White v. Cummings

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
CAMBRIDGE CAPITAL GROUP,
INC.,
Debtor.
___________________________
WILLIAM D. WHITE, CHAPTER 7
TRUSTEE,
Plaintiff,
v.
ERIC L. CUMMINGS,
Defendant.
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Case No. 03-01178
(Chapter 7)
Adversary Proceeding
No. 06-10006
DECISION RE: MOTION FOR DEFAULT JUDGMENT
The complaint for this adversary proceeding was filed on
January 25, 2006, by the chapter 7 trustee in the debtor’s main
bankruptcy case to recover money or property of the estate. 	On
the same day, a summons was issued and an amended complaint was
filed. 	Service of the summons and the complaint was executed on
January 30, 2006. 	No answer or response has been made by the
The decision below is hereby signed. Dated: June
14, 2006.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
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1 	The trustee’s motion for default judgment requests a
final judgment of $200,000.00. 	The court believes this figure to
have been requested in error; in any event, the trustee cannot
seek to recover through his motion for default judgment assets
not alleged to belong to the estate in his complaint.
2
defendant, so, at the request of the plaintiff, default was
entered by the clerk of the court on May 3, 2006. 	The trustee
filed a motion for default judgment on June 5, 2006. 	The
principal amount of monies transferred to Defendant is alleged to
be $43,750.00. 1
According to this court’s decision in Webster v. Harris (In
re NETtel Corp., Inc.), 327 B.R. 8 (Bankr. D.D.C. 2005), pre-
judgment interest may be calculated using the prime rate unless
there is evidence presented that another rate should be used or
that preference claims should be treated differently than those
of other private litigants. 	Id. at 13. 	The D.C. Circuit has
also found the prime rate to be more logical in determining the
appropriate pre-judgment interest because that is the rate the
“victim must pay--either explicitly if it borrows money or
implicitly if it finances things out of cash on hand--and the
rate the wrongdoer has available to it.” 	Forman v. Korean Air
Lines Co., 84 F.3d 446, 450-51 (D.C. Cir. 1996), cert. denied,
519 U.S. 1028 (1996)(holding that the prime rate is the
appropriate rate for calculating interest on a plaintiff’s award
for pain and suffering). 	NETtel expanded this reasoning to apply
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2 	Prior to NETtel, this court applied the Treasury bill
rate to calculate pre-judgment interest unless there were
specific requests otherwise. 	327 B.R. at 10 (citing White v.
Bradford (In re Tax Reduction Institute), 138 B.R. 325 (Bankr.
D.D.C 1991)). 	However, the court clarified in NETtel that its
former use of the Treasury bill rate was “not legally
imperative,” but rather was employed at the discretion of the
court. 	Id.
3 An electronic version of the Federal Reserve’s table of
prime interest rates is available at
http://www.federalreserve.gov/releases/h15/data/Monthly/H15_PRIME
_NA.txt.
4 This amount is determined by the following equation:
$43,750 x [1 + (0.0726 x 140/365)] = $44,968.29
3
to bankruptcy cases. 	327 B.R. at 12. 2
The pre-judgment interest to be awarded will be calculated
based on the monthly bank prime rates at the day of the filing, 3
to be compounded annually. 	See id at 13-14; accord Alberts v.
Mac, M.D. (In re Greater Southeast Cmty. Hosp. Corp., I), 2006 WL
1174332, at *1 (Bankr. D.D.C. Apr. 28, 2006). 	This results in a
judgment of $44,968.29. 4
The post-judgment interest will be calculated according to
28 U.S.C. § 1961, which provides that interest accrues from the
date of judgment “at a rate equal to the weekly average 1-year
constant maturity Treasury yield” released by the Federal
Reserve. 	This interest will be added to the total judgment
amount (the aggregate of the principal, pre-judgment interest,
and costs).
A judgment follows.
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4	O:\Alexis V Chapin\default judgment order_ cummings.wpd
[Signed and dated above.]
Copies to: All counsel and parties of record.
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