The Andersons Inc. v. Sadot LLC et al

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
The Andersons Inc.,
Plaintiff,
V.
CaseNo. 2:25-cv-1118
Judge Michael H. Watson
Magistrate Judge Vascura
Sadot LLC, et al.,
Defendants.
OPINION AND ORDER
The Andersons Inc. ("Plaintiff") moves for the Court to (1) enter default
judgment on its claims against Sadot LLC ("Sadot") and Sadot Latam LLC
("Sadot Latam" and, together with Sadot, "Defendants"); and (2) not apply
Federal Rule of Civil Procedure 62(a)'s automatic stay on enforcement of default
judgment to this case. Mot., ECF No. 24. For the following reasons, the motion
is DENIED.
I. BACKGROUND
Plaintiff alleges that it entered into an agreement with Sadot (the
"Agreement") in February 2025, wherein Plaintiff agreed to sell 15, 000 metric
tons ("mt") of Argentine Wheat (the "Cargo") at $253 per mt in exchange for
Sadot's payment for the Cargo. Compl. ^ 7, ECF No. 1; Mot., ECF No. 24. The
total purchase price was $521 , 631. 25. Compl. If 7. A month later, the Cargo
was loaded onto a vessel to be shipped to Sadot. Id. If 8. The vessel departed a
port in Argentina and arrived at a port in Ecuador. Id. If 12. Because Sadot
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allegedly had not paid for the Cargo, Plaintiff did not permit the Cargo to be
discharged from the vessel. Id. If 8. So, the Cargo remained on the vessel
through May 2025, collecting $13, 500. 69 in demurrage charges. 1 Id. ; Mot., ECF
No. 24-1 at PAGEID # 71. According to Plaintiff, at some time in May 2025,
Sadot lied to the vessel's owners and orchestrated the Cargo's discharge from
the vessel without Plaintiff's authorization. Compl. If 18, ECF No. 1. To date,
Sadot has not paid Plaintiff for the Cargo or for the demurrage charges. Id. If 19.
In addition, Plaintiff also alleges that Sadot Latam is Sadot's alter ego. Id.
IT 20. According to Plaintiff, Sadot Latam is Sadot's subsidiary. Id. Though
Plaintiff entered into other maritime contracts with Sadot for maritime
transportation and the sale of corn, Sadot Latam paid Sadot's obligations under
those contracts, which totaled $1 . 5 million. Id. Moreover, Plaintiff avers that
Defendants share the same offices in Burleson, Texas; they share the same
phone number; they are part of the conglomerate "Sadot Group Inc. "; and Sadot
shares its management with Sadot Group Inc. Id. ^t 21-22.
Plaintiff filed its Complaint on September 26, 2025. Compl., ECF No. 1.
Defendants were served on October 28, 2025. ECF Nos. 17-18. After
Defendants failed to plead or otherwise defend as required by law, the Clerk
1 "Demurrage" refers to "[liquidated damages owed by a charterer to a shipowner for
the charterer's failure to load or unload cargo by the agreed time. " Marquette Transp.
Co., LLC v. Emerald Int'l Corp., No. 5:22-cv-24-BJB, 2025 WL 2642652, at *1 n. 3 (W. D.
Ky. Sept. 15, 2025) (citing Liberty Mutual Ins. v. Royal White Cement, Inc., 769 F. Supp.
3d 513, 521 (E. D. La. 2025)).
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entered default against them. ECF No. 22. Plaintiff now moves for default
judgment on its breach-of-maritime-contract and maritime conversion tort claims
and for a finding that Sadot Latam is Sadot's alter ego. Mot., ECF No. 24. In
addition, Plaintiff requests that the Court not stay the proceedings to enforce the
default judgment pursuant to Rule 62(a). Id. Defendants have not responded,
and the deadline to do so has passed.
II. STANDARD OF REVIEW
Applications for default judgment are governed by Federal Rule of Civil
Procedure 55(b)(2). "Following the clerk's entry of default pursuant to ... R[ule]
55(a) and the party's application for default under Rule 55(b), the complaint's
factual allegations regarding liability are taken as true, while allegations regarding
the amount of damages must be proven. " Wood v. Bronzie, No. 1:20-cv-231,
2020 WL 4015247, at *1 (S. D. Ohio July 16, 2020) (internal quotation marks and
citation omitted). "Hhe party moving for a default judgment must present some
evidence of its damages. " Id. (internal quotation marks and citation omitted).
However, the Court need not hold an evidentiary hearing "if the Court can
determine the amount of damages by computation from the record before it. " Id.
(citation omitted).
In addition, Federal Rule 62(a) provides that "execution on a judgment and
proceedings to enforce it are stayed for 30 days after its entry, unless the court
orders otherwise. " A court may consider setting aside the automatic stay under
Rule 62(a) when there is a "risk that the judgment debtor's assets will be
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dissipated" or "when the judgment does not involve a payment of money."
Calloway Cleaning & Restoration, Inc. v. Burer, No. 1:22-cv-12, 2024 U. S. Dist.
LEXIS 67307, at *2 (S. D. Ohio Apr. 12, 2024) (citing the Fed. R. Civ. P. 62(a)
2018 Advisory Committee Notes).
III. ANALYSIS
A. Motion for Default Judgment
The Court has considered the Complaint, the motion for default judgment,
and all attachments to the same. Because the Court concludes that Plaintiff has
neither pleaded that Sadot Latam is Sadot's alter ego nor established maritime
attachment as to Sadot, Plaintiff is not entitled to default judgment for its claims
against Defendants.
1. Alter Ego Theory
Generally, "a court pierces the corporate form to hold an individual [or
corporation] responsible for acts done in the name of the corporation because
the court finds that the individual [or corporation] and corporation are one and the
same, no more than alter egos. " Williamson v. Recovery Ltd. P'ship, No. 2:06-
cv-292, 2011 WL 2181813, at*27 (S. D. Ohio Jun. 3, 2011) (citation omitted). In
the context of admiralty veil-piercing situations, other federal courts have relied
on factors such as:
(1) common or overlapping stock ownership between parent and
subsidiary; (2) common or overlapping directors and officers; (3) use
of same corporate office; (4) inadequate capitalization of subsidiary;
(5) financing of subsidiary by parent; (6) parent exists solely as
holding company of subsidiaries; (7) parent's use of subsidiaries'
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property and assets as its own; (8) informal intercorporate loan
transactions; (9) incorporation of subsidiary caused by parent;
(10) parent and subsidiary's filing of consolidated income tax returns;
(11) decision-making for subsidiary by parent and principals;
(12) subsidiary's directors do not act independently in interest of
subsidiary but in interest of parent; (13) contracts between parent and
subsidiary that are more favorable to parent; (14) non-observance of
formal legal requirements; (15) existence of fraud, wrongdoing or
injustice to third parties.
Id. at *28 (citation omitted). Because piercing the veil is a highly fact-intensive
inquiry, there is no set rule for how many of the above factors must be met to
pierce the veil. Id.
Here, Plaintiff has not established that Sadot Latam is an alter ego of
Sadot. Plaintiff asserts that Sadot Latam is a subsidiary of Sadot; they share
office space and a phone number; Sadot Latam (the subsidiary) paid Sadot's (the
parent's) contractual obligations for two maritime contracts with Plaintiff; and the
companies share management. Compl. ^ 20-22, ECF No. 1. But the Court
hesitates to accept these allegations as true simply because Sadot Latam is in
default. Indeed, Plaintiff fails to allege how Sadot and Sadot Latam are "one in
the same"-for example, Plaintiff does not allege Sadot's use of Sadot Latam's
assets. Nor does Plaintiff allege that Defendants had informal intercorporate
loan transactions, consolidated income tax returns, or lack of independent
director for decision-making. Thus, Plaintiffs motion for default judgment under
an alter ego theory against Sadot Latam is DENIEDWITHOUT PREJUDICE.
Plaintiff may amend its Complaint WITHIN THIRTY DAYS of this Order as to
whether Sadot Latam is the alter ego for Sadot, if it can do so in good faith.
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2. Rule B Maritime Jurisdiction
Before the Court may enter default judgment against Sadot, it must
consider personal jurisdiction over Sadot. Under the Supplemental Admiralty
and Maritime Claims Rule B for In Personam Actions: Attachment and
Garnishment ("Rule B"), "a plaintiff may obtain jurisdiction over a defendant by
attaching its property. " Agric. & Energy Carriers LTD v. United Coals, Inc., No.
2:14-cv-434, 2015 U. S. Dist. LEXIS 16709, at*1-2 (S. D. Ohio Feb. 11, 2015)
(citation omitted). "Rule B thus allows plaintiffs to maintain lawsuits which they
otherwise could not, in that it allows 'quasi-in-rem jurisdiction over a defendant
not otherwise subject to the court's jurisdiction ... . '" Id. (citation omitted). "Rule
B [further] requires a plaintiff seeking maritime attachment to provide notice to
the defendant. " Id. (citation omitted).
In its October 2025 Order, ECF No. 12, the Court determined that Plaintiff
met the conditions required to invoke Rule B against both Defendants. 2 So, the
Court issued a writ of attachment and garnishment, attaching Defendants'
property within this District at Wells Fargo Bank, N. A. ("Wells Fargo"). Id.
Subsequently, counsel for Plaintiff filed an affidavit of service of notice to
Defendants. ECF Nos. 16, 19.
2 The Court notes that Plaintiff's motion for issue of writs of maritime attachment and
garnishment and proposed order of the same indicated that the Wells Fargo bank
accounts were Defendants' property. ECF Nos. 5, 5-1. But the Complaint and motion
for default judgment indicate that the Wells Fargo bank account belongs to only Sadot
Latam. Compl. If 20, ECF No. 1; Mot, ECF No. 24-1 at PAGEID # 70.
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That said, given the Court's finding that Plaintiff has not pleaded that Sadot
Latam is Sadot's alter ego, the Court is concerned that Plaintiff has failed to
obtain personal jurisdiction over Sadot by attachment of Sadot's property (i. e.,
that Rule B jurisdiction has not been met for Sadot). According to Plaintiff, the
Wells Fargo bank account that served as the basis for Rule B attachment
belonged to Sadot Latam, not Sadot. Compl. ^ 20, ECF No. 1. Moreover,
Plaintiff does not allege that Sadot has any other property in this district to satisfy
Rule B. See generally id. Because the Rule B requirements for maritime
attachment seem to have not been met, Plaintiff's motion for default judgment
against Sadot is DENIEDWITHOUT PREJUDICE. Plaintiff may file a motion for
writ of maritime garnishment or attachment against Sadot, or otherwise show
cause as to why the Court has personal jurisdiction over Sadot such that it could
enter a default judgment, WITHIN THIRTY DAYS of this Order.
B. Motion for Rule 62(a) Automatic Stay
Finally, Plaintiff asks the Court to depart from the automatic stay imposed
under Rule 62(a), essentially seeking immediate enforcement of the default
judgment. Mot., ECF No. 24. Because the Court denied without prejudice
Plaintiff's motion for default judgment, its motion as to the Rule 62(a) stay is
DENIEDas moot.
IV. CONCLUSION
Plaintiff's motion for default judgment, ECF No. 24, is DENIED WITHOUT
PREJUDICE. WITHIN THIRTY DAYS of this Order, Plaintiff may: (1) amend its
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Complaint as to whether Sadot Latam is the alter ego for Sadot; and/or (2) file a
motion for writ of maritime garnishment or attachment pursuant to Rule B against
Sadot, or otherwise show cause as to personal jurisdiction.
Plaintiff's motion as to Rule 62(a) is DENIED as moot.
The Clerk shall terminate ECF No. 24.
IT IS SO ORDERED.
HAEL H. WA ON, JUDGE
UNITED STATES DISTRICT COURT
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