United States District Court, D. Nevada
NATIONSTAR MORTGAGE LLC; and FEDERAL HOME LOAN MORTGAGE CORPORATION, Plaintiffs,
FIRST 100, LLC, Defendant.
ORDER GRANTING DEFAULT JUDGMENT AGAINST FIRST 100,
Nationstar Mortgage LLC and Federal Home Loan Mortgage
Corporation (Freddie Mac) (collectively,
plaintiffs) filed a request for entry of
judgment by default in favor of plaintiffs against defendant
First 100, LLC pursuant to Federal Rule of Civil Procedure
55(b)(2). Plaintiffs moved on the ground First 100 failed to
appear or otherwise respond to plaintiffs' complaint
within the time prescribed by the Federal Rules of Civil
Procedure, and the Clerk of Court entered default against
First 100 on September 19, 2018. ECF No. 13.
do not seek an award of monetary damages or attorneys'
fees and costs, but rather request this Court to enter
judgment against First 100 as follows: (1) First 100 acquired
its ownership interest in real property located at 260 East
Flamingo Road #320, Las Vegas, Nevada, APN 162-16-810-501
subject to the senior deed of trust recorded against the
property on August 25, 2006 as instrument number
20060825-0003916; and (2) First 100's interests in the
property were extinguished when Freddie Mac foreclosed on the
senior deed of trust and conducted a nonjudicial foreclosure
sale of the property on March 7, 2014.
Findings of Fact
about August 16, 2006, Catherine Egan
(borrower) obtained a $300, 000 loan from
Taylor, Bean & Whitaker Mortgage Corp., which was secured
by a senior deed of trust recorded on August 25, 2006 in the
Clark County recorder's office as instrument number
20060825-0003916. In October 2006, Freddie Mac acquired
ownership of the loan, including the underlying promissory
note and deed of trust. The senior deed of trust was assigned
to Ocwen Loan Servicing LLC in an assignment recorded on
November 14, 2011 in the Clark County recorder's office
as instrument number 201111140002756. The senior deed of
trust was subsequently assigned to Nationstar in an
assignment recorded on June 3, 2013 in the Clark County
recorder's office as instrument number 201306030000448.
The senior deed of trust was assigned to Freddie Mac in an
assignment recorded on March 12, 2014 in the Clark County
recorder's office as instrument number 201403120000078.
borrower failed to pay the assessments due to the HOA. On
November 24, 2009, the HOA, through its agent Red Rock
Financial Services, recorded a lien for delinquent
assessments in the Clark County recorder's office as
instrument number 200911240001842. The HOA, through Red Rock,
also recorded: (1) a notice of default and election to sell
pursuant to the lien for delinquent assessments on January
29, 2010 in the Clark County recorder's office as
instrument number 201001290001965; (2) a notice of
foreclosure sale on November 26, 2012 in the Clark County
recorder's office as instrument number 201211260002736;
and (3) a second notice of foreclosure sale on June 18, 2013
in the Clark County recorder's office as instrument
number 201306180001799. The HOA foreclosed on the property on
or about July 13, 2013. A trustee's deed upon sale in
favor of First 100 was recorded on July 16, 2013 in the Clark
County recorder's office as instrument number
borrower also defaulted on her mortgage loan and failed to
repay the amounts due under the note at the time such sums
were due and payable pursuant of the terms of the note. A
notice of default was recorded on September 20, 2013 in the
Clark County recorder's office as instrument number
201309200002721. A notice of trustee's sale was recorded
on January 22, 2014 in the Clark County recorder's office
as instrument number 201401220002414. On March 7, 2014, the
senior deed of trust was foreclosed upon pursuant to
borrower's default, and a trustee's sale of the
property was held. A trustee's deed upon sale naming
Freddie Mac as the grantee as foreclosing beneficiary was
recorded on March 24, 2014 in the Clark County recorder's
office as instrument number 20140324-0001806.
filed their complaint to quiet title and for declaratory
judgment and injunctive relief against First 100 on June 12,
2018. ECF No. 1. Freddie Mac alleged, inter alia,
that its deed of trust continued to encumber the property
after the HOA foreclosure sale because notwithstanding any
contrary Nevada law, the Housing and Economic Recovery Act of
2008 (HERA), Pub. L. No. 110- 289, 122 Stat.
2654, codified at 12 U.S.C. § 4511 et
seq., prevented the HOA foreclosure sale from
extinguishing any lien owned by Freddie Mac while Freddie Mac
is under the conservatorship of the Federal Housing Finance
Agency. See generally ECF No. 1.
regularly served the summons and complaint on First 100 on
June 22, 2018. ECF No. 9. First 100's response was due
July 13, 2018. Neither plaintiffs nor the Court granted First
100 any extension of time. First 100 failed to appear or
otherwise respond to the complaint within the time required
under the Federal Rules of Civil Procedure. ECF Nos. 10 and
12. The Clerk of the Court entered default against First 100
on September 19, 2018. ECF No. 13.
Rule of Civil Procedure 55 details a two-step procedure for
obtaining a default judgment, "[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." Fed R. Civ. P. 55(a); Eitel
v. McCool, 782 F.2d 1470 (9th Cir. 1986). First, the
clerk must enter default against the party. Fed R. Civ. P.
55(a). Second, the party seeking default judgment must
petition the district court for entry of default judgment.
Fed R. Civ. P. 55(b)(2).
determining whether the entry of default judgment is proper,
the Ninth Circuit reviews the following factors:
(1) the possibility of prejudice to the
plaintiff; (2) the merits of the
plaintiff's 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 the
excusable neglect; and (7) the strong policy
underlying the Federal Rules of Civil Procedure favoring
decisions on the merits. Eitel, 782 F.2d at 1471-72.
In applying the Eitel factors, the well-pleaded
factual allegations of the complaint are taken as true after
the court clerk enters a default, except for the allegations
relating to damages. See TeleVideo Sys., Inc. v.
Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987).
"Rule 55 gives the court considerable leeway as to what
it may require as a prerequisite to the entry of a default
judgment." Id. at 917. In particular, a court
may require a moving party to "establish the truth of
any allegation by evidence." Fed R. Civ. P. 55(b)(2)(C).
Conclusions of Law
Court grants plaintiffs' request for the entry of default
judgment against First 100. Plaintiffs properly served the
summons and complaint on First 100, and the Clerk of Court
properly entered default against First 100. When applying the
Eitel factors, and for the reasons set forth in
plaintiffs' renewed motion for default judgment, ECF No.
18, the Court finds the circumstances warrant ...