## Facts

- Doolim Corp., a South Korean garment manufacturer, contracted to sell women’s garments to R Doll, LLC, a U.S. buyer, in three lots; the garments bore trademarks associated with the buyer.
- The contract was governed by the CISG because the parties were in different contracting states and did not opt out.
- Doolim delivered the first two lots, which Doll accepted, but Doll failed to pay the price.
- Doolim attempted to accommodate Doll by modifying payment terms, but Doll still did not pay.
- Doolim canceled the third shipment and retained the undelivered, trademark-bearing garments, asserting it could not resell them without infringing the defendants’ trademark rights.
- Defendants R Doll, LLC, Steven Oshatz, and Rosenthal & Rosenthal, Inc. failed to appear or defend; the court entered defaults and referred an inquest on damages and relief to a magistrate judge.
- The magistrate judge issued a report recommending damages, declaratory relief permitting resale, dismissal of an asset-related claim, and denial of attachment; no party objected.

## Issues

1. What damages and relief are appropriate under the CISG when a buyer accepts delivered goods but fails to pay, and the seller cancels further delivery.
2. Whether the seller may obtain damages and declaratory relief concerning resale of undelivered goods bearing the buyer’s trademarks.
3. Whether additional relief concerning third-party-held assets and an attachment order should be granted on a default record.
4. What standard applies when adopting an unopposed magistrate judge’s report and recommendation.

## Decision

- The district court adopted the magistrate judge’s report and recommendation in full after finding no clear error on the face of the record.
- Judgment was entered for Doolim against R Doll, LLC in the amount of \$840,085.94.
- Default judgment was entered against Steven Oshatz.
- The court declared that Doolim may sell the garments in its possession manufactured for Doll without regard to Doll’s trademark rights and without regard to Oshatz’s trademark rights.
- The court dismissed Doolim’s fourth claim seeking relief regarding assets in Rosenthal & Rosenthal’s possession and denied Doolim’s application for an order of attachment.
- The clerk was directed to close the case.

## Legal Principles

- When no objections are filed to a magistrate judge’s report and recommendation, a district court may adopt it upon finding no clear error on the face of the record.
- Under the CISG, a buyer must pay the price for goods; persistent nonpayment after delivery constitutes a breach supporting seller remedies, including suspension/avoidance and damages.
- CISG damages generally compensate losses caused by breach and are subject to mitigation requirements; courts may grant declaratory relief to resolve legal impediments that affect resale and mitigation.
- Defaulting parties who receive adequate notice may be subjected to default judgments and damages determinations based on the plaintiff’s unrebutted submissions.
- Claims for additional remedies such as attachment or declarations about third-party-held assets may be denied or dismissed when the record does not justify that relief.

## Conclusion

The court, proceeding on defendants’ defaults, awarded substantial CISG damages for nonpayment, granted declaratory relief allowing resale of trademarked garments held by the seller, and denied broader asset-focused and attachment relief not supported on the inquest record.


Doolim Corp. v. R Doll, LLC, 2009 WL 1514913 (S.D.N.Y. 2009)