MEMORANDUM DECISION AND ORDER Plaintiff Fabrique Innovations, Inc., doing business as Sykel Enterprises, commenced this action alleging that Defendant Federal Insurance Company breached its contractual obligations under an Ocean Cargo Insurance policy (the “Policy”) by denying coverage for a claim that Plaintiff submitted in connection with loss of certain of its goods (the “Goods”) in 2016. (Compl., ECF No. 1.) By Amended Memorandum Decision and Order dated January 4, 2019, this Court denied Defendant’s motion for summary judgment on the issue of Defendant’s liability, and granted Plaintiff’s cross-motion for summary judgment, finding that Plaintiff had established a prima facie case for recovery under the Policy. (Am. Mem. Decision and Order, ECF No. 68.) Plaintiff now moves for summary judgment pursuant to Federal Rule of Civil Procedure 56 on the issue of the amount of its damages. (Pl.’s Notice of Mot. for Summ. J., ECF No. 73.) Plaintiff’s motion for summary judgment on damages is GRANTED.1 I. FACTUAL BACKGROUND A. The Policy. The Policy that Plaintiff purchased from Defendant, as later modified by an endorsement, provides coverage for “direct physical loss or damage to merchandise in transit caused by or resulting from a covered peril while such merchandise is temporarily in storage…subsequent to leaving the point of origin for commencement of transit; or…in anticipation of transit.” (Decl. of Andrew N. Bourne (“Decl.”), Ex. 3 (Policy and Endorsement), ECF No. 74-3, at FEDERAL_001362.) “Merchandise in transit” is defined in the Policy as, inter alia, Plaintiff’s “business personal property” that is “shipped by or consigned to [Plaintiff], or shipped by or consigned to others for [Plaintiff's] account,” and are either “intracompany shipments” or property “for which [Plaintiff] ha[s] agreed in writing, prior to loss or damage, to provide insurance.” (Id. at FEDERAL_001336.) The Policy also provides “Automatic Extensions of Coverage.” (Id. at FEDERAL_001310-12.) One such “Automatic Extension of Coverage” is “Sue and Labor,” which provides that Defendant “will reimburse [Plaintiff] or [its] assignee for charges reasonably incurred pursuant to the Duty of the Insured Common Policy Condition of this policy, whether the efforts are successful or not.” (Id. at FEDERAL_001312.) The “Duty of the Insured Common Policy Condition,” in turn, states: In the event of actual or imminent loss or damage, it is your duty and the duty of any assignee of your rights hereunder to take all reasonable measures to avert or minimize loss or damage to which this insurance applies and to ensure that all rights against third parties are preserved and exercised. (Id. at FEDERAL_001371.) B. The Loss of the Goods and the Hancock Adversary Proceeding. In October 2015, Plaintiff and non-party Hancock Fabrics Inc. (“Hancock”) reached a business arrangement under which Hancock would store Plaintiff’s goods at Hancock’s storage facility in Baldwyn, Mississippi (the “Hancock Warehouse”) and ship those goods to Plaintiff’s customers, and would also sell Plaintiff’s goods in Hancock’s own stores. (Pl.’s Statement Pursuant to Local Rule 56.1 of Material Facts Not in Dispute in Supp. of Its Mot. for Summ. J. (“Pl.’s 56.1 Stmt.”), ECF No. 75, 14; Def. Federal Insurance Company’s Resp. to Pl.’s Statement of Undisputed Material Facts Pursuant to Local Rule 56.1 (“Def.’s 56.1 Stmt.”), ECF No. 79, at 6.) In connection with this arrangement, Plaintiff requested that Defendant add the Hancock Warehouse as a covered location to the Policy. (Pl.’s 56.1 Stmt, 1; Def.’s 56.1 Stmt, at 1.) Shortly thereafter, in October and November 2015, Plaintiff shipped the Goods to the Hancock Warehouse. (Pl.’s 56.1 Stmt. 15; Def.’s 56.1 Stmt, at 6.) Plaintiff alleges that the total value of the Goods was approximately $1.15 million. (Pl.’s 56.1 Stmt, 16.) On February 2, 2016, Hancock filed a voluntary Chapter 11 bankruptcy petition in the United States Bankruptcy Court for the District of Delaware. (Pl.’s 56.1 Stmt. 18; Def.’s 56.1 Stmt, at 7.) After Plaintiff objected to Hancock retaining the proceeds of the sale of the Goods in bankruptcy, Hancock commenced an adversary proceeding against Plaintiff on March 24, 2016, seeking a declaration that Hancock’s interest in the Goods was superior to that of Plaintiff. (Pl.’s 56.1 Stmt. 19; Decl., Ex. 9 (Adversary Proceeding Compl.), ECF No. 74-10.) According to Plaintiff, Hancock sold all of the Goods and continued to report sales through the end of March 2016, but made no payments to Plaintiff after January 2016. (Pl.’s 56.1 Stmt,
21-22.) Specifically, Plaintiff claims that prior to Hancock’s liquidation, Hancock sold approximately $214,066.41 worth of Goods, but paid Plaintiff only $100,159.79. (Id. 17; see also Decl., Ex. 7 (Sales and Payments Spreadsheet), ECF No. 74-8, at FEDERAL_000571-75.) Moreover, according to bankruptcy filings, Hancock shipped an additional $3,691.21 worth of Goods to Plaintiffs customers after February 2016. (Am. Compl., Ex. A (Post-Pet. Transfers), Hancock Fabrics, Inc. v. Sykel Enterprises, A Divison of Fabrique Innovations, Inc., No. 16-50418 (BLS) (Bankr. D. Del. Mar. 8, 2017), ECF No. 39.) Plaintiff and Hancock ultimately entered into a settlement agreement resolving the adversary proceeding. (Pl.’s 56.1 Stmt. 23; Def.’s 56.1 Stmt, at 8; Decl., Ex. 11 (Order Approving Settlement Agreement), ECF No. 74-12.) Under the terms of the settlement agreement, Hancock disclaimed liability but agreed to pay Plaintiff $250,000, which was to be “allocated proportionally to [Plaintiff's] claims for (a) loss of goods valued by [Plaintiff] at $1,172,731.00 based on their wholesale price, and (b) lost profits and consequential damages valued by [Plaintiff] at $3,000,000.” (Decl., Ex. 11 (Order Approving Settlement Agreement), at Ex. 1
