International Marine, L.L.C., et al v. Delta Towing, L.L.C., No. 12-30280 (5th Cir. 2013)
Annotate this CasePlaintiff appealed the district court's entry of an order declaring enforceable under general maritime law a liquidated damages provision (LD Provision) in a contract between defendant and plaintiff. The parties entered into a Vessel Sales Agreement (VSA), which included the LD Provision, that provided for a $250,000 payment for each violation of the non-competition clause. The court followed Farmers Exp. Co. v. M/V Georgis Prois in finding persuasive the district court's careful factual findings as to whether the LD Provision was a reasonable forecast of damages. The court held that looking at the contract at the time it was made, ex ante breach, the court could not bicker with the $250,000 per occurrence forecast. Plaintiff had not met its burden to prove that the LD Provision was a penalty. Therefore, the court concluded that the district court properly held that the LD Provision was enforceable and affirmed the judgment.
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