Nichamin v. Horchen et al

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
District Judge S. Kato Crews
Civil Action No. 1:24-cv-00980-SKC-NRN
LOUIS D. NICHAMIN,
Plaintiff,
v.
RYAN HORCHEN, and
H&H PERFORMANCE, INC, a Pennsylvania corporation,
Defendants.
ORDER GRANTING DEFAULT JUDGMENT
In 2015, Plaintiff Dr. Louis D. Nichamin, a Colorado citizen, entered into an
agreement with Defendants Ryan Horchen, a Pennsylvania citizen, and H&H
Performance, Inc., a Pennsylvania corporation (collectively “Defendants”), for the
purchase of a 1966 Ford Shelby GT350 (“the Shelby”). Dkt. 1, ¶¶1-3, 11. Dr. Nichamin
paid Defendants $160,000 in exchange for the vehicle; after receiving the title, he
immediately registered the car with the State of Colorado and obtained a Colorado
title in his name. Id. ¶¶12-13.
In 	2022, 	Dr. 	Nichamin 	transferred 	the 	car 	to 	Barrett-Jackson 	Auction
Company in Arizona to be listed for sale on Barrett-Jackson’s website. Id. ¶14. But
on November 15, 2023, Dr. Nichamin learned of a second individual, Dr. Timothy
Wong, who claimed ownership of the vehicle. Id. ¶15. According to Dr. Wong, he
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purchased the vehicle in 2010 and sent the car to Defendants in 2015 to sell on his
behalf. Dkt. 1-2, pp.1-2, 15-16. Dr. Wong further alleged that Defendants then sold
the car to Dr. Nichamin without his knowledge or permission in 2016. Id. Dr. Wong
obtained a default judgment against Defendants in Harris County Court, Texas, with
the court finding that Defendants had unlawfully taken Dr. Wong’s money and
property, including the Shelby. Id. pp.3-18. In addition, Dr. Wong’s lawyers reported
the matter to the Scottsdale, Arizona police department and demanded that Barrett-
Jackson cease marketing the vehicle. Id. pp.1-3.
Dr. Nichamin filed his Complaint against Defendants on April 11, 2024,
asserting claims for breach of contract, negligent misrepresentation or omission,
fraudulent concealment, fraudulent misrepresentation and inducement, breach of the
implied covenant of good faith and fair dealing, and unjust enrichment. See generally
Dkt. 1. Plaintiff requests damages or, in the alternative, rescission of the contract
and a judgment of restitution in his favor. Id. Defendants were personally served on
April 22, 2024 (Dkt. 7); however, they never answered or otherwise responded to the
Complaint. Dkt. 8.
Dr. Nichamin filed a motion for entry of default and default judgment. Id.
Although the Clerk of Court entered default against Defendants on June 17, 2024
(Dkt. 9), the Court denied the motion for default judgment without prejudice and gave
Plaintiff leave to refile (Dkt. 13). Plaintiff filed his renewed Motion for Default
Judgment on July 9, 2025. Dkt. 19. The Court has reviewed the renewed Motion and
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its attachments, the relevant law, and the record in this case. No hearing is necessary.
For the following reasons, the renewed Motion for Default Judgment is granted.
STANDARD OF REVIEW
Pursuant to Federal Rule of Civil Procedure 55(b), default judgment may enter
against a party who fails to appear or otherwise defend a case brought against them.
However, a party is not entitled to the entry of default judgment as a matter of right.
Greenwich Ins. Co. v. Daniel Law Firm, No. 07-cv-02445-LTB-MJW, 2008 WL
793606, at * 2 (D. Colo. Mar. 22, 2008) (quoting Cablevision of S. Conn. Ltd. P’ship v.
Smith, 141 F.Supp.2d 277, 281 (D. Conn. 2001)). Even after the entry of default, “it
remains for the court to consider whether the unchallenged facts constitute a
legitimate basis for the entry of a judgment.” McCabe v. Campos, No. 05-cv-00846-
RPM-BNB, 2008 WL 576245, at *2 (D. Colo. Feb. 28, 2008) (citing Black v. Lane, 22
F.3d 1395, 1407 (7th Cir. 1994)). “In determining whether a claim for relief has been
established, the well-pleaded facts of the complaint are deemed true.” Id. The decision
whether to enter judgment by default is committed to the sound discretion of the
district court. Olcott v. Del. Flood Co., 327 F.3d 1115, 1124 (10th Cir. 2003).
ANALYSIS
A. 	Subject Matter Jurisdiction, Personal Jurisdiction & Venue
In determining whether the entry of default judgment is warranted, the Court
must first determine whether it has jurisdiction over the subject matter and the
defendant. Dennis Garberg & Assocs. v. Pack-Tech Int’l Corp., 115 F.3d 767, 772 (10th
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Cir. 1997); Williams v, Life Sav. & Loan, 802 F.2d 1200, 1202-03 (10th Cir. 1986). It
is well-settled that “[a] judgment is void when a court enters it lacking subject matter
jurisdiction or jurisdiction over the parties.” Id. at 1202.
Here, the allegations in the Complaint—taken as true for purposes of default
judgment—establish the Court’s jurisdiction over this lawsuit. The parties to this
matter are citizens of different states and the amount in controversy exceeds $75,000;
thus, the Court has subject matter jurisdiction under 28 U.S.C. § 1332.
With respect to personal jurisdiction, in his original motion seeking default
judgment, 	Dr. 	Nichamin 	argued 	that 	Defendants 	were 	“subject 	to 	personal
jurisdiction in Colorado because, at minimum, Defendants have transacted business
in [this state].” Dkt. 8, p.3. The Court, however, denied the motion without prejudice
because the allegations in the Complaint regarding the business transactions were
too attenuated. Dkt. 13, p.3. With his renewed Motion for Default Judgment, Dr.
Nichamin has provided supporting evidence regarding his course of dealings with
Defendants. Dkt. 19-1.
In his affidavit, Dr. Nichamin attests he met Defendants in Pennsylvania—
where he was living at the time—when he was looking to purchase a classic car. Id.
¶4. Although Plaintiff was interested in a different vehicle, Defendant Horchen
pressed Plaintiff to purchase the Shelby and assured him it had the pedigree he was
looking for. Id. ¶5. After Plaintiff moved to Colorado—a fact Defendant Horchen knew
based on his conversations with Plaintiff—Defendants continued to call and email
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Plaintiff urging him to buy the Shelby and promising it met all the requirements
Plaintiff was seeking in a classic vehicle. Id. ¶7. And when Dr. Nichamin did finally
purchase the Shelby, Defendants shipped both the title and the vehicle to Colorado.
Id. ¶¶8, 9.
The Court concludes based on these attestations that the Parties’ course of
dealings, particularly Defendants’ repeated solicitations of a known Colorado citizen,
are sufficient to constitute minimum contacts with the state for purposes of personal
jurisdiction. Furthermore, Dr. Nichamin’s affidavit also establishes that Defendants’
guarantees to Plaintiff were knowingly false and meant to induce Plaintiff into
purchasing a car with a clouded title. This further supports the finding of personal
jurisdiction. See Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1077-
78 (10th Cir. 2008) (finding purposeful direction supporting personal jurisdiction
where the defendants had intentionally caused harm to the plaintiffs’ business in the
forum state).
The record shows that service on Defendants was valid and effective under the
Colorado Rules of Civil Procedure governing personal service on individuals and
corporate entities, Colo. R. Civ. P. 4(e). Dkt. 7. Consequently, the Court has personal
jurisdiction over Defendants. And finally, because a substantial part of the events
giving rise to the claim, namely the injury, occurred in this state, the Court finds
venue is proper in the State and District of Colorado under 28 U.S.C. § 1391.
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B. 	Liability
Dr. Nichamin seeks default judgment against Defendants on all his claims.
The Court needs only address Plaintiff’s claims for breach of contract (claim one) and
fraudulent inducement (claim four) because Plaintiff may receive all the relief he
seeks under these claims. And by failing to answer the Complaint, Defendants have
relieved Dr. Nichamin of the burden of proving his factual allegations supporting
these claims. United States v. Craighead, 176 F. App’x 922, 924 (10th Cir. 2006).
Nevertheless, “the Court must determine whether the allegations contained in
Plaintiff’s Complaint are sufficient to state a claim for relief.” Jones v. Wells Fargo
Bank, N.A., No 13-cv-02210-MSK-KLM, 2014 WL 3906297, at *8 (D. Colo. Aug. 7,
2014) (internal quotation marks and citations omitted).
“To state a claim for relief, the Complaint must contain sufficient factual
matter, accepted as true to show that the claim is plausible on its face.” Id. (citations
omitted). “A claim is facially plausible when the plaintiff pleads facts that allow the
court to reasonably infer that the defendant is liable for the alleged conduct.” Id.
1. 	Breach of Contract
To establish a claim for breach of contract, a plaintiff must demonstrate (1) the
existence of a contract; (2) performance by them or some justification for their
nonperformance; (3) failure to perform by defendant; and (4) resulting damages. W.
Distrib. Co. v. Diodosio, 841 P.2d 1053, 1058 (Colo. 1992). The Court has little trouble
concluding the allegations in the Complaint establish a breach of contract. According
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to the terms of the agreement, Defendants warranted that they had the authority to
sell the Shelby and that it was free and clear of all encumbrances. See Dkt. 1-1.
Although Plaintiff paid Defendants $160,000, the allegations further establish that
Defendants did not have the right to sell the Shelby to Dr. Nichamin because
Defendants stole the car from Dr. Wong. Dkt. 1, ¶15. And Dr. Wong claims to have a
superior title to Dr. Nichamin. Id. at ¶17.
Plaintiff is now unable to sell the Shelby, and he will have to spend additional
funds to defend his title against Dr. Wong. Dkt. 19-1. Plaintiff has also provided
evidence that the Shelby is not the pedigree Defendants promised because it does not
have the original drivetrain and there are defects in the vehicle’s body. Dkt. 19-2,
¶¶8-9. 	These 	defects, 	in 	combination 	with 	the 	cloud 	on 	Plaintiff’s 	title, 	have
substantially 	reduced 	the 	value 	of 	the 	vehicle. 	Id. 	Thus, 	Dr. 	Nichamin 	has
demonstrated not only a breach of contract, but also that he has suffered damages.
He is, therefore, entitled to default judgment on his claim for breach of contract.
2. 	Fraudulent Inducement
To establish a claim for fraudulent inducement, a plaintiff must demonstrate
“(1) the defendant made a fraudulent misrepresentation of fact or knowingly failed to
disclose a fact that defendant had a duty to disclose; (2) the fact was material; (3) the
plaintiff relied on the misrepresentation or failure to disclose; (4) the plaintiff's
reliance was justified; and (5) the reliance resulted in damage to the plaintiff.”
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Granite Southlands Town Ctr., LLC v. Provost, 445 F. App’x 72, 75 (10th Cir. 2011)
(applying Colorado law).
According to the allegations in the Complaint and Dr. Nichamin’s affidavit,
Defendants knew that Dr. Nichamin was looking to buy a classic car with a particular
pedigree. Dkt. 1, ¶11; Dkt. 19-1, ¶¶4-5. Despite knowing they did not have the
authority to sell the Shelby, which was stolen from Dr. Wong, Defendants specifically
told Plaintiff the Shelby met those requirements. Dkt. 19-1, ¶¶5, 7, 13, 18-19.
After Plaintiff initially declined to buy the Shelby, Defendants repeatedly
contacted Plaintiff and told him that the Shelby was of a “pure pedigree,” and
therefore, a bargain. Dkt. 19-1, ¶¶5-7. Because Defendants were in the business of
repairing, restoring, and selling luxury vehicles, and because Defendants possessed
a title suggesting they had the authority to sell the Shelby, Plaintiff relied on
Defendants’ fraudulent statements. Id. ¶¶3, 8-11. And as described above, Plaintiff
has suffered damages based on his reliance on those fraudulent statements, to wit,
he has purchased a vehicle worth far less than he bargained for and is unable to sell
it because of Dr. Wong’s claim of superior title. Dkt. 1, ¶¶15-18; Dkt. 19-1, ¶¶15, 18-
20.
C. 	Damages
Default judgment cannot enter under Rule 55(b)(2) until the amount of
damages has been ascertained. See Herzfeld v. Parker, 100 F.R.D. 770, 773 (D. Colo.
1984). A default judgment for money damages must be supported by proof. Klapprott
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v. United States, 335 U.S. 601, 611-12 (1949). This ensures that the plaintiff is not
awarded more in damages than can be supported by the evidence. See id. Whether to
conduct a hearing for the purpose of ascertaining damages is discretionary. See Hunt
v. Inter-Globe Energy, Inc., 770 F.2d 145, 148 (10th Cir. 1985). The Court concludes
a hearing is unnecessary.
1. 	Actual Damages
In his renewed Motion, Dr. Nichamin seeks an award of monetary damages
representing the difference between the present fair market value of the Shelby and
the fair market value of the Shelby if it had been in the condition Defendants
represented. Dr. Nichamin has included the affidavit of Gary Riley, an expert in the
field of classic vehicle valuation with over 25 years of experience in the business of
classic car restoration. Dkt. 19-2. Mr. Riley attests that if the Shelby had been in the
condition promised by Defendant it would likely be worth $350,000. Id. ¶7. He also
states that because the Shelby does not have its original drivetrain, has various
defects, and has a clouded title, it is worth only $220,000. Id. ¶11. Thus, Plaintiff has
established actual damages in the amount of $130,000.
2. 	Punitive Damages
Plaintiff also seeks an award of exemplary damages to cover his attorney’s fees
in the amount of at least $17,198.44. Pertinent here, Colo. Rev. Stat. § 13-21-102
provides:
In all civil actions in which damages are assessed by a jury for a wrong
done to the person or to personal or real property, and the injury
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complained of is attended by circumstances of fraud . . . the jury, in
addition to the actual damages sustained by such party, may award him
reasonable 	exemplary 	damages. 	The 	amount 	of 	such 	reasonable
exemplary damages shall not exceed an amount which is equal to the
amount of the actual damages awarded to the injured party.
Id. at § 13-21-102(1)(a) (emphasis added).
“The general purposes of punitive damages under section 13-21-102 are
punishment of the defendant and deterrence against the commission of similar
offenses by the defendant or others in the future.” Coors v. Sec. Life of Denver Ins.
Co., 112 P.3d 59, 65 (Colo. 2005). Although there is no precise calculation for punitive
damages, they must nevertheless bear some relation to the plaintiff’s actual damages.
Palmer v. A.H. Robins Co., 684 P.2d 187, 220 (Colo. 1984). In addition, the Tenth
Circuit has noted that “the costs of litigation in order to vindicate rights is an
appropriate element to consider in justifying a punitive damages award.” Cont’l
Trend Res., Inc. v. v. OXY USA Inc., 101 F.3d at 642 (citing O’Gilvie v. Int’l Playtex,
Inc., 821 F.2d 1438, 1447 (10th Cir. 1987), cert. denied, 486 U.S. 1032 (1988)).
The Court has determined that both the allegations and evidence support a
finding that Defendants fraudulently induced Dr. Nichamin into purchasing the
Shelby and that this conduct has resulted in actual damages. See Defeyter v. Riley,
671 P.2d 995, 998 (Colo. App. 1983) (“It is a fundamental principle of law that
punitive damages may not be awarded absent an award of actual damages.”). And
because of Defendants’ conduct, Plaintiff not only had to retain a lawyer and
prosecute this case, but he will also bear additional legal expenses in clearing the title
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to the Shelby as against Dr. Wong. In addition, the Court observes that Plaintiff’s
punitive damages request amounts only to 13 percent of the actual damages. Cf.
Palmer v. A.H. Robins Co., 684 P.2d 187, 220 (Colo. 1984) (ten-to-one ratio of
exemplary to compensatory damages upheld as reasonable); Mailloux v. Bradley, 643
P.2d 797 (Colo. App. 1982) (ratios of 10:1 and 35:1 upheld).
Consequently, the Court concludes that awarding Plaintiff $18,000 in punitive
damages is reasonable.
3. 	Costs
Federal Rule of Civil Procedure 54(d)(1) provides that costs should be allowed
to a prevailing party. In this action, Dr. Nichamin is the prevailing party by virtue of
Defendants’ default. See, e.g., J & J Sports Productions, Inc. v. Paz-Padilla, No. 3:12-
cv-0228-GPC-WMC, 2013 WL 6002872, at *1 (S.D. Cal. Nov. 12, 2013) (“a plaintiff
who obtains a default judgment may be considered a prevailing party for purposes of
awarding fees and costs . . .”) (citations omitted). By the well-pleaded allegations and
evidence, 	Dr. 	Nichamin 	has 	established 	his 	claims 	of 	breach 	of 	contract 	and
fraudulent inducement and an entitlement to exemplary damages under Colorado
statute. He has incurred $1,364.58 in compensable litigation costs, which consist of
filing fees, notary fees, and service fees. Dkt. 19-3, p.4. Therefore, pursuant to Fed.
R. Civ. P. 54(d), Plaintiff is also awarded his costs.
* 	* 	*
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For 	the 	reasons 	shared 	above, 	Plaintiff’s 	Renewed 	Motion 	for 	Default
Judgment is GRANTED and IT IS ORDERED:
1. 	Plaintiff shall be awarded $149,364.58, consisting of actual damages,
punitive damages, and costs.
2. 	Plaintiff is entitled to recover pre- and post- judgment interest as requested
in the renewed Motion.
3. 	The Clerk of Court shall enter judgment and close this case.
DATED: March 16, 2026.
BY THE COURT:
S. Kato Crews
United States District Judge
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