. On October 18, 2023, Stonefield sent Ridgeline and Gerald Brashear a formal written notice of material breach pursuant to Section 14.3 of the DFSA (the "Cure Notice"). The Cure Notice was sent via certified mail, return receipt requested, and via electronic mail to the contractual notice addresses specified in Section 16.1 of the DFSA:

• Ridgeline Freight Carriers LLC: 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159 (Attention: Gerald Brashear, Managing Member)

• Gerald Brashear: 2314 Quail Creek Drive, Edmond, Oklahoma 73034

The Cure Notice identified Ridgeline's failure to provide the contractual minimum of twelve (12) dedicated trucks on Stonefield's lanes as a material breach of Sections 3.1 and 3.2 of the DFSA, documented the progressive reduction in service levels from July 2023 through October 2023, and demanded that Ridgeline cure the breach by restoring full service levels within thirty (30) days, as required by the cure provisions of Section 14.3.

The Cure Notice further advised Ridgeline and Brashear that, in the event Ridgeline failed to cure the material breach within the thirty-day cure period, Stonefield would exercise its rights and remedies under Section 14 of the DFSA, including the right to demand payment of liquidated damages and re-procurement damages, and to enforce Brashear's personal guaranty.

A true and correct copy of the Cure Notice dated October 18, 2023 is attached as Exhibit 2 to the Affidavit of Marcus Ellington (Exhibit A hereto) and is authenticated by Mr. Ellington at paragraph 20 of his Affidavit.

3. Failure to Cure; Cessation of Operations. The thirty-day cure period specified in Section 14.3 of the DFSA expired on November 17, 2023. Ridgeline failed to cure the breach. To the contrary, Ridgeline's service levels continued to deteriorate during the cure period, and Ridgeline took no meaningful steps to restore the required fleet capacity on Stonefield's lanes.

Ridgeline ceased all freight operations entirely on or about December 8, 2023. Stonefield's operations team was informed by Ridgeline's dispatch office that Ridgeline had suspended operations and would not be dispatching further loads. No prior notice of the cessation of operations was provided to Stonefield, and no arrangements were made by Ridgeline or Brashear for the transition of Stonefield's freight to an alternative carrier. The abrupt cessation of operations left Stonefield without any dedicated carrier capacity for its Texas retail distribution lanes and forced Stonefield to procure emergency substitute transportation services on the open spot market at substantial additional cost.

On December 22, 2023, Stonefield's General Counsel, Diane Ostrowski, sent a formal demand letter to Ridgeline at its principal office address and to Gerald Brashear at his residential address, demanding payment of liquidated damages in accordance with Section 14.3 of the DFSA and invoking Brashear's personal guaranty under Section 14.5. The demand letter set forth Stonefield's calculation of liquidated damages and re-procurement costs and demanded payment within fifteen (15) days. No payment was received from either Ridgeline or Brashear in response to the December 22, 2023 demand letter. No written response of any kind was received.

A true and correct copy of the December 22, 2023 demand letter is attached as Exhibit 3 to the Affidavit of Marcus Ellington (Exhibit A hereto) and is authenticated by Mr. Ellington at paragraph 23 of his Affidavit.

4. Pre-Suit Demand by Counsel. On February 5, 2024, Calderwood & Harkness LLP, acting as litigation counsel for Stonefield, sent a pre-suit demand letter to Ridgeline Freight Carriers LLC at its principal office at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159, and to Gerald Brashear individually at his residence at 2314 Quail Creek Drive, Edmond, Oklahoma 73034. The pre-suit demand letter demanded payment of the sum of $2,437,500.00, representing the combined liquidated damages and re-procurement damages calculated by Stonefield, within ten (10) calendar days of receipt. The letter further advised Defendants that, in the event payment was not received within the specified period, Stonefield would file suit in the 134th Judicial District Court of Dallas County, Texas, and would seek recovery of all damages, pre-judgment interest, attorneys' fees, and costs of suit.

No response to the pre-suit demand letter was received from either Ridgeline or Brashear. No payment was received. No counteroffer or proposed settlement was communicated. The ten-day deadline passed without any communication whatsoever from either Defendant.

A true and correct copy of the pre-suit demand letter dated February 5, 2024 is attached as Exhibit 5 to the Affidavit of Marcus Ellington (Exhibit A hereto) and is authenticated by Mr. Ellington at paragraph 25 of his Affidavit.

E. Damages Calculation

Stonefield seeks total damages of $2,437,500.00, consisting of liquidated damages of $1,381,250.00 under Section 14.3 of the DFSA and re-procurement damages of $1,056,250.00 under Section 14.4 of the DFSA, together with pre-judgment interest, attorneys' fees, and court costs. The calculation of each component is set forth below.

1. Liquidated Damages Under § 14.3 — $1,381,250.00. The liquidated damages owed by Ridgeline under Section 14.3 of the DFSA are calculated as follows:

Date of Default: November 17, 2023 (the date of expiration of the thirty-day cure period following Stonefield's October 18, 2023 Cure Notice)

Contract Expiration Date: April 14, 2025

Remaining Months in Unexpired Term: 17 months (from November 17, 2023 through April 14, 2025, inclusive of the partial month of November 2023 and the partial month of April 2025, calculated as seventeen full monthly periods consistent with the DFSA's revenue commitment structure)

Remaining Minimum Monthly Revenue Commitment: $325,000.00 × 17 months = $5,525,000.00

Liquidated Damages (25% of Remaining Commitment): $5,525,000.00 × 0.25 = $1,381,250.00

The liquidated damages amount of $1,381,250.00 calculated under Section 14.3(a) exceeds the $500,000.00 floor established by Section 14.3(b). Accordingly, the twenty-five percent (25%) calculation under Section 14.3(a) controls, and the total liquidated damages owed are $1,381,250.00.

The liquidated damages provision in Section 14.3 of the DFSA is enforceable under Texas law. Texas courts will enforce a liquidated damages provision where (1) the harm caused by the breach is incapable or difficult of estimation, and (2) the amount of liquidated damages is a reasonable forecast of just compensation. Phillips v. Phillips, 820 S.W.2d 785, 788 (Tex. 1991); Stewart v. Basey, 245 S.W.2d 484, 486 (Tex. 1952). Both conditions are satisfied here.

First, the harm caused by a dedicated carrier's sudden cessation of operations is inherently difficult to estimate at the time of contracting. The losses resulting from such a breach include not only the direct cost of re-procuring replacement carrier capacity but also the cascading disruptions to the shipper's entire distribution network, the loss of customer goodwill resulting from delayed or missed deliveries, and the reputational harm suffered by the shipper in the competitive transportation logistics market. These consequential and incidental damages are, by their nature, difficult to quantify with precision at the time the contract is executed.

Second, the liquidated damages amount—twenty-five percent of the remaining unpaid Minimum Monthly Revenue Commitment for the unexpired term—is a reasonable pre-estimate of the damages that would be incurred by the shipper in the event of the carrier's material default. The parties expressly acknowledged this in Section 14.3 of the DFSA, and the reasonableness of the estimate is confirmed by the actual re-procurement costs Stonefield incurred following Ridgeline's breach, which were substantial.

The liquidated damages amount of $1,381,250.00 is established and supported by the Affidavit of Marcus Ellington (Exhibit A) at paragraphs 26 through 30.

2. Re-Procurement Damages Under § 14.4 — $1,056,250.00. Following Ridgeline's cessation of all freight operations on or about December 8, 2023, Stonefield was left without dedicated carrier capacity for its Texas retail distribution lanes. To maintain the continuity of its distribution operations and fulfill its obligations to its retail customers throughout Texas, Stonefield was forced to procure emergency substitute carrier capacity on the open spot market at rates significantly higher than the contract rates established under the DFSA.

During the period from November 18, 2023 (the day following the expiration of the cure period) through January 15, 2024 (the date by which Stonefield had secured and transitioned to a new dedicated carrier arrangement), Stonefield incurred documented re-procurement costs totaling $1,056,250.00. These costs include, without limitation:

(a) Emergency spot-market freight charges for loads that would have been transported by Ridgeline's dedicated fleet under the DFSA;

(b) Surge pricing premiums assessed by spot-market carriers due to the emergency nature of the freight requirements and the lack of advance planning;

(c) Substitute carrier mobilization fees charged by carriers that agreed to provide temporary dedicated capacity on an expedited basis; and

(d) Additional logistical coordination costs incurred by Stonefield's operations team in managing the transition from Ridgeline's failed service to substitute carrier arrangements.

These re-procurement damages are recoverable under the consequential damages carve-out in Section 14.4 of the DFSA, which expressly permits the recovery of actual re-procurement costs that are not duplicative of the liquidated damages calculated under Section 14.3. The re-procurement damages represent actual out-of-pocket costs incurred by Stonefield to maintain its distribution operations in the wake of Ridgeline's material breach and are distinct from, and not duplicative of, the liquidated damages, which compensate Stonefield for the loss of the contractual relationship over the remaining unexpired term.

Detailed supporting documentation for the re-procurement costs of $1,056,250.00 is attached as Exhibit 4 to the Affidavit of Marcus Ellington (Exhibit A hereto). Exhibit 4 includes copies of invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet prepared by Stonefield's finance department itemizing each component of the re-procurement costs by date, carrier, lane, and amount. These documents are authenticated by Mr. Ellington in his Affidavit at paragraphs 31 through 36.

3. Total Damages — $2,437,500.00. The total damages sought by Stonefield are as follows:

Liquidated damages under § 14.3 of the DFSA: $1,381,250.00

Re-procurement damages under § 14.4 of the DFSA: $1,056,250.00

Total Damages: $2,437,500.00

4. Pre-Judgment Interest — $87,791.10. Plaintiff is entitled to recover pre-judgment interest on the damages awarded in this action. Under Texas Finance Code § 304.003, pre-judgment interest accrues on damages in a wrongful-death, personal-injury, or property-damage case at the rate provided for post-judgment interest—currently 5.00% per annum—beginning on the earlier of (1) 180 days after the date the defendant receives written notice of a claim, or (2) the date suit is filed. See also Tex. Fin. Code § 304.104; Johnson & Higgins of Tex., Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 531 (Tex. 1998) (holding that pre-judgment interest is available in breach-of-contract cases as a matter of equity). Additionally, contractual obligations to pay money that have accrued bear interest from the date the obligation matures at the legal rate. Tex. Fin. Code § 304.003.

In this case, the damages became fixed and ascertainable no later than November 17, 2023, the date the cure period expired and Ridgeline's obligation to pay liquidated damages and re-procurement damages accrued. Accordingly, pre-judgment interest begins to accrue on that date.

Stonefield calculates pre-judgment interest as follows, based on an anticipated judgment date of August 6, 2024 (the date on which the Court may sign the judgment following the hearing on this Motion):

Principal amount: $2,437,500.00

Annual interest rate: 5.00%

Accrual period: November 17, 2023 through August 6, 2024 = 263 days

Pre-judgment interest: $2,437,500.00 × 0.05 × (263 ÷ 365) = $87,791.10

Stonefield respectfully requests that the Court calculate and award pre-judgment interest through the actual date of judgment entry. If the Court signs the judgment on or about the scheduled hearing date, the amount of $87,791.10 is correct. To the extent the judgment is signed on a different date, Plaintiff respectfully requests that the Court adjust the pre-judgment interest calculation accordingly, using the formula and rate set forth above.

5. Attorneys' Fees — $18,650.00. Stonefield is entitled to recover reasonable attorneys' fees incurred in connection with this action pursuant to two independent bases: (1) Section 14.6 of the DFSA, which provides that the prevailing party in any action to enforce the DFSA is entitled to recover reasonable attorneys' fees and costs of suit; and (2) Texas Civil Practice & Remedies Code § 38.001, which entitles a party who prevails on a breach-of-contract claim to recover reasonable attorneys' fees from the opposing party.

The reasonableness and necessity of the attorneys' fees sought in this action are established by the Affidavit of Priya Anand, Partner at Calderwood & Harkness LLP (Exhibit B hereto). Ms. Anand's Affidavit sets forth the qualifications, experience, and billing rates of each member of the engagement team that has worked on this matter:

• Priya Anand, Partner — $895.00 per hour

• Julia Carmichael, Of Counsel — $875.00 per hour

• Jeffrey Park, Senior Associate — $545.00 per hour

• Kenji Nakamura, Associate — $425.00 per hour

Ms. Anand attests that these rates are reasonable and consistent with the prevailing market rates for attorneys of comparable experience and skill in the Dallas legal market handling commercial litigation of this nature and complexity. Ms. Anand's Affidavit further describes the nature and complexity of the legal work performed, the hours expended by each member of the engagement team through the date of this Motion, and the necessity of the work performed in the prosecution of Stonefield's claims.

In evaluating the reasonableness of attorneys' fees, Texas courts apply the factors set forth in Marlowe Enterprises v. Perry Equipment Corp., 945 S.W.2d 812, 818 (Tex. 1997), as clarified and refined by the Texas Supreme Court in Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469, 498 (Tex. 2019). These factors include (1) the time and labor required, the novelty and difficulty of the questions involved, and the skill required to perform the legal services properly; (2) the likelihood that the acceptance of the particular employment will preclude other employment by the lawyer; (3) the fee customarily charged in the locality for similar legal services; (4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and (8) whether the fee is fixed or contingent on results obtained or uncertainty of collection. Ms. Anand's Affidavit addresses each of these factors.

The total attorneys' fees incurred by Stonefield in connection with this matter through the date of this Motion are $18,650.00. This amount reflects the efficient prosecution of a straightforward, well-documented breach-of-contract and default judgment case, and Stonefield submits that the amount is reasonable in light of the factors enumerated above, the amount in controversy, and the results obtained.

6. Court Costs — $1,247.50. Stonefield has incurred court costs totaling $1,247.50 in connection with this action. These costs include the filing fee for the Original Petition, fees for issuance and service of citation on both Defendants (including the process server's fee for personal service on Brashear in Oklahoma and the fee for substitute service through the Texas Secretary of State on Ridgeline), and certified copy fees. Stonefield seeks recovery of these costs pursuant to Section 14.6 of the DFSA and applicable Texas Rules of Civil Procedure.

7. Total Judgment Sought — $2,545,188.60. The total judgment sought by Stonefield against Defendants Ridgeline Freight Carriers LLC and Gerald "Gerry" Brashear, individually, jointly and severally, is summarized as follows:

This judgment is sought jointly and severally against both Defendants. Gerald Brashear's personal guaranty under Section 14.5 of the DFSA guarantees Ridgeline's obligations under Section 14 up to a maximum aggregate amount of $3,000,000.00. The total judgment of $2,545,188.60 is well within the guaranty cap, and Brashear is jointly and severally liable with Ridgeline for the full amount of the judgment.

F. Post-Judgment Interest

Plaintiff respectfully requests that the default judgment provide for post-judgment interest at the rate of 5.00% per annum, as permitted under Texas Finance Code § 304.003, accruing from the date of judgment until the judgment is paid in full. Under Texas Finance Code § 304.003(c), the post-judgment interest rate for a judgment entered in a case in which the claimant is other than a consumer is equal to the prime rate as published by the Board of Governors of the Federal Reserve System on the date of computation, plus an additional two percent (2%), but such rate shall not exceed the maximum rate authorized by law. Plaintiff asserts that 5.00% per annum is the applicable rate. To the extent the Court determines that a different rate applies based on the prime rate in effect on the date of judgment, Plaintiff respectfully requests that the Court apply the rate mandated by statute.

G. Joint and Several Liability

As set forth above, the DFSA and Brashear's personal guaranty under Section 14.5 establish that both Ridgeline and Brashear are jointly and severally liable for all amounts owed under Section 14 of the DFSA. The personal guaranty executed by Brashear is unconditional and irrevocable. It is a guaranty of payment and not merely of collection, meaning that Stonefield is entitled to proceed directly against Brashear without first pursuing collection from Ridgeline. The guaranty is capped at a maximum aggregate liability of $3,000,000.00, which is well in excess of the total judgment amount of $2,545,188.60 sought in this Motion.

Accordingly, Stonefield respectfully requests that the Court enter default judgment against both Ridgeline Freight Carriers LLC and Gerald "Gerry" Brashear, individually, jointly and severally, in the total amount of $2,545,188.60, plus post-judgment interest.

III. EVIDENCE IN SUPPORT

In support of this Motion for Default Judgment, Stonefield submits the following evidence:

A. Affidavit of Marcus Ellington (Exhibit A)

Marcus Ellington is the Chief Executive Officer of Stonefield Logistics Group Inc. and has served in that capacity since the company's founding. Mr. Ellington has personal knowledge of the facts relevant to this action, including the negotiation and execution of the DFSA, the performance of the parties' obligations thereunder, Ridgeline's progressive service failures and ultimate cessation of operations, Stonefield's issuance of the cure notice and demand letters, and the calculation and documentation of Stonefield's damages.

In his Affidavit (Exhibit A hereto), Mr. Ellington attests to, among other things, the following:

• The execution of the DFSA dated April 15, 2022 between Stonefield and Ridgeline, and the material terms thereof, including the thirty-six-month term, the minimum commitment of twelve dedicated Class 8 tractor-trailers, and the Minimum Monthly Revenue Commitment of $325,000.00 per month;

• The execution by Gerald Brashear of the personal guaranty under Section 14.5 of the DFSA;

• Ridgeline's progressive service failures commencing in July 2023, including the reduction of dedicated truck availability from twelve to as few as four by October 2023;

• The issuance of Stonefield's written Cure Notice dated October 18, 2023, and the expiration of the thirty-day cure period on November 17, 2023;

• Ridgeline's failure to cure the breach and its complete cessation of freight operations on or about December 8, 2023;

• The issuance of the formal demand letter by Stonefield's General Counsel, Diane Ostrowski, dated December 22, 2023, and the failure of Defendants to respond or make payment;

• The computation of liquidated damages in the amount of $1,381,250.00 under Section 14.3 of the DFSA;

• The documented re-procurement costs of $1,056,250.00 incurred by Stonefield during the period from November 18, 2023 through January 15, 2024, as a result of Ridgeline's breach and cessation of operations; and

• The total damages of $2,437,500.00 sought by Stonefield.

Mr. Ellington's Affidavit authenticates the following documentary exhibits attached thereto:

• Exhibit 1: Dedicated Freight Services Agreement dated April 15, 2022 (including the Personal Guaranty at § 14.5)

• Exhibit 2: Cure Notice dated October 18, 2023

• Exhibit 3: Formal Demand Letter from Diane Ostrowski, General Counsel, dated December 22, 2023

• Exhibit 4: Re-Procurement Cost Documentation (including invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet)

• Exhibit 5: Pre-Suit Demand Letter from Calderwood & Harkness LLP dated February 5, 2024

B. Affidavit of Priya Anand (Exhibit B)

Priya Anand is a Partner at Calderwood & Harkness LLP and serves as the Responsible Partner for this matter. Ms. Anand has over eighteen years of experience in commercial litigation in the Dallas legal market, with particular expertise in transportation, logistics, and supply chain disputes.

In her Affidavit (Exhibit B hereto), Ms. Anand attests to the following:

• The qualifications, experience, and billing rates of each member of the Calderwood & Harkness LLP engagement team that has worked on this matter, specifically: Priya Anand ($895.00/hr), Julia Carmichael ($875.00/hr), Jeffrey Park ($545.00/hr), and Kenji Nakamura ($425.00/hr);

• The nature and complexity of the legal work performed in this matter, including pre-suit investigation and demand, preparation and filing of the Original Petition, coordination of service of process on both Defendants, preparation and filing of the Certificate of Last Known Address and Request for Entry of Default, and preparation and filing of this Motion for Default Judgment with Supporting Brief;

• The total hours expended by each member of the engagement team through the date of this Motion;

• The total attorneys' fees incurred in the amount of $18,650.00;

• The reasonableness and necessity of the fees incurred in light of the factors set forth under Texas law, including the Arthur Andersen and Rohrmoos factors; and

• The customary rates and fees charged in the Dallas legal market for similar commercial litigation matters of comparable complexity and value.

C. Documentary Exhibits (Referenced in and Authenticated by the Ellington Affidavit)

The documentary exhibits submitted in support of this Motion are referenced in and authenticated by the Affidavit of Marcus Ellington (Exhibit A). A complete list of these exhibits is set forth in the Exhibit List / Appendix appended to this Motion and is reproduced here for the convenience of the Court:

• Exhibit 1: Dedicated Freight Services Agreement dated April 15, 2022 (including the Personal Guaranty at § 14.5)

• Exhibit 2: Cure Notice dated October 18, 2023

• Exhibit 3: Formal Demand Letter from Diane Ostrowski, General Counsel, dated December 22, 2023

• Exhibit 4: Re-Procurement Cost Documentation (invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet of re-procurement costs)

• Exhibit 5: Pre-Suit Demand Letter from Calderwood & Harkness LLP dated February 5, 2024

IV. PRAYER FOR RELIEF

WHEREFORE, PREMISES CONSIDERED, Plaintiff Stonefield Logistics Group Inc. respectfully prays that this Court:

1. Enter default judgment against Defendants Ridgeline Freight Carriers LLC and Gerald "Gerry" Brashear, individually, jointly and severally;

2. Award Plaintiff damages in the total amount of $2,437,500.00, consisting of liquidated damages of $1,381,250.00 under Section 14.3 of the Dedicated Freight Services Agreement and re-procurement damages of $1,056,250.00 under Section 14.4 of the Dedicated Freight Services Agreement;

3. Award Plaintiff pre-judgment interest in the amount of $87,791.10, or such amount as calculated through the actual date of judgment entry at the rate of 5.00% per annum under Texas Finance Code § 304.003, accruing from November 17, 2023 through the date of judgment;

4. Award Plaintiff reasonable attorneys' fees in the amount of $18,650.00 pursuant to Section 14.6 of the Dedicated Freight Services Agreement and Texas Civil Practice & Remedies Code § 38.001;

5. Award Plaintiff court costs in the amount of $1,247.50;

6. Award post-judgment interest at the rate of 5.00% per annum from the date of judgment until the judgment is paid in full, as permitted under Texas Finance Code § 304.003;

7. Grant Plaintiff such other and further relief, both general and special, at law or in equity, to which it may be justly entitled.

Total judgment requested: $2,545,188.60, plus post-judgment interest from the date of judgment until paid.

V. PROPOSED ORDER

A proposed Default Judgment (Order) is submitted herewith for the Court's consideration, consistent with the relief sought in this Motion. The proposed Order provides for the entry of default judgment against both Defendants, jointly and severally, in the total amount of $2,545,188.60, together with post-judgment interest, and is presented in a form suitable for the Court's signature.

VI. SIGNATURE BLOCK

Respectfully submitted,

CALDERWOOD & HARKNESS LLP

By: ________

Priya Anand State Bar No. 24078341 panand@calderwoodharkness.com

Jeffrey Park State Bar No. 24106589 jpark@calderwoodharkness.com

CALDERWOOD & HARKNESS LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Telephone: (214) 555-7200 Facsimile: (214) 555-7201

ATTORNEYS FOR PLAINTIFF STONEFIELD LOGISTICS GROUP INC.

Date: April 15, 2024

VII. CERTIFICATE OF SERVICE

I hereby certify that on April 15, 2024, a true and correct copy of the foregoing Plaintiff's Motion for Default Judgment with Supporting Brief, together with all exhibits and attachments, was served on the following parties by certified mail, return receipt requested:

Ridgeline Freight Carriers LLC 7820 South Meridian Avenue Oklahoma City, Oklahoma 73159

Gerald "Gerry" Brashear 2314 Quail Creek Drive Edmond, Oklahoma 73034

________________________________________

Priya Anand

VIII. EXHIBIT LIST / APPENDIX

The following exhibits are filed contemporaneously with this Motion for Default Judgment with Supporting Brief:

EXHIBIT A: Affidavit of Marcus Ellington, Chief Executive Officer, Stonefield Logistics Group Inc.

With the following documentary exhibits attached thereto and authenticated therein:

• Exhibit 1: Dedicated Freight Services Agreement dated April 15, 2022 (including the Personal Guaranty executed by Gerald Brashear at Section 14.5)

• Exhibit 2: Cure Notice from Stonefield Logistics Group Inc. to Ridgeline Freight Carriers LLC and Gerald Brashear, dated October 18, 2023

• Exhibit 3: Formal Demand Letter from Diane Ostrowski, General Counsel of Stonefield Logistics Group Inc., to Ridgeline Freight Carriers LLC and Gerald Brashear, dated December 22, 2023

• Exhibit 4: Re-Procurement Cost Documentation, including invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet of re-procurement costs incurred during the period November 18, 2023 through January 15, 2024

IN THE 134TH JUDICIAL DISTRICT COURT
OF DALLAS COUNTY, TEXAS
PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT WITH SUPPORTING BRIEF
TO THE HONORABLE JUDGE OF SAID COURT:
I. INTRODUCTION
Plaintiff Stonefield Logistics Group Inc. ("Stonefield" or "SLG"), a Texas corporation with its principal offices at 4100 Commerce Street, Suite 1200, Dallas, Texas 75226, by and through its counsel of record, Calderwood & Harkness LLP, 2200 Ross Avenue, Suite 3600, Dallas, Texas 75201, respectfully moves this Court to enter default judgment against Defendants Ridgeline Freight Carriers LLC ("Ridgeline"), an Oklahoma limited liability company with its principal office at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159, and Gerald "Gerry" Brashear ("Brashear"), individually, of 2314 Quail Creek Drive, Edmond, Oklahoma 73034, jointly and severally.
In support of this Motion, Stonefield would respectfully show the Court as follows:
Defendants were properly served with process in accordance with the Texas Rules of Civil Procedure and applicable statutes governing service on out-of-state defendants and foreign limited liability companies. Despite having been afforded full and adequate notice of this lawsuit and a reasonable opportunity to appear and respond, Defendants have wholly failed to file an answer or any other responsive pleading within the time prescribed by the Texas Rules of Civil Procedure. Default has been entered by the Clerk of this Court as to both Defendants.
Stonefield's claims arise from Defendants' material breach of a Dedicated Freight Services Agreement dated April 15, 2022 (the "DFSA"), and from Brashear's personal guaranty of Ridgeline's obligations thereunder. Ridgeline progressively failed to perform its contractual obligations under the DFSA beginning in July 2023 and ultimately ceased all freight operations entirely on or about December 8, 2023, leaving Stonefield without the dedicated carrier capacity essential to its Texas retail distribution network. Despite written notice of material breach, a contractual cure period, and multiple pre-suit demands for payment, neither Ridgeline nor Brashear has taken any action to cure the breach or satisfy the amounts owed.
Through this Motion, Stonefield seeks entry of a total judgment in the amount of $2,545,188.60, comprising the following:
This Motion is supported by the Brief set forth below, together with the following evidence submitted contemporaneously herewith:
•  Exhibit A: Affidavit of Marcus Ellington, Chief Executive Officer of Stonefield Logistics Group Inc. (with attached documentary Exhibits 1 through 5);
•  Exhibit B: Affidavit of Priya Anand, Partner at Calderwood & Harkness LLP, in support of attorneys' fees.
The documentary exhibits authenticated by the Ellington Affidavit include, among other things, the DFSA itself, written cure notices, formal demand letters, and detailed re-procurement cost documentation, all of which are described more fully in the Evidence section of this Motion and in the Exhibit List appended hereto.
Stonefield respectfully requests that this Court grant this Motion, enter default judgment against Defendants jointly and severally in the total amount of $2,545,188.60, award post-judgment interest as provided by law, and grant such other and further relief to which Stonefield may be justly entitled.
II. SUPPORTING BRIEF
A. Procedural History and Proper Service of Process
1. Filing of the Original Petition.  On February 12, 2024, Stonefield filed its Original Petition in this Court, asserting claims for breach of contract against Ridgeline and for enforcement of the personal guaranty against Gerald Brashear, individually. The claims arise from Defendants' obligations under the Dedicated Freight Services Agreement dated April 15, 2022, between Stonefield (as "Shipper") and Ridgeline (as "Carrier"), including the personal guaranty executed by Brashear as Managing Member and sole owner of Ridgeline under Section 14.5 of the DFSA. The Original Petition sets forth well-pleaded facts establishing this Court's subject matter jurisdiction, personal jurisdiction over both Defendants, proper venue in Dallas County, and the elements of each cause of action.
Citation was issued by the Clerk of this Court for both Defendants on February 14, 2024, two days after the filing of the Original Petition.
2. Service on Gerald "Gerry" Brashear.  Defendant Gerald "Gerry" Brashear was personally served with process on February 22, 2024, at his residence located at 2314 Quail Creek Drive, Edmond, Oklahoma 73034. Personal service was effected in the State of Oklahoma by a licensed process server retained for that purpose, in accordance with the Texas long-arm statute, Texas Civil Practice & Remedies Code § 17.042, which authorizes service of process on nonresident defendants who have engaged in business in this State or committed a tort in whole or in part in this State. Brashear's execution of a personal guaranty in connection with a contract governed by Texas law and subject to exclusive jurisdiction and venue in Dallas County, Texas, together with his role as Managing Member and sole owner of Ridgeline during the performance of the DFSA in Texas, provides a sufficient basis for the exercise of personal jurisdiction over Brashear under the Texas long-arm statute.
The Officer's Return of Service on file with the Clerk of this Court confirms that Brashear was personally served by delivery of a true copy of the citation together with a copy of the Original Petition directly into his hands on February 22, 2024. Service was accomplished in strict compliance with Texas Rule of Civil Procedure 106(a).
Under Texas Rule of Civil Procedure 99(b), a defendant served with citation must file a written answer with the clerk of the court within the time provided by Rule 101. Pursuant to Rule 101, a defendant served within the State of Texas must answer by 10:00 a.m. on the first Monday after the expiration of twenty days after the date of service. Although Brashear was served in Oklahoma rather than in Texas, Rule 108 provides that service of process beyond the State of Texas shall be in the same manner as provided for personal service within the State, and the same answer deadline applies. Accordingly, Brashear's answer was due on or before Monday, March 18, 2024—the first Monday following the expiration of twenty days after the date of personal service on February 22, 2024.
As of the date of this Motion, April 15, 2024, twenty-eight days after the expiration of the answer deadline, Gerald Brashear has not filed an answer, a general denial, a motion to dismiss, a motion for extension of time, or any other responsive pleading or appearance whatsoever with this Court. The docket sheet of this Court reflects no filing of any kind by or on behalf of Brashear.
3. Service on Ridgeline Freight Carriers LLC.  Ridgeline Freight Carriers LLC is an Oklahoma limited liability company that was authorized to transact business in the State of Texas during the performance period of the DFSA. Ridgeline designated Lone Star Registered Agents LLC, 811 Congress Avenue, Suite 400, Austin, Texas 78701, as its registered agent for service of process in Texas.
Initial attempts to effect personal service on Ridgeline through its designated registered agent were unsuccessful. Lone Star Registered Agents LLC was non-responsive to service attempts conducted on February 15, 2024 and February 19, 2024, and the process server was unable to effect service at the registered agent's address on either occasion. The process server's affidavit documenting these unsuccessful attempts is on file with the Clerk.
In light of the inability to serve Ridgeline through its designated registered agent, Stonefield effected substitute service on Ridgeline through the Texas Secretary of State on February 26, 2024, in accordance with Texas Business Organizations Code § 5.251 and Texas Civil Practice & Remedies Code § 17.044, which authorize service on a foreign entity through the Secretary of State when the entity's registered agent cannot be found at the registered office address with reasonable diligence. The Secretary of State received the citation and a copy of the Original Petition and forwarded the same by certified mail to Ridgeline at its principal office address: 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159.
Under Texas Rule of Civil Procedure 101, when service is effected through the Secretary of State, the defendant's answer is due on or before 10:00 a.m. on the first Monday after the expiration of twenty days after the date of service. For purposes of determining the answer deadline, service through the Secretary of State is deemed complete on the date the Secretary of State is served. See Tex. Civ. Prac. & Rem. Code § 17.045. The Secretary of State was served on February 26, 2024. Accordingly, Ridgeline's answer was due on or before Monday, March 27, 2024—the first Monday following the expiration of twenty days after substitute service was deemed complete.
As of the date of this Motion, April 15, 2024, nineteen days after the expiration of the answer deadline, Ridgeline Freight Carriers LLC has not filed an answer or any other responsive pleading or appearance with this Court. The docket sheet of this Court reflects no filing of any kind by or on behalf of Ridgeline.
4. Certificate of Last Known Address and Request for Default.  On April 2, 2024, in compliance with Texas Rule of Civil Procedure 239, Stonefield filed a Certificate of Last Known Address with the Clerk of this Court, certifying the last known addresses of both Defendants as follows:
•  Ridgeline Freight Carriers LLC: 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159
•  Gerald "Gerry" Brashear: 2314 Quail Creek Drive, Edmond, Oklahoma 73034
Contemporaneously with the Certificate of Last Known Address, Stonefield filed a Request for Entry of Default, confirming that neither Defendant had appeared or filed any responsive pleading within the time prescribed by law. Upon review of the Court's records and verification that no answer or other responsive pleading had been filed, the Clerk of this Court entered default as to both Defendants.
Stonefield now moves for the entry of default judgment against both Defendants based on the default entered by the Clerk, the evidence of proper service, and the proof of Stonefield's claims and damages set forth herein and in the supporting affidavits and documentary evidence.
B. Legal Standard for Default Judgment in Texas
Under Texas Rule of Civil Procedure 239, when a defendant who has been duly served with process in the manner prescribed by law fails to appear or answer within the time allowed, the court may, upon the plaintiff's motion and proof of claim, render judgment by default against the non-answering defendant. The entry of default judgment requires satisfaction of the following elements:
(1) The plaintiff must demonstrate that the defendant was properly served with citation and a copy of the petition in compliance with the Texas Rules of Civil Procedure;
(2) The plaintiff must establish that the defendant failed to file an answer or other responsive pleading within the time prescribed by law;
(3) The default must have been entered by the Clerk of the Court; and
(4) The plaintiff must present evidence sufficient to support the judgment sought, including proof of the amount of damages claimed.
It is well established under Texas law that a default judgment constitutes an admission of all well-pleaded facts contained in the petition. Stoner v. Thompson, 578 S.W.2d 679, 682 (Tex. 1979); Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d 80, 83 (Tex. 1992). A defendant who fails to answer is deemed to have admitted the material allegations of the plaintiff's petition, and the plaintiff is not required to offer further proof of those facts at the default judgment hearing. See Morgan v. Compugraphic Corp., 675 S.W.2d 729, 731 (Tex. 1984).
However, while the well-pleaded facts in the petition are deemed admitted by default, unliquidated damages are not admitted by default and must be proven by evidence. Tex. R. Civ. P. 241; Holt Atherton, 835 S.W.2d at 83. The plaintiff bears the burden of presenting competent evidence to support the amount of unliquidated damages sought. Where the damages claimed include both liquidated and unliquidated components, the plaintiff must offer evidence establishing each component with reasonable certainty. See Argyle Indep. Sch. Dist. v. Wolf, 234 S.W.3d 229, 236 (Tex. App.—Fort Worth 2007, no pet.).
Additionally, the court has an independent obligation to ensure that service of process was accomplished in strict compliance with the Texas Rules of Civil Procedure. Wilson v. Dunn, 800 S.W.2d 833, 836 (Tex. 1990). Strict compliance with the rules governing service of citation is required before a default judgment may be rendered, because service of citation is the means by which a court acquires jurisdiction over a defendant and ensures the defendant has received constitutionally adequate notice of the proceedings. Id.; Uvalde Country Club v. Martin Linen Supply Co., 690 S.W.2d 884, 885 (Tex. 1985).
The procedural requirements for default judgment in Texas are governed by Texas Rules of Civil Procedure 107, 239, and 241, among others. Rule 107 sets forth the requirements for the Officer's Return of Service, which must be on file for at least ten days before default judgment may be rendered. Rule 239 authorizes the entry of default when the defendant has been duly served and has failed to answer. Rule 241 provides that in cases of default judgment on unliquidated demands, the court shall hear evidence as to damages and render judgment therefor.
As set forth in detail in Section II.A above, Stonefield has satisfied each of these requirements. Both Defendants were duly served with process in compliance with applicable rules and statutes; both Defendants have failed to file any answer or responsive pleading within the prescribed time periods; the Clerk has entered default as to both Defendants; and Stonefield presents herein, and through the supporting affidavits and documentary exhibits, competent evidence establishing each element of its claims and supporting the damages sought with reasonable certainty.
C. Well-Pleaded Facts Establishing Breach of Contract
1. The Dedicated Freight Services Agreement.  On April 15, 2022, Stonefield Logistics Group Inc., acting as "Shipper," and Ridgeline Freight Carriers LLC, acting as "Carrier," entered into a Dedicated Freight Services Agreement (the "DFSA"). The DFSA is a comprehensive, arms-length commercial transportation services agreement negotiated between sophisticated parties, each represented by counsel, governing the provision of dedicated freight transportation services for Stonefield's Texas retail distribution operations.
The DFSA has a term of thirty-six (36) months, commencing on April 15, 2022 and running through April 14, 2025 (the "Term"). Under the DFSA, Ridgeline committed to providing a minimum of twelve (12) dedicated Class 8 tractor-trailers, each operated by a qualified commercial driver holding a valid Class A commercial driver's license, for exclusive deployment on Stonefield's Texas retail distribution lanes. These dedicated lanes encompass daily routes between Stonefield's distribution centers located in Dallas, Houston, San Antonio, and Austin, Texas, serving Stonefield's network of retail customers throughout the State of Texas.
Section 3.2 of the DFSA established a Minimum Monthly Revenue Commitment of Three Hundred Twenty-Five Thousand Dollars ($325,000.00) per month, representing an annualized revenue floor of Three Million Nine Hundred Thousand Dollars ($3,900,000.00) and a total contract value over the thirty-six-month Term of Eleven Million Seven Hundred Thousand Dollars ($11,700,000.00). The Minimum Monthly Revenue Commitment reflected the parties' agreement as to the base-level economic commitment necessary to sustain the dedicated fleet capacity required by Stonefield's distribution operations.
A true and correct copy of the DFSA is attached as Exhibit 1 to the Affidavit of Marcus Ellington, Chief Executive Officer of Stonefield Logistics Group Inc. (Exhibit A hereto). The DFSA is authenticated by Mr. Ellington in his Affidavit at paragraphs 5 through 9.
2. The Liquidated Damages Provision (§ 14.3).  The DFSA contains a carefully negotiated liquidated damages provision at Section 14.3. That provision states, in relevant part, that in the event of Carrier's material default under the DFSA and Carrier's failure to cure such default within thirty (30) days of Shipper's written notice thereof, Carrier shall pay to Shipper liquidated damages in an amount equal to the greater of:
(a) twenty-five percent (25%) of the remaining unpaid Minimum Monthly Revenue Commitment for the unexpired portion of the Term; or
(b) Five Hundred Thousand Dollars ($500,000.00).
Section 14.3 further provides that the parties expressly acknowledge and agree that the liquidated damages amount set forth therein represents a reasonable estimate of Shipper's losses and damages that would be incurred as a result of Carrier's material default, including but not limited to re-procurement costs, service disruption to Shipper's distribution network, loss of customer goodwill, and reputational harm, which losses and damages the parties agree would be difficult or impracticable to calculate with precision at the time of contracting. The inclusion of this provision reflects the reality that, in the dedicated freight transportation industry, the sudden loss of committed carrier capacity creates cascading disruptions across the shipper's supply chain that are not readily quantifiable in advance.
3. The Consequential Damages Carve-Out (§ 14.4).  In addition to the liquidated damages recoverable under Section 14.3, the DFSA provides at Section 14.4 a consequential damages carve-out that expressly permits Shipper to recover actual re-procurement damages incurred as a result of Carrier's material default, to the extent such re-procurement damages are not duplicative of the liquidated damages amount calculated under Section 14.3. This carve-out was specifically negotiated to address the circumstance—which ultimately materialized here—in which the shipper is forced to procure emergency substitute carrier capacity on the open spot market at rates substantially above the contract rate, incurring actual out-of-pocket costs that exceed the scope of the liquidated damages formula.
Section 14.4 provides that re-procurement damages recoverable under this carve-out shall include, without limitation, emergency spot-market freight charges, surge pricing premiums, substitute carrier mobilization fees, and other direct costs incurred by Shipper to maintain its distribution network operations during the period following Carrier's default and cessation of services.
4. The Personal Guaranty (§ 14.5).  Pursuant to Section 14.5 of the DFSA, Gerald "Gerry" Brashear executed a personal, unconditional, and irrevocable guaranty of Carrier's obligations under Section 14 of the DFSA, including but not limited to Carrier's obligations to pay liquidated damages under Section 14.3 and re-procurement damages under Section 14.4. The personal guaranty is capped at a maximum aggregate liability of Three Million Dollars ($3,000,000.00).
Brashear signed the personal guaranty in his individual capacity, acknowledging in the guaranty provision that he is the Managing Member and sole owner of Ridgeline Freight Carriers LLC, and that his personal guaranty was a material inducement to Shipper's willingness to enter into the DFSA. The personal guaranty provides that it is a guaranty of payment and not merely of collection, and that Shipper may proceed directly against Brashear without first pursuing remedies against Ridgeline.
The personal guaranty bears Brashear's original signature, dated April 15, 2022, as set forth in the DFSA attached as Exhibit 1 to the Ellington Affidavit.
5. Attorneys' Fee Provision (§ 14.6).  Section 14.6 of the DFSA provides that, in any action or proceeding arising out of or relating to this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees and costs of suit from the non-prevailing party. This provision is enforceable under Texas law and independently supports an award of attorneys' fees in addition to the statutory entitlement under Texas Civil Practice & Remedies Code § 38.001 for breach of contract claims.
6. Governing Law and Forum Selection (§§ 18.1, 18.2).  The DFSA is governed by the laws of the State of Texas without regard to its conflict-of-laws principles (Section 18.1). The DFSA further provides that the parties irrevocably submit to the exclusive jurisdiction and venue of the courts of Dallas County, Texas, for the resolution of any dispute arising out of or relating to the Agreement (Section 18.2). Both Defendants, including Brashear in his individual capacity as guarantor, consented to this forum selection clause. Accordingly, this Court has proper subject matter jurisdiction over the claims asserted, personal jurisdiction over both Defendants, and venue is proper in Dallas County, Texas.
D. Ridgeline's Material Breach and Failure to Cure
1. Progressive Service Failures.  Ridgeline Freight Carriers LLC was a regional motor carrier operating under United States Department of Transportation Number 3281947 and Motor Carrier Authority Number MC-1042886. At peak operations during the early months of the DFSA's performance period, Ridgeline operated a fleet of up to thirty-eight (38) Class 8 tractors and fifty-two (52) dry van trailers, and it maintained a roster of qualified commercial drivers sufficient to staff the twelve (12) dedicated units committed to Stonefield's distribution lanes.
For approximately the first fifteen months of the DFSA's term—from April 2022 through June 2023—Ridgeline performed its obligations under the DFSA in a generally satisfactory manner, providing the required minimum of twelve dedicated tractor-trailers with qualified drivers on Stonefield's Texas retail distribution lanes and meeting or exceeding the Minimum Monthly Revenue Commitment.
Beginning in July 2023, however, Ridgeline began failing to provide the contractually required minimum of twelve (12) dedicated trucks under the DFSA. Ridgeline progressively reduced the number of trucks and drivers deployed on Stonefield's lanes without contractual justification or prior notice, resulting in a steadily worsening degradation of service levels. In July 2023, Ridgeline deployed only ten (10) trucks on Stonefield's lanes. By August 2023, the number had fallen to eight (8). In September 2023, Ridgeline provided only six (6) trucks. By October 2023, Ridgeline was providing as few as four (4) trucks—representing merely one-third of the contractual minimum of twelve—causing severe and escalating disruption to Stonefield's Texas retail distribution network.
The progressive reduction in dedicated carrier capacity resulted in delayed shipments, missed delivery windows, loss of retail customer confidence, and the accumulation of freight backlogs at Stonefield's Dallas distribution center. Stonefield's operations team repeatedly contacted Ridgeline's management, including Gerald Brashear personally, to demand restoration of service levels, but Ridgeline failed to remedy the deficiency or provide any credible plan for doing so.
These facts are established in detail in the Affidavit of Marcus Ellington (Exhibit A), at paragraphs 12 through 19, based on Mr. Ellington's personal knowledge as Chief Executive Officer of Stonefield and his direct involvement in overseeing the company's carrier relationships and distribution operations during the relevant period.
2. Written Cure Notice.  On October 18, 2023, Stonefield sent Ridgeline and Gerald Brashear a formal written notice of material breach pursuant to Section 14.3 of the DFSA (the "Cure Notice"). The Cure Notice was sent via certified mail, return receipt requested, and via electronic mail to the contractual notice addresses specified in Section 16.1 of the DFSA:
•  Ridgeline Freight Carriers LLC: 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159 (Attention: Gerald Brashear, Managing Member)
•  Gerald Brashear: 2314 Quail Creek Drive, Edmond, Oklahoma 73034
The Cure Notice identified Ridgeline's failure to provide the contractual minimum of twelve (12) dedicated trucks on Stonefield's lanes as a material breach of Sections 3.1 and 3.2 of the DFSA, documented the progressive reduction in service levels from July 2023 through October 2023, and demanded that Ridgeline cure the breach by restoring full service levels within thirty (30) days, as required by the cure provisions of Section 14.3.
The Cure Notice further advised Ridgeline and Brashear that, in the event Ridgeline failed to cure the material breach within the thirty-day cure period, Stonefield would exercise its rights and remedies under Section 14 of the DFSA, including the right to demand payment of liquidated damages and re-procurement damages, and to enforce Brashear's personal guaranty.
A true and correct copy of the Cure Notice dated October 18, 2023 is attached as Exhibit 2 to the Affidavit of Marcus Ellington (Exhibit A hereto) and is authenticated by Mr. Ellington at paragraph 20 of his Affidavit.
3. Failure to Cure; Cessation of Operations.  The thirty-day cure period specified in Section 14.3 of the DFSA expired on November 17, 2023. Ridgeline failed to cure the breach. To the contrary, Ridgeline's service levels continued to deteriorate during the cure period, and Ridgeline took no meaningful steps to restore the required fleet capacity on Stonefield's lanes.
Ridgeline ceased all freight operations entirely on or about December 8, 2023. Stonefield's operations team was informed by Ridgeline's dispatch office that Ridgeline had suspended operations and would not be dispatching further loads. No prior notice of the cessation of operations was provided to Stonefield, and no arrangements were made by Ridgeline or Brashear for the transition of Stonefield's freight to an alternative carrier. The abrupt cessation of operations left Stonefield without any dedicated carrier capacity for its Texas retail distribution lanes and forced Stonefield to procure emergency substitute transportation services on the open spot market at substantial additional cost.
On December 22, 2023, Stonefield's General Counsel, Diane Ostrowski, sent a formal demand letter to Ridgeline at its principal office address and to Gerald Brashear at his residential address, demanding payment of liquidated damages in accordance with Section 14.3 of the DFSA and invoking Brashear's personal guaranty under Section 14.5. The demand letter set forth Stonefield's calculation of liquidated damages and re-procurement costs and demanded payment within fifteen (15) days. No payment was received from either Ridgeline or Brashear in response to the December 22, 2023 demand letter. No written response of any kind was received.
A true and correct copy of the December 22, 2023 demand letter is attached as Exhibit 3 to the Affidavit of Marcus Ellington (Exhibit A hereto) and is authenticated by Mr. Ellington at paragraph 23 of his Affidavit.
4. Pre-Suit Demand by Counsel.  On February 5, 2024, Calderwood & Harkness LLP, acting as litigation counsel for Stonefield, sent a pre-suit demand letter to Ridgeline Freight Carriers LLC at its principal office at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159, and to Gerald Brashear individually at his residence at 2314 Quail Creek Drive, Edmond, Oklahoma 73034. The pre-suit demand letter demanded payment of the sum of $2,437,500.00, representing the combined liquidated damages and re-procurement damages calculated by Stonefield, within ten (10) calendar days of receipt. The letter further advised Defendants that, in the event payment was not received within the specified period, Stonefield would file suit in the 134th Judicial District Court of Dallas County, Texas, and would seek recovery of all damages, pre-judgment interest, attorneys' fees, and costs of suit.
No response to the pre-suit demand letter was received from either Ridgeline or Brashear. No payment was received. No counteroffer or proposed settlement was communicated. The ten-day deadline passed without any communication whatsoever from either Defendant.
A true and correct copy of the pre-suit demand letter dated February 5, 2024 is attached as Exhibit 5 to the Affidavit of Marcus Ellington (Exhibit A hereto) and is authenticated by Mr. Ellington at paragraph 25 of his Affidavit.
E. Damages Calculation
Stonefield seeks total damages of $2,437,500.00, consisting of liquidated damages of $1,381,250.00 under Section 14.3 of the DFSA and re-procurement damages of $1,056,250.00 under Section 14.4 of the DFSA, together with pre-judgment interest, attorneys' fees, and court costs. The calculation of each component is set forth below.
1. Liquidated Damages Under § 14.3 — $1,381,250.00.  The liquidated damages owed by Ridgeline under Section 14.3 of the DFSA are calculated as follows:
Date of Default: November 17, 2023 (the date of expiration of the thirty-day cure period following Stonefield's October 18, 2023 Cure Notice)
Contract Expiration Date: April 14, 2025
Remaining Months in Unexpired Term: 17 months (from November 17, 2023 through April 14, 2025, inclusive of the partial month of November 2023 and the partial month of April 2025, calculated as seventeen full monthly periods consistent with the DFSA's revenue commitment structure)
Remaining Minimum Monthly Revenue Commitment: $325,000.00 × 17 months = $5,525,000.00
Liquidated Damages (25% of Remaining Commitment): $5,525,000.00 × 0.25 = $1,381,250.00
The liquidated damages amount of $1,381,250.00 calculated under Section 14.3(a) exceeds the $500,000.00 floor established by Section 14.3(b). Accordingly, the twenty-five percent (25%) calculation under Section 14.3(a) controls, and the total liquidated damages owed are $1,381,250.00.
The liquidated damages provision in Section 14.3 of the DFSA is enforceable under Texas law. Texas courts will enforce a liquidated damages provision where (1) the harm caused by the breach is incapable or difficult of estimation, and (2) the amount of liquidated damages is a reasonable forecast of just compensation. Phillips v. Phillips, 820 S.W.2d 785, 788 (Tex. 1991); Stewart v. Basey, 245 S.W.2d 484, 486 (Tex. 1952). Both conditions are satisfied here.
First, the harm caused by a dedicated carrier's sudden cessation of operations is inherently difficult to estimate at the time of contracting. The losses resulting from such a breach include not only the direct cost of re-procuring replacement carrier capacity but also the cascading disruptions to the shipper's entire distribution network, the loss of customer goodwill resulting from delayed or missed deliveries, and the reputational harm suffered by the shipper in the competitive transportation logistics market. These consequential and incidental damages are, by their nature, difficult to quantify with precision at the time the contract is executed.
Second, the liquidated damages amount—twenty-five percent of the remaining unpaid Minimum Monthly Revenue Commitment for the unexpired term—is a reasonable pre-estimate of the damages that would be incurred by the shipper in the event of the carrier's material default. The parties expressly acknowledged this in Section 14.3 of the DFSA, and the reasonableness of the estimate is confirmed by the actual re-procurement costs Stonefield incurred following Ridgeline's breach, which were substantial.
The liquidated damages amount of $1,381,250.00 is established and supported by the Affidavit of Marcus Ellington (Exhibit A) at paragraphs 26 through 30.
2. Re-Procurement Damages Under § 14.4 — $1,056,250.00.  Following Ridgeline's cessation of all freight operations on or about December 8, 2023, Stonefield was left without dedicated carrier capacity for its Texas retail distribution lanes. To maintain the continuity of its distribution operations and fulfill its obligations to its retail customers throughout Texas, Stonefield was forced to procure emergency substitute carrier capacity on the open spot market at rates significantly higher than the contract rates established under the DFSA.
During the period from November 18, 2023 (the day following the expiration of the cure period) through January 15, 2024 (the date by which Stonefield had secured and transitioned to a new dedicated carrier arrangement), Stonefield incurred documented re-procurement costs totaling $1,056,250.00. These costs include, without limitation:
(a) Emergency spot-market freight charges for loads that would have been transported by Ridgeline's dedicated fleet under the DFSA;
(b) Surge pricing premiums assessed by spot-market carriers due to the emergency nature of the freight requirements and the lack of advance planning;
(c) Substitute carrier mobilization fees charged by carriers that agreed to provide temporary dedicated capacity on an expedited basis; and
(d) Additional logistical coordination costs incurred by Stonefield's operations team in managing the transition from Ridgeline's failed service to substitute carrier arrangements.
These re-procurement damages are recoverable under the consequential damages carve-out in Section 14.4 of the DFSA, which expressly permits the recovery of actual re-procurement costs that are not duplicative of the liquidated damages calculated under Section 14.3. The re-procurement damages represent actual out-of-pocket costs incurred by Stonefield to maintain its distribution operations in the wake of Ridgeline's material breach and are distinct from, and not duplicative of, the liquidated damages, which compensate Stonefield for the loss of the contractual relationship over the remaining unexpired term.
Detailed supporting documentation for the re-procurement costs of $1,056,250.00 is attached as Exhibit 4 to the Affidavit of Marcus Ellington (Exhibit A hereto). Exhibit 4 includes copies of invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet prepared by Stonefield's finance department itemizing each component of the re-procurement costs by date, carrier, lane, and amount. These documents are authenticated by Mr. Ellington in his Affidavit at paragraphs 31 through 36.
3. Total Damages — $2,437,500.00.  The total damages sought by Stonefield are as follows:
Liquidated damages under § 14.3 of the DFSA: $1,381,250.00
Re-procurement damages under § 14.4 of the DFSA: $1,056,250.00
Total Damages: $2,437,500.00
4. Pre-Judgment Interest — $87,791.10.  Plaintiff is entitled to recover pre-judgment interest on the damages awarded in this action. Under Texas Finance Code § 304.003, pre-judgment interest accrues on damages in a wrongful-death, personal-injury, or property-damage case at the rate provided for post-judgment interest—currently 5.00% per annum—beginning on the earlier of (1) 180 days after the date the defendant receives written notice of a claim, or (2) the date suit is filed. See also Tex. Fin. Code § 304.104; Johnson & Higgins of Tex., Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 531 (Tex. 1998) (holding that pre-judgment interest is available in breach-of-contract cases as a matter of equity). Additionally, contractual obligations to pay money that have accrued bear interest from the date the obligation matures at the legal rate. Tex. Fin. Code § 304.003.
In this case, the damages became fixed and ascertainable no later than November 17, 2023, the date the cure period expired and Ridgeline's obligation to pay liquidated damages and re-procurement damages accrued. Accordingly, pre-judgment interest begins to accrue on that date.
Stonefield calculates pre-judgment interest as follows, based on an anticipated judgment date of August 6, 2024 (the date on which the Court may sign the judgment following the hearing on this Motion):
Principal amount: $2,437,500.00
Annual interest rate: 5.00%
Accrual period: November 17, 2023 through August 6, 2024 = 263 days
Pre-judgment interest: $2,437,500.00 × 0.05 × (263 ÷ 365) = $87,791.10
Stonefield respectfully requests that the Court calculate and award pre-judgment interest through the actual date of judgment entry. If the Court signs the judgment on or about the scheduled hearing date, the amount of $87,791.10 is correct. To the extent the judgment is signed on a different date, Plaintiff respectfully requests that the Court adjust the pre-judgment interest calculation accordingly, using the formula and rate set forth above.
5. Attorneys' Fees — $18,650.00.  Stonefield is entitled to recover reasonable attorneys' fees incurred in connection with this action pursuant to two independent bases: (1) Section 14.6 of the DFSA, which provides that the prevailing party in any action to enforce the DFSA is entitled to recover reasonable attorneys' fees and costs of suit; and (2) Texas Civil Practice & Remedies Code § 38.001, which entitles a party who prevails on a breach-of-contract claim to recover reasonable attorneys' fees from the opposing party.
The reasonableness and necessity of the attorneys' fees sought in this action are established by the Affidavit of Priya Anand, Partner at Calderwood & Harkness LLP (Exhibit B hereto). Ms. Anand's Affidavit sets forth the qualifications, experience, and billing rates of each member of the engagement team that has worked on this matter:
•  Priya Anand, Partner — $895.00 per hour
•  Julia Carmichael, Of Counsel — $875.00 per hour
•  Jeffrey Park, Senior Associate — $545.00 per hour
•  Kenji Nakamura, Associate — $425.00 per hour
Ms. Anand attests that these rates are reasonable and consistent with the prevailing market rates for attorneys of comparable experience and skill in the Dallas legal market handling commercial litigation of this nature and complexity. Ms. Anand's Affidavit further describes the nature and complexity of the legal work performed, the hours expended by each member of the engagement team through the date of this Motion, and the necessity of the work performed in the prosecution of Stonefield's claims.
In evaluating the reasonableness of attorneys' fees, Texas courts apply the factors set forth in Marlowe Enterprises v. Perry Equipment Corp., 945 S.W.2d 812, 818 (Tex. 1997), as clarified and refined by the Texas Supreme Court in Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469, 498 (Tex. 2019). These factors include (1) the time and labor required, the novelty and difficulty of the questions involved, and the skill required to perform the legal services properly; (2) the likelihood that the acceptance of the particular employment will preclude other employment by the lawyer; (3) the fee customarily charged in the locality for similar legal services; (4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and (8) whether the fee is fixed or contingent on results obtained or uncertainty of collection. Ms. Anand's Affidavit addresses each of these factors.
The total attorneys' fees incurred by Stonefield in connection with this matter through the date of this Motion are $18,650.00. This amount reflects the efficient prosecution of a straightforward, well-documented breach-of-contract and default judgment case, and Stonefield submits that the amount is reasonable in light of the factors enumerated above, the amount in controversy, and the results obtained.
6. Court Costs — $1,247.50.  Stonefield has incurred court costs totaling $1,247.50 in connection with this action. These costs include the filing fee for the Original Petition, fees for issuance and service of citation on both Defendants (including the process server's fee for personal service on Brashear in Oklahoma and the fee for substitute service through the Texas Secretary of State on Ridgeline), and certified copy fees. Stonefield seeks recovery of these costs pursuant to Section 14.6 of the DFSA and applicable Texas Rules of Civil Procedure.
7. Total Judgment Sought — $2,545,188.60.  The total judgment sought by Stonefield against Defendants Ridgeline Freight Carriers LLC and Gerald "Gerry" Brashear, individually, jointly and severally, is summarized as follows:
This judgment is sought jointly and severally against both Defendants. Gerald Brashear's personal guaranty under Section 14.5 of the DFSA guarantees Ridgeline's obligations under Section 14 up to a maximum aggregate amount of $3,000,000.00. The total judgment of $2,545,188.60 is well within the guaranty cap, and Brashear is jointly and severally liable with Ridgeline for the full amount of the judgment.
F. Post-Judgment Interest
Plaintiff respectfully requests that the default judgment provide for post-judgment interest at the rate of 5.00% per annum, as permitted under Texas Finance Code § 304.003, accruing from the date of judgment until the judgment is paid in full. Under Texas Finance Code § 304.003(c), the post-judgment interest rate for a judgment entered in a case in which the claimant is other than a consumer is equal to the prime rate as published by the Board of Governors of the Federal Reserve System on the date of computation, plus an additional two percent (2%), but such rate shall not exceed the maximum rate authorized by law. Plaintiff asserts that 5.00% per annum is the applicable rate. To the extent the Court determines that a different rate applies based on the prime rate in effect on the date of judgment, Plaintiff respectfully requests that the Court apply the rate mandated by statute.
G. Joint and Several Liability
As set forth above, the DFSA and Brashear's personal guaranty under Section 14.5 establish that both Ridgeline and Brashear are jointly and severally liable for all amounts owed under Section 14 of the DFSA. The personal guaranty executed by Brashear is unconditional and irrevocable. It is a guaranty of payment and not merely of collection, meaning that Stonefield is entitled to proceed directly against Brashear without first pursuing collection from Ridgeline. The guaranty is capped at a maximum aggregate liability of $3,000,000.00, which is well in excess of the total judgment amount of $2,545,188.60 sought in this Motion.
Accordingly, Stonefield respectfully requests that the Court enter default judgment against both Ridgeline Freight Carriers LLC and Gerald "Gerry" Brashear, individually, jointly and severally, in the total amount of $2,545,188.60, plus post-judgment interest.
III. EVIDENCE IN SUPPORT
In support of this Motion for Default Judgment, Stonefield submits the following evidence:
A. Affidavit of Marcus Ellington (Exhibit A)
Marcus Ellington is the Chief Executive Officer of Stonefield Logistics Group Inc. and has served in that capacity since the company's founding. Mr. Ellington has personal knowledge of the facts relevant to this action, including the negotiation and execution of the DFSA, the performance of the parties' obligations thereunder, Ridgeline's progressive service failures and ultimate cessation of operations, Stonefield's issuance of the cure notice and demand letters, and the calculation and documentation of Stonefield's damages.
In his Affidavit (Exhibit A hereto), Mr. Ellington attests to, among other things, the following:
•  The execution of the DFSA dated April 15, 2022 between Stonefield and Ridgeline, and the material terms thereof, including the thirty-six-month term, the minimum commitment of twelve dedicated Class 8 tractor-trailers, and the Minimum Monthly Revenue Commitment of $325,000.00 per month;
•  The execution by Gerald Brashear of the personal guaranty under Section 14.5 of the DFSA;
•  Ridgeline's progressive service failures commencing in July 2023, including the reduction of dedicated truck availability from twelve to as few as four by October 2023;
•  The issuance of Stonefield's written Cure Notice dated October 18, 2023, and the expiration of the thirty-day cure period on November 17, 2023;
•  Ridgeline's failure to cure the breach and its complete cessation of freight operations on or about December 8, 2023;
•  The issuance of the formal demand letter by Stonefield's General Counsel, Diane Ostrowski, dated December 22, 2023, and the failure of Defendants to respond or make payment;
•  The computation of liquidated damages in the amount of $1,381,250.00 under Section 14.3 of the DFSA;
•  The documented re-procurement costs of $1,056,250.00 incurred by Stonefield during the period from November 18, 2023 through January 15, 2024, as a result of Ridgeline's breach and cessation of operations; and
•  The total damages of $2,437,500.00 sought by Stonefield.
Mr. Ellington's Affidavit authenticates the following documentary exhibits attached thereto:
•  Exhibit 1: Dedicated Freight Services Agreement dated April 15, 2022 (including the Personal Guaranty at § 14.5)
•  Exhibit 2: Cure Notice dated October 18, 2023
•  Exhibit 3: Formal Demand Letter from Diane Ostrowski, General Counsel, dated December 22, 2023
•  Exhibit 4: Re-Procurement Cost Documentation (including invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet)
•  Exhibit 5: Pre-Suit Demand Letter from Calderwood & Harkness LLP dated February 5, 2024
B. Affidavit of Priya Anand (Exhibit B)
Priya Anand is a Partner at Calderwood & Harkness LLP and serves as the Responsible Partner for this matter. Ms. Anand has over eighteen years of experience in commercial litigation in the Dallas legal market, with particular expertise in transportation, logistics, and supply chain disputes.
In her Affidavit (Exhibit B hereto), Ms. Anand attests to the following:
•  The qualifications, experience, and billing rates of each member of the Calderwood & Harkness LLP engagement team that has worked on this matter, specifically: Priya Anand ($895.00/hr), Julia Carmichael ($875.00/hr), Jeffrey Park ($545.00/hr), and Kenji Nakamura ($425.00/hr);
•  The nature and complexity of the legal work performed in this matter, including pre-suit investigation and demand, preparation and filing of the Original Petition, coordination of service of process on both Defendants, preparation and filing of the Certificate of Last Known Address and Request for Entry of Default, and preparation and filing of this Motion for Default Judgment with Supporting Brief;
•  The total hours expended by each member of the engagement team through the date of this Motion;
•  The total attorneys' fees incurred in the amount of $18,650.00;
•  The reasonableness and necessity of the fees incurred in light of the factors set forth under Texas law, including the Arthur Andersen and Rohrmoos factors; and
•  The customary rates and fees charged in the Dallas legal market for similar commercial litigation matters of comparable complexity and value.
C. Documentary Exhibits (Referenced in and Authenticated by the Ellington Affidavit)
The documentary exhibits submitted in support of this Motion are referenced in and authenticated by the Affidavit of Marcus Ellington (Exhibit A). A complete list of these exhibits is set forth in the Exhibit List / Appendix appended to this Motion and is reproduced here for the convenience of the Court:
•  Exhibit 1: Dedicated Freight Services Agreement dated April 15, 2022 (including the Personal Guaranty at § 14.5)
•  Exhibit 2: Cure Notice dated October 18, 2023
•  Exhibit 3: Formal Demand Letter from Diane Ostrowski, General Counsel, dated December 22, 2023
•  Exhibit 4: Re-Procurement Cost Documentation (invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet of re-procurement costs)
•  Exhibit 5: Pre-Suit Demand Letter from Calderwood & Harkness LLP dated February 5, 2024
IV. PRAYER FOR RELIEF
WHEREFORE, PREMISES CONSIDERED, Plaintiff Stonefield Logistics Group Inc. respectfully prays that this Court:
1.  Enter default judgment against Defendants Ridgeline Freight Carriers LLC and Gerald "Gerry" Brashear, individually, jointly and severally;
2.  Award Plaintiff damages in the total amount of $2,437,500.00, consisting of liquidated damages of $1,381,250.00 under Section 14.3 of the Dedicated Freight Services Agreement and re-procurement damages of $1,056,250.00 under Section 14.4 of the Dedicated Freight Services Agreement;
3.  Award Plaintiff pre-judgment interest in the amount of $87,791.10, or such amount as calculated through the actual date of judgment entry at the rate of 5.00% per annum under Texas Finance Code § 304.003, accruing from November 17, 2023 through the date of judgment;
4.  Award Plaintiff reasonable attorneys' fees in the amount of $18,650.00 pursuant to Section 14.6 of the Dedicated Freight Services Agreement and Texas Civil Practice & Remedies Code § 38.001;
5.  Award Plaintiff court costs in the amount of $1,247.50;
6.  Award post-judgment interest at the rate of 5.00% per annum from the date of judgment until the judgment is paid in full, as permitted under Texas Finance Code § 304.003;
7.  Grant Plaintiff such other and further relief, both general and special, at law or in equity, to which it may be justly entitled.
Total judgment requested: $2,545,188.60, plus post-judgment interest from the date of judgment until paid.
V. PROPOSED ORDER
A proposed Default Judgment (Order) is submitted herewith for the Court's consideration, consistent with the relief sought in this Motion. The proposed Order provides for the entry of default judgment against both Defendants, jointly and severally, in the total amount of $2,545,188.60, together with post-judgment interest, and is presented in a form suitable for the Court's signature.
VI. SIGNATURE BLOCK
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Priya Anand State Bar No. 24078341 panand@calderwoodharkness.com
Jeffrey Park State Bar No. 24106589 jpark@calderwoodharkness.com
CALDERWOOD & HARKNESS LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Telephone: (214) 555-7200 Facsimile: (214) 555-7201
ATTORNEYS FOR PLAINTIFF STONEFIELD LOGISTICS GROUP INC.
Date: April 15, 2024
VII. CERTIFICATE OF SERVICE
I hereby certify that on April 15, 2024, a true and correct copy of the foregoing Plaintiff's Motion for Default Judgment with Supporting Brief, together with all exhibits and attachments, was served on the following parties by certified mail, return receipt requested:
Ridgeline Freight Carriers LLC 7820 South Meridian Avenue Oklahoma City, Oklahoma 73159
Gerald "Gerry" Brashear 2314 Quail Creek Drive Edmond, Oklahoma 73034
________________________________________
Priya Anand
VIII. EXHIBIT LIST / APPENDIX
The following exhibits are filed contemporaneously with this Motion for Default Judgment with Supporting Brief:
EXHIBIT A: Affidavit of Marcus Ellington, Chief Executive Officer, Stonefield Logistics Group Inc.
With the following documentary exhibits attached thereto and authenticated therein:
•  Exhibit 1: Dedicated Freight Services Agreement dated April 15, 2022 (including the Personal Guaranty executed by Gerald Brashear at Section 14.5)
•  Exhibit 2: Cure Notice from Stonefield Logistics Group Inc. to Ridgeline Freight Carriers LLC and Gerald Brashear, dated October 18, 2023
•  Exhibit 3: Formal Demand Letter from Diane Ostrowski, General Counsel of Stonefield Logistics Group Inc., to Ridgeline Freight Carriers LLC and Gerald Brashear, dated December 22, 2023
•  Exhibit 4: Re-Procurement Cost Documentation, including invoices from spot-market carriers, emergency substitute carrier agreements, and a summary spreadsheet of re-procurement costs incurred during the period November 18, 2023 through January 15, 2024
•  Exhibit 5: Pre-Suit Demand Letter from Calderwood & Harkness LLP, on behalf of Stonefield Logistics Group Inc., to Ridgeline Freight Carriers LLC and Gerald Brashear, dated February 5, 2024
EXHIBIT B: Affidavit of Priya Anand, Partner, Calderwood & Harkness LLP, in Support of Attorneys' Fees
STONEFIELD LOGISTICS GROUP INC.,
<!-- indent:1 -->Plaintiff,<!-- /indent -->
v. | CAUSE NO. DC-24-01847
RIDGELINE FREIGHT CARRIERS LLC and GERALD "GERRY" BRASHEAR, Individually,
<!-- indent:1 -->Defendants.<!-- /indent -->
Component | Amount
Liquidated damages under § 14.3 of the DFSA | $1,381,250.00
Re-procurement damages under § 14.4 of the DFSA | $1,056,250.00
Pre-judgment interest (5.00% per annum, 263 days) | $87,791.10
Attorneys' fees under § 14.6 of the DFSA | $18,650.00
Court costs | $1,247.50
Total | $2,545,188.60
Component | Amount
Liquidated damages (§ 14.3 of the DFSA) | $1,381,250.00
Re-procurement damages (§ 14.4 of the DFSA) | $1,056,250.00
Pre-judgment interest (5.00% per annum, 263 days) | $87,791.10
Attorneys' fees (§ 14.6 of the DFSA / Tex. Civ. Prac. & Rem. Code § 38.001) | $18,650.00
Court costs | $1,247.50
TOTAL | $2,545,188.60