United States District Court, D. Nevada
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT (ECF NO.
P. GORDON UNITED STATES DISTRICT JUDGE
an interpleader action filed by plaintiff The Guardian Life
Insurance Company of America due to competing claims for life
insurance benefits under an ERISA plan. Among the possible
claimants to the funds is defendant Edward Samuel Pundyk.
Guardian moves for default judgment because Edward Pundyk has
not filed an answer after having been served. Edward Pundyk
did not oppose the motion for default judgment.
a default judgment under Federal Rule of Civil Procedure 55
is a two-step process. See Eitel v. McCool, 782 F.2d
1470, 1471 (9th Cir. 1986). First, “[w]hen a party
against whom a judgment for affirmative relief is sought has
failed to plead or otherwise defend, and that failure is
shown by affidavit or otherwise, the clerk must enter the
party's default.” Fed.R.Civ.P. 55(a). After the
clerk enters default, a party must seek entry of default
judgment under Rule 55(b).
entry of default, I take as true the factual allegations in
the non-defaulting party's complaint, except those
related to the amount of damages. Fed.R.Civ.P. 8(b)(6);
TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915,
917-18 (9th Cir. 1987) (quotation omitted). Nonetheless,
“[e]ntry of default does not entitle the non-defaulting
party to a default judgment as a matter of right.”
Warner Bros. Entm't Inc. v. Caridi, 346
F.Supp.2d 1068, 1071 (CD. Cal. 2004) (citation omitted). The
“general rule [is] that default judgments are
ordinarily disfavored. Cases should be decided upon their
merits whenever reasonably possible.” Eitel,
782 F.2d at 1472 (citing Peno v. Seguros La Comercial,
S.A., 770 F.2d 811, 814 (9th Cir. 1985)). Whether to
grant a default judgment lies within the district court's
consider the following factors in determining whether to
grant a default judgment: (1) the possibility of prejudice to
the plaintiff; (2) the merits of the plaintiffs substantive
claims; (3) the sufficiency of the complaint; (4) the sum of
money at stake in the action; (5) the possibility of a
dispute concerning material facts; (6) whether the default
was due to excusable neglect; and (7) the strong policy
underlying the Federal Rules of Civil Procedure favoring
decisions on the merits. Id. at 1471-72.
has satisfied the procedural requirements for default
judgment. Pursuant to Rule 55(a), the clerk properly entered
a default against Edward Pundyk. ECF Nos. 6, 28, 33. Because
Edward Pundyk has neither answered nor otherwise responded to
the complaint, the notice requirement of Rule 55(b)(2) is not
implicated. Thus, there is no procedural impediment to
entering a default judgment.
to the Eitel factors, the first factor considers
whether Guardian will suffer prejudice if a default judgment
is not entered. See PepsiCo, Inc. v. Cal. Sec. Cans,
238 F.Supp.2d 1172, 1177 (CD. Cal. 2002); Next Gaming,
LLC v. Glob. Gaming Grp., Inc., No.
214-CV-00071-MMD-CWH, 2016 WL 3750651, at *3 (D. Nev. July
13, 2016). In this case, the clerk entered default against
Edward Pundyk for his failure to file a responsive pleading
or answer the complaint and defend the lawsuit. As a result,
Guardian will suffer prejudice if default judgment is not
entered as it may leave Guardian open to litigation with
Edward Pundyk in the future over the disposition of the
funds. Thus, this factor weighs in favor of an entry of
second and third Eitel factors favor a default
judgment when the “plaintiff state[s] a claim on which
the plaintiff may recover.” Danning v. Lavine,
572 F.2d 1386, 1389 (9th Cir. 1978); see also Fed.
R. Civ. P. 8. Guardian's interpleader complaint is well
pleaded in that it adequately states the controversy over who
is entitled to the funds. The other defendants have answered.
Thus, the second and third Eitel factors weigh in
favor of an entry of default judgment.
assessing the fourth Eitel factor, I consider
“the amount of money requested in relation to the
seriousness of the defendant's conduct, whether large
sums of money are involved, and whether ‘the recovery
sought is proportional to the harm caused by [the]
defendant's conduct.'” Curtis v.
Illumination Arts, Inc., 33 F.Supp.3d 1200, 1212 (W.D.
Wash. 2014) (quoting Landstar Ranger, Inc. v. Earth
Enters., Inc., 725 F.Supp.2d 916, 921 (N.D. Cal. 2010));
PepsiCo., Inc., 238 F.Supp.2d at 1176. The amount of
benefits at issue is only $12, 000. Guardian seeks no money
from Edward Pundyk and does not claim an interest in the $12,
000 beyond fees and costs related to bringing this
interpleader action. Therefore, the fourth Eitel
factor weighs in favor of default judgment.
fifth Eitel factor weighs the possibility of a
dispute regarding any material facts in the case.
PepsiCo., Inc., 238 F.Supp.2d at 1177. “Upon
entry of default, all well-pleaded facts in the complaint are
taken as true, except those relating to damages.”
Id. (citation omitted). There is a possibility of
disputed facts because Edward Pundyk is the named beneficiary
for the benefits but he may not be entitled to those funds if
he murdered his mother, and he was arrested and charged with
that crime. However, this court later will determine the
proper disposition of the funds among the various claimants.
Thus, the fifth Eitel factor weighs in favor of an
entry of default judgment as to Guardian, who claims no
interest in the funds.
sixth Eitel factor considers whether the
defendant's default is due to excusable neglect.
PepsiCo., Inc., 238 F.Supp.2d at 1177. Guardian
properly served Edward Pundyk with the summons and the
complaint but he failed to respond. He was given an extended
deadline to respond but failed to do so. The clerk of court
entered default on October 25, 2016 and Edward Pundyk still
has not appeared in this case. There is no evidence before me
that Edward Pundyk's failure to respond is due to
excusable neglect. United States v. High Country Broad.
Co., 3 F.3d 1244, 1245 (9th Cir. 1993) (per curiam)
(holding that it was “perfectly appropriate” for
the district court to enter default judgment against a
corporation that failed to appear in the action). Given the
time period during which Edward Pundyk had notice of the
action yet failed to answer or otherwise respond, it is
unlikely that he failed to respond due to excusable neglect.
Thus, the sixth Eitel factor weighs in favor of an
entry of default judgment.
the seventh Eitel factor takes into account the
policy favoring a decision on the merits. “Cases should
be decided on their merits whenever reasonably
possible.” Eitel, 782 F.2d at 1472. However,
Edward Pundyk's failure to respond to the complaint
“makes a decision on the merits impractical, if not
impossible.” PepsiCo, Inc., 238 F.Supp.2d at
1177. Thus, while this final Eitel factor always
weighs against an entry of default judgment, it does not
preclude me from entering a default judgment. A decision on
the merits is desirable, but Edward Pundyk has failed to file
a responsive pleading or answer the complaint. Under these
circumstances, default judgment in favor Guardian and against
Edward Pundyk is warranted.
THEREFORE ORDERED that plaintiffs The Guardian Life Insurance
Company of America's motion for default judgment as to
defendant Edward Samuel Pundyk (ECF No. 37) is GRANTED. The
clerk of court shall enter judgment in favor of plaintiff The