The opinion of the court was delivered by: Landya McCafferty United States Magistrate Judge
On January 27, 2012, the clerk of the court entered a default against Midway Line of Illinois, Inc. ("Midway") on a claim brought against it by Ameriswiss Technology, LLC ("Ameriswiss"), under the federal Carmack Amendment, 49 U.S.C. § 14706. That claim arises from a traffic accident in which thirteen machines that Midway was transporting for Ameriswiss were "damaged beyond repair." Compl. (doc. no. 1) ¶ 23. Before the court is Ameriswiss's motion for entry of judgment pursuant to Rule 55(b)(2) of the Federal Rules of Civil Procedure ("Federal Rules"). In its motion, Ameriswiss asks the court to enter final judgment in its favor, against Midway, in the amount of $545,000. For the reasons that follow, Ameriswiss's motion is granted in part.
By failing to respond to Ameriswiss's complaint as required by the Federal Rules, Midway has defaulted on Ameriswiss's Carmack Amendment claim. Ameriswiss is entitled to a default judgment as to liability given that its machines were delivered to Midway in good condition and were damaged while being transported by Midway. See Camar Corp. v. Preston Trucking Co., 221 F.3d 271, 274 (1st Cir. 2000) (setting out elements of Carmack Amendment claim). When a motor carrier is liable for damaging a shipper's goods, the shipper is entitled to recover "the actual loss or injury to [its] property." 49 U.S.C. 14706(a)(1). The issue here is the amount of Ameriswiss's actual loss.
"Within the meaning of the Carmack Amendment, 'actual loss or injury to . . . property' is ordinarily measured by the reduction in market value at destination or by replacement or repair costs occasioned by the harm." Camar, 221 F.3d at 277 (citing Fredette v. Allied Van Lines, Inc., 66 F.3d 369, 372 (1st Cir. 1995)). "Although mathematical precision is not required . . . a damages award must have a 'rational basis in the evidence.'" Camar, 221 F.3d at 279 (quoting Thermo Electron Corp. v. Schiavone Constr. Co., 958 F.2d 1158, 1166 (1st Cir. 1992); citing Jay Edwards, Inc. v. N.E. Toyota Distrib., Inc., 708 F.2d 814, 819 (1st Cir. 1983)). In other words, an award of damages must be based on more than speculation. See Camar, 221 F.3d at 277.
Here, the evidence of the market value of the machines that Midway damaged is two-fold. First, it is undisputed that on September 20, 2010, less than a month before the accident that gave rise to Midway's liability, Ameriswiss paid $44,800 for thirteen machines,*fn1 including eleven used Model D6 Escomatic screw machines that were between twenty and thirty years old. Second, Ameriswiss has submitted an affidavit from one of its members (Paul Luscher) and an affidavit from an appraiser (Steven Beck), both stating that Ameriswiss's D6 Escomatics were worth $545,000. Those affidavits are supported by Beck's appraisal report which states that if Ameriswiss's eleven D6s had not been damaged, they would have had a fair market value of $545,000 as of April 4, 2012.*fn2
Beck's report, however, says little of substance about how he determined the value of the damaged D6s. To be fair, the report indicates that Beck viewed photographs of them, "conducted an investigation into the market conditions for this type of equipment," and "consulted with several new and used machinery dealerships as well as reports and periodicals."
Pl.'s Mot. for Entry of J., Ex. B (doc. no. 59-2), at 3. But, the report does not indicate what Beck learned from those sources that led him to determine the values of Ameriswiss's D6s. More specifically, the report includes no information about either attempted or completed sales of comparable machines.
As between the $44,800 Ameriswiss paid for the machines shortly before they were damaged and the $545,000 that Beck says they were worth, the court concludes that their fair market value is no more than $44,800. Beck's report defines fair market value as:
[a] professional opinion of the estimated most profitable price . . . to be realized for property in an exchange between a willing buyer and a willing seller, with equity to both, neither being under any compulsion to buy or sell, and both parties fully aware of all relevant facts, as of the effective date of this appraisal report.
Pl.'s Mot. for Entry of J., Ex. B (doc. no. 59-2), at 4. Beck's professional opinion is that the machines had a fair market value of $545,000. But his report identifies no evidence supporting that opinion such as the prices asked by other willing sellers for similar equipment or the prices paid by other willing buyers. The fact that Beck's report mentions no other sales of used D6s from the 1980s suggests that sales of machines such as the ones Midway damaged occur infrequently enough to make any opinion concerning their market value inherently speculative. See Camar, 221 F.3d at 278 (pointing out, in connection with claim for lost profits, difference between markets for fungible new goods and markets for used goods). But, of course, the record does include evidence of one sale of used Escomatic D6 screw machines involving a willing buyer and a willing seller: Ameriswiss's purchase of the machines that Midway damaged, for $44,800.*fn3
While the court has found no case that is directly on point, the First Circuit's opinion in Camar offers useful guidance as to the kind of evidence necessary to support an award of damages under the Carmack Amendment. In Camar, the plaintiff shipper was a company that, like Ameriswiss, bought used equipment and refurbished it for resale. See 221 F.3d at 273. In August of 1995, Camar purchased 156 pieces of "used marine equipment located at a naval depot in California," id., "from the United States Navy's Defense Reutilization and Marketing Service ('DRMS')," id. The "Navy had originally paid $275,000 to acquire the equipment," id., but sold it to Camar for $215, id. Camar then contracted with Preston to transport its newly acquired equipment. Id. After Preston lost Camar's goods, "Camar submitted a loss claim to Preston of $137,500." Id. When Preston did not pay that claim, Camar sued for $137,500, and later "amended its complaint to allege damages of $353,370, claiming it could have sold the equipment for [that] sum." Id.
At summary judgment, Camar contended that [its] actual loss should be measured by what foreign buyers had previously paid [it] for similar items." Camar, 221 F.3d at 273-74. Regarding the legal aspect of Camar's argument, i.e., the correct measure of damages, the court of appeals held that the Carmack Amendment "permits recovery of lost profits unless they are speculative." Id. at 277 (citing Pillsbury Co. v. Ill. Cent. Gulf R.R., 687 F.2d 241, 245-46 (8th Cir. 1982); Hector Martinez & Co. v. S. Pac. ...