United States District Court, D. Nevada
Hoffman, Jr. United States Magistrate Judge.
before the Court is Defendant Mania Media LLC's motion to
set aside clerk's entry of default (ECF No. 66), filed on
November 20, 2017. Plaintiff filed a response (ECF No. 70) on
November 22, 2017 and Defendant filed a repy (ECF No. 73) on
November 30, 2017. Also before the Court is Plaintiff's
motion to strike (ECF No. 76), filed on December 12, 2017.
Plaintiff's motion to strike
motion to strike relates to Defendant's affidavit (ECF
No. 73), submitted in support of its reply in support of its
motion to set aside clerk's entry of default judgment.
Plaintiff moves to strike the affidavit because it “is
not a sworn affidavit, ” “fails to meet the
requirements of declaration under federal law, ” and is
“based on hearsay.” Pl's Mot. at p. 1.
Defendant's affidavit appears to be signed and dated by
unclear to the Court the basis for this motion, as Plaintiff
fails to articulate with any specificity how the document is
legally flawed, or base his assertions on any authority.
Under Local Rule 7-2(d), the failure of a party to file
points and authorities in support of a motion constitutes
consent to the denial of the motion. The Court will therefore
deny the motion without prejudice.
Defendant's Motion to Set Aside Clerk's Entry of
preliminary matter, Defendant's motion is styled as both
a motion to set aside clerk's entry of default and a
motion to quash. However, Defendant makes only a brief
mention of the circumstances of service in this case and
cites no points and authorities in support of a motion to
quash. As noted above, under Local Rule 7-2(d), the failure
of a party to file points and authorities in support of a
motion constitutes consent to the denial of the motion.
Further, Defendant's motion seeks relief under multiple
grounds. Under Local Rule IC 2-2(b), when filing a motion or
other document with the Court, “[f]or each type of
relief requested or purpose of the document, a separate
document must be filed and a separate event must be selected
for that document.” Therefore, the Court will deny
Defendant's motion to the extent that it is a motion to
quash and consider it only as a motion to set aside
clerk's default judgment.
seeks to set aside the Clerk's entry of default (ECF No.
65), entered on November 16, 2017. Defendant filed this
motion four days after the default was entered, on November
20, 2017, arguing that it had not engaged in any culpable
conduct leading to the default, that it has meritorious
defenses to Plaintiff's claims, and that setting aside
the default would not prejudice Plaintiff. Plaintiff
disagrees with each of Defendant's arguments.
court may set aside the entry of default for “good
cause.” Fed.R.Civ.P. 55(c); United States v. Signed
Pers. Check No. 730 of Yubran S. Mesle
(“Mesle”), 615 F.3d 1085, 1091 (9th Cir.
2010). In ruling on a motion to set aside a default, the
court considers whether the plaintiff would be prejudiced if
the default is set aside, whether the defendant has a
meritorious defense, and whether the defendant engaged in
culpable conduct that led to the default. Id. The
defendant bears the burden of demonstrating that these
factors favor setting aside the default. TCI Grp. Life
Ins. Plan v. Knoebber (“TCI”), 244 F.3d 691,
696 (9th Cir. 2001), overruled on other grounds, Egelhoff
v. Egelhoff ex rel. Breiner, 532 U.S. 141 (2001). If the
defendant fails to meet its burden with respect to any of
these factors, the court may deny the motion to set aside the
default. Mesle, 615 F.3d at 1091.
determine whether the plaintiff would be prejudiced if the
default judgment is set aside, “[t]he standard is
whether his ability to pursue his claim will be
hindered.” Falk v. Allen, 739 F.2d 461, 463
(9th Cir. 1984). Setting aside a default must do more than
simply delay resolution of the case to be considered
prejudicial to the plaintiff. TCI, 244 F.3d at 701.
Similarly, requiring a plaintiff to adjudicate a claim on the
merits does not constitute prejudice. Id. Rather,
the delay must result in some tangible harm, such as
“loss of evidence, increased difficulties of discovery,
or greater opportunity for fraud or collusion.”
Id. (quotation omitted).
satisfy the “not extraordinarily heavy” burden of
presenting a meritorious defense, the defendant seeking to
vacate a default must present specific facts that would
constitute a defense. Id. at 700. There must be some
possibility that the suit would have a different outcome at
trial than the result achieved by default. Hawaii
Carpenters' Trust Funds v. Stone, 794 F.2d 508, 513
(9th Cir. 1986).
“a defendant's conduct is culpable if he has
received actual or constructive notice of the filing of the
action and intentionally failed to answer.”
TCI, 244 F.3d at 697 (emphasis and quotation
omitted). However, if the defendant offers a good faith
explanation for its neglectful failure to answer, and that
explanation negates any intent to take advantage of the
plaintiff, interfere with judicial decision making, or
otherwise manipulate the legal process, such failure is not
“intentional.” Id. at 697-98. For
example, where the defendants received actual notice of the
lawsuit, but failed to answer because they did not believe
the court had subject matter jurisdiction, the
defendants' failure to answer was not culpable.
Id. at 698. Instead, a defendant's conduct is
culpable “where there is no explanation of the default
inconsistent with a devious, deliberate, willful, or bad
faith failure to respond.” Id.
test is “at bottom an equitable one, taking account of
all relevant circumstances surrounding the party's
omission.” Brandt v. Am. Bankers Ins. Co. of
Fla., 653 F.3d 1108, 1111 (9th Cir. 2011) (quotation
omitted). The court has discretion to determine whether to
set aside a default. O'Connor v. State of Nev.,
27 F.3d 357, 364 (9th Cir. 1994). The court's discretion
is especially broad when considering a motion to set aside an
entry of default, as opposed to a default judgment.
Id. Generally, cases should be decided on the
merits, rather than by default. See, e.g., Mesle,
615 F.3d at 1091. The court has the discretion to condition
the setting aside of a default under Rule 55(c) on payment of
attorney's fees and costs. Nilsson, Robbins, Dalgarn,
Berliner, Carson & Wurst v. Louisiana Hydrolec, 854
F.2d 1538, 1546 (9th Cir. 1988).
the Court finds that Defendant has a good faith explanation
for the delay in filing a response. Both parties refer to
ongoing attempts to settle this case, which appear to have
ended only on November 10, 2017 when Plaintiff informed
Defendant of its intent to file for a default judgment.
Def's Reply, Ex. 1 (ECF No. 73-1). Defendant's
counsel Chad Anderson filed a notice of appearance just four
days later (ECF No. 59), followed by Plaintiffs motion for
entry of Clerk's default on November 15, 2017, and
Defendant's motion to set aside the Clerk's default
on November 20, 2017. Given the short time between the
breakdown of settlement talks, the notice of Plaintiff s
intent to seek default and Defendant's appearance and
motion to set aside the default, the Court ...