L.E.K. Consulting LLC v. Amicus Capital Partners, LLC

UNITED STATES DISTRICT COURT                                              
SOUTHERN DISTRICT OF NEW YORK                                             
L.E.K. CONSULTING LLC,                                                   
                    Plaintiff,                                           
                                         19 Civ. 10648 (KPF)             
               -v.-                                                      
                                              ORDER                      
AMICUS CAPITAL PARTNERS, LLC,                                            
                    Defendant.                                           
KATHERINE POLK FAILLA, District Judge:                                    
    On August 14, 2020, the Court held a hearing regarding Defendant’s   
default in this action.  (Minute Entry of August 14, 2020).  At the hearing, 
Defendant agreed that an entry of default was warranted.  (Id.).  However, the 
parties disputed whether the amount for the default judgment should be based 
on the agreement undergirding Plaintiff’s Complaint in this action, or whether 
instead the amount should be based on the settlement agreement executed   
between the parties.  (Id.).  The Court ordered the parties to submit letter briefs 
addressing the issue (id.), and the parties filed said briefs on September 4, 
2020 (Dkt. #34-35).                                                       
    Having carefully considered the parties’ submissions, the Court finds 
that the settlement agreement provides the relevant amount for the default 
judgment.  As Plaintiff notes (see Dkt. #34), the controlling question of law is 
whether the settlement agreement constitutes an executory accord or a     
substitute agreement.  If it is the former, then Plaintiff’s original claims remain 
live; if the latter, Plaintiff may only seek relief based on the settlement 
agreement.  See Nat’l Am. Corp. v. Fed. Republic of Nigeria, 448 F. Supp. 622, 
643 (S.D.N.Y. 1978).  “The parties’ intent dictates the proper characterization of 
the contract at issue, which is ordinarily a question of fact.”  C3 Media & Mktg. 
Grp., LLC v. Firstgate Internet, Inc., 419 F. Supp. 2d 419, 434 (S.D.N.Y. 2005) 

(citing Frank Felix Assocs., Ltd. v. Austin Drugs, Inc., 111 F.3d 284, 287 (2d Cir. 
1997)).  “However, where the parties have manifested their intent on the face of 
the document, the court can make this determination as a matter of law based 
on the documents before the court.”  Id. (quoting Koening Iron Works, Inc. v. 
Sterling Factories, Inc., No. 89 Civ. 4257 (THK), 1999 WL 178785, at *8   
(S.D.N.Y. Mar. 30, 1999)).  Moreover, while there is a presumption that “one 
does not surrender an existing obligation for a promise to perform in the 
future,” Albee Truck Inc. v. Halpin Fire Equip. Inc., 615 N.Y.S.2d 118, 120 (3d 

Dep’t 1994) (quoting Goldbard v. Empire State Mut. Life Ins. Co., 171 N.Y.S.2d 
194, 201 (1st Dep’t 1958)), “courts hasten to find an intention to have a 
substituted or superseding agreement discharging the old where [a] settlement 
has resulted in formalized papers with unequivocal language,”  Nat’l Am. Corp., 
448 F. Supp. at 643 (quoting Goldbard, 171 N.Y.S.2d at 200).              
    Here, it is readily apparent from its face that the settlement agreement 
was intended to supersede the original contract between the parties.  The 
settlement agreement both provides for a complete release of all claims arising 

from the original dispute between the parties and, even more persuasively, 
provides for a specific remedy should Defendant fail to pay the amount    
required by the settlement.  (See Dkt. #34, Ex. A).  In addition, the settlement 
agreement offers no language indicating that Plaintiff’s claims would remain 
live pending Defendant’s performance of the settlement.  While the settlement 
agreement does provide that Plaintiff will have the lawsuit between the parties 
dismissed upon receipt of the required payment (see id.), it does not state that 

Plaintiff’s claims remain actionable pending such payment.  Given the     
unequivocal language of the settlement agreement, it is clear that the    
settlement agreement superseded any prior contracts between the parties, and 
is therefore the only valid source for determining the amount for the default 
judgment.  Moreover, the Court will not grant Plaintiff the equitable remedy of 
rescission of the settlement agreement, given that Plaintiff has failed to show 
that it “lacks an adequate remedy at law.”  C3 Media, 419 F. Supp. 2d at 435 
(quoting Faden Bayes Corp. v. Ford Motor Co., No. 97 Civ. 1867 (MBM), 1997 

WL 426100, at *2 (S.D.N.Y. July 30, 1997)).  While the amount provided by the 
settlement agreement is certainly less than Plaintiff would have received from 
the original contract, it is not inadequate.                              
    Accordingly, the Court ORDERS that Plaintiff be awarded $475,000 in  
damages.  The Court further ORDERS that interest shall accrue on this     
amount at the rate of 18% per annum as of the date of this Order.  See    
Westinghouse Credit Corp. v. D’Urso, 371 F.3d 96, 102 (2d Cir. 2004) (noting 
that parties are free to set a post-judgment interest rate by contract as long as 

they do so through “clear, unambiguous[,] and unequivocal language”).     
Finally, should Plaintiff wish to seek attorney’s fees and costs relating to the 
enforcement of this Judgment, the Court ORDERS that such a motion be filed 
no later than October 14, 2020.  Opposition papers, if any, shall be filed by 
October 28, 2020. 
     SO ORDERED. 
Dated:   September 15, 2020                                     
        New York, New York               Kathe alc fild- 
                                           KATHERINE POLK FAILLA 
                                          United States District Judge